EXHIBIT 10.34
AGREEMENT &
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FINAL RELEASE
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This Agreement made and entered into this 1st day of February, 2002 by and
between Mannatech(TM) Incorporated ("Mannatech"), a Texas corporation with its
principle place of business located at 600 S. Royal Lane, Suite 200, Coppell,
Texas 75019 and Ray Robbins, individually and as president of Robbins
Enterprises, Inc. (collectively, "Robbins) whose principal place of business is
located at 2201 Ingleside, Grand Prairie, Texas 75050 (hereinafter collectively,
the "Parties").
WITNESSETH:
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WHEREAS, Mannatech is in the business of operating a network marketing
company which sells a proprietary line of dietary supplements, cosmetics and
over-the-counter products ("Products") and which compensates its distributors
("Associates") by a defined compensation plan in the United States, Canada,
Australia, Japan and the United Kingdom;
WHEREAS, in connection with the development of the Mannatech business, the
Parties have previously entered into various written agreements including those
entered into on April 14, 1994 (Exhibit "A"), March 23, 1995 (Exhibit "B"), May
14, 1997 (Exhibit "C"), June 24, 1999 (Exhibit "D") and July 19, 2000 (Exhibit
"E") (collectively, the "Prior Agreements") all of which are incorporated by
reference and merged herein;
WHEREAS, the Parties desire to enter into this Settlement and Release
Agreement ("Agreement") to provide, among other things, for certain obligations
in full settlement and discharge of all claims and actions Robbins had or may
have pertaining to the subject matter hereof and the Parties are further
desirous of amending such Prior Agreements between them into this the final
Agreement;
WHEREAS, Robbins is highly respected in the network marketing field and
Mannatech is desirous of continuing to utilize his expertise as a consultant to
build motivate, educate and build its downline organization;
WHEREAS, in connection with the development of its business, Mannatech has
previously entered into a confidential relationship with Robbins whereby Robbins
has acquired and will continue to acquire an intimate knowledge of Mannatech's
business and will obtain or has obtained specialized skills. Mannatech will
continue to permit or has permitted Robbins to have access to and to utilize its
CONFIDENTIAL INFORMATION (as defined herein) and various trade secrets belonging
to Mannatech, including without limitation, marketing programs, business
relationships, customer lists and other compilations of information developed by
Mannatech and essential to its business and Mannatech is desirous of protecting
its CONFIDENTIAL INFORMATION; and
WHEREAS, Robbins is key to the business of Mannatech and Mannatech will
provide or has provided Robbins with access to such CONFIDENTIAL INFORMATION and
trade secrets of Mannatech, Robbins has agreed to enter into this Agreement with
Mannatech;
NOW, THEREFORE, promises considered, and in consideration of the covenants,
releases, payments and obligations of the Parties herein, the Parties agree as
follows:
ARTICLE I
PRIOR AGREEMENTS
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1.1 AMENDMENT. This Agreement supersedes all prior oral and written agreements
between the Parties of any and every nature whatsoever, including, with
specificity the Prior Agreements and any other agreements for additional
compensation, benefits and stock except as embodied in this Agreement.
Nothing herein shall be construed to alter or amend the obligations created
under any Associate agreement, which creates an Associate position in the
Mannatech downline of which Robbins is a party, including any compensation
due to Robbins as an Associate under Mannatech's compensation plan, as it
is currently in effect and modified from time-to-time and the obligation of
Mannatech to reimburse or pay Robbins' reasonable travel expenses in
connection with Mannatech business.
1.2 GRANDFATHERED POSITIONS. The Parties previously agreed to designate
positions 6103 and 994 at Platinum Presidential status. However, because of
various delays in integrating these positions into Mannatech's Enterprise
computer system ("Enterprise") for reasons beyond Mannatech's control and
without an admission of liability, the Parties have agreed that Mannatech
shall designate ("grandfather") positions 268, 328, 741, and 947 at
Platinum Presidential status (collectively "Grandfathered Positions")
effective Business Period 1 (2002). Robbins understands and agrees that the
Grandfathered Positions will not be entered into the Enterprise until on or
about February 2002, and any and all commissions then due will be
automatically generated through Enterprise. Robbins shall properly pay,
when due, any and all tax liability resulting from and due any taxing
authority on account of the effect of this Agreement, and shall indemnify
and hold Mannatech harmless from the same.
1.3 PRIOR PAYMENT OF COMMISSIONS. Mannatech has used its best efforts to
manually compute any and all commissions due Robbins and for which Robbins
has been paid from November 2000 to December 31, 2001 for positions 6103
and 994 ("Prior Payments") . The Parties agree that all Prior Payments made
to Robbins under the terms of the July 19, 2000 agreement are final as of
the close of Business Period 13 (2001) and no further payments are due; and
Robbins further agrees to discharge any obligation of Mannatech to
grandfather positions 6103 and 994.
1.4 RELEASE. Robbins for himself and his respective representatives, successors
and assigns, hereby fully, completely and finally releases and forever
discharges Mannatech, its officers, directors, agents, independent sales
associates and their heirs, personal representatives, successors and
assigns, its attorneys, employees, subsidiaries, successors and assigns
from any and all claims, demands, causes of action and liabilities that he
has or may have, whether known or unknown, asserted or unasserted, existing
as of the date of execution hereof including any liabilities relating to
the Prior Agreements.
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ARTICLE II
DUTIES & NON-COMPETITION
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2.1.1 ROBBINS DUTIES. Robbins agrees that:
2.1.2 His duties shall be those assigned and agreed to between Mannatech
and himself from time-to-time, but shall include development of
recruiting and Associate downline matters.
2.1.3 He will serve Mannatech diligently, faithfully and to his ability
during the term of this Agreement, which shall be at the will of
Mannatech, and which shall further be subject to the announced
Policies & Procedures of Mannatech will shall from time-to-time be in
effect.
2.1.4 He shall devote reasonable time, efforts, ability and attention to
the business of Mannatech and the performance of his duties,
understanding that he is an independent contractor for all purposes,
including federal income tax purposes.
2.1.5 He acknowledges and understands that from time-to-time his duties
will require that he work at non-company locations. In such
instances, Robbins agrees to comply with all policies, procedures and
directives relevant to working at such non-company locations.
2.1.6 Nothing contained in this Agreement is intended to abrogate or affect
the right of Robbins to be paid in accordance with the Compensation
Plan, as the same is from time-to-time in effect.
2.1.7 He shall use his best efforts to ensure that no relative of his, nor
any corporation or other entity of which he is an officer, principal,
manager director or shareholder or other affiliate, shall take any
action that he could not take without violating any term of this
Agreement.
2.2 NON-COMPETITION/NON-SOLICITATION. Robbins agrees that in the highly
competitive business in which Mannatech is engaged, personal contact is of
primary importance in securing new and retaining present Associates and
customers. Robbins also agrees that Mannatech has a legitimate interest in
maintaining its relationships with its Associates and customers and that it
would be unfair for Robbins to solicit the business of Mannatech's
Associates and customers in relation to Mannatech's current business and
exploit the personal relationships that he has developed with Mannatech's
Associates and customers by virtue of his access to them as a result of his
close relationship with Mannatech. To the full extent permitted by law
following any termination of his relationship with Mannatech Robbins will
not, for a period equivalent to his tenure with Mannatech, which at the
time of this Agreement is five (5) years:
2.2.1 Attempt to cause any person, firm or corporation which is a customer
of or has a contractual relationship with Mannatech (including its
Associates) to terminate such relationship with Mannatech. This
provision shall apply regardless of whether such customer has a valid
contractual arrangement with Mannatech;
2.2.2 Attempt to cause any employee of Mannatech to leave such employment;
2.2.3 Engage any person who was an employee of Mannatech or cause such
person otherwise to become associated with Robbins or with any other
person, corporation, partnership or other entity with which Robbins
may thereafter become associated; or
2.2.4 Engage in any activity or perform any services competitive with any
business conducted by Mannatech in the United States which Mannatech
operates, at the time of execution of this Agreement.
2.2.5 Robbins represents and admits that in the event of termination of his
consulting duties for any reason whatsoever, his experiences and
capabilities are such that he can obtain engagement in business
engaged in other lines and/or of a different
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nature, and that the enforcement of a remedy by way of injunction
will not prevent him from earning a livelihood.
2.2.6 Robbins acknowledges that at the time that this non-competition
covenant is made, that the limitations as to time defined herein and
that the limitations as to geographic area are reasonable and do not
impose a greater restraint than is necessary to protect the goodwill
or other business interests of Mannatech.
2.2.7 The agreements, noncompetition agreements, nondisclosure agreements,
and non-solicitation agreements set forth herein each constitute
separate agreements, independently supported by good and adequate
consideration and shall be severable from the other provisions of
this Agreement and shall survive the Agreement. The existence of any
claim or cause of action of Robbins against Mannatech, whether
predicated on this Agreement or otherwise, shall not constitute a
defense to the enforcement by Mannatech of the covenants and
agreements of Robbins contained in the noncompetition, nondisclosure
or the non-solicitation agreements herein, If a court of competent
jurisdiction determines that any restriction in a clause or provision
of this Agreement is void, illegal or unenforceable, the other
clauses and provisions of this Agreement shall remain in full force
and effect and the clauses and provisions that are determined to be
void, illegal or unenforceable shall be limited so that they shall
remain in effect to the fullest extent allowed by law.
2.3 SPECIALIZED TRAINING. Irrespective of the term of this Agreement and in
consideration of the promises specified in Article III, Mannatech agrees to
provide specialized training and instruction to Robbins for duties in
consultation of the Associate downline of Mannatech, recruitment and other
matters as may come before the Parties from time-to-time, and agrees to
provide specialized training to Robbins for such additional consulting
duties as the Parties may in good faith agree in the future. Robbins
acknowledges that he will receive special knowledge and specialized
training from Mannatech, included in which is the CONFIDENTIAL INFORMATION
identified in Article III. Robbins further acknowledges that training
provided by Mannatech and the CONFIDENTIAL INFORMATION is valuable to
Mannatech and, therefore, Mannatech's investment in the training and the
protection and maintenance of the CONFIDENTIAL INFORMATION constitutes a
legitimate interest to be protected by Mannatech by the covenants not to
compete in Article 2.2.
2.4 DUTY OF GOOD FAITH & LOYALTY. Robbins acknowledges and agrees that he owes
a fiduciary duty of loyalty, fidelity, and allegiance to act at all times
in the best interests of Mannatech. In keeping with these duties, Robbins
shall make full disclosure to Mannatech of all business opportunities
pertaining to Mannatech's present business and shall not appropriate for
his own benefit business opportunities concerning such business. The
Parties further agree that during the term of this Agreement and
thereafter, they will not disparage each other or their respective
Affiliates.
2.4.1 MANNATECH'S DUTIES. Irrespective of the term of engagement as a
consultant, and in consideration of the promises in this Article,
Mannatech agrees to provide specialized training as specified herein
and to provide Robbins with access to Mannatech's software and files,
records, marketing procedures, processes, computer programs,
compilations of information, records, Associate and client
requirements, pricing techniques, lists, formulae, lists identifying
Associates, partners, potential investors, methods of doing business
and other
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CONFIDENTIAL INFORMATION which is regularly used in the operation of
the business of Mannatech as is relevant to Robbins' engagement in
the opinion of Mannatech.
2.4.2 To continue to refer to Robbins in all corporate literature and
presentations as a "founder" of Mannatech and member of the Board of
Directors for so long as he holds such a position.
ARTICLE III
CONFIDENTIAL INFORMATION
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3.1 CONFIDENTIAL INFORMATION. Prior to and after execution hereof, Robbins
will have been given access to Mannatech's CONFIDENTIAL INFORMATION
concerning Products and the business operations of Mannatech. For
purposes of this Agreement "CONFIDENTIAL INFORMATION" shall mean and
include information disclosed to Robbins or known by Robbins and, not
generally known in Mannatech's industry, or otherwise known to Robbins
or received from a source other than Mannatech about Mannatech's
products, processes and services, including but not limited to
information concerning inventions, trade secrets, research and
development, as well as all data or information concerning customers
(including, Associates), customer lists (including downline reports
and similar reports of business activities and relevant information
concerning persons who conduct the same), prospect lists, mailing
lists, sales leads, contracts, financial reports, sales, purchasing,
price lists, product costs, marketing programs, marketing plans,
business relationships, business methods, accounts payable, accounts
receivable, accounting procedures, control procedures and training
materials.
3.2 Robbins acknowledges that he has had and will continue to have a
close, personal and special influence with Mannatech's customers and
will be acquainted with all of Mannatech's business, particularly
Mannatech's CONFIDENTIAL INFORMATION concerning the business of
Mannatech and its affiliates.
3.3 Robbins recognizes that his relationship with Mannatech is one of the
highest trust and confidence by reason of Robbins's access to the
CONFIDENTIAL INFORMATION and Robbins agrees to use his best efforts
and will exercise utmost diligence to protect and safeguard the
CONFIDENTIAL INFORMATION.
3.4 Except as may be required by Mannatech or with the express written
permission of Mannatech, Robbins shall not, either during his
relationship with Mannatech or at any time thereafter, directly or
indirectly, download, print out, copy, remove from the premises of
Mannatech, use for his own benefit or for the benefit of another, or
disclose to another, any CONFIDENTIAL INFORMATION of Mannatech, its
customers, contractors, or any other person or entity with which
Mannatech has a business relationship.
3.5 Robbins agrees that all files, memoranda, data, notes, records,
drawings, charts, graphs, analyses, letters, reports or other
documents or similar items made or compiled by Robbins, made available
to him or otherwise coming into his possession concerning any process,
apparatus or products manufactured, sold, used, developed,
investigated or considered by Mannatech concerning the CONFIDENTIAL
INFORMATION or concerning any other business or activity of Mannatech
shall remain at all times the property of Mannatech and shall be
delivered to Mannatech at any other time upon request. Robbins further
agrees, that if requested by Mannatech to do so, he will sign an
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appropriate list of any and all CONFIDENTIAL INFORMATION of Mannatech
of which he has knowledge about or which he has acquired information.
3.6 Robbins acknowledges that the violation of any of the provisions of
this provision will cause irreparable loss and harm to Mannatech which
cannot be reasonably or adequately compensated by damages in an action
at law, and accordingly, Mannatech will be entitled, without posting
bond or other security, to injunctive and other equitable relief to
enforce the provisions of this section but no action for any such
relief shall be deemed to waive the right of Mannatech to an action
for damages.
ARTICLE IV
ASSIGNMENT OF INVENTIONS
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4.1 PROPRIETARY INFORMATION. Robbins agrees to promptly disclose to
Mannatech and hereby assigns to Mannatech or its designee, its
assigns, successors or legal representatives, all right, title and
interest in and to any and all patents, formulae, inventions,
processes, designs, software, firmware, circuitry, diagrams,
copyrights, trade secrets, and any other proprietary information
(collectively, the "Proprietary Information") whatsoever, conceived,
developed or completed by Robbins during the course of his engagement
as a consultant, or using Mannatech's time, data, facilities and/or
materials, provided the subject matter of the Proprietary Information
is within the scope of his duties and responsibilities as one in
Robbins' position with Mannatech or occurs as a result of his
knowledge of a particular interest of the corporation.
4.2 Robbins agrees to assist Mannatech at any time during his engagement
with Mannatech, or after termination of his engagement with
reimbursement by Mannatech for all expenses incurred in the
preparation, execution and delivery of any assignments, disclosures,
patent applications, or papers within the scope and intent of this
Agreement required to obtain patents or copyrights in the Proprietary
Information in this or a foreign country and in connection with such
other proceedings as may be necessary to transfer title to Mannatech,
its assigns, successors, or legal representatives.
ARTICLE V
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MISCELLANEOUS
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5.1 PROMOTIONAL MATERIALS. As long as Robbins remains an Associate of
Mannatech and without further remuneration, Mannatech shall have the
right to use Robbins's name, voice, likeness, and similar
characteristics for the purposes of advertising, promoting, selling
and otherwise merchandising the company and its Products in the United
States and all other countries in which Mannatech conducts business.
During the term of this Agreement, Mannatech shall be the sole owner
and have use and control of all promotional materials and trade
literature ("PROMOTIONAL MATERIALS") produced for Mannatech bearing
Robbins's image, likeness, voice or name. Mannatech shall be free to
dispose of and treat in any way all Promotional Materials as
contemplated hereby, including but not limited to selling,
advertising, distributing, and permitting use in other mediums without
prior approval of Robbins.
5.2 ENFORCEMENT. It is the express intention of the Parties to this
Agreement to comply with all laws applicable to the covenants and
provisions contained in this Agreement. If any of the covenants
contained in this Agreement are found to exceed in duration or scope
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permitted by law, it is expressly agreed that such covenant may be
reformed or modified by the award or decree, if applicable
("Reformation"). The Reformation shall be governed by a final judgment
of a court of competent jurisdiction or other lawful constituted
authority, as the case may be, to reflect a lawful and enforceable
duration or scope, and such covenant automatically shall be deemed to
be amended and modified so as to comply. If any one or more of the
provisions contained herein shall for any reason be held invalid,
illegal or unenforceable in any respect, even after formation, such
invalidity, illegality or unenforceability shall not affect the
enforceability or validity of any other provision contained in this
Agreement, and this Agreement shall be construed as if such invalid,
illegal or unenforceable provision had never been contained herein.
5.3 PRIVITY. This Agreement is for the sole benefit of Robbins and
Mannatech, its successors and assigns, and no other person shall be
deemed to have privity of contract hereunder, nor shall any other
person or entity be deemed to be a third-party beneficiary hereunder.
5.4 AUTHORITY. The Parties represent that they have full capacity and
authority to grant all rights and assume all obligations they have
granted and assumed under this Agreement.
5.5 ASSIGNMENT. This Agreement and the rights hereunder may not be
assigned by any party (except by operation of law) without prior
written consent of the other party, but, subject to the foregoing
limitation, this Agreement shall be binding and inure to the benefit
of the respective successors, assigns, and legal representatives of
the Parties.
5.6 AGREEMENT TO PERFORM NECESSARY ACTS. The Parties agree to perform any
further acts and execute and deliver any documents that may be
reasonably necessary to carry out the provisions of this Agreement.
5.7 INJUNCTIVE RELIEF. Robbins recognizes and acknowledges that damages in
the event of his breach of certain provisions of this Agreement would
be inadequate, and Robbins agrees that Mannatech, in addition to all
other remedies it may have, shall have the right to injunctive relief
if there is a breach by Robbins of any one or more of the provisions
contained herein
5.8 NOTICES. Notices required to be given under this Agreement shall be in
writing and shall be deemed to have been given and received when
personally delivered, or when mailed by registered or certified mail,
postage prepaid, return receipt requested, or when sent by overnight
delivery service to the address as first written above.
5.9 NO AGENCY. This Agreement does not constitute a joint venture or
partnership of any kind between Mannatech and Robbins.
5.10 WAIVER. A waiver by either party of any term or condition of this
Agreement in any instance shall not be deemed or construed to be a
waiver of such term or condition for the future, or any breach of such
term or condition.
5.11 AUTHORITY. The Parties represent that they have full capacity and
authority to grant all rights and assume all obligations they have
granted and assumed under this Agreement.
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5.12 CAPTIONS. The headings of the sections in this Agreement are intended
solely for convenience of reference and are not intended and shall not
be deemed for any purpose whatsoever to modify or explain or place
constriction upon any of the provisions of this Agreement.
5.13 GOVERNING LAW. The Parties hereto agree that this Agreement shall be
governed by the laws of the State of Texas without regard to the
conflicts of law principles. The Parties further agree that exclusive
jurisdiction and venue to enforce the provisions of this agreement
shall be in a state or federal court of appropriate jurisdiction in
Dallas County, Texas. Each party consents to personal jurisdiction in
Dallas County, Texas, for any action to enforce the Agreement
including any further rules provided for emergency or extraordinary
relief, as to this Agreement.
5.14 DISCLOSURE. Each of the Parties agree to keep confidential the
specific terms of this Agreement, and shall not disclose the terms of
this Agreement to any person except the financial, tax and legal
advisors of the other (and the Board of Directors of Mannatech) unless
required to disclose the same to others by legal process, in which
event the Party so ordered shall first give notice to the other Party
and an opportunity to seek a protective order. This Agreement may be
disclosed or appended as an exhibit to any securities filing required
to be made by Mannatech. However, after having been so disclosed or
appended, Robbins shall have no further duty of confidentiality
concerning this Agreement, as set forth in this paragraph.
5.15 SUBSIDIARIES. Wherever the term Mannatech is referred to in this
Agreement, it shall include all subsidiaries of Mannatech even where
the term "SUBSIDIARIES" is not explicitly stated in connection with
such reference, as such subsidiaries may exist from time to time.
5.16 ACKNOWLEDGEMENT. Robbins affirms and attests by signing this Agreement
that he has read this Agreement before signing it and that he fully
understands its purposes, terms, and provisions, which he hereby
expressly acknowledges to be reasonable in all respects. Robbins
further acknowledges receipt of one (1) copy of this Agreement. Both
Parties agree and represent that they are entering this Agreement
without coercion and that they have received legal advice from counsel
of their choice with regard to this Settlement Agreement and Release.
5.17 COUNTERPARTS. This Agreement may be executed in multiple counterparts,
any one of which will be deemed an original, but all of which will
constitute one and the same instrument.
[Signature Page Follows]
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IN WITNESS WHEREOF, this Agreement is executed by the Parties hereto, effective
as of the ___ day of February, 2002.
RAY ROBBINS, INDIVIDUALLY AND
ON BEHALF OF ROBBINS ENTERPRISES, INC.
/s/ Ray Robbins
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MANNATECH, INCORPORATED
A TEXAS CORPORATION
By: /s/ Robert M. Henry
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Robert M. Henry
Its: Chief Executive Officer
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