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Exhibit 10.1

EMPLOYMENT AGREEMENT
 
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into effective as of
2020‑10‑15 (the “Effective Date”) by and between Nu Skin Enterprises, Inc., a
Delaware corporation (the “Company”) and Joseph Y. Chang, an individual (the
“Executive”).
 
WHEREAS, the Executive has been employed since May 17, 1997 by the Company or
one of its affiliates;
 
WHEREAS, the Executive and the Company entered into an Employment Agreement
dated April 16, 2015 and an Amendment to Employment Agreement dated March 8,
2018 (collectively the “Prior Employment Agreement”); and
 
WHEREAS, the Company and the Executive desire to terminate the Prior Employment
Agreement and establish new terms and conditions of the Executive’s employment;
 
NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set
forth, the parties hereto agree as follows:
 
1.           Duties and Responsibilities.
 
A.          The Executive shall serve as the Company’s Chief Scientific Officer
and Executive Vice President of Product Development, reporting directly to the
Company’s Chief Executive Officer.  The Executive shall have the duties and
powers at the Company that are customary for an individual holding such
positions.
 
B.         The Executive agrees to use the Executive’s best efforts to advance
the business and welfare of the Company, to render the Executive’s services
under this Agreement faithfully, diligently and to the best of the Executive’s
ability.
 
C.         Except as may otherwise be approved in advance by the Nominating and
Corporate Governance Committee (the “Nominating and Corporate Governance
Committee”) of the Company’s Board of Directors (the “Board”), and except during
vacation periods and reasonable periods of absence due to sickness, personal
injury or other disability, the Executive shall devote the Executive’s full
working time to the services required of him hereunder, and shall use the
Executive’s best efforts, judgment and energy to improve and advance the
business and interests of the Company in a manner consistent with the duties of
the Executive’s position.  The Executive may participate in charitable, civic
and professional activities as long as the activities do not interfere with the
performance of the Executive’s duties hereunder.  The Executive shall not serve
on the board of directors of any entity, other than an affiliate of the Company,
without the approval of the Nominating and Corporate Governance Committee.
 
2.          Employment Period. The Executive shall be employed by the Company
under the terms of this Agreement for the period commencing on the Effective
Date and ending on December 31, 2025 (the “Employment Period”).  Notwithstanding
the foregoing, the Executive and the Company may terminate the Employment Period
and this Agreement prior to December 31, 2025 in accordance with Section 7
hereof.  Notwithstanding the termination of this Agreement, the provisions of
Sections 7 and 8 shall survive the termination of this Agreement and shall
remain in full force and effect in accordance with the terms thereof unless
otherwise agreed to by the parties in writing.
 

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3.           Cash Compensation.
 
A.         Annual Salary.  The Executive’s annual base salary (the “Annual
Salary”) shall be determined by the Compensation Committee of the Board (the
“Compensation Committee”), and shall be payable in accordance with the Company’s
standard payroll schedule for its executive officers (but in no event less
frequent than on a monthly basis).  The Compensation Committee shall review the
Executive’s Annual Salary at least annually and shall make a determination
regarding any changes to the Annual Salary.  Any changed annual salary shall
thereupon be the “Annual Salary” for the purposes hereof.
 
B.         Bonus.  The Executive shall be eligible to participate in the
Company’s cash incentive plan as adopted by the Compensation Committee at levels
and upon attainment of such corporate and/or individual performance targets as
shall be established by the Compensation Committee from time to time.  The
Executive shall be entitled to receive bonuses, cash or otherwise, in the
discretion of the Compensation Committee, from time to time.
 
C.        Applicable Withholdings.  The Company shall deduct and withhold from
the compensation payable to the Executive under this Agreement any and all
applicable federal, state and local income and employment withholding taxes and
any other amounts required to be deducted or withheld by the Company under
applicable statutes, regulations, ordinances or orders governing or requiring
the withholding or deduction of amounts otherwise payable as compensation or
wages to employees.
 
4.          Equity Compensation.  The Executive shall be eligible to participate
in any equity incentive plans of the Company in which other executive officers
of the Company are eligible to participate.  All options or other equity awards
granted under the equity incentive plans will be made at the discretion of the
Compensation Committee pursuant and subject to the terms and conditions of the
applicable equity incentive plan.  To the extent the Company grants any
time-based equity awards (i.e., equity that vests with the passage of time) to
the Executive during the Employment Period, the grant documentation for such
equity awards shall provide that if a Change in Control (as defined below) is
consummated during the Employment Period, and within six months prior to and in
connection with such Change in Control or within two years following such Change
in Control, the Executive’s employment is terminated (i) by the Company without
Cause (as defined in the applicable equity plan or award agreement) or (ii) by
the Executive for Good Reason (as defined in the applicable equity plan or award
agreement), then all of such equity awards shall vest in full.  The vesting of
any performance-based equity awards shall be determined in accordance with the
applicable equity incentive plan and grant documentation. For purposes of this
Agreement, “Change in Control” shall mean the consummation of any of the
following transactions effecting a change in ownership or control of the
Company:
 
(i)         During any 24 month period, individuals who, as of the beginning of
such period, constitute the Board (the “Incumbent Directors”) cease for any
reason to constitute at least a majority of the Board, provided that any person
becoming a director subsequent to the beginning of such period whose election or
nomination for election was approved by a vote of at least a majority of the
Incumbent Directors then on the Board (either by a specific vote or by approval
of the proxy statement of the Company in which such person is named as a nominee
for director, without written objection to such nomination) shall be an
Incumbent Director; provided, however, that no individual initially elected or
nominated as a director of the Company as a result of an actual or threatened
election contest with respect to directors or as a result of any other actual or
threatened solicitation of proxies by or on behalf of any person other than the
Board shall be deemed to be an Incumbent Director;
 
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(ii)       Any “person” (as such term is defined in the Exchange Act and as used
in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 50% or more of the
combined voting power of the Company’s then outstanding securities eligible to
vote for the election of the Board (“Company Voting Securities”); provided,
however, that the event described in this paragraph (ii) shall not be deemed to
be a Change in Control by virtue of any of the following acquisitions:  (A) by
the Company or any Subsidiary, (B) by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any Subsidiary, (C) by any
underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction, as defined in
paragraph (iii), or (E) by any person of Company Voting Securities from the
Company, if a majority of the Incumbent Board approves in advance the
acquisition of beneficial ownership of 50% or more of Company Voting Securities
by such person;
 
(iii)      The consummation of a merger, consolidation, statutory share exchange
or similar form of corporate transaction involving the Company or any of its
Subsidiaries that requires the approval of the Company’s stockholders, whether
for such transaction or the issuance of securities in the transaction (a
“Business Combination”), unless immediately following such Business
Combination:  (A) more than 50% of the total voting power of (x) the corporation
resulting from such Business Combination (the “Surviving Corporation”), or (y)
if applicable, the ultimate parent corporation that directly or indirectly has
beneficial ownership of at least 90% of the voting securities eligible to elect
directors of the Surviving Corporation (the “Parent Corporation”), is
represented by Company Voting Securities that were outstanding immediately prior
to such Business Combination (or, if applicable, is represented by shares into
which such Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business
Combination, (B) no person (other than any employee benefit plan (or related
trust) sponsored or maintained by the Surviving Corporation or the Parent
Corporation), is or becomes the beneficial owner, directly or indirectly, of 50%
or more of the total voting power of the outstanding voting securities eligible
to elect directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation) and (C) at least a majority of the
members of the board of directors of the Parent Corporation (or, if there is no
Parent Corporation, the Surviving Corporation) following the consummation of the
Business Combination were Incumbent Directors at the time of the Board’s
approval of the execution of the initial agreement providing for such Business
Combination (any Business Combination which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”); or
 
(iv)       The stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or the consummation of a sale of all
or substantially all of the Company’s assets.
 
“Subsidiary” shall mean any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company if, at the relevant time each
of the corporations other than the last corporation in the unbroken chain owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in the chain.
 
5.           Expense Reimbursement.  In addition to the compensation specified
in Section 3, the Executive shall be entitled to receive reimbursement from the
Company for all reasonable business expenses incurred by the Executive in the
performance of the Executive’s duties hereunder, provided that the Executive
furnishes the Company with vouchers, receipts and other details of such expenses
in the form reasonably required by the Company to substantiate a deduction for
such business expenses under all applicable rules and regulations of federal and
state taxing authorities.
 
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6.           Employee Benefits.  The Executive shall, throughout the Employment
Period, be eligible to participate in all of the life insurance plans, health
plans, accidental death and dismemberment plans, short-term disability programs,
retirement plans, profit sharing plans or other employee benefit plans that are
available to the executive officers of the Company, for which the Executive
qualifies as provided under the terms of such plans.
 
7.          Termination of Employment.  During the Employment Period, the
Executive’s employment with the Company may be terminated by either the Company
or the Executive at any time, and for any reason.  Upon such termination, the
Executive (or, in the case of the Executive’s death, the Executive’s estate and
beneficiaries) shall have no further rights to any other compensation or
benefits from the Company on or after the termination of employment except as
follows:
 
A.          Executive Severance Policy.  The Executive shall be a participant in
the Company’s Executive Severance Policy and shall be entitled to the rights and
payments provided therein.
 
B.          Consulting Agreement.  If the Executive’s employment terminates
pursuant to Section 3 or 6 of the Executive Severance Policy as in effect on the
date of this Agreement, then the Company and the Executive agree to enter into a
consulting agreement, in substantially the form attached hereto as Exhibit A
(the “Consulting Agreement”).
 
8.          Key-Employee Covenants.  The Executive agrees to perform the
Executive’s obligations and duties and to be bound by the terms of the
Key-Employee Covenants attached hereto as Exhibit B which are incorporated into
this Section 8 by reference, and which may be modified from time to time.
 
9.          Successors and Assigns.  This Agreement is personal in its nature
and the Executive shall not assign or transfer the Executive’s rights under this
Agreement.  The provisions of this Agreement shall inure to the benefit of, and
shall be binding on, each successor of the Company whether by merger,
consolidation, transfer of all or substantially all assets, or otherwise, and
the heirs and legal representatives of the Executive.
 
10.         Notices.  Any notices, demands or other communications required or
desired to be given by any party shall be in writing and shall be validly given
to another party if served either personally or via an overnight delivery
service such as Federal Express, postage prepaid, return receipt requested.  If
such notice, demand or other communication shall be served personally, service
shall be conclusively deemed made at the time of such personal service.  If such
notice, demand or other communication is given by overnight delivery, such
notice shall be conclusively deemed given two business days after the deposit
thereof with such service, properly addressed to the party to whom such notice,
demand or other communication is to be given as hereinafter set forth:
 
To the Company:
Nu Skin Enterprises, Inc.
75 West Center Street
Provo, Utah 84601
Attn: General Counsel
   
To the Executive:
At the Executive’s last residence as provided by the Executive to the Company
for payroll records.

Any party may change such party’s address for the purpose of receiving notices,
demands and other communications by providing written notice to the other party
in the manner described in this Section 10.
 
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11.        Governing Documents.  This Agreement, along with the documents
expressly referenced in this Agreement, including the Key Employee Covenants and
equity incentive plans and grant documents, constitute the entire agreement and
understanding of the Company and the Executive with respect to the terms and
conditions of the Executive’s employment with the Company and the payment of
severance benefits, and supersedes all prior and contemporaneous written or
verbal agreements and understandings (including the 2009 Employment Agreement
and any other offer letter and any other existing employment agreements or
arrangements, and any amendments thereto) between the Executive and the Company
relating to such subject matter.  Any and all other prior agreements,
understandings or representations relating to the Executive’s employment with
the Company, including the 2009 Employment Agreement, are terminated and
cancelled in their entirety and are of no further force or effect. This
Agreement may only be amended by written instrument signed by the Executive and
an authorized officer of the Company.
 
12.         Governing Law.  The provisions of this Agreement will be construed
and interpreted under the laws of the State of Utah, without regard to
principles of conflict of laws.  If any provision of this Agreement as applied
to any party or to any circumstance should be adjudged by a court of competent
jurisdiction to be void or unenforceable for any reason, the invalidity of that
provision shall in no way affect (to the maximum extent permissible by law) the
application of such provision under circumstances different from those
adjudicated by the court, the application of any other provision of this
Agreement, or the enforceability or invalidity of this Agreement as a whole. 
Should any provision of this Agreement become or be deemed invalid, illegal or
unenforceable in any jurisdiction by reason of the scope, extent or duration of
its coverage, then such provision shall be deemed amended to the extent
necessary to conform to applicable law so as to be valid and enforceable or, if
such provision cannot be so amended without materially altering the intention of
the parties, then such provision will be stricken and the remainder of this
Agreement shall continue in full force and effect.
 
13.         Remedies.  The parties to this Agreement agree that:  (i) the
Executive’s services are unique because of the particular skill, knowledge,
experience and reputation of the Executive; (ii) if the Executive breaches this
Agreement, the damage to the Company will be substantial and difficult to
ascertain, and further, that money damages will not afford the Company an
adequate remedy. Consequently, if the Executive is in breach of any provision of
this Agreement, or threatens a breach of this Agreement, the Company shall be
entitled, in addition to all other rights and remedies as may be provided by
law, to seek specific performance and injunctive and other equitable relief to
prevent or restrain a breach of any provision of this Agreement notwithstanding
Section 14 hereof.  All rights and remedies provided pursuant to this Agreement
or by law shall be cumulative, and no such right or remedy shall be exclusive of
any other. All claims for damages for a breach of this Agreement shall be
submitted to mediation and arbitration in accordance with Section 14 of this
Agreement.
 
14.        Dispute Resolution.  Except for the right of the Company to seek
specific performance and injunctive and other equitable relief in court as set
forth in Section 13 hereof, any controversy, claim or dispute of any type
arising out of, in connection with, or in relation to the interpretation,
performance or breach of this Agreement shall be resolved in accordance with
this Section 14 of this Agreement, regarding resolution of disputes.  This
Agreement shall be enforced in accordance with the Federal Arbitration Act, the
enforcement provisions of which are incorporated by this reference.
 
A.         Mediation.  The Company and the Executive will make a good faith
attempt to resolve any and all claims and disputes under this Agreement through
good faith negotiations.  If such claims and disputes cannot be settled through
negotiation, the Company and the Executive agree to submit them to mediation in
Salt Lake City, Utah before resorting to arbitration or any other dispute
resolution procedure.  The mediation of any such claim or dispute must be
conducted in accordance with the then-current American Arbitration Association
(“AAA”) procedures for the resolution of disputes by mediation, by a mediator
(“Mediator”) who has had both training and experience as a mediator of general
non-competition and commercial matters.  If the parties to this Agreement cannot
agree on a Mediator, then the Mediator will be selected by AAA in accordance
with AAA’s strike list method.  Within 30 days after the selection of the
Mediator, the Company and the Executive and their respective attorneys will meet
with the Mediator for one mediation session of at least four hours.  If the
claim or dispute cannot be settled during such mediation session or mutually
agreed continuation of the session, either the Company or the Executive may give
the Mediator and the other party to the claim or dispute written notice
declaring the end of the mediation process.  All discussions connected with this
mediation provision will be confidential and treated as compromise and
settlement discussions.  Nothing disclosed in such discussions, which is not
independently discoverable, may be used for any purpose in any later
proceeding.  If the mediation process is ended without resolution, the
Mediator’s fees will be paid in equal portions by the Company and the Executive.
 
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B.        Arbitration.  If a claim or dispute under this Agreement has not been
resolved in accordance with Section 14A above, then the claim or dispute will be
determined by arbitration in accordance with the then-current AAA comprehensive
arbitration rules and procedures, except as modified herein.  The arbitration
will be conducted in Salt Lake City, Utah by a sole neutral arbitrator
(“Arbitrator”) who has had both training and experience as an arbitrator of
general non-competition and commercial matters and who is, and for at least 10
years has been, a partner, a shareholder, or a member in a law firm.  If the
Company and the Executive cannot agree on an Arbitrator, then the Arbitrator
will be selected by AAA in accordance with AAA’s comprehensive arbitration rules
and procedures.  No person who has served as a Mediator under the mediation
provision, however, may be selected as the Arbitrator for the same claim or
dispute.  Reasonable discovery will be permitted and the Arbitrator may decide
any issue as to discovery.  The Arbitrator may decide any issue as to whether or
as to the extent to which a dispute is subject to the dispute resolution
provisions in this Section 14 and the Arbitrator may award any relief permitted
by law.  The Arbitrator must base the arbitration award on the provisions of
this Section 14B and applicable law and must render the award in writing,
including an explanation of the reasons for the award.  Judgment upon the award
may be entered by any court having jurisdiction of the matter.  The statute of
limitations applicable to the commencement of a lawsuit will apply to the
commencement of an arbitration under this Section 14B.  At the request of any
party, the Arbitrator, attorneys, parties to the arbitration, witnesses,
experts, court reporters or other persons present at the arbitration shall agree
in writing to maintain the strict confidentiality of the arbitration
proceedings.  The Arbitrator’s fee will be paid in full by the Company, unless
the Executive agrees in writing to pay some or all of the fee.
 
C.         Interim Actions.  Notwithstanding the foregoing, a party may apply to
a court of competent jurisdiction within the State of Utah for relief in the
form of a temporary restraining order or preliminary injunction, pending
appointment of an Arbitrator or pending determination of a claim through
arbitration in accordance with this Section 14.  If a dispute is submitted to
arbitration hereunder during the term of this Agreement, the parties shall
continue to perform their respective obligations hereunder, subject to any
interim relief that may be ordered by the Arbitrator or by a court of competent
jurisdiction pursuant to the previous sentence.
 
D.         Fees.  Unless otherwise agreed, the prevailing party (if a prevailing
party is determined to exist by the Arbitrator or judge) will be entitled to its
costs and attorneys’ fees incurred in any arbitration or other proceeding under
this Section 14 relating to the interpretation or enforcement of this Agreement.
 
E.         Acknowledgement.  EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION 14,
WHICH DISCUSSES MEDIATION AND ARBITRATION.  EXECUTIVE UNDERSTANDS THAT BY
SIGNING THIS AGREEMENT, EXECUTIVE AGREES TO SUBMIT ANY CLAIMS ARISING OUT OF,
RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,
VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH OR TERMINATION THEREOF TO MEDIATION
AND ARBITRATION, AND THAT THE DISPUTE RESOLUTION PROVISIONS SET FORTH IN THIS
AGREEMENT CONSTITUTE A WAIVER OF EXECUTIVE’S RIGHT TO A JURY TRIAL.
 
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15.         No Waiver.  The waiver by either party of a breach of any provision
of this Agreement shall not operate as, or be construed as, a waiver of any
later breach of that provision.
 
16.         Taxes.  Except as otherwise provided under Section 3C, each party
agrees to be responsible for its own taxes and penalties.
 
17.         Counterparts.  This Agreement may be executed in more than one
counterpart, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.
 
18.       Representation of the Executive; Interpretation of this Agreement. 
The Executive represents and warrants to the Company that the Executive has read
and understands this Agreement, has consulted with independent counsel of the
Executive’s choice prior to agreeing to the terms of this Agreement and is
entering into this Agreement, knowingly, willingly and voluntarily.  The parties
agree that this Agreement shall not be construed for or against either party in
any interpretation thereof.
 
[Signature Page Follows]
 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
 

 
NU SKIN ENTERPRISES, INC.
     
/s/ Ritch Wood
 
Ritch Wood
 
Chief Executive Officer

 
EXECUTIVE
     
/s/ Joseph Chang
 
Joseph Y. Chang

[Signature Page to Employment Agreement]

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EXHIBIT A
 
CONSULTING AGREEMENT
 

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CONSULTING AGREEMENT

This Consulting Agreement (this “Agreement”) is entered into effective as of
[________] (the “Effective Date”), by and between Nu Skin Enterprises, Inc., a
Delaware corporation (the “Company”) and Joseph Y. Chang, an individual
(“Consultant”). The Company and Employee are sometimes hereinafter referred to
as “party” or “parties.”

RECITALS

A.
Prior to the termination of Consultant’s employment, Consultant served as an
Executive of the Company, pursuant to an employment agreement dated _________,
2020, as amended from time to time (the “Employment Agreement”).

B.
The Company desires to obtain certain rights related to Consultant and to retain
Consultant as an independent contractor to provide certain consulting services
to the Company.

C.
The Consultant is willing to grant such rights and provide such services
pursuant to the terms and conditions set forth in this Agreement.

AGREEMENT

In consideration of the mutual promises and covenants set forth herein, and for
other good and valuable consideration, the receipt, adequacy, and legal
sufficiency of which are hereby acknowledged, the parties hereby mutually agree
as follows:

1.
Term. This Agreement shall commence on the Effective Date and shall continue for
four years, unless otherwise terminated or extended (the “Consulting Term”).
Either party may terminate this Agreement immediately if the other party commits
a material breach of this Agreement. Upon termination of this Agreement, all
obligations of the parties hereunder shall terminate except that (i) each party
shall remain liable for any breach by such party of any covenant or obligation
under this Agreement prior to the termination of this Agreement, and (ii)
Consultant shall remain obligated and liable under the provisions of Sections
7.5, 7.8, 8, 9, 10, 12, 18 and 19, which shall survive the expiration or
termination of this Agreement.

 

2.
Engagement.  The Company hereby engages Consultant as an independent contractor
to provide certain rights and consulting services as set forth in Section 3
below (the “Rights and Consulting Services”) to the Company and its affiliated
entities during the Consulting Term, and Consultant hereby accepts such
engagement on the terms and conditions set forth herein.  Consultant may provide
the Rights and Consulting Services as an individual in his own name, or through
a business entity established for that purpose.  In the event that Consultant
provides the Rights and Consulting Services through a business entity, then both
Consultant and the business entity shall be subject to all of the obligations
hereunder.

 

3.
Rights and Consulting Services.  During the Consulting Term, Consultant shall
provide the following Rights and Consulting Services to the Company:

 

a.
Consulting services up to 10 hours per month;

 

b.
Service as a member of the Company’s Scientific Advisory Board;

 

c.
Appearances and speaking engagements up to 10 days per year; and

 
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d.
Full rights and authorization to use Consultant’s name and likeness for the
Company’s marketing and other purposes.

 

4.
Consulting Fees. During the Consulting Term, the Company agrees to pay
Consultant an annual consulting fee of $287,500 less any severance payments
pursuant to Section 3 or 6 of the Executive Severance Policy (other than Accrued
Rights, as defined in such policy) paid to Consultant during the year (the
“Consulting Fee”). The Consulting Fee shall be paid in equal monthly
installments.

 

5.
Reimbursement of Expenses. The Company agrees to reimburse Consultant for, or
pay directly, reasonable expenses Consultant incurs in connection with the
services provided hereunder, provided such expenses have been approved in
advance by the Company and Consultant submits adequate documentation for such
expenses including the purpose of the expense and the names of all persons who
participated in any meetings or meals covered by such expenses.

 

6.
Independent Contractor. Consultant acknowledges that he is an independent
contractor and the Company shall not be responsible to compensate Consultant
for, or make any withholdings such as, FICA, worker’s compensation, unemployment
taxes, or any other similar taxes or fees associated with employment.  Under no
circumstances is Consultant to be considered an employee of the Company.

 

7.
Restrictive Covenants.

 
7.1          Definitions.  For purposes of this Agreement, the following defined
terms shall have the meaning indicated:
 
(i)          “Competitive Business” shall mean Direct Selling.
 
(ii)          “Competing Entity” shall mean any entity or person that is
engaged, directly or indirectly, in a Competitive Business.
 
(iii)        “Direct Selling” means (i) the multi-level marketing channel
through which products and services are marketed directly to consumers through a
sales force of independent contractors (including, without limitation, through
person to person contact, via the telephone or through the Internet) who receive
rewards or commissions based upon a compensation plan which contemplates a
genealogical sales force of multiple levels, with such commissions paid for by
(A) sales of products and services by such contractor, and/or (B) sales of
products and services by other independent contractors in such contractor’s
genealogical downline, and (ii)  a home-based business opportunity focused on
selling products directly to the consumers.
 
(iv)        “Territory” shall mean those countries where the Company, or any of
its affiliates, engages in business or sells products or plans to conduct
business.  This definition is intended to reflect the Consultant’s knowledge
about the operations and activities of the Company as a whole.
 
7.2         Non-Competition. Consultant shall not in any way, directly or
indirectly, at any time during the Consulting Term, within the Territory: (i)
engage in any Competitive Business; (ii) undertake to plan or organize any
Competing Entity; (iii) become associated or connected in any way with,
participate in, be employed by, render services to, or consult with, any
Competing Entity (nor shall Consultant discuss the possibility of employment or
other relationship with any Competing Entity); or (iv) own any direct or
indirect interest in any other Competing Entity; provided, however, this
limitation shall not be interpreted as prohibiting Consultant from investing in
a Competing Entity that is a public company so long as such investment does not
exceed 1% of the outstanding securities of such public company and Consultant
discloses in writing to the Company (a) the name of the public company and the
number of shares which he owns, and (b) any material change in Consultant’s
ownership. This Section 7.2 shall not restrict the right of the Employee to
practice law in violation of any applicable rules of professional conduct.
 
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7.3        Non-Solicitation. Consultant shall not in any way, directly or
indirectly, at any time during the Consulting Term solicit any employee,
independent contractor, consultant or other person or entity in the employment
or service of the Company or any of its respective subsidiaries or affiliates
(each of the preceding, a “Group Company”), at the time of such solicitation, in
any case to (i) terminate such employment or service, and/or (ii) accept
employment, or enter into any consulting or other service arrangement, with any
person or entity other than a Group Company.
 
7.4        Non-Endorsement. Consultant shall not in any way, directly or
indirectly, at any time during the Consulting Term endorse any Competitive
Business or competing product, promote or speak on behalf of any Competitive
Business or competing product, or allow Consultant’s name or likeness to be used
in any way to promote any Competitive Business or competing product.
 
7.5         Non-Disparagement. Consultant shall not in any way, directly or
indirectly at any time during or after the Consulting Term, disparage the
Company or the Company’s products or sales force.
 
7.7         Acknowledgement. Consultant acknowledges that the Rights and
Consulting Services are critical and vital to the on-going success of the
Company’s operation in each product category and in each geographic location in
which the Company operates.  In addition, the Consultant acknowledges that
Consultant’s experience with, and knowledge of the Company’s operations as a
whole constitute skills and knowledge which are special, unique and
extraordinary with respect to Consultant’s service to the Company.  Therefore,
Consultant acknowledges that the non-competition, non-solicitation,
non-endorsement and non-disparagement covenants hereunder are fair, reasonable
and necessary to protect the legitimate business interests of the Company. 
These covenants, and each of them, should be construed to apply to the fullest
extent possible by applicable laws. Consultant has carefully read this
Agreement, has consulted with independent legal counsel to the extent Consultant
deems appropriate, and has given careful consideration to the restraints imposed
by this Agreement. Consultant acknowledges that the terms of this Agreement are
enforceable regardless of the manner in which this Agreement is terminated.
 
7.8          Remedies. Consultant acknowledges: (a) that compliance with the
restrictive covenants contained in this Section 7 are necessary to protect the
business and goodwill of the Company or its affiliates and (b) that a breach of
the restrictive covenants contained in this Section 7 may result in irreparable
and continuing damage to the Company or its affiliates, for which money damages
may not provide adequate relief.  Consequently, Consultant agrees that, in the
event that Consultant breaches or threatens to breach these restrictive
covenants, the Company or its affiliates shall be entitled to (1) a preliminary
or permanent injunction, without bond, to prevent the continuation of harm and
(2) money damages insofar as they can be determined with respect to a material
breach.  Nothing in this Agreement shall be construed to prohibit the Company or
its affiliates from also pursuing any other remedy, the parties having agreed
that all remedies are cumulative.
 
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8.
Work Product. The Company shall have the sole proprietary interest in the work
product produced by Consultant pursuant to the Rights and Consulting Services
provided under this Agreement (the “Work Product”) in accordance with applicable
laws.  Further, Consultant expressly assigns to the Company or its designee all
rights, title and interest in and to all copyrights, patents, trade secrets,
improvements, inventions, sketches, models and all documents related thereto,
innovations, business plans, designs and any other Work Product developed by
Consultant in connection with the Rights and Consulting Services in accordance
with applicable laws. Consultant further agrees to promptly disclose any and all
Work Product to Company.

 

9.
Confidential Information. Consultant acknowledges that during the Consulting
Term he may develop, learn and be exposed to information about the Company and
its business, including but not limited to formulas, business plan and
processes, financial data, vendor lists, product and marketing plans, sales
force lists and other trade secrets which information is secret and confidential
(“Confidential Information”). Consultant agrees that Consultant will not at any
time during or after the Consulting Term, without the express written consent of
the Company, disclose, copy, retain, remove from the Company’s premises or make
any use of such Confidential Information except as may be required in the course
of the Rights and Consulting Services.  At the end of the Consulting Term, or at
the earlier request of the Company, Consultant shall promptly return to the
Company all Confidential Information. Consultant expressly assigns to the
Company or its designee all rights, title and interest in all Confidential
Information. Notwithstanding the foregoing, for purposes of this Agreement,
Confidential Information does not include any information which is currently in
the public domain or which hereafter becomes public knowledge in a way that does
not involve a breach of an obligation of confidentiality.

 

10.
Cooperation.  Consultant agrees that, upon the Company’s reasonable request,
Consultant in good faith and using diligent efforts shall cooperate and assist
the Company in any dispute, controversy or litigation in which the Company may
be involved including, without limitation, Consultant’s participation in any
court or arbitration proceedings, the giving of testimony, the signing of
affidavits or such other personal cooperation as counsel for the Company may
reasonably request.  Such cooperation shall not be unreasonably burdensome
without reasonable compensation.

 

11.
Compliance with Laws.  Consultant agrees to comply with all applicable laws in
the performance of his obligations under this Agreement.

 

12.
Indemnification. Consultant shall indemnify and hold the Company and its
affiliates, and each of their respective officers, directors, employees and
agents, harmless from any and all liabilities, damages, judgments, or expenses,
including reasonable attorney’s fees, resulting or arising from, directly or
indirectly, any acts or omissions by Consultant. Consultant further agrees to
indemnify and hold each of the Company and its affiliates, and each of their
officers, directors, employees and agents, harmless from any withholding tax,
unemployment payments, fees, penalties, expenses, assessments or other
liabilities that the Company or its affiliates may incur as a result of any
determination or claim that Consultant is an employee of the Company.

 

13.
Assignment. This Agreement is for the unique personal services of Consultant and
is not assignable or delegable in whole or in part by Consultant or the Company
without the prior written consent of the other party; provided the Company may
assign its rights and obligations hereunder to an Affiliate of the Company or in
connection with the sale of its business, and provided Consultant may perform
his personal services through a business entity established for those purposes.

 
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14.
Waiver and Modification.  Any waiver, change, modification, extension,
discharge, or amendment of any provision of this Agreement shall be effective
only if in writing in a document that specifically refers to this Agreement and
the party against whom enforcement of such waiver, change, modification,
extension, discharge, or amendment is sought signs such document.  The waiver by
either party of a breach of any provision of this Agreement by the other party
shall not operate or be construed as a waiver of any other provision hereof or
any subsequent breach of the same provision.

 

15.
Severability, Interpretation.  If any provision of this Agreement is found to be
unenforceable by a court of competent jurisdiction, the remaining provisions
hereof shall nevertheless remain in full force and effect.  Notwithstanding any
rule or maxim of construction to the contrary, any ambiguity or uncertainty in
this Agreement shall not be construed against either of the parties based upon
authorship of any of the provisions hereof.

 

16.
Reformation. The Company intends to restrict the activities of the Consultant
only to the extent necessary for the protection of the legitimate business
interests of the Company and its affiliates.  It is the intention and agreement
of the parties that all of the terms and conditions hereof be enforced to the
fullest extent permitted by law.  If the provisions of this Agreement should
ever be deemed or adjudged by a court of competent jurisdiction to exceed the
time or geographical limitations permitted by applicable law, then such
provisions shall nevertheless be valid and enforceable to the extent necessary
for such protection as determined by such court, and such provisions will be
reformed to the maximum time or geographic limitations as determined by such
court.

 

17.
Notices.  Any notice required or permitted hereunder to be given by either party
shall be in writing and shall be delivered personally or sent by certified or
registered mail, postage prepaid, or by private overnight courier, or by
facsimile (with a conforming copy sent by overnight mail) to the address or fax
number set forth below or to such other address as either party may designate
from time to time according to the terms of this Section 17:

 

If to Consultant: Joseph Chang
 
 
 
 
 
 
 
 
 
 

If to the Company:
Nu Skin Enterprises, Inc.
 
 
 
 
           

A notice delivered personally shall be effective upon receipt.  A notice sent by
facsimile shall be effective the date delivered, provided confirmation of
delivery is obtained and a copy is delivered by overnight mail, 24 hours after
the dispatch thereof.  A notice delivered by private overnight courier shall be
effective on the day delivered or if delivered by mail, the third day after the
day of mailing.  Either party may change its address for purposes of this
Section 17 by providing the other party notice as required herein.
 
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18.
Attorneys’ Fees.  In the event of any action at law or in equity to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled to
reasonable attorneys’ fees and court costs in addition to any other relief to
which such party may be entitled.

 

19.
Governing Law, Jurisdiction and Venue.  The validity of this Agreement and the
interpretation and performance of all of its terms shall be governed by the
substantive and procedural laws of the State of Utah.  Each party expressly
submits and consents to exclusive personal jurisdiction and venue in the courts
of Utah County, State of Utah or in any Federal District Court in Utah.

 

20.
Entire Agreement.  This Consulting Agreement, together with the Separation and
Release Agreement entered into pursuant to the Company’s Executive Severance
Policy, the Employment Agreement and the Key-Employee Covenants Agreement as
amended by the Employment Agreement, and the agreements related to the Company’s
deferred compensation plan, the Company’s 401(k) plan, and Consultant’s stock
option agreements (the “Sole Agreements”), constitute the entire and sole
agreements between Consultant and the Company and its affiliates.  No other
promises or agreements have been made to Consultant or the Company other than
those contained in the Sole Agreements. Consultant and the Company acknowledge
that they have read this Consulting Agreement carefully, fully understand the
meaning of the terms of this Consulting Agreement, and are signing this
Consulting Agreement knowingly and voluntarily.  This Consulting Agreement may
not be modified except by an instrument in writing signed by all of the parties
hereto.

[Signature page follows]

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IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date first set forth above.
 

 
NU SKIN ENTERPRISES, INC.
     
By:
 
Its:

 

 
EMPLOYEE
     
Joseph Y. Chang

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EXHIBIT B
 
KEY EMPLOYEE COVENANTS
 

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KEY EMPLOYEE COVENANTS AGREEMENT

Joseph Y. Chang
“Employee” (PRINT NAME)
 

Nu Skin Enterprises, Inc. and its affiliated companies (“Company”) operate in
the highly competitive direct selling marketplace competing for product market
share as well as recruitment and retention of independent distributors.  The
success of Company depends on maintaining a competitive edge in this industry
through the introduction of innovative products and attracting and retaining
distributors. Accordingly, as a condition of and in consideration of employment
or continued employment with Company and participation in the Executive
Severance Policy maintained by Company, the parties hereby acknowledge and agree
as follows.

1.
Conflict of Interest:  During employment with Company, Employee shall not have
any personal interest that is incompatible with the loyalty and responsibility
owed to the Company.  Employee must discharge his/her responsibility solely on
the basis of what is in the best interest of Company and independent of personal
considerations or relationships. Employee shall maintain impartial relationships
with vendors, suppliers and distributors. Should Employee have any questions
regarding this matter, Employee should consult with his/her director or
supervisor.  If any conflict of interest or potential conflict of interest
arises, the Employee must notify his director or supervisor and seek an
appropriate waiver or resolution of such conflict of interest. Although it is
difficult to identify every activity that might give rise to a conflict of
interest, and not by way of making an all-inclusive list, the following
provisions apply to common areas for potential conflicts of interests:

1.1
Related Party Transactions.  Employees should not have a direct or indirect
ownership or financial interest in vendors of Company nor any company doing or
seeking to do business with Company. Employees should also not have a financial
or other interest in any transaction involving the Company.  In the event such a
conflict arises, the Employee must notify his/her director or supervisor and the
Company may not do business with such vendor or enter into any such transaction
unless it has been approved in accordance with the Company’s policy with respect
to related party transactions.

1.2
Other Employment.  Employee shall not perform services of any kind for any
entity doing or seeking to do business with Company. As to employment with or
service to another company, Employee shall not provide service to any company
that competes with the Company, and shall not allow any such activity to detract
from his/her job performance, use Company’s time, resources or personnel, or
require such long hours to affect his/her physical or mental effectiveness.

1.3
Distributorships.  While employed by Company and for a period of three (3)
months after termination of an employment relationship with Company, Employee
shall not directly or indirectly own any interest in a Company distributorship
or similar account.  Additionally, during the course of employment, neither the
Employee’s spouse, nor any member of the Employee’s household shall own any
interest in, or otherwise be associated with, a Company distributorship without
the prior written consent of the Company. Employee’s spouse, or significant
other living in the same household, will not, without the prior written consent
of the Company, own any interest in, or otherwise be affiliated with, another
direct sales distributorship or be employed by another direct sales or
multilevel marketing company.  Any pre-existing ownership interests or
employment covered in this paragraph must be disclosed to the Company at the
time of the execution of this Agreement.  Employee shall disclose to his/her
immediate director or supervisor any and all areas posing a potential or actual
conflict of interest.  Said disclosure shall be made as promptly as possible
after such conflict arises.

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2.
Work Product:

2.1
Company shall have the sole proprietary interest in the work product of Employee
created  during his/her employment with Company (“Work Product”), and Employee
expressly assigns to Company or its designee all rights, title and interest in
and to all copyrights, patents, trade secrets, improvements, inventions,
sketches, models and all documents related thereto, manufacturing processes and
innovations, special calibration techniques, software, service code, systems
designs and any other Work Product developed by Employee, either solely or
jointly with others, where said Work Product relates to any business activity or
research and development activity in which Company is involved or plans to be
involved at the time of or prior to Employee’s creating such Work Product, or
where such Work Product is developed with the use of Company’s time, material,
or facilities; and Employee further agrees to disclose any and all such Work
Product to Company without delay.

2.2
Employee will promptly disclose to the Company all Work Product, whether or not
patentable or registrable under patent, copyright or similar statutes, made or
conceived or reduced to practice or learned by Employee, either alone or jointly
with others, during the period of his/her employment that (i) at the time of
conception or reduction to practice are related to the actual or demonstrably
anticipated business of the Company, (ii) result from tasks performed by
Employee for the Company, or (iii) are developed on any amount of the Company’s
time or result from the use of premises or property (including computer systems
and engineering facilities) owned, leased, or contracted for by the Company
(collectively, “Inventions”).

3.
Non-Disclosure and Assignment:

3.1
Employee acknowledges that during the term of employment with Company he/she may
develop, learn and be exposed to information about Company and its business,
including but not limited to formulas, business plans, financial data, vendor
lists, product and marketing plans, distributor lists, and other trade secrets
which information is secret, confidential and vital to the continued success of
Company (“Confidential Information”).  All Confidential Information and/or
Inventions, as well as all intellectual property rights therein, are and shall
be the sole property of the Company.  Employee hereby assigns and agrees to
assign to the Company any rights he or she may have or acquire in such
Confidential Information and/or Inventions.

3.2
During and after Employee’s employment, Employee shall hold the Confidential
Information and/or Inventions in confidence and shall protect them with utmost
care. Employee shall not disclose, copy, remove from the Company’s premises, or
permit any person to disclose or copy any of the Confidential Information and/or
Inventions, and Employee shall not use any of the Confidential Information
and/or Inventions, except as necessary to perform his/her duties as an employee
of Company.  In the event that Employee has or has had access to any
confidential information belonging to any third party, including but not limited
to any of Employee’s previous employers, Employee shall hold all such
confidential information in confidence and shall comply with the terms of any
and all agreements between Employee or Company and the third party with respect
to such confidential information. Upon hire, Employee shall disclose to Company
the existence of agreements Employee has with prior employers.

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3.3
This Agreement will not be interpreted to prevent the use or disclosure of
information that (i) is required by law to be disclosed, but only to the extent
that such disclosure is legally required, (ii) becomes a part of the public
knowledge other than by a breach of an obligation of confidentiality, or (iii)
is rightfully received from a third party not obligated to hold such information
confidential.  The Defend Trade Secrets Act provides immunity to individuals
under any federal or state trade secret law for the disclosure of a trade secret
that is made: (i) in confidence to a federal, state, or local government
official, either directly or indirectly, or to an attorney for the sole purpose
of reporting or investigating a suspected violation of law; or (ii) in a
complaint or other document filed in a lawsuit or other proceedings, if such
filing is made under seal.  If an individual files a lawsuit against his or her
employer alleging retaliation for reporting a suspected violation of law, the
individual may disclose the trade secret to his or her attorney.  The individual
may also use the trade secret information in the court proceedings, provided
that he or she files any documents containing the trade secret under seal and
does not disclose the trade secret except pursuant to court order.

3.4
Upon Company’s request, and in any event upon termination of Employee’s
employment for any reason, Employee shall promptly return to Company all
materials in his/her possession or control that represent, contain or reasonably
could contain Confidential Information and/or Inventions, including but not
limited to passwords, documents, drawings, diagrams, flow charts, computer
programs, memoranda, notes, and every other medium, and all copies thereof.

3.5
Subject to Paragraph 17 below, during and after Employee’s employment,
regardless of the circumstances of Employee’s termination, Employee shall not
communicate to, or use for his/her benefit, or for the benefit of any person,
firm, or other entity, without the prior approval of the Company, any
Confidential Information or information about Inventions; provided, however,
that Employee may communicate such information as required pursuant to law or as
necessary or appropriate in connection with any suit or action, or any potential
suit or action, brought by Employee against the Company in connection with
his/her employment relationship with the Company. Except as outlined in
Paragraph 17 below, Employee must advise Company prior to disclosure of
Confidential Information to be communicated pursuant to law or in connection
with a suit or action as described above so that the Company may obtain a
protective order as necessary to protect its confidentiality interests. Employee
will return to Company all Company-owned materials including, without
limitation, computer and office equipment, supplies and internal Company
manuals, customer lists and information, passwords, and marketing materials.

4.
Future Inventions:  Employee recognizes that Inventions relating to his/her
activities while working for Company and conceived or made by Employee, whether
alone or with others, within one year after termination of Employee’s employment
may have been conceived in significant part while employed by Company. 
Accordingly, Employee agrees that such Inventions shall be presumed to have been
conceived during Employee’s employment with Company and are to be, and hereby
are, assigned to Company unless and until Employee has established the contrary.

5.
Cooperation:  Employee shall assist Company in every way deemed necessary or
desirable by the Company (but at the Company’s expense) to obtain and enforce
patents, copyrights, trademarks and other rights and protections relating to any
Confidential Information and Inventions in any and all countries, and to that
end Employee will execute all documents for use in obtaining and enforcing such
patents, copyrights, trademarks and other rights and protections as Company may
desire, together with any assignments thereof to Company or persons designated
by it.  If Company is unable for any reason to secure Employee’s signature to
any document required to apply for or execute any patent, copyright, mask work
or other applications with respect to any Inventions (including improvements,
renewals, extensions, continuations, divisions or continuations in part
thereof), Employee hereby irrevocably designates Company and its duly authorized
officers and agents as Employee’s agents and attorneys-in-fact for and on
Employee’s behalf to execute and file any such application and to do all other
lawfully permitted acts to further the prosecution and issuance of patents,
copyrights, mask works or other rights thereon with the same legal force and
effect as if executed by Employee.  Employee’s duty to assist Company extends to
enforcement of patents, copyrights, trademarks, and other rights and protections
described above, of which were executed and signed on Employee’s behalf pursuant
to Employee’s designation of Company for signatory authority.  Employee’s
obligation to assist Company shall continue beyond the termination of his/her
employment, but Company shall compensate him/her at a reasonable rate after
his/her termination for time actually spent by Employee at Company’s request on
such assistance.

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6.
Ethical Standards:  Employee agrees to maintain the highest ethical and legal
standards in his/her conduct, to be scrupulously honest and straight-forward in
all of his/her dealings and to avoid all situations which might project the
appearance of being unethical or illegal.

7.
Product Resale:  As an employee of Company, Employee may receive Company
products and materials either at no charge or at a discount as specified from
time to time by Company in its sole discretion.  Employee agrees that the
products received shall be used strictly in accordance with the policies of the
Company regarding products received by employees from the Company and shall not
be sold, distributed or transferred in any manner that would violate such
policies, as they may be amended from time to time.

8.
Gratuities:  Employee shall neither seek nor retain gifts, gratuities,
entertainment or other forms of compensation, benefit, or persuasion from
suppliers, distributors, vendors or their representatives without the consent of
a Company Vice President with the exception of meals provided in the ordinary
course of business on an infrequent basis.

9.
Non-Solicitation:  Employee shall not in any way, directly or indirectly, at any
time during employment or within two (2) years after either a voluntary or
involuntary employment termination: (a) solicit, divert, take away, or
unreasonably interfere with Company’s distributors; (b) in any manner solicit,
divert, take away, or interfere unreasonably with Company’s employees or
vendors; or (c) assist any other person(s) in any manner  in an attempt to do
any of the foregoing.

10.
Non-Disparagement:  Subject to Paragraph 17 below, employee shall not in any
way, directly or indirectly at any time during employment or after either
voluntary or involuntary employment termination, disparage Company, Company
products or Company Distributors.

11.
Non-Endorsement:  Employee shall not in any way, directly or indirectly, at any
time during employment or within one (1) year after either a voluntary or
involuntary employment termination endorse any sales compensation plan of
another company or product that competes with products of Company, promote or
speak on behalf of any company whose products compete with those of Company, or
allow Employee’s name or likeness to be used in any way to promote any company
or product that competes with Company or any products of Company.

12.
Non-Competition:  Because of the Company’s legitimate business interest, in
exchange for the benefits of continued employment by Company and participation
in the Executive Severance Policy maintained by Company, Employee shall not
accept employment with, contribute Employee’s knowledge, engage in or
participate, directly or indirectly, individually or as an officer, director,
employee, shareholder, consultant, partner, joint venturer, agent, equity owner,
distributor or in any other capacity whatsoever, with any entity engaged in the
same or similar business as the Company, including those engaged in the business
of LED light source growing, or direct selling that competes with the business
of Company whether for market share of products or for independent distributors
in a territory in which Company is doing business; provided, however, Employee
may own publicly-traded securities of a company’s whose securities are publicly
traded on either the NYSE, American or NASDAQ stock exchanges if the Employee’s
ownership interest is less than 1% of the total outstanding securities of such
company.  The Employee shall not engage in activities that may require or
inevitably require disclosure of trade secrets, proprietary information, or
Confidential Information.  The restrictions set forth in this paragraph shall
remain in effect during the Employee’s employment with Company and during a
period of one (1) year following the Employee’s termination of employment. 
Within fifteen (15) days of termination of Employee’s employment, Company shall
notify Employee whether it elects to enforce the Employee’s obligation set forth
in this paragraph. Notwithstanding the foregoing, in the event Company decides,
in its sole discretion, to enforce Employee’s non-competition obligation(s) with
regard to an Employee whose employment ended as a result of the Employee’s
voluntary termination of employment without Good Reason (as defined in the
Executive Severance Policy maintained by Company), Company may elect, in its
sole discretion, to pay Employee a sum of up to seventy-five percent of the
Employee’s annual base salary at termination of employment, less applicable
withholding taxes, for the one year period following the termination of
employment during which the restrictive covenants in this paragraph remain in
effect. Unless other arrangements are made at Company’s sole discretion, such
payment may be made in equal periodic installments in accordance with Company’s
regular payroll practices until all payments are completed. Such ongoing
payments shall be contingent upon Employee’s ongoing compliance with his/her
continuing obligations under this Agreement.

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13.
Acknowledgement:  Employee acknowledges that his/her position and work
activities with the Company are “key” and vital to the on-going success of
Company’s operation in each product category and in each geographic location in
which Company operates. In addition, Employee acknowledges that his/her
employment or involvement with any other entity or company engaged in the
business of LED light source growing, or direct selling or multilevel marketing
would create the impression that Employee has left Company for a “better
opportunity,” which could damage Company by this perception in the minds of
Company’s employees, independent distributors, or other persons. Therefore,
Employee acknowledges that his/her confidentiality, non-solicitation,
non-disparagement, non-endorsement and non-competition covenants are fair and
reasonable and should be construed to apply to the fullest extent possible by
applicable laws.  Employee has carefully read this Agreement, has consulted with
independent legal counsel to the extent Employee deems appropriate, and has
given careful consideration to the restraints imposed by the Agreement. Employee
acknowledges that the terms of this Agreement are enforceable regardless of the
manner in which Employee’s employment is terminated, whether voluntary or
involuntary. In the event that Employee is to be employed as an attorney for a
competitive business, Company and Employee acknowledge that paragraph 12 is not
intended to restrict the right of the Employee to practice law in violation of
any applicable rules of professional conduct.

14.
Return of Equipment and Information upon Termination:  Upon termination of
employment, Employee shall return to Company all assets and equipment of Company
along with any Confidential Information and Work Product including any
distributor and vendor contact information and notes or summaries of all of the
above.  Employee shall not retain any copies of the returned items.

15.
Remedies:  Employee acknowledges: (a) that compliance with the restrictive
covenants contained in this Agreement are necessary to protect the business and
goodwill of Company and (b) that a breach will result in irreparable and
continuing damage to Company, for which money damages may not provide adequate
relief. Consequently, Employee agrees that, in the event that he/she breaches or
threatens to breach these restrictive covenants, Company shall be entitled to
both: (1) a preliminary or permanent injunction to prevent the continuation of
harm and (2) money damages insofar as they can be determined. Nothing in this
Agreement shall be construed to prohibit Company from also pursuing any other
remedy, the parties having agreed that all remedies are cumulative.  It is
further recognized and agreed that the covenants set forth herein are for the
purpose of restricting Employee’s activities to the extent necessary for the
protection of the legitimate business interests of Company and that Employee
agrees that said covenants do not and will not preclude him/her from engaging in
activities sufficient for the purposes of earning a living.

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16.
Attorney’s Fees:  If any party to this Agreement breaches any of the terms of
this Agreement, then that party shall pay to the non-defaulting party all of the
non-defaulting party’s costs and expenses, including reasonable attorney’s fees,
incurred by that party in enforcing the terms of this Agreement.

17.
Protected Activity. Nothing in this document is intended, or should be
interpreted, to restrict, impede, or otherwise limit the rights of all
employees, including Key Employees, to report possible violations of law or
regulation to any governmental agency or entity tasked with enforcing such laws
and regulations, including but not limited to the United States Department of
Justice, the Securities and Exchange Commission, the Equal Employment
Opportunity Commission, the Department of Labor, Congress, and any agency
Inspector General, or participate in an investigation by any such administrative
agencies; nor is this document intended to limit employees’ rights to discuss
among themselves or others wages, benefits, and other terms and conditions of
employment or workplace matters of mutual concern, as protected by the National
Labor Relations Act.  Employee is not required to notify the Company of his or
her intention to file such a report or participate in such an investigation
prior to contacting the agency.

18.
Court’s Right to Modify Restriction:  The parties have attempted to limit the
Employee’s right to compete only to the extent necessary to protect Company from
unfair competition. The parties recognize, however, that reasonable people may
differ in making such a determination. Consequently, the parties agree that, if
the scope or enforceability of the restrictive covenants contained in this
Agreement is in any way disputed at any time, a court or other trier of fact may
modify and enforce the covenants to the extent that it believes to be reasonable
under the circumstances existing at that time.

19.
Severability:  If any provision, paragraph, or subparagraph of this Agreement is
adjudged by any court or administrative agency to be void or unenforceable in
whole or in part, this adjudication shall not affect the validity of the
remainder of the Agreement, including any other provision, paragraph, or
subparagraph. Each provision, paragraph, and subparagraph of this Agreement is
severable from every other provision, paragraph, and subparagraph and
constitutes a separate and distinct covenant.

20.
Governing Law and Forum:  This Agreement shall be governed and enforced in
accordance with the laws of the State of Utah, and any litigation between the
parties relating to this Agreement shall be conducted in the courts of Utah
County or Salt Lake City where necessary for federal court matters.

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21.
Employment At Will:  Employee understands that employment with Company is
at-will, meaning that employment with Company is completely voluntary and for an
indefinite term and that either Employee or Company is free to terminate the
employment relationship at any time, with or without cause or advance notice,
provided that termination is not done for an unlawful or discriminatory purpose.

22.
Employment Subject to Company’s Policies and Procedures:  The Parties
acknowledge and agree that Company has established, and may establish, various
workplace policies and procedures, which the Company may modify in its sole
discretion from time to time.  Employee acknowledges such policies and
procedures, and agrees to abide by such policies and procedures as they may be
implemented or modified from time to time.

23.
Entire Agreement:  Company and Employee understand and agree that this Agreement
and the Employment Agreement by and between Company and Employee shall
constitute the entire agreement between them regarding the subject matter
contained herein, and that all prior understandings or agreements regarding
these matters are hereby superseded and replaced, including, without limitation,
the Key-Employee Covenants Agreement previously signed by the parties.  Any
amendment to or modification of this Agreement must be in writing signed by the
parties hereto and stating the intent of the parties to amend or modify this
Agreement.

24.
Survivability of Obligations:  This Agreement sets forth several obligations
which continue after the termination of Employee’s employment with Company,
including without limitation those obligations set forth in paragraphs 1, 2, 3,
4, 5, 6, 9, 10, 11, and 12, and the Parties specifically acknowledge and agree
that such obligations shall survive the termination of Employee’s employment for
any reason.

25.
Enforcement of Restrictive Covenants:  If Employee breaches any of the
provisions of Paragraphs 3, 9, 10, 11, or 12 of this Agreement, the Parties
acknowledge and agree that such breach is likely to cause the Company serious,
immediate and irreparable damage.  Accordingly, if Employee breaches or
threatens to breach any such provision, the Company shall have no adequate
remedy at law and may obtain injunctive relief against Employee in any court of
competent jurisdiction.  The seeking and/or obtaining of such injunctive relief
shall be without prejudice to the Company’s right to seek any other remedies
available to the Company for such breach or threatened breach, including the
recovery of damages from Employee.  Employee agrees that the Company does not
need to post a bond to obtain an injunction and waives Employee’s right to
require such a bond.   The remedies provided for under this provision are
intended to be in addition to, not in place of, remedies available under federal
and state laws, including the Federal Defend Trade Secrets Act (“FDTSA”).  If
the Company pursues claims against Employee under the FDTSA, the Company may
recover damages from Employee that include, but are not limited to, monetary
damages and punitive or exemplary damages and may obtain injunctive relief
against Employee.

THIS AGREEMENT HAS BEEN READ, UNDERSTOOD AND FREELY ACCEPTED BY:

/s/ Joseph Chang
 
Dated: 2020-10-16
 
Employee
 
 
 
 

B-7

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