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EXHIBIT

10.12




 




TERMINATION AND RELEASE

AGREEMENT




This TERMINATION AND

RELEASE AGREEMENT (“Termination Agreement”), is made and entered into this 11th

day of April, 2002, by and among USANA Health Sciences, Inc., a Utah

corporation (“USANA”), USANA Acquisition Corp., a Utah corporation

(“Acquisition  Sub”), and Gull Holdings, Ltd., an Isle of Man corporation

and the sole shareholder of Acquisition Sub (“Gull”).  USANA, Acquisition Sub, and Gull are sometimes collectively

referred to herein as the “Parties.”  Defined

terms not otherwise defined in this Termination Agreement shall have the

meaning set forth in the Asset Purchase Agreement (as defined below).




RECITALS




WHEREAS, on March 21,

2002, USANA, Acquisition Sub, and Gull entered into that certain Asset Purchase

Agreement whereby Acquisition Sub would acquire substantially all of the

operating assets of USANA and assume substantially all of the liabilities and

contractual obligations of USANA (the “Asset Purchase Agreement”);




WHEREAS, the Parties

believe that the Asset Purchase Agreement is no longer in the bests interests

of their respective shareholders; and




WHEREAS, pursuant to

Section 7.1 of the Asset Purchase Agreement, the Asset Purchase Agreement may

be terminated at any time prior to Closing by mutual written consent of the

Parties.




NOW, THEREFORE, in

consideration of the covenants and agreements herein set forth and for other

good and valuable consideration, the receipt and sufficiency of which are

hereby acknowledged, the Parties do hereby agree as follows:




1.             Termination of Asset Purchase

Agreement.  Effective immediately,

the Parties hereby abandon the transactions contemplated by the Asset Purchase

Agreement and mutually terminate the Asset Purchase Agreement pursuant to

Section 7.1 thereof.  Except for

Sections 5.15, 5.16.1, 5.16.2, and 5.16.4 of the Asset Purchase Agreement, none

of the provisions of the Asset Purchase Agreement shall survive termination of

the Asset Purchase Agreement hereunder.




2.             Publicity.  The Parties shall not make any public

statement regarding this Termination Agreement until 4:00 p.m. Eastern Daylight

Time on April 11, 2002.  At that time,

USANA shall issue a press release in the form, and containing the contents, of Exhibit

A to this Termination Agreement.




3.             Fees and Expenses.  Within thirty (30) days of the date of this Agreement, to the

extent not previously paid by USANA, USANA shall reimburse Acquisition Sub and

Gull for their costs and expenses heretofore or hereafter incurred in connection

with or relating to this 




 




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Termination

Agreement, the Asset Purchase Agreement, and the transactions contemplated

hereby and thereby.




4.             Release of Claims.  Effective immediately, each of Gull,

Acquisition Sub, USANA, and each of their respective predecessors, successors,

subsidiaries and assigns (and any of the present and former officers, directors

and employees of each of the foregoing) (each, a “Releasing Party”),

in their capacity as such, hereby covenants not to sue and forever releases and

discharges Gull, Acquisition Sub, and USANA, respectively (and each of their

respective present and former directors, officers, representatives, advisors

(including but not limited to financial advisors), attorneys, accountants,

employees, agents, parents, subsidiaries, affiliated persons and entities,

predecessors, successors and assigns and heirs, executors and administrators

and all persons acting in concert with any such party) (each, a “Released

Party”) from all manner of claims, actions, causes of action or suits, at law

or in equity, known or unknown, which each now has or hereafter can, shall or

may have by reason of any matter, cause or thing whatsoever relating to or

arising out of the Asset Purchase Agreement or the agreements or instruments

ancillary thereto or the transactions contemplated thereby, or any action or

failure to act under the Asset Purchase Agreement or in connection therewith,

or in connection with the events leading to the abandonment of the transactions

contemplated by the Asset Purchase Agreement and the mutual termination of the

Asset Purchase Agreement, excepting only any claim, action, cause of action or

suit arising (i) out of an undertaking or promise contained in this Termination

Agreement, (ii) by virtue of obligations specifically surviving under the Asset

Purchase Agreement, or (iii) with respect to any statements made or actions

taken after the date of this Termination Agreement.




5.             Representations and Warranties.




                (a)           Gull

and Acquisition Sub represent to USANA that Gull and Acquisition Sub have all

requisite corporate power and authority to enter into this Termination

Agreement and to take the actions contemplated hereby.  The execution and delivery of this Termination

Agreement and the actions contemplated hereby have been duly authorized by all

necessary corporate action on the part of Gull and Acquisition Sub. This

Termination Agreement has been duly executed and delivered by Gull and

Acquisition Sub and constitutes a valid and binding agreement of Gull and

Acquisition Sub, enforceable against them in accordance with its terms.




                (b)           USANA

represents to Gull and Acquisition Sub that USANA has all requisite corporate

power and authority to enter into this Termination Agreement and to take the

actions contemplated hereby.  The

execution and delivery of this Termination Agreement and the actions

contemplated hereby have been duly authorized by all necessary corporate action

on the part of USANA, including approval of the USANA Special Committee of the

Board of Directors.  This Termination

Agreement has been duly executed and delivered by USANA and constitutes a valid

and binding agreement of USANA, enforceable against it in accordance with its

terms.




6.             Miscellaneous.




                                (a)           Entire

Agreement; Assignment.




 




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(i)            This Termination

Agreement (including the documents and instruments referred to herein)

constitutes the entire agreement between the parties hereto in respect of the

subject matter hereof and supersedes all other prior agreements and

understandings, both written and oral, between the parties in respect of the

subject matter hereof.




(ii)           Neither this

Termination Agreement nor any of the rights, interests or obligations hereunder

shall be assigned or transferred, except by operation of law (including by

merger or consolidation), without the prior written consent of the other

parties.  Any assignment in violation of

the preceding sentence shall be null and void.




                (b)           Notices.  Any notice

or other communications pursuant to this Termination Agreement will be in

writing and will be deemed given if delivered personally, telecopied, sent by

nationally-recognized overnight courier or mailed by registered or certified

mail (return receipt requested), postage prepaid, to the Parties at the

following addresses (or at such other address for a Party as will be specified

by like notice):




                                (i)            If

to USANA:




                                USANA Health Sciences, Inc.




                                c/o

Durham Jones & Pinegar




                                111

East Broadway #900




                                Salt

Lake City, Utah 84111




                                Attention:  Kevin Pinegar




                                Telecopier:  (801) 415-3500




 




                                (ii)           If to Acquisition Sub:




                                USANA

Acquisition Corp.




                                c/o

Snell & Wilmer LLP




                                Gateway

Tower West




                                15

West South Temple, Suite 1200




                                Salt

Lake City, UT  84101




                                Attention:  Chris Anderson




                                Telecopier:  (801) 257-1800




 




                                (iii)          If to Gull:




                                Gull

Holdings, Ltd.




                                4

Finch Road




                                Douglas,

Isle of Man




                                Attention:  Stephen Eppleston




                                Telecopier:  011 441 624 663 534




 




All such notices and

other communications will be deemed to have been received (a) in the case of

personal delivery, on the date of such delivery, (b) in the case of a telecopy,

when the Party receiving such copy will have confirmed receipt of the

communication, (c) in the case of delivery by nationally-recognized courier, on

the business day following dispatch by overnight courier service (on the third

business day following dispatch in the case of international deliveries), and

(d) in the case of mailing, on the third business day following such mailing.




 




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                                (c)           Governing Law. 

This Termination Agreement shall be governed by and construed in

accordance with the laws of the State of Utah, without giving effect to the

choice of law principles thereof.




                                (d)           Descriptive

Headings.  The descriptive headings herein are

inserted for convenience of reference only and are not intended to be part of

or to affect the meaning or interpretation of this Termination Agreement.




                                (e)           Parties

in Interest.  This Termination Agreement shall be

binding upon and inure solely to the benefit of the Parties and their

successors and permitted assigns, and nothing in this Termination Agreement,

express or implied, is intended to or shall confer upon any other person any

rights, benefits or remedies of any nature whatsoever.




                                (f)            Severability.  The provisions of this Termination

Agreement shall be deemed severable and the invalidity or unenforceability of

any provision shall not affect the validity or enforceability of the other

provisions hereof.  If any provision of

this Termination Agreement, or the application thereof to any person or any

circumstance, is invalid or unenforceable, (i) a suitable and equitable

provision shall be substituted therefor in order to carry out, so far as may be

valid and enforceable, the intent and purpose of such invalid or unenforceable

provision, and (ii) the remainder of this Termination Agreement and the

application of such provision to other persons or circumstances shall not be

affected by such invalidity or unenforceability, nor shall such invalidity or

unenforceability affect the validity or enforceability of such provision, or

the application thereof, in any other jurisdiction.




                                (g)           Counterparts.  This Termination Agreement may be

executed in two or more counterparts, all of which shall be considered one and

the same agreement and shall become effective when one or more counterparts

have been signed by each of the parties and delivered to the other

parties.  The Parties agree that

delivery of executed signature pages by facsimile shall be sufficient to render

this Termination Agreement effective.




                                (h)           Joint

Drafting.  The parties have

participated jointly in the negotiation and drafting of this Termination

Agreement.  In the event an ambiguity or

question of intent or interpretation arises, this Termination Agreement shall

be construed as if drafted jointly by the parties and no presumption or burden

of proof shall arise favoring or disfavoring any party by virtue of the

authorship of any provisions of this Termination Agreement.




                (i)            Amendment and Modification.  This Termination Agreement may be amended,

modified, and supplemented only by a written document executed by the Parties

which specifically states that it is an amendment, modification or supplement

to this Termination Agreement.




 




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IN

WITNESS WHEREOF, each of the parties has caused this Termination Agreement to

be duly executed on its behalf as of the date first above written.




	

   


  	

  USANA HEALTH SCIENCES, INC.,


  
	

   


  	

  a Utah corporation


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/  John B.

  McCandless


  
	

   


  	

   


  	

   John B.

  McCandless, Sr. VP and COO


  
	

   


  	

   


  	

   


  
	

   


  	

  USANA ACQUISITION CORP.,


  
	

   


  	

  a Utah corporation


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

  /s/  David

  Wentz


  
	

   


  	

   


  	

   David Wentz,

  CEO


  
	

   


  	

   


  	

   


  
	

   


  	

  GULL HOLDINGS, LTD.,


  
	

   


  	

  an Isle of Man corporation


  
	

   


  	

   


  	

   


  
	

   


  	

  /s/  Stephen

  M. Eppleston


  
	

   


  	

  By:


  	

   


  
	

   


  	

  Its:


  	

   


  





 




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