Employee or the Board may utilize the dispute resolution procedures contained in Section11 to challenge or confirm, as the case may be, a termination for Cause.     (c) “Code” means the Internal Revenue Code of 1986, as amended.     (d) “Date of Contribution” means the date on which the Company makes the RetentionContribution to the Trust.     (e) “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.     (f) “Good Reason” means any of the following: (i) the Employee’s compensation isreduced by the Company; (ii) the Employee’s function, duties and/or responsibilities aresignificantly reduced so as to cause his position with the Company to become of materially lessdignity, responsibility and/or importance than those associated with his functions, duties and/orresponsibilities as of the date of this Agreement; or (iii) the Employee is required by the Companyto permanently relocate his residence or the Company’s principal business office is relocated morethan 60 miles away from its then current location.     (g) “Investments” means the investments into which the Trustee may invest amountscredited to his Account pursuant to the provisions of the Trust.     (h) “Payment Date” means April 1, 2010.     (i) “Retention Contribution” means $                    .     (j) “Trust” means that certain trust agreement established pursuant to this Agreementbetween the Employee and the Trustee, the provisions of which are incorporated herein by reference.The Trust is an employee grantor trust in which all gains from investment experience is taxed tothe Employee and not the Company.     (k) “Trustee” means the trustee appointed under the Trust.     (l) “Valuation Date” means the date or dates as of which amounts credited to theEmployee’s Account are adjusted to reflect the crediting of investment experience and thesubtraction of distributions.**3.****COMPANY CONTRIBUTION**     (a) General. Subject to the provisions in this Agreement, on September 15, 2009, theCompany agrees to make the Retention Contribution to the Employee’s Account.     (b) Retention Contribution Taxable to Employee When Contributed. The RetentionContribution made to, and held by, the Trust is not subject to the claims of the Company’screditors. In addition, amounts held in the Trust on the Employee’s behalf, although subject toforfeiture in certain cases, are not subject to a substantial risk of forfeiture, as such term isdefined in Treasury Regulations Section 1.83-3(c). Therefore, the Retention Contribution isincludible in the Employee’s income on the date the Retention Contribution is made to the Trust.
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**4.****CREDITING OF THE RETENTION CONTRIBUTION AND INCOME**     (a) Crediting to Account. Except as otherwise provided in this Agreement and Trust,as of each Valuation Date the Employee’s Account shall be adjusted with the positive or negativerate of return on the Investments.     (b) Investments. The Trustee shall invest amounts credited to the Employee’s Accountin Investments.     (c) Trust Expenses. Expenses related to the administration of the Trust shall be paidby the Company.**5.****VESTING**     Subject to the terms of this Agreement (including the possibility of forfeiture), theRetention Contribution shall be fully vested as of the Date of Contribution.**6.****DISTRIBUTIONS**     (a) Tax Payment. From the Retention Contribution contributed to the Employee’sAccount under Section 3 above, the Company will withhold an amount required to satisfy theEmployee’s applicable income tax liability and any FICA tax liability resulting from the RetentionContribution. Consequently, the amount of the Retention Contribution allocated to the Employee’sAccount will be net of income and FICA taxes (the “Tax Payment”).     (b) Payment Date Distributions.          (i) Subject to the terms of this Subsection (b), the Employee shall be entitled toreceive all amounts in the Employee’s Account on the Payment Date.          (ii) Distribution Upon Termination of Employment Before Payment Date.               (1) Termination without Good Reason. If the Employee voluntarily terminates hisemployment with the Company before the Payment Date without Good Reason, the Employee will forfeitall previously undistributed amounts remaining in his Account under this Agreement and, upon noticefrom the Company to the Trustee pursuant to the Trust, the Trustee shall immediately pay suchamounts to the Company.               (2) Termination with Cause. If the Company terminates the Employee’s employment forCause before the Payment Date, the Employee will forfeit all previously undistributed amountsremaining in his Account under this Agreement and, upon notice from the Company to the Trusteepursuant to the Trust, the Trustee shall immediately pay such amounts to the Company.               (3) Termination for any Other Reason. If the Employee’s employment with the Companyterminates for any reason other than as provided in Subsection (b)(ii)(1) or (2) above, theEmployee shall be entitled to a distribution equal to all amounts remaining in the Employee’sAccount as of the date of his termination of employment with the Company. The
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Company shall provide notice to the Trustee pursuant to the Trust directing the Trustee tomake such distribution to the Employee.     (c) Timing of Distribution. Payment to the Employee shall be paid to the Employeewithin five business days of the event that triggers the payment obligation.     (d) Method of Distribution. Distribution of benefits under this Agreement shall bemade in cash lump sums.     (e) Designation of Beneficiary. The Employee shall have the right to designate, onforms supplied by and delivered to the Trustee, a beneficiary or beneficiaries (the“Beneficiary” or “Beneficiaries”) to receive his benefits hereunder in the event ofthe Employee’s death. The Employee may change his Beneficiary designation from time to time in themanner specified in such forms. Upon receipt of such designation by the Trustee, such designationor change of designation shall become effective as of the date of the notice, whether or not theEmployee is living at the time the notice is received. If no designated Beneficiary is living whenbenefits become payable, or if there is no designated Beneficiary, the Beneficiary shall be theestate of Employee.**7.****INALIENABILITY OF BENEFITS**     Neither the Employee, the Beneficiary, nor creditors of Employee or Beneficiary, shall haveany right to assign, pledge, hypothecate, anticipate or in any way create a lien upon theEmployee’s or Beneficiary’s interest created under this Agreement. All payments to be made to theEmployee or his Beneficiaries shall be made only upon their personal receipt or endorsement, and nointerest under this Agreement shall be subject to assignment or transfer or otherwise be alienable,either by voluntary or involuntary act or by operation of law or equity, or subject to attachment,execution, garnishment, sequestration, levy or other seizure under any legal, equitable or otherprocess, or be liable in any way for the debts or defaults of the Employee or his Beneficiaries.**8.****BINDING NATURE OF AGREEMENT**     This Agreement shall be binding upon the heirs, executors, administrators, successors andassigns of any and all interested parties, present and future.**9.****CLAIMS OF CREDITORS**     The Employee and his Beneficiary or Beneficiaries shall be considered the owners of amountsheld in the Trust and in the Employee’s Account. All amounts held in the Account are set aside andnot subject to the claims of the Company’s creditors.**10.****FUNDED PLAN**     This Agreement is intended to create a funded arrangement, and does not defer the receipt ofincome to termination of employment or beyond and is therefore not subject to the requirements ofERISA.
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**11.****DISPUTE RESOLUTION**     If there is a dispute between the Company and the Employee concerning the terms of thisAgreement, the dispute will be resolved by binding arbitration in accordance with the NationalRules for the Resolution of Labor Disputes (“Rules”) administered by the AmericanArbitration Association (“AAA”). This arbitration will be held in the AAA office locatednearest the Company’s headquarters. The provisions of the Rules are incorporated as a part of thisAgreement; provided, however, that (a) the Company or the Employee must initiate arbitration withinone year from the date any claim accrues; and (b) either party may seek injunctive relief in courtto avoid irreparable injury during the pendency or arbitration proceedings. IT IS EXPRESSLYUNDERSTOOD THAT BY SIGNING THIS AGREEMENT, WHICH INCORPORATES BINDING ARBITRATION, THE COMPANY ANDTHE EMPLOYEE AGREE, EXCEPT AS OTHERWISE PROVIDED ABOVE, TO WAIVE COURT OR JURY TRIAL TO THE FULLESTEXTENT PERMITTED BY LAW AND TO WAIVE PUNITIVE, STATUTORY, CONSEQUENTIAL, AND ANY DAMAGES, OTHERTHAN COMPENSATORY DAMAGES.**12.****VALIDITY**     The invalidity or unenforceability of any provision of this Agreement shall not affect thevalidity or enforceability of any other provision of this Agreement, which shall remain in fullforce and effect.**13.****NO EMPLOYMENT CONTRACT**     Nothing in this Agreement shall confer upon the Employee any right to continue in the employof the Company (or any parent or subsidiary corporation of the Company employing the Employee) forany period of time or to interfere with or otherwise restrict in any way the rights of the Companyor the Employee to terminate the Employee’s employment.**14.****AMENDMENT AND TERMINATION**     Any amendment, modification, change, or termination of this Agreement must be done so inwriting and signed by both parties.**15.****CODE SECTION 409A**     This Agreement is designed to not be subject to the requirements of Code Section 409A.However, if for any reason, any payments under this Agreement become subject to the provisions ofCode Section 409A, it is intended that the Agreement will comply fully with and meet all therequirements of Code Section 409A.**16.****GOVERNING LAW**     The validity, interpretation, construction, and performance of this Agreement shall begoverned by the laws of the State of Arizona.
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**17.****NOTICES**     All notices, requests, demands, claims and other communications permitted or required to begiven hereunder must be in writing and shall be deemed duly given and received (a) if personallydelivered, when so delivered, (b) if mailed, three (3) business days after having been sent byregistered or certified mail, return receipt requested, postage prepaid and addressed to theintended recipient as set forth below, (c) if sent by electronic facsimile, one (1) business dayafter having been transmitted to the fax number specified below and the appropriate telephonicconfirmation is received, provided that a copy of such notice, request, demand, claim or othercommunication is promptly thereafter sent in accordance with the provisions of clause (b) or (d) ofthis Section 17 , or (d) if sent through an overnight delivery service in circumstances towhich such service guarantees next day delivery, the day following being so sent:   if to the Company: Matrixx Initiatives, Inc.  Attn: Executive Vice President and General Counsel  8515 East Anderson Drive  Scottsdale AZ 85255  Facsimile: (602) 385-8850   with a copy (which shall Snell & Wilmer L.L.P.not constitute notice) to: Attn: Matthew P. Feeney  One Arizona Center  400 East Van Buren  Phoenix, Arizona 85004-2202  Facsimile: (602) 382-6070if to the Employee:                         Facsimile: (     )      -     or to such other address or addresses as either party may specify in writing from time to time.**18.****COUNTERPARTS**     This Agreement may be executed in several counterparts, each of which shall be deemed to be anoriginal, but all of which together will constitute one and the same instrument.**19.****ENTIRE AGREEMENT**     This Agreement and the Trust Agreement sets forth the entire agreement between the Employeeand the Company concerning the subject matter discussed in this Agreement and supersedes all prioragreements, promises, covenants, arrangements, communications, and representations or warranties,whether written or oral, by any officer, employee, or representative of the Company. Any prioragreements or understandings with respect to the subject matter set forth in this Agreement and theTrust Agreement are hereby terminated and canceled.
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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date set forthabove.      **MATRIXX INITIATIVES, INC.**