**Exhibit 10.8**

** **

**EMPLOYMENT AGREEMENT**

 

This Agreement, iseffective as of the 1st day of June, 2001 (the “Effective Date”),and is by and between NATURE’S SUNSHINE PRODUCTS, INC., a Utah Corporation,having its principal place of business in Provo, Utah (“NSP”), and  the undersigned individual (“Employee”).

 

**RECITALS**

 

WHEREAS, NSP is inthe business of (i) manufacturing and selling numerous consumer productsand services, including but not limited to herbs, vitamins, minerals, healthfoods, food supplements, skin care products and other health-related products,and (ii) distribution of products and services by the method of multilevelmarketing/direct sales distribution; and

 

WHEREAS, both NSPand Employee desire to embody the terms and conditions of Employee’s employmentin a written agreement which shall supersede and revoke any and all prioragreements of employment, whether written or oral.

 

NOW, THEREFORE, inconsideration of the mutual agreements herein contained, the parties herebyagree as follows:

 

**GENERAL PROVISIONS**

 

**1.****            ****Employment: **NSP hereby employs Employee and Employee hereby agreesto serve NSP as its Vice President U.S. Sales and Marketing.  Employee shall devote Employee’s full timeand efforts to NSP during the term of Employee’s employment and shall act withcomplete loyalty to NSP.

 

NSP may assignEmployee such additional or substitute titles and duties as NSP shall determinein its sole discretion.  Employee shallat all times act in a professional manner. Employee shall perform the duties set forth in Exhibit “A”,attached hereto, and such other duties as NSP may specify, in a competent andresponsible manner and to NSP’s reasonable satisfaction.  Employee agrees to abide by the policies andprocedures as may be set forth in handbooks, manuals and other materialsprovided by NSP.

 

**2.****            ****Term: **The term of Employee’s employment shall be twelvemonths, and shall hereinafter be referred to as the “Initial Term.”  The Initial Term shall begin as of theEffective Date.  Unless and untilEmployee’s employment with NSP is terminated by NSP or Employee for any reasonor no reason, at the end of the Initial Term this Agreement shall automaticallybe renewed and extended for additional periods of twelve months each andEmployee’s employment with NSP shall continue during the extended period.

 

**3.****            ****Compensation:**

 

**(a)****          ****Base Salary: **As compensation, NSP shall pay Employee a base salaryof $102,960 per year (“Base Salary”). Base Salary shall be paid according to NSP’s payroll schedule.

 

**(b)****          ****Discretionary Bonus: **Employee shall also be eligible to participate in theexecutive bonus program or any successor program (the “EBP”).  Payment of any bonus under the EBP is in NSP’ssole discretion according to the then current practice and criteria establishedby NSP.

 

**(c)****          ****Employee’s Benefits: **Until Employee’s employment is terminated, Employeeshall be entitled to all standard employee benefits then in effect foremployees of NSP holding comparable titles or positions (the “Benefits”).

 

**(d)****          ****Stock Option:  **In addition to the base salary and bonus provided forin Sections 3(a) and 3(b) above NSP may from time to time grant toEmployee options (the “Options”) to 

 

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purchase shares ofNSP’s common stock (the “Option Stock”), pursuant to the price, terms andconditions set forth in NSP’s 1995 Stock Option Plan, as amended from time totime.

 

**4.****            ****Termination:**

 

**(a)****          ****Discretionary Termination by NSP:** Notwithstanding anything in this Agreement,during the Initial Term and thereafter NSP may terminate Employee’s employmentimmediately for Cause.  NSP may terminateEmployee’s employment at will, subject to this Agreement and NSP’s obligationto pay Severance Pay to Employee as provided in Section 5.

 

**(b)****          ****Discretionary Termination byEmployee:**  Employee may terminate Employee’s employmentby giving NSP at least two weeks’ notice of said resignation.

 

**(c)****          ****Termination for Cause by NSP:** Notwithstanding anything in this Agreement, during the Initial Term andthereafter NSP may terminate Employee’s employment immediately for Cause.  For purposes of this Agreement, “Cause” shallinclude (i) material breach by Employee of this Agreement, (ii) performanceby Employee deemed unsatisfactory to NSP acting reasonably, provided NSP’sexpectations for specific improvement are communicated to Employee in writingwith a ninety (90) day probation period allowed for the requisite improvement, (iii) Employee’sdishonesty or violation of company rules by Employee including thatcertain Confidentiality Agreement by and between NSP and Employee, or (iv) Employee’sconviction of or entrance of a plea of *nolo contendere*to a felony or to any other crime punishable by incarceration.

 

**(d)****          ****Termination upon Death orIncapacity of Employee:**  Employee’s employment with NSPshall, at the exclusive election of NSP, terminate upon the death or Incapacityof Employee.  For purposes of Sections 4and 5, termination of Employee’s employment by reason of Employee’s death orIncapacity shall be considered termination of Employee’s employment by NSP *without* Cause and Employee shall receive the Severance Pay,if any, pursuant to Section 5.

 

**(e)****          ****Definition of Incapacity:** In this Agreement, “Incapacity” shall mean that Employee is for a periodof ninety-five (95) consecutive days or more, unable to perform Employee’sduties effectively, for reasons such as emotional, mental or physical illness,deficiency or disability.  In thisAgreement, if any question arises as to the “Incapacity” of Employee, NSP shallpromptly engage three physicians who are members of the American Medical Associationto examine Employee and determine if Employee is able to perform the duties ofEmployee’s employment with NSP.  In theevent Employee appears to have mental capacity to act, one of said threephysicians shall be selected by Employee, one shall be selected by NSP, and oneshall be selected by the other two physicians. The decision of the three physicians shall be conclusive for allpurposes of this Agreement.

 

**5.****            ****Effect of Termination onCompensation:**

 

**(a)****          ****Discretionary Termination by NSP:** If Employee’s employment is terminated by NSP *withoutCause*, Employee shall be entitled to receive as severance pay (“SeverancePay”) the following:  (i) an amountequal to Base Salary for the three (3) months from the date of termination(the “Severance Pay Period”) and (ii) continuation of any coverage ineffect at the date of termination for Employee and his or her family at NSP’sexpense under NSP’s major medical and life insurance plans during the SeverancePay Period.

 

**(b)****          ****Non-Renewal by NSP Without Cause;Death; Incapacity: **If NSP *withoutCause* does *not* renewEmployee’s employment at the end of the Initial Term, or the end of anyemployment period thereafter, or if Employee’s employment is terminated byreason of Employee’s death or Incapacity, then Employee (or Employee’s estateor designated 

 

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beneficiary, asthe case may be) shall receive Severance Pay during the Severance Pay Period.

 

**(c)****          ****Termination by Employee;Termination or Non-Renewal by NSP For Cause: **IfEmployee’s employment is (i) terminated by Employee, or (ii) terminatedfor Cause or for Cause not renewed by NSP, Employee shall receive only Employee’sBase Salary and the Benefits earned through the date of such termination.

 

**(d)****          ****Payment: **At the option of NSP, Severance Pay may be distributedin a lump sum or in regular biweekly checks over the Severance Pay Period.  Any Severance Pay is subject to requiredpayroll deductions and withholdings.

 

**(e)****          ****Limitation: **Except as provided in this Section 5, Employeeshall not be entitled to any further or other Severance Pay, Base Salary,Benefits, compensation, damages or other amounts.  Employee understands and agrees thatnotwithstanding anything in this Agreement, NSP’s obligation to pay any BaseSalary, benefits or Severance Pay after termination of employment depends uponEmployee’s compliance with the agreements and covenants of Sections 6 through9.  *Except as otherwiseexpressly provided in this Agreement, Employee shall not receive any healthor life insurance coverage after the date of termination, except COBRAbenefits, if any, as and to the extent prescribed by law.*

 

**PROTECTION OF NSP**

 

**6.****            ****Noncompetition andNonsolicitation:**

 

**(a)****          ****Definitions: **In this Section 6, the “Restricted Territory” shallmean the United States and any country where (on the date the noticeterminating Employee’s employment is received) NSP is doing business orplanning to do business within the next year through a subsidiary or jointventure.  In this Section 6, the “RestrictivePeriod” shall mean the period **(i) ***commencing* with the Effective Date, and **(ii) ***ending* one year after the later of (x) the date oftermination of Employee’s employment (whether or not employment is terminatedby NSP or Employee, or for Cause or otherwise), or (y) the date of finalpayment of Severance Pay was paid to Employee (or would have been paid but fora breach of this Agreement by Employee or for Cause termination of Employee’semployment).

 

**(b)****          ****Employee Noncompetition andNonsolicitation Covenants: **Employee hereby covenants and agrees thatEmployee shall not, directly or indirectly, in the Restricted Territory duringthe Restricted Period, do any of the following:

 

**(i)****           **own an interest in (other than less than one percentof a publicly traded company), operate, join, control, participate in or be adistributor, agent, consultant, independent contractor, employee, officer,director, partner, principal or shareholder of *anyindividual, person or entity having ten percent (10%) or more of its grosssales from distribution of herbs and/or vitamins*;

 

**(ii)**           plan for or organize any business which competes orwould compete with *any herb or vitaminproduct of NSP,* or combine with any other employee or representativeof NSP to organize any such competitive business;

 

**(iii)****        **solicit, induce or influence (or seek to induce orinfluence) any person under contract with NSP (including any associate ordistributor of NSP) to terminate or alter his or her relationship with NSP; or

 

**(iv)****         **solicit any customer of NSP where the identity or anysignificant information about such customer was or is Confidential Informationof NSP (as such term is defined in that certain Confidentiality Agreement byand between Employee and NSP).

 

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**(c)****          ****Extension of RestrictivePeriod: **Employee agrees that NSP, in its sole discretion, mayextend the Restrictive Period and the foregoing restrictive covenants in Section 6(b) forup to an additional year.  To do so, NSPmust (i) give Employee at least ninety days prior notice of its intentionto extend the restrictive covenant, and (ii) pay Employee an amount equalto the Base Salary for and during the period of such extension.  Any such payments shall be paid according toNSP’s regular payroll schedule.

 

**(d)****          ****Intentions:** It is the intention of the parties that the foregoing restrictivecovenant be enforced as written, and, in any other event, enforced to thegreatest extent (but to no greater extent) in time, territory and degree ofparticipation as permitted by applicable law.

 

**7.****            ****Non-Disparagement:** Employee hereby also covenants not to disparage, orally or in writing,NSP or its management (including NSP’s products, practices and policies) to anyNSP employee, associate, distributor or member of the public or press.  Employee understands and agrees that Employeemay lose any right to Severance Pay if Employee breaches this covenant not todisparage.

 

**8.****            ****Acknowledgement:** Employee acknowledges that Employee’s covenants and agreements in Sections6 and 7 are reasonable and necessary to protect the legitimate interests andConfidential Information of NSP. Employee acknowledges that Section 6 is not so broad as to preventEmployee from earning a livelihood or practicing Employee’s chosen professionafter termination of Employee’s employment. The parties acknowledge and agree that the compensation and benefitsprovided for under this Agreement are in substantial part consideration forEmployee’s covenants in Sections 6 and 7.

 

**9.****            ****Enforcement: **For any breach of Section 6, 7, 8 or 9, Employeeagrees that NSP is entitled to equitable and other injunctive relief which mayinclude, but shall not be limited to restraining Employee from rendering anyservice or performing or participating in any activity in breach of thisAgreement.  However, no remedy availableunder this Agreement (including this Section 9) is intended to beexclusive of any other remedy, and each and every remedy shall be cumulativeand shall be in addition to every other available remedy or now hereafterexisting at law or in equity, by statute or otherwise.

 

**MISCELLANEOUS**

 

**10.****         ****Entire Agreement: **This Agreement (including the recitalsand Exhibit “A”, attached hereto) sets forth the entire agreement andunderstanding between Employee and NSP and cannot be modified or altered, norcan any provision hereof be waived, except in writing signed by Employee and aduly authorized officer of NSP.

 

**11.****         ****Interpretation: **The Section and other headings inthis Agreement are for reference only and shall not affect the construction ofthis Agreement.  Whenever the contextrequires, the singular shall include the plural, the plural shall include thesingular, and the whole shall include any part thereof.

 

**12.****         ****Invalidity of Provision: **If any provisions in this Agreement areheld invalid, illegal or unenforceable in any respect for any reason, suchinvalid, illegal or unenforceable provision(s) shall be limited, construedor eliminated to the extent necessary to remove such invalidity, illegality orunenforceability and the other provisions of this Agreement shall not beaffected thereby.

 

**13.****         ****Binding Effect: **This Agreement shall inure to the benefitof and be binding upon Employee and Employee’s heirs and personalrepresentatives, and upon NSP and its successors and assigns.  Employee’s covenants and agreements ofSections 6 through 9 shall survive the termination of Employee’s employment byany means, reason or party.

 

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**14.****         ****Waiver: **No waiver of any provision of thisAgreement shall constitute a waiver of any other provision, whether or notsimilar, nor shall any waiver constitute a continuing waiver.

 

**15.****         ****Notice: **Any notice given under this Agreementshall be in writing and shall be sufficient if personally delivered or sent byregistered or certified mail and addressed, if to Employee, to Employee’saddress set forth in NSP’s records, or if to NSP, to its principal office.  Such notice shall be deemed given whendelivered if delivered personally, or, if sent by registered or certified mail,at the earlier of actual receipt or three days after mailing in United Statesmail, addressed as aforesaid with postage prepaid.

 

**16.****         ****Governing Law: **This Agreement shall be governed by thelaws of the State of Utah and any litigation arising out of it shall beconducted in applicable state courts located in Utah County or federal courtslocated in Salt Lake County, Utah.  Theparties expressly consent to such jurisdiction and venue.

 

AGREED TO ANDACCEPTED AS OF THE DATE FIRST ABOVE WRITTEN:

 
| Employee:               | Employer:                                  |
|-------------------------|--------------------------------------------|
|                    |                                       |
| **GREGORY R. HALLIDAY** | **NATURE’S SUNSHINE PRODUCTS,  INC.** |
|                    |                                       |
| \s\ Gregory Halliday    |                                       | By | \s\ Douglas Faggioli |
| Signature               |                                       |
|                    | Name                                       |   |
|                    |                                       |
|                    | Title                                      |   |
|                         |                                            |  |  |  |  |

 

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**EXHIBIT “A”**

**TO**

**EMPLOYMENT AGREEMENT**

**BETWEEN**

**NATURE’S SUNSHINE PRODUCTS, INC.**

**AND**

**GREGORY R. HALLIDAY**

 

**Duties of Employee**

 

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