Document:

exv10w1

 

Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”), dated as of October 10, 2006 is made and entered into by
GREGORY L. PROBERT (“Executive”) and HERBALIFE INTERNATIONAL OF AMERICA, INC., a Nevada corporation
(“Company”). The parties to this Agreement agree as follows:

1. Employment At-Will. The Company and Executive acknowledge and agree that each can
terminate the employment relationship at any time upon written notice to the other, with or without
prior notice, for any reason or for no reason. Executive has received no promise of continued
employment or employment for any specific period of time, and no employee of the Company, including
without limitation the Company’s officers, has the authority to alter the at-will nature of the
employment relationship except in a written employment contract signed by an authorized Company
executive and by Executive.

2. Duties. Executive shall serve in the Los Angeles, California area as President and
Chief Operating Officer of the Company, with all of the authority, duties, and responsibilities
commensurate with such position. Executive shall report only to the Chief Executive Officer or
Chairman of the Company. Executive’s service on any outside board of directors, including any
non-profit board, shall be subject to joint approval by the Chief Executive Officer and the
Company’s Board of Directors (the “Board”); provided, however, the board set forth in Schedule A
attached hereto is deemed approved.

3. Compensation and Related Matters.

(a) Salary. Executive shall receive a salary at the per
annum rate of Seven Hundred Fifty Thousand Dollars ($750,000), payable in accordance with
the Company’s payroll practices for Senior Executives (as defined in Section 3(b) below).
Executive’s salary shall be subject to an annual review and adjustment in the discretion of
the Chief Executive Officer, subject to approval by the Board’s Compensation Committee. In
the event that the Chief Executive Officer’s salary is increased, then Executive’s salary
shall be increased the same percentage; provided, however, that if Executive accepts a
higher percentage increase in base salary than the Chief Executive Officer in any period,
then from that day forward, increases in Executive’s salary will no longer be tied to
increases in the Chief Executive Officer’s salary. Executive’s salary shall be subject to a
reduction of not more than ten percent in the event that the Company adopts an
across-the-board reduction for Senior Executives and the Chief Executive Officer, in which
event such percentage reduction shall not exceed the smallest percentage reduction imposed
on any Senior Executive or the Chief Executive Officer.

(b) Employee Benefits. Executive and Executive’s qualified dependents shall be
entitled to participate in or receive benefits under each benefit plan or arrangement made
available by the Company to its most senior executives (including its President and Chief
Operating Officer but specifically excluding its Chief Executive Officer (“Senior

 

 

Executives”)) including, without limitation, those relating to group medical, dental,
vision, long-term disability, D&O, accidental death and dismemberment, and life insurance,
subject to and on a basis consistent with the terms, conditions and overall administration
of such plans and subject to the Company’s right to modify, amend or terminate any such plan
or arrangement with or without prior notice. Executive shall be eligible to participate in
the Company’s 401K program and the Company’s Deferred Compensation program. Executive shall
be entitled to reimbursement of reasonable business expenses in accordance with the
Company’s practices and procedures. Executive shall be entitled to paid vacation in
accordance with Company policy.

(c) Bonus. If the Company shall achieve the applicable bonus target set annually by
the Board’s Compensation Committee (the “Performance Target”), then the Company shall pay
Executive a cash bonus in an amount equal to one hundred percent (100%) of Executive’s
Target Bonus (as defined below) calculated in accordance with the Company’s then current
bonus plan in effect for its Senior Executives. The Performance Target utilized for
calculating Executive’s bonus shall be the same as that utilized in calculating the primary
bonus (and not the APT bonus) for its Chief Executive Officer. Executive’s “Target Bonus”
shall be in an amount no less than one hundred percent of Executive’s annual salary for the
year with respect to which the bonus is to be paid. Any bonus will be paid following the
completion of the relevant calendar year at such time bonuses are paid to the Company’s
other Senior Executives.

(d) Long-Term Incentives. Executive shall be eligible to participate in the
Company’s long-term incentive plan for Senior Executives, if any. The size, form, and
timing of grants, if any, shall be consistent with competitive practice, internal position
responsibilities, and subject to the joint approval of the Chief Executive Officer and the
Board’s Compensation Committee.

4. Severance.

(a) Although nothing in this Section 4 shall be construed to alter the at-will nature of
employment as set forth in Section 1 above, if Executive is terminated by the Company
without Cause or resigns for Good Reason, Executive will be paid a lump sum amount equal to
two times Executive’s then-current annual salary (the “Salary Severance”), in addition to
all other accrued entitlements such as unpaid salary and accrued vacation, if any. If
Executive is terminated by the Company without Cause or resigns for Good Reason, the Company
will also provide Executive with outplacement services for up to six months by a provider
selected and paid for by the Company in an amount not to exceed $20,000; Executive shall not
be entitled to cash in lieu of outplacement services. If Executive is terminated by the
Company without Cause, resigns for Good Reason, retires, dies, or resigns as a result of a
disability, Executive will be entitled to receive a pro rata bonus payment, at such time
bonuses are paid to the Company’s other Senior Executives, based on the number of months
worked in the applicable fiscal year of the Company (the “Bonus Severance”). Executive will
have no duty to mitigate. As a precondition to the Company’s obligation to pay Executive
severance of two years of salary and a pro rata bonus, Executive agrees to execute and
deliver to the Company a fully effective general release in the form attached to this
Agreement as Attachment A.

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Company shall pay Executive the Salary Severance on the date which is the later of ten days
after the date on which it receives the signed release or six months after the date of
separation from service, and the Company shall pay the Bonus Severance on the date which is
the later of ten days after the date on which it receives the signed release, the date on
which Company pays bonuses to Company’s Senior Executives for the applicable year, or the
date that is six months after the date of separation from service. Executive understands
and agrees that Executive shall not be entitled to any other severance benefit not set forth
in this Section 4, and accordingly Executive expressly acknowledges that the Company will
not be obligated to make 401(k) contributions following the termination of Executive’s
employment.

(b) In the event that Executive is qualified for and elects COBRA coverage under the
Company’s health plans after a termination without Cause or a resignation for Good Reason,
the Company will continue to pay its share of the cost of premiums under such plans until
Executive is reemployed, or for a period of two years, whichever occurs first. Upon a
termination for Cause and upon a resignation without Good Reason (other than due to death,
disability or retirement), except as set forth in Section 4(a) above and/or one or more
separate written agreements between Company and Executive, all unearned compensation,
benefits and unvested options shall be forfeited.

(c) If Executive is terminated by the Company without Cause or resigns for Good Reason, and
on the effective date of such termination Executive is subject to a “trading blackout” or
“quiet period” with respect to the Company’s common shares or if the Company determines,
upon the advice of legal counsel, that on the effective date of such termination Executive
may not to trade in the Company’s common shares due to Executive’s possession of material
non-public information, in each case, which restriction or prohibition continues for a
period of at least twenty consecutive calendar days, Executive will be paid an additional
lump sum amount equal to $250,000 (the “Blackout Period Severance”). Company shall pay
Executive the Blackout Period Severance on the same date that the Salary Severance is paid.

(d) For purposes of this Agreement, the Company shall have “Cause” to terminate the
Executive’s services in the event of any of the following acts or circumstances: (i)
Executive’s conviction of a felony or entering a plea of guilty or nolo contendere to any
crime constituting a felony (other than a traffic violation or by reason of vicarious
liability); (ii) Executive’s substantial and repeated failure to attempt to perform
Executive’s lawful duties as contemplated in Section 2 of this Agreement, except during
periods of physical or mental incapacity; (iii) Executive’s gross negligence or willful
misconduct with respect to any material aspect of the business of the Company or any of its
affiliates, which gross negligence or willful misconduct has a material and demonstrable
adverse effect on the Company; (iv) Executive’s material violation of a Company policy
resulting in a material and demonstrable adverse effect to the Company or an affiliate,
including but not limited to a violation of the Company’s Code of Business Conduct and
Ethics; or (v) any material breach of this Agreement or any material breach of any other
written agreement between Executive and the Company’s affiliates governing Executive’s
equity compensation arrangements (i.e., any agreement with respect to Executive’s stock
and/or stock options of any of the Company’s affiliates);

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provided, however, that Executive shall not be deemed to have been terminated for Cause in
the case of clause (ii), (iii), (iv) or (v) above, unless any such breach is not fully
corrected prior to the expiration of the thirty (30) calendar day period following delivery
to Executive of the Company’s written notice of its intention to terminate his employment
for Cause describing the basis therefore in reasonable detail.

(e) Executive will be deemed to have a “Good Reason” if Executive terminates his employment
because of (i) a material diminution of Executive’s duties as President and Chief Operating
Officer, (ii) the failure by any successor of the Company to assume in writing the Company’s
obligations under this Agreement, (iii) the breach by the Company in any respect of any of
its obligations under this Agreement, and, in any such case (but only if correction or cure
is possible), the failure by the Company to correct or cure the circumstance or breach on
which such resignation is based within 30 days after receiving notice from Executive
describing such circumstance or breach in reasonable detail, (iv) the relocation of
Executive’s primary office location of more than 50 miles that places the primary office
farther from Executive’s residence than it was before, or (v) the imposition by the Company
of a requirement that Executive report to a person other than the Chief Executive Officer of
the Company or the Chairman of the Board. Executive shall not have a Good Reason to resign
if the Company suspends Executive due to an indictment of Executive on felony charges,
provided that the Company continues to pay Executive’s salary and benefits. No Salary
Severance is payable after Executive turns age 65, regardless of whether Executive has a
Good Reason for resignation and regardless whether the Company has Cause to terminate
Executive.

5. Adjustment to Payments Triggering Excise Tax. In the event that any amount or benefit
that may be paid or otherwise provided to or in respect of the Executive by the Company or any
affiliated company, whether pursuant to this Agreement or otherwise (collectively, “Covered
Payments”), is or may become subject to the tax imposed under Section 4999 of the Internal Revenue
Code of 1986, as amended (or any successor provision) (“Excise Tax”), the Company shall pay to the
Executive a “Reimbursement Amount,” defined as an amount, which when added to the Covered Payments
and after taking into account any federal, state or local tax resulting from the Covered Payment
and the Reimbursement Amount will provide Executive with after tax net income equal to the amount
Executive would have earned had no Excise Tax been imposed on the Covered Payments.

6. Confidential and Proprietary Information.

(a) The parties agree and acknowledge that during the course of Executive’s employment,
Executive will be given and will have access to and be exposed to trade secrets and
confidential information in written, oral, electronic and other forms regarding the Company
and its affiliates (which includes but is not limited to all of its business units,
divisions and affiliates) and their business, equipment, products and employees, including,
without limitation: the identities of the Company’s and its affiliates’ distributors and
customers and potential distributors and customers (hereinafter referred to collectively as
“Distributors”), including, without limitation, the identity of Distributors that Executive
cultivates or maintains while providing services at the Company or any of its affiliates
using the Company’s or any of its affiliates’ products,

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name and infrastructure, and the identities of contact persons with respect to those
Distributors; the particular preferences, likes, dislikes and needs of those Distributors
and contact persons with respect to product types, pricing, sales calls, timing, sales
terms, rental terms, lease terms, service plans, and other marketing terms and techniques;
the Company’s and its affiliates’ business methods, practices, strategies, forecasts,
pricing, and marketing techniques; the identities of the Company’s and its affiliates’
licensors, vendors and other suppliers and the identities of the Company’s and its
affiliates’ contact persons at such licensors, vendors and other suppliers; the identities
of the Company’s and its affiliates’ key sales representatives and personnel and other
employees; advertising and sales materials; research, computer software and related
materials; and other facts and financial and other business information concerning or
relating to the Company or any of its affiliates and their business, operations, financial
condition, results of operations and prospects. Executive expressly agrees to use such
trade secrets and confidential information only for purposes of carrying out his duties for
the Company and its affiliates as he deems appropriate in his good faith judgment, and not
for any other purpose, including, without limitation, not in any way or for any purpose that
could reasonably be foreseen to be detrimental to the Company or any of its affiliates;
provided, Executive shall be permitted to disclose such trade secrets and confidential
information to third parties in the course of performing his duties for the Company and its
affiliates as he deems appropriate in his good faith judgment provided that prior to such
disclosure Executive causes the intended recipient of such information to sign a
confidentiality agreement. Executive shall not at any time, either during the course of his
employment hereunder or after the termination of such employment, use for himself or others,
directly or indirectly, any such trade secrets or confidential information, and, except as
required by law or as permitted hereunder, Executive shall not disclose such trade secrets
or confidential information, directly or indirectly, to any other person or entity. Trade
secret and confidential information hereunder shall not include any information which (i) is
already in or subsequently enters the public domain, other than as a result of any
unauthorized direct or indirect disclosure by Executive, (ii) becomes available to Executive
on a non-confidential basis from a source other than the Company or any of its affiliates,
provided that Executive has no knowledge that such source is subject to a confidentiality
agreement or other obligation of secrecy or confidentiality (whether pursuant to a contract,
legal or fiduciary obligation or duty or otherwise) to the Company or any of its affiliates
or any other person or entity or (iii) is approved for release by the Chief Executive
Officer or the board of directors of the Company or any of its affiliates or which the Chief
Executive Officer or the board of directors of the Company or any of its affiliates makes
available or authorizes Executive to make available to third parties without an obligation
of confidentiality.

(b) All physical property and all notes, memoranda, files, records, writings, documents and
other materials of any and every nature, written or electronic, which Executive shall
prepare or receive in the course of his employment with the Company and which relate to or
are useful in any manner to the business now or hereafter conducted by the Company or any of
its affiliates are and shall remain the sole and exclusive property of the Company and its
affiliates, as applicable. Executive shall not remove from the Company’s premises any such
physical property, the original or any reproduction of any such materials nor the
information contained therein except for the

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purposes of carrying out his duties to the Company or any of its affiliates and all such
property (except for any items of personal property not owned by the Company or any of its
affiliates), materials and information in his possession or under his custody or control
upon the termination of his employment (other than such materials received by Executive
solely in his capacity as a shareholder) or at any other time upon request by the Company
shall be immediately turned over to the Company and its affiliates, as applicable.

(c) All inventions, improvements, trade secrets, reports, manuals, computer programs, tapes
and other ideas and materials developed or invented by Executive during the period of his
employment, either solely or in collaboration with others, which relate to the actual or
anticipated business or research of the Company or any of its affiliates which result from
or are suggested by any work Executive may do for the Company or any of its affiliates or
which result from use of the Company’s or any of its affiliates’ premises or property
(collectively, the “Developments”) shall be the sole and exclusive property of the Company
and its affiliates, as applicable. Executive assigns and transfers to the Company his entire
right and interest in any such Development, and Executive shall execute and deliver any and
all documents and shall do and perform any and all other acts and things necessary or
desirable in connection therewith that the Company or any of its affiliates may reasonably
request, it being agreed that the preparation of any such documents shall be at the
Company’s expense. Nothing in this paragraph applies to an invention which qualifies fully
under the provisions of California Labor Code Section 2870.

(d) Following the termination of Executive’s employment, Executive will reasonably cooperate
with the Company (at the Company’s expense, if Executive reasonably incurs any out-of-pocket
costs with respect thereto, including, but not limited to, lost salary or the value of
vacation benefits used in connection therewith) in any defense of any legal, administrative
or other action in which the Company or any of its affiliates or any of their distributors
or other business relations are a party or are otherwise involved, so long as any such
matter was related to Executive’s duties and activities conducted on behalf of the Company
or its Subsidiaries.

(e) The provisions of this Section 6 and Section 7 shall survive any termination of this
Agreement and termination of Executive’s employment with the Company.

7. Non-Solicitation. Executive acknowledges that in the course of his employment for the
Company he will become familiar with the Company’s and its affiliates’ trade secrets and other
confidential information concerning the Company and its affiliates. Accordingly, Executive agrees
that, during Executive’s employment and for a period of twenty-four (24) months immediately
thereafter (the “Nonsolicitation Period”), he will not directly or indirectly through another
entity unlawfully (i) induce or attempt to induce any employee or Distributor of the Company or any
of its affiliates to leave the employment of, or cease to maintain its distributor relationship
with, the Company or such affiliate, or in any way interfere with the relationship between the
Company or any such affiliate and any employee or Distributor thereof, (ii) hire any person who was
an employee of the Company or any of its affiliates at any time during the Nonsolicitation Period
unless such person’s employment was terminated by the Company or such affiliate or enter into a
distributor relationship with any person or entity who was a Distributor of

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the Company or any of its affiliates at any time during the Nonsolicitation Period, (iii) induce or
attempt to induce any Distributor, supplier, licensor, licensee or other business relation of the
Company or any of its affiliates to cease doing business with the Company or such affiliate, or in
any way interfere with the relationship between such Distributor, supplier, licensor, licensee or
business relation and the Company or any of its affiliates or (iv) use any trade secrets or other
confidential information of the Company or any of its affiliates to directly or indirectly
participate in any means or manner in any business which is a direct competitor of the Company.

8. Non-Disparagement. During Executive’s employment and thereafter, Executive agrees not
to make any derogatory, negative or disparaging public statement about the Company, its officers,
its employees, or members of its Board, or to make any public statement (or any statement likely to
become public) that could reasonably be expected to adversely affect or disparage the reputation,
or, to the extent applicable, business or goodwill of the Company, it being agreed and understood
that nothing herein shall prohibit Executive (a) from disclosing that Executive is no longer
employed by the Company, (b) from responding truthfully to any governmental investigation or
inquiry related thereto, whether by the Securities and Exchange Commission or other governmental
entity or any other law, subpoena, court order or other compulsory legal process or any disclosure
requirement of the Securities and Exchange Commission, or (c) from making traditional competitive
statements in the course of promoting a competing business, so long as any statements made by
Executive described in this clause (c) are not based on confidential information obtained during
the course of Executive’s employment with the Company. The Company agrees that it will not make any
derogatory, negative or disparaging public statements about Executive that are untruthful in any
authorized Company statement (whether written or oral), including, but not limited to, any press
release or public announcement.

9. Injunctive Relief. Executive and the Company (a) intend that the provisions of Sections
6 and 7 be and become valid and enforceable, (b) acknowledge and agree that the provisions of
Sections 6 and 7 are reasonable and necessary to protect the legitimate interests of the business
of the Company and its affiliates and (c) agree that any violation of Section 6 or 7 might result
in irreparable injury to the Company and its affiliates, the exact amount of which would be
difficult to ascertain and the remedies at law for which may not be reasonable or adequate
compensation to the Company and its affiliates for such a violation. Accordingly, Executive agrees
that if Executive violates or threatens to violate the provisions of Section 6 or 7, in addition to
any other remedy which may be available at law or in equity, the Company shall be entitled to seek
specific performance and injunctive relief, and without the necessity of proving actual damages. In
addition, in the event of a violation or threatened violation by Executive of Section 6 or 7 of
this Agreement, the Nonsolicitation Period will be tolled until such violation or threatened
violation has been duly cured. If, at the time of enforcement of Sections 6 or 7 of this Agreement,
a court holds that the restrictions stated therein are unreasonable under circumstances then
existing, the parties hereto agree that the maximum period, scope or geographical area reasonable
under such circumstances shall be substituted for the stated period, scope or area.

10. Indemnification. The Company shall indemnify Executive to the fullest extent permitted
by applicable law as more fully described in the Indemnification Agreement between the Company and
the Executive; in the event that California law is deemed to apply and to permit

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the Company to provide more indemnification to Executive for the matters described in the
Indemnification Agreement, the Company agrees to provide such indemnification to the fullest extent
permitted under California law.

11. Assignment: Successors and Assigns. Executive agrees that he shall not assign, sell,
transfer, delegate or otherwise dispose of, whether voluntarily or involuntarily, any rights or
obligations under this Agreement, nor shall Executive’s rights hereunder be subject to encumbrance
of the claims of creditors. This Agreement may be assigned by the Company without the consent of
Executive to (a) any entity succeeding to all or substantially all of the assets or business of the
Company, whether by merger, consolidation, acquisition or otherwise (upon which entity the
Agreement shall be binding), or (b) any affiliate; provided, however, that in neither case shall
the Company be released from its obligations hereunder, nor shall any assignment to an affiliate
lessen the Executive’s rights with respect to his position, duties, responsibilities or authority
with respect to the Company.

12. Governing Law: Jurisdiction and Venue. This Agreement shall be governed, construed,
interpreted and enforced in accordance with the substantive laws of the State of California without
regard to the conflicts of law principles thereof. Suit to enforce this Agreement or any provision
or portion thereof may be brought in the federal or state courts located in Los Angeles,
California.

13. Severability of Provisions. In the event that any provision of this Agreement should
ever be adjudicated by a court of competent jurisdiction to be unenforceable, then such provision
shall be deemed reformed to the maximum extent permitted by applicable law, and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of any other
provision of this Agreement.

14 Warranty. As an inducement to the other party to enter into this Agreement, subject to
the termination of Executive’s Employment Agreement as set forth in paragraph 17 below, each party
represents and warrants to the other that it/he has the power and authority to enter into this
Agreement and is not a party to any other agreement or obligation, and that there exists no
impediment or restraint, contractual or otherwise, on its/his power, right or ability to enter into
this Agreement and to perform its/his duties and obligations hereunder.

15. Notices. All notices, requests, demands and other communications which are required or
may be given under this Agreement shall be in writing and shall be deemed to have been duly given
when received if personally delivered; when transmitted if transmitted by telecopy, electronic or
digital transmission method upon receipt of telephonic or electronic confirmation; the day after it
is sent, if sent for next day delivery to a domestic address by recognized overnight delivery
service (e.g., Federal Express); and upon receipt, if sent by certified or registered mail, return
receipt requested. In each case notice will be sent to:

	 	(a)	 	If to the Company:

Herbalife International of America, Inc.

1800 Century Park East

Los Angeles, California 90067

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       Attention: Members of the Compensation Committee of the Board of Directors

Telecopy: (310) 557-3906

with a copy to:

Herbalife International of America, Inc.

1800 Century Park East

Los Angeles, California 90067

Attention: Chief Executive Officer

Telecopy: (310) 557-3906

	 	(b)	 	if to Executive, to:

Gregory L. Probert

1440 St. Albans Rd.

San Marino, California 91108

with a copy to:

Cathy J. Frankel, Esq.

Moses & Singer LLP

1301 Avenue of the Americas

New York, New York 10019-6076

or to such other place and with other copies as either party may designate as to itself or himself
by written notice to the others.

16. Counterparts. This Agreement may be executed in several counterparts, each of which
will be deemed to be an original, but all of which together shall constitute one and the same
Agreement.

17. Entire Agreement. The terms of this Agreement are intended by the parties to be the
final expression of their agreement with respect to the subject matter hereof and this Agreement
supersedes (and may not be contradicted by, modified or supplemented by) any prior or
contemporaneous agreement, written or oral, with respect thereto, including but not limited to the
Employment Agreement between the parties dated July 31, 2003 (which Employment Agreement shall be
deemed terminated as of the date of this Agreement), but with the exception of the Non-Statutory
Stock Option Agreement dated July 31, 2003, as amended effective as of December 30, 2003,
Non-Statutory Stock Option Agreement dated September 1, 2004, Stock Option Agreement dated December
1, 2004, Stock Option Agreement dated April 27, 2005, Stock Appreciation Right Award Agreement
dated March 23, 2006, Stock Unit Award Agreement dated March 23, 2006, Stock Unit Award Agreement
dated October 10, 2006, Shareholders’ Agreement dated July 31, 2002, and the Indemnification
Agreement. The parties further intend that this Agreement shall constitute the complete and
exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any
judicial, administrative, or other legal proceeding to vary the terms of this Agreement.

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18. Amendments: Waivers. This Agreement may not be modified or amended except by an
instrument in writing, signed by Executive and a duly authorized representative of the Company. No
waiver of any of the provisions of this Agreement, whether by conduct or otherwise, in any one or
more instances, shall be deemed to be construed as a further, continuing, or subsequent waiver of
any such provision or as a waiver of any other provision of this Agreement. No failure to exercise
and no delay in exercising any right, remedy or power hereunder shall preclude any other or further
exercise of any other right, remedy, or power provided herein or by law or in equity.

19. Representation of Counsel: Mutual Negotiation. Each party has had the opportunity to
be represented by counsel of its choice in negotiating this Agreement. This Agreement shall
therefore be deemed to have been negotiated and prepared at the joint request, direction and
construction of the parties, at arm’s-length, with the advice and participation of counsel, and
shall be interpreted in accordance with its terms without favor to any party.

20. Surviving Terms. The provisions of Sections 4(a), 4 (b), 5, 6, 7, 8 and 10 shall
survive the termination or expiration of this Agreement.

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

	 	 	 	 	 
	 

	 	EXECUTIVE	 	 
	 	 	 	 	 
	 
	 	/s/ Gregory L. Probert	 	 
	 

	 	 	 	 
	 

	 	By: Gregory L. Probert	 	 
	 
	 	 	 	 
	 

	 	HERBALIFE INTERNATIONAL OF AMERICA, INC.	 	 
	 	 	 	 	 
	 
	 	/s/ Michael O. Johnson	 	 
	 

	 	 	 	 
	 

	 	By: Michael O. Johnson	 	 
	 

	 	Title: Chief Executive Officer	 	 

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ATTACHMENT A

Agreement and General Release

Agreement and General Release (“AGREEMENT”), by and among GREGORY L. PROBERT (“EXECUTIVE” and
referred to herein as “you”) and HERBALIFE INTERNATIONAL OF AMERICA, INC., a Nevada corporation
(the “COMPANY”).

1. In exchange for your waiver of claims against the Company Entities (as defined below) and
compliance with other terms and conditions of this Agreement, upon the effectiveness of this
Agreement, the Company agrees to provide you with the payments and benefits provided in Section 4
of your Employment Agreement with the Company.

2. (a) In consideration for the payments and benefits to be provided to you pursuant to paragraph 1
above, you, for yourself and for your heirs, executors, administrators, trustees, legal
representatives, and assigns (hereinafter referred to collectively as “RELEASORS”), FOREVER RELEASE
AND DISCHARGE THE Company and its past, present and future parent entities, subsidiaries,
divisions, affiliates and related business entities, successors and assigns, assets, employee
benefit plans or funds (including, without limitation, each of Whitney & Co., LLC, Golden Gate
Private Equity, Inc., any investment fund managed by either of them and any affiliate of any of the
aforementioned persons or entities), and any of its or their respective past, present and/or future
directors, officers, fiduciaries, agents, trustees, administrators, employees and assigns, whether
acting on behalf of the Company or in their individual capacities (collectively the “COMPANY
ENTITIES”) from any and all claims, suits, demands, causes of action, covenants, obligations,
debts, costs, expenses, fees and liabilities of any kind whatsoever in law or equity, by statute or
otherwise, whether known or unknown, vested or contingent, suspected or unsuspected and whether or
not concealed or hidden (collectively, the “CLAIMS”), which you ever had, now have, or may have
against any of the Company Entities by reason of any act, omission, transaction, practice, plan,
policy, procedure, conduct, occurrence, or other matter related in any way to your employment by
(including, but not limited to, termination thereof) the Company Entities up to and including the
date on which you sign this Agreement, except as provided in subsection (c) below.

     (b) Without limiting the generality of the foregoing, this Agreement is intended to and shall
release the Company Entities from any and all claims, whether known or unknown, which Releasors
ever had, now have, or may have against the Companies Entities arising out of your employment or
termination thereof, including, but not limited to: (i) any claim under the Age Discrimination in
Employment Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the
Employee Retirement Income Security Act of 1974,(excluding claims for accrued, vested benefits
under any employee benefit or pension plan of the Company Entities subject to the terms and
conditions of such plan and applicable law), the Family and Medical Leave Act, the Worker
Adjustment and Retraining Notification Act of 1988, or the Fair Labor Standards Act of 1938, in
each case as amended; (ii) any claim under the California Fair Employment and Housing Act, the
California Labor Code, the California Family Rights Act, or the California pregnancy Disability
Leave Law; (iii) any other claim (whether based on federal, state, or local law (statutory or
decisional), rule, regulation or ordinance)

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relating to or arising out of your employment, the terms and conditions of such employment, the
termination of such employment, including, but not limited to, breach of contract (express or
implied), wrongful discharge, detrimental reliance, defamation, emotional distress or compensatory
or punitive damages; and (iv) any claim for attorneys’ fees, costs, disbursements and/or the like.

     (c) Notwithstanding the foregoing, nothing in this Agreement shall be a waiver of claims: (1)
that may arise after the date on which you sign this Agreement; (2) with respect to your right to
enforce your rights that survive termination under the Employment Agreement or any other written
agreement entered into between you and the Company (including, without limitation, any agreements
granting you any stock units, stock appreciation rights, stock options or any other equity grants
or equivalents); (3) regarding rights of indemnification, receipt of legal fees and directors and
officers liability insurance to which you are entitled under the Employment Agreement, the
Company’s Certificate of Incorporation or By-laws, pursuant to any separate writing between you and
the Company or pursuant to applicable law; (4) relating to any claims for accrued, vested benefits
under any employee benefit plan or pension plan of the Company Entities subject to the terms and
conditions of such plan and applicable law; or (5) as a stockholder or optionholder of the Company.

     (d) In signing this Agreement, you acknowledge that you intend that this Agreement shall be
effective as a bar to each and every one of the Claims hereinabove mentioned or implied. You
expressly consent that this Agreement shall be given full force and effect according to each and
all of its express terms and provisions, including those relating to unknown, unsuspected or
unanticipated Claims (notwithstanding any state statute that expressly limits the effectiveness of
a general release of unknown, unsuspected or unanticipated Claims), if any, as well as those
relating to any other claims hereinabove mentioned or implied. You acknowledge and agree that this
waiver is an essential and material term of this Agreement, and if you bring your own Claim in
which you seek damages against any Company Entity, or if you seek to recover against any Company
Entity in any Claim brought by a governmental agency on your behalf, the release set forth in this
Agreement shall serve as a complete defense to such Claims, and you shall reimburse each Company
Entity for any attorneys’ fees or expense or other fees and expense incurred in defending such
Claim; provided, however, if a class action claim or governmental claim is brought on your behalf,
your obligations will be limited to (i) opting out of such action or other proceedings received in
connection therewith to the Company, it being agreed that you shall not be liable to the Company
for any attorneys’ fees or expense or other fees or expenses in the case of any such class action
claim or governmental claim.

     (e) Without limiting the generality of the foregoing, you waive all rights under California
Civil Code Section 1542, which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER
MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

12

 

3. (a) This Agreement is not intended, and shall not be construed, as an admission that any of the
Company Entities has violated any federal, state or local law (statutory or decisional), ordinance
or regulation, breached any contract or committed any wrong whatsoever against you.

     (b) Should any provision of this Agreement require interpretation or construction, it is
agreed by the parties that the entity interpreting or constructing this Agreement shall not apply a
presumption against one party by reason of the rule of construction that a document is to be
construed more strictly against the party who prepared the document.

4. For two years from and after the date of your employment termination, you agree not to make any
derogatory, negative or disparaging public statement about any Company Entity, or to make any
public statement (or any statement likely to become public) that could reasonably be expected to
adversely affect or disparage the reputation, or, to the extent applicable, business or goodwill of
any Company Entity, it being agreed and understood that nothing herein shall prohibit you (a) from
disclosing that you are no longer employed by the Company, (b) from responding truthfully to any
governmental investigation or inquiry related thereto, whether by the Securities and Exchange
Commission or other governmental entity or any other law, subpoena, court order or other compulsory
legal process or any disclosure requirement of the Securities and Exchange Commission, or (c) from
making traditional competitive statements in the course of promoting a competing business, so long
as any statements made by you described in this clause (c) are not based on confidential
information obtained during the course of your employment with the Company. The Company agrees that
it will not make any derogatory, negative or disparaging public statement about you in an
authorized press release or authorized public announcement.

5. This Agreement is binding upon, and shall inure to the benefit of, the parties and their
respective heirs, executors, administrators, successors and assigns.

6. This Agreement shall be construed and enforced in accordance with the laws of the State of
California applicable to agreements made and to be performed entirely within such State.

7. You acknowledge that your obligations pursuant to Sections 6, 7 and 8 of the Employment
Agreement survive the termination of your employment in accordance with the terms thereof. The
Company acknowledges that its obligations under Sections 4(a), 4(b), 5, 8 and 10 of the Employment
Agreement survive the termination of your employment in accordance with the terms thereof.

8. You acknowledge that you: (a) have carefully read this Agreement in its entirety; (b) have had
an opportunity to consider for at least twenty-one (21) days the terms of this Agreement; (c) are
hereby advised by the Company in writing to consult with an attorney of your choice in connection
with this Agreement; (d) fully understand the significance of all of the terms and conditions of
this Agreement and have discussed them with your independent legal counsel, or have had a
reasonable opportunity to do so; (e) have had answered to your satisfaction by your independent
legal counsel any questions you have asked with regard to the meaning and significance of any of
the provisions of this Agreement; and (f) are signing this Agreement voluntarily and of your own
free will and agree to abide by all the terms and conditions contained herein.

13

 

9. You understand that you will have at least twenty-one (21) days from the date of receipt of this
Agreement to consider the terms and conditions of this Agreement. You may accept this Agreement by
signing it and returning it to the Company’s Chief Executive Officer at the address specified
pursuant to Section 15 of the Employment Agreement. After executing this Agreement, you shall have
seven (7) days (the “REVOCATION PERIOD”) to revoke this Agreement by indicating your desire to do
so in writing delivered to the Chief Executive Officer at the address above by no later than 5:00
p.m. on the seventh (7th) day after the date you sign this Agreement. The effective date of this
Agreement shall be the eighth (8th) day after you sign the Agreement (the “AGREEMENT EFFECTIVE
DATE”). If the last day of the Revocation Period falls on a Saturday, Sunday or holiday, the last
day of the Revocation Period will be deemed to be the next business day. In the event you do not
accept this Agreement as set forth above, or in the event you revoke this Agreement during the
Revocation Period, this Agreement, including but not limited to the obligation of the Company to
provide the payments and benefits provided in paragraph 1 above, shall be deemed automatically null
and void.

	 	 	 	 	 	 	 
	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Gregory L. Probert	 	 
	 
	 	 	 	 	 	 
	 	 	HERBALIFE INTERNATIONAL OF AMERICA, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

14exv10w2

 

Exhibit 10.2

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”), dated as of October 10, 2006 is made and entered into by
BRETT R. CHAPMAN (“Executive”) and HERBALIFE INTERNATIONAL OF AMERICA, INC., a Nevada corporation
(“Company”). The parties to this Agreement agree as follows:

1. Employment At-Will. The Company and Executive acknowledge and agree that each can
terminate the employment relationship at any time upon written notice to the other, with or without
prior notice, for any reason or for no reason. Executive has received no promise of continued
employment or employment for any specific period of time, and no employee of the Company, including
without limitation the Company’s officers, has the authority to alter the at-will nature of the
employment relationship except in a written employment contract signed by an authorized Company
executive and by Executive.

2. Duties. Executive shall serve in the Los Angeles, California area as General Counsel of
the Company, with all of the authority, duties, and responsibilities commensurate with such
position. Executive shall report only to the Chief Executive Officer or Chairman of the Company.
Executive’s service on any outside board of directors, including any non-profit board, shall be
subject to joint approval by the Chief Executive Officer and the Company’s Board of Directors (the
“Board”); provided, however, the board set forth in Schedule A attached hereto is deemed approved.

3. Compensation and Related Matters.

(a) Salary. Executive shall receive a salary at the per
annum rate of Five Hundred Thousand Dollars ($500,000), payable in accordance with the
Company’s payroll practices for Senior Executives (as defined in Section 3(b) below).
Executive’s salary shall be subject to an annual review and adjustment in the discretion of
the Chief Executive Officer, subject to approval by the Board’s Compensation Committee. In
the event that the Chief Executive Officer’s salary is increased, then Executive’s salary
shall be increased the same percentage; provided, however, that if Executive accepts a
higher percentage increase in base salary than the Chief Executive Officer in any period,
then from that day forward, increases in Executive’s salary will no longer be tied to
increases in the Chief Executive Officer’s salary. Executive’s salary shall be subject to a
reduction of not more than ten percent in the event that the Company adopts an
across-the-board reduction for Senior Executives and the Chief Executive Officer, in which
event such percentage reduction shall not exceed the smallest percentage reduction imposed
on any Senior Executive or the Chief Executive Officer.

(b) Employee Benefits. Executive and Executive’s qualified dependents shall be
entitled to participate in or receive benefits under each benefit plan or arrangement made
available by the Company to its most senior executives (including its President and Chief
Operating Officer but specifically excluding its Chief Executive Officer (“Senior

 

 

Executives”)) including, without limitation, those relating to group medical, dental,
vision, long-term disability, D&O, accidental death and dismemberment, and life insurance,
subject to and on a basis consistent with the terms, conditions and overall administration
of such plans and subject to the Company’s right to modify, amend or terminate any such plan
or arrangement with or without prior notice. Executive shall be eligible to participate in
the Company’s 401K program and the Company’s Deferred Compensation program. Executive shall
be entitled to reimbursement of reasonable business expenses in accordance with the
Company’s practices and procedures. Executive shall be entitled to paid vacation in
accordance with Company policy.

(c) Bonus. If the Company shall achieve the applicable bonus target set annually by
the Board’s Compensation Committee (the “Performance Target”), then the Company shall pay
Executive a cash bonus in an amount equal to one hundred percent (100%) of Executive’s
Target Bonus (as defined below) calculated in accordance with the Company’s then current
bonus plan in effect for its Senior Executives. The Performance Target utilized for
calculating Executive’s bonus shall be the same as that utilized in calculating the primary
bonus (and not the APT bonus) for its Chief Executive Officer. Executive’s “Target Bonus”
shall be in an amount no less than fifty percent of Executive’s annual salary for the year
with respect to which the bonus is to be paid. Any bonus will be paid following the
completion of the relevant calendar year at such time bonuses are paid to the Company’s
other Senior Executives.

(d) Long-Term Incentives. Executive shall be eligible to participate in the
Company’s long-term incentive plan for Senior Executives, if any. The size, form, and
timing of grants, if any, shall be consistent with competitive practice, internal position
responsibilities, and subject to the joint approval of the Chief Executive Officer and the
Board’s Compensation Committee.

4. Severance.

(a) Although nothing in this Section 4 shall be construed to alter the at-will nature of
employment as set forth in Section 1 above, if Executive is terminated by the Company
without Cause or resigns for Good Reason, Executive will be paid a lump sum amount equal to
two times Executive’s then-current annual salary (the “Salary Severance”), in addition to
all other accrued entitlements such as unpaid salary and accrued vacation, if any. If
Executive is terminated by the Company without Cause or resigns for Good Reason, the Company
will also provide Executive with outplacement services for up to six months by a provider
selected and paid for by the Company in an amount not to exceed $20,000; Executive shall not
be entitled to cash in lieu of outplacement services. If Executive is terminated by the
Company without Cause, resigns for Good Reason, retires, dies, or resigns as a result of a
disability, Executive will be entitled to receive a pro rata bonus payment, at such time
bonuses are paid to the Company’s other Senior Executives, based on the number of months
worked in the applicable fiscal year of the Company (the “Bonus Severance”). Executive will
have no duty to mitigate. As a precondition to the Company’s obligation to pay Executive
severance of two years of salary and a pro rata bonus, Executive agrees to execute and
deliver to the Company a fully effective general release in the form attached to this
Agreement as Attachment A.

2

 

Company shall pay Executive the Salary Severance on the date which is the later of ten days
after the date on which it receives the signed release or six months after the date of
separation from service, and the Company shall pay the Bonus Severance on the date which is
the later of ten days after the date on which it receives the signed release, the date on
which Company pays bonuses to Company’s Senior Executives for the applicable year, or the
date that is six months after the date of separation from service. Executive understands
and agrees that Executive shall not be entitled to any other severance benefit not set forth
in this Section 4, and accordingly Executive expressly acknowledges that the Company will
not be obligated to make 401(k) contributions following the termination of Executive’s
employment.

(b) In the event that Executive is qualified for and elects COBRA coverage under the
Company’s health plans after a termination without Cause or a resignation for Good Reason,
the Company will continue to pay its share of the cost of premiums under such plans until
Executive is reemployed, or for a period of two years, whichever occurs first. Upon a
termination for Cause and upon a resignation without Good Reason (other than due to death,
disability or retirement), except as set forth in Section 4(a) above and/or one or more
separate written agreements between Company and Executive, all unearned compensation,
benefits and unvested options shall be forfeited.

(c) If Executive is terminated by the Company without Cause or resigns for Good Reason, and
on the effective date of such termination Executive is subject to a “trading blackout” or
“quiet period” with respect to the Company’s common shares or if the Company determines,
upon the advice of legal counsel, that on the effective date of such termination Executive
may not to trade in the Company’s common shares due to Executive’s possession of material
non-public information, in each case, which restriction or prohibition continues for a
period of at least twenty consecutive calendar days, Executive will be paid an additional
lump sum amount equal to $100,000 (the “Blackout Period Severance”). Company shall pay
Executive the Blackout Period Severance on the same date that the Salary Severance is paid.

(d) For purposes of this Agreement, the Company shall have “Cause” to terminate the
Executive’s services in the event of any of the following acts or circumstances: (i)
Executive’s conviction of a felony or entering a plea of guilty or nolo contendere to any
crime constituting a felony (other than a traffic violation or by reason of vicarious
liability); (ii) Executive’s substantial and repeated failure to attempt to perform
Executive’s lawful duties as contemplated in Section 2 of this Agreement, except during
periods of physical or mental incapacity; (iii) Executive’s gross negligence or willful
misconduct with respect to any material aspect of the business of the Company or any of its
affiliates, which gross negligence or willful misconduct has a material and demonstrable
adverse effect on the Company; (iv) Executive’s material violation of a Company policy
resulting in a material and demonstrable adverse effect to the Company or an affiliate,
including but not limited to a violation of the Company’s Code of Business Conduct and
Ethics; or (v) any material breach of this Agreement or any material breach of any other
written agreement between Executive and the Company’s affiliates governing Executive’s
equity compensation arrangements (i.e., any agreement with respect to Executive’s stock
and/or stock options of any of the Company’s affiliates);

3

 

provided, however, that Executive shall not be deemed to have been terminated for Cause in
the case of clause (ii), (iii), (iv) or (v) above, unless any such breach is not fully
corrected prior to the expiration of the thirty (30) calendar day period following delivery
to Executive of the Company’s written notice of its intention to terminate his employment
for Cause describing the basis therefore in reasonable detail.

(e) Executive will be deemed to have a “Good Reason” if Executive terminates his employment
because of (i) a material diminution of Executive’s duties as General Counsel, (ii) the
failure by any successor of the Company to assume in writing the Company’s obligations under
this Agreement, (iii) the breach by the Company in any respect of any of its obligations
under this Agreement, and, in any such case (but only if correction or cure is possible),
the failure by the Company to correct or cure the circumstance or breach on which such
resignation is based within 30 days after receiving notice from Executive describing such
circumstance or breach in reasonable detail, (iv) the relocation of Executive’s primary
office location of more than 50 miles that places the primary office farther from
Executive’s residence than it was before, or (v) the imposition by the Company of a
requirement that Executive report to a person other than the Chief Executive Officer of the
Company or the Chairman of the Board. Executive shall not have a Good Reason to resign if
the Company suspends Executive due to an indictment of Executive on felony charges, provided
that the Company continues to pay Executive’s salary and benefits.

5. Adjustment to Payments Triggering Excise Tax. In the event that any amount or benefit
that may be paid or otherwise provided to or in respect of the Executive by the Company or any
affiliated company, whether pursuant to this Agreement or otherwise (collectively, “Covered
Payments”), is or may become subject to the tax imposed under Section 4999 of the Internal Revenue
Code of 1986, as amended (or any successor provision) (“Excise Tax”), the Company shall pay to the
Executive a “Reimbursement Amount,” defined as an amount, which when added to the Covered Payments
and after taking into account any federal, state or local tax resulting from the Covered Payment
and the Reimbursement Amount will provide Executive with after tax net income equal to the amount
Executive would have earned had no Excise Tax been imposed on the Covered Payments.

6. Confidential and Proprietary Information.

(a) The parties agree and acknowledge that during the course of Executive’s employment,
Executive will be given and will have access to and be exposed to trade secrets and
confidential information in written, oral, electronic and other forms regarding the Company
and its affiliates (which includes but is not limited to all of its business units,
divisions and affiliates) and their business, equipment, products and employees, including,
without limitation: the identities of the Company’s and its affiliates’ distributors and
customers and potential distributors and customers (hereinafter referred to collectively as
“Distributors”), including, without limitation, the identity of Distributors that Executive
cultivates or maintains while providing services at the Company or any of its affiliates
using the Company’s or any of its affiliates’ products, name and infrastructure, and the
identities of contact persons with respect to those Distributors; the particular
preferences, likes, dislikes and needs of those Distributors and

4

 

contact persons with respect to product types, pricing, sales calls, timing, sales terms,
rental terms, lease terms, service plans, and other marketing terms and techniques; the
Company’s and its affiliates’ business methods, practices, strategies, forecasts, pricing,
and marketing techniques; the identities of the Company’s and its affiliates’ licensors,
vendors and other suppliers and the identities of the Company’s and its affiliates’ contact
persons at such licensors, vendors and other suppliers; the identities of the Company’s and
its affiliates’ key sales representatives and personnel and other employees; advertising and
sales materials; research, computer software and related materials; and other facts and
financial and other business information concerning or relating to the Company or any of its
affiliates and their business, operations, financial condition, results of operations and
prospects. Executive expressly agrees to use such trade secrets and confidential
information only for purposes of carrying out his duties for the Company and its affiliates
as he deems appropriate in his good faith judgment, and not for any other purpose,
including, without limitation, not in any way or for any purpose that could reasonably be
foreseen to be detrimental to the Company or any of its affiliates; provided, Executive
shall be permitted to disclose such trade secrets and confidential information to third
parties in the course of performing his duties for the Company and its affiliates as he
deems appropriate in his good faith judgment provided that prior to such disclosure
Executive causes the intended recipient of such information to sign a confidentiality
agreement. Executive shall not at any time, either during the course of his employment
hereunder or after the termination of such employment, use for himself or others, directly
or indirectly, any such trade secrets or confidential information, and, except as required
by law or as permitted hereunder, Executive shall not disclose such trade secrets or
confidential information, directly or indirectly, to any other person or entity. Trade
secret and confidential information hereunder shall not include any information which (i) is
already in or subsequently enters the public domain, other than as a result of any
unauthorized direct or indirect disclosure by Executive, (ii) becomes available to Executive
on a non-confidential basis from a source other than the Company or any of its affiliates,
provided that Executive has no knowledge that such source is subject to a confidentiality
agreement or other obligation of secrecy or confidentiality (whether pursuant to a contract,
legal or fiduciary obligation or duty or otherwise) to the Company or any of its affiliates
or any other person or entity or (iii) is approved for release by the Chief Executive
Officer or the board of directors of the Company or any of its affiliates or which the Chief
Executive Officer or the board of directors of the Company or any of its affiliates makes
available or authorizes Executive to make available to third parties without an obligation
of confidentiality.

(b) All physical property and all notes, memoranda, files, records, writings, documents and
other materials of any and every nature, written or electronic, which Executive shall
prepare or receive in the course of his employment with the Company and which relate to or
are useful in any manner to the business now or hereafter conducted by the Company or any of
its affiliates are and shall remain the sole and exclusive property of the Company and its
affiliates, as applicable. Executive shall not remove from the Company’s premises any such
physical property, the original or any reproduction of any such materials nor the
information contained therein except for the purposes of carrying out his duties to the
Company or any of its affiliates and all such property (except for any items of personal
property not owned by the Company or any of

5

 

its affiliates), materials and information in his possession or under his custody or control
upon the termination of his employment (other than such materials received by Executive
solely in his capacity as a shareholder) or at any other time upon request by the Company
shall be immediately turned over to the Company and its affiliates, as applicable.

(c) All inventions, improvements, trade secrets, reports, manuals, computer programs, tapes
and other ideas and materials developed or invented by Executive during the period of his
employment, either solely or in collaboration with others, which relate to the actual or
anticipated business or research of the Company or any of its affiliates which result from
or are suggested by any work Executive may do for the Company or any of its affiliates or
which result from use of the Company’s or any of its affiliates’ premises or property
(collectively, the “Developments”) shall be the sole and exclusive property of the Company
and its affiliates, as applicable. Executive assigns and transfers to the Company his entire
right and interest in any such Development, and Executive shall execute and deliver any and
all documents and shall do and perform any and all other acts and things necessary or
desirable in connection therewith that the Company or any of its affiliates may reasonably
request, it being agreed that the preparation of any such documents shall be at the
Company’s expense. Nothing in this paragraph applies to an invention which qualifies fully
under the provisions of California Labor Code Section 2870.

(d) Following the termination of Executive’s employment, Executive will reasonably cooperate
with the Company (at the Company’s expense, if Executive reasonably incurs any out-of-pocket
costs with respect thereto, including, but not limited to, lost salary or the value of
vacation benefits used in connection therewith) in any defense of any legal, administrative
or other action in which the Company or any of its affiliates or any of their distributors
or other business relations are a party or are otherwise involved, so long as any such
matter was related to Executive’s duties and activities conducted on behalf of the Company
or its Subsidiaries.

(e) The provisions of this Section 6 and Section 7 shall survive any termination of this
Agreement and termination of Executive’s employment with the Company.

7. Non-Solicitation. Executive acknowledges that in the course of his employment for the
Company he will become familiar with the Company’s and its affiliates’ trade secrets and other
confidential information concerning the Company and its affiliates. Accordingly, Executive agrees
that, during Executive’s employment and for a period of twenty-four (24) months immediately
thereafter (the “Nonsolicitation Period”), he will not directly or indirectly through another
entity unlawfully (i) induce or attempt to induce any employee or Distributor of the Company or any
of its affiliates to leave the employment of, or cease to maintain its distributor relationship
with, the Company or such affiliate, or in any way interfere with the relationship between the
Company or any such affiliate and any employee or Distributor thereof, (ii) hire any person who was
an employee of the Company or any of its affiliates at any time during the Nonsolicitation Period
unless such person’s employment was terminated by the Company or such affiliate or enter into a
distributor relationship with any person or entity who was a Distributor of the Company or any of
its affiliates at any time during the Nonsolicitation Period, (iii) induce or attempt to induce any
Distributor, supplier, licensor, licensee or other business relation of the

6

 

Company or any of its affiliates to cease doing business with the Company or such affiliate, or in
any way interfere with the relationship between such Distributor, supplier, licensor, licensee or
business relation and the Company or any of its affiliates or (iv) use any trade secrets or other
confidential information of the Company or any of its affiliates to directly or indirectly
participate in any means or manner in any business which is a direct competitor of the Company.

8. Non-Disparagement. During Executive’s employment and thereafter, Executive agrees not
to make any derogatory, negative or disparaging public statement about the Company, its officers,
its employees, or members of its Board, or to make any public statement (or any statement likely to
become public) that could reasonably be expected to adversely affect or disparage the reputation,
or, to the extent applicable, business or goodwill of the Company, it being agreed and understood
that nothing herein shall prohibit Executive (a) from disclosing that Executive is no longer
employed by the Company, (b) from responding truthfully to any governmental investigation or
inquiry related thereto, whether by the Securities and Exchange Commission or other governmental
entity or any other law, subpoena, court order or other compulsory legal process or any disclosure
requirement of the Securities and Exchange Commission, or (c) from making traditional competitive
statements in the course of promoting a competing business, so long as any statements made by
Executive described in this clause (c) are not based on confidential information obtained during
the course of Executive’s employment with the Company. The Company agrees that it will not make any
derogatory, negative or disparaging public statements about Executive that are untruthful in any
authorized Company statement (whether written or oral), including, but not limited to, any press
release or public announcement.

9. Injunctive Relief. Executive and the Company (a) intend that the provisions of Sections
6 and 7 be and become valid and enforceable, (b) acknowledge and agree that the provisions of
Sections 6 and 7 are reasonable and necessary to protect the legitimate interests of the business
of the Company and its affiliates and (c) agree that any violation of Section 6 or 7 might result
in irreparable injury to the Company and its affiliates, the exact amount of which would be
difficult to ascertain and the remedies at law for which may not be reasonable or adequate
compensation to the Company and its affiliates for such a violation. Accordingly, Executive agrees
that if Executive violates or threatens to violate the provisions of Section 6 or 7, in addition to
any other remedy which may be available at law or in equity, the Company shall be entitled to seek
specific performance and injunctive relief, and without the necessity of proving actual damages. In
addition, in the event of a violation or threatened violation by Executive of Section 6 or 7 of
this Agreement, the Nonsolicitation Period will be tolled until such violation or threatened
violation has been duly cured. If, at the time of enforcement of Sections 6 or 7 of this Agreement,
a court holds that the restrictions stated therein are unreasonable under circumstances then
existing, the parties hereto agree that the maximum period, scope or geographical area reasonable
under such circumstances shall be substituted for the stated period, scope or area.

10. Indemnification. The Company shall indemnify Executive to the fullest extent permitted
by applicable law as more fully described in the Indemnification Agreement between the Company and
the Executive; in the event that California law is deemed to apply and to permit the Company to
provide more indemnification to Executive for the matters described in the

7

 

Indemnification Agreement, the Company agrees to provide such indemnification to the fullest extent
permitted under California law.

11. Assignment: Successors and Assigns. Executive agrees that he shall not assign, sell,
transfer, delegate or otherwise dispose of, whether voluntarily or involuntarily, any rights or
obligations under this Agreement, nor shall Executive’s rights hereunder be subject to encumbrance
of the claims of creditors. This Agreement may be assigned by the Company without the consent of
Executive to (a) any entity succeeding to all or substantially all of the assets or business of the
Company, whether by merger, consolidation, acquisition or otherwise (upon which entity the
Agreement shall be binding), or (b) any affiliate; provided, however, that in neither case shall
the Company be released from its obligations hereunder, nor shall any assignment to an affiliate
lessen the Executive’s rights with respect to his position, duties, responsibilities or authority
with respect to the Company.

12. Governing Law: Jurisdiction and Venue. This Agreement shall be governed, construed,
interpreted and enforced in accordance with the substantive laws of the State of California without
regard to the conflicts of law principles thereof. Suit to enforce this Agreement or any provision
or portion thereof may be brought in the federal or state courts located in Los Angeles,
California.

13. Severability of Provisions. In the event that any provision of this Agreement should
ever be adjudicated by a court of competent jurisdiction to be unenforceable, then such provision
shall be deemed reformed to the maximum extent permitted by applicable law, and the invalidity or
unenforceability of any provision shall not affect the validity or enforceability of any other
provision of this Agreement.

14 Warranty. As an inducement to the other party to enter into this Agreement, subject to
the termination of Executive’s Employment Agreement as set forth in paragraph 17 below, each party
represents and warrants to the other that it/he has the power and authority to enter into this
Agreement and is not a party to any other agreement or obligation, and that there exists no
impediment or restraint, contractual or otherwise, on its/his power, right or ability to enter into
this Agreement and to perform its/his duties and obligations hereunder.

15. Notices. All notices, requests, demands and other communications which are required or
may be given under this Agreement shall be in writing and shall be deemed to have been duly given
when received if personally delivered; when transmitted if transmitted by telecopy, electronic or
digital transmission method upon receipt of telephonic or electronic confirmation; the day after it
is sent, if sent for next day delivery to a domestic address by recognized overnight delivery
service (e.g., Federal Express); and upon receipt, if sent by certified or registered mail, return
receipt requested. In each case notice will be sent to:

	 	(a)	 	If to the Company:

Herbalife International of America, Inc.

1800 Century Park East

Los Angeles, California 90067

8

 

Attention:
Members of the Compensation Committee of the Board of Directors

Telecopy: (310) 557-3906

with a copy to:

Herbalife International of America, Inc.

1800 Century Park East

Los Angeles, California 90067

Attention: Chief Executive Officer

Telecopy: (310) 557-3906

	 	(b)	 	if to Executive, to:

Brett R. Chapman

5054 Royal Vista Court

Thousand Oaks, California 91362

with a copy to:

Cathy J. Frankel, Esq.

Moses & Singer LLP

1301 Avenue of the Americas

New York, New York 10019-6076

or to such other place and with other copies as either party may designate as to itself or himself
by written notice to the others.

16. Counterparts. This Agreement may be executed in several counterparts, each of which
will be deemed to be an original, but all of which together shall constitute one and the same
Agreement.

17. Entire Agreement. The terms of this Agreement are intended by the parties to be the
final expression of their agreement with respect to the subject matter hereof and this Agreement
supersedes (and may not be contradicted by, modified or supplemented by) any prior or
contemporaneous agreement, written or oral, with respect thereto, including but not limited to the
Employment Agreement between the parties dated October 6, 2003 (which Employment Agreement shall be
deemed terminated as of the date of this Agreement), but with the exception of the Non-Statutory
Stock Option Agreement dated October 6, 2003, as amended effective as of December 30, 2003,
Non-Statutory Stock Option Agreement dated September 1, 2004, Stock Option Agreement dated December
1, 2004, Stock Option Agreement dated April 27, 2005, Stock Appreciation Right Award Agreement
dated March 23, 2006, Stock Unit Award Agreement dated March 23, 2006, Stock Unit Award Agreement
dated October 10, 2006, Shareholders’ Agreement dated July 31, 2002, and the Indemnification Agreement. The parties further
intend that this Agreement shall constitute the complete and exclusive statement of its terms and
that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other
legal proceeding to vary the terms of this Agreement.

9

 

18. Amendments: Waivers. This Agreement may not be modified or amended except by an
instrument in writing, signed by Executive and a duly authorized representative of the Company. No
waiver of any of the provisions of this Agreement, whether by conduct or otherwise, in any one or
more instances, shall be deemed to be construed as a further, continuing, or subsequent waiver of
any such provision or as a waiver of any other provision of this Agreement. No failure to exercise
and no delay in exercising any right, remedy or power hereunder shall preclude any other or further
exercise of any other right, remedy, or power provided herein or by law or in equity.

19. Representation of Counsel: Mutual Negotiation. Each party has had the opportunity to
be represented by counsel of its choice in negotiating this Agreement. This Agreement shall
therefore be deemed to have been negotiated and prepared at the joint request, direction and
construction of the parties, at arm’s-length, with the advice and participation of counsel, and
shall be interpreted in accordance with its terms without favor to any party.

20. Surviving Terms. The provisions of Sections 4(a), 4 (b), 5, 6, 7, 8 and 10 shall
survive the termination or expiration of this Agreement.

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

	 	 	 	 	 
	 

	 	EXECUTIVE	 	 
	 
	 	 	 	 
	 
	 	/s/ Brett R. Chapman	 	 
	 

	 	 

By: Brett R. Chapman
	 	 
	 
	 	 	 	 
	 

	 	HERBALIFE INTERNATIONAL OF AMERICA, INC.	 	 
	 
	 	 	 	 
	 
	 	/s/ Michael O. Johnson	 	 
	 

	 	 

By: Michael O. Johnson
	 	 
	 

	 	Title: Chief Executive Officer	 	 

10

 

SCHEDULE A

Constitutional Rights Foundation

11

 

ATTACHMENT A

Agreement and General Release

Agreement and General Release (“AGREEMENT”), by and among BRETT R. CHAPMAN (“EXECUTIVE” and
referred to herein as “you”) and HERBALIFE INTERNATIONAL OF AMERICA, INC., a Nevada corporation
(the “COMPANY”).

1. In exchange for your waiver of claims against the Company Entities (as defined below) and
compliance with other terms and conditions of this Agreement, upon the effectiveness of this
Agreement, the Company agrees to provide you with the payments and benefits provided in Section 4
of your Employment Agreement with the Company.

2. (a) In consideration for the payments and benefits to be provided to you pursuant to paragraph 1
above, you, for yourself and for your heirs, executors, administrators, trustees, legal
representatives, and assigns (hereinafter referred to collectively as “RELEASORS”), FOREVER RELEASE
AND DISCHARGE THE Company and its past, present and future parent entities, subsidiaries,
divisions, affiliates and related business entities, successors and assigns, assets, employee
benefit plans or funds (including, without limitation, each of Whitney & Co., LLC, Golden Gate
Private Equity, Inc., any investment fund managed by either of them and any affiliate of any of the
aforementioned persons or entities), and any of its or their respective past, present and/or future
directors, officers, fiduciaries, agents, trustees, administrators, employees and assigns, whether
acting on behalf of the Company or in their individual capacities (collectively the “COMPANY
ENTITIES”) from any and all claims, suits, demands, causes of action, covenants, obligations,
debts, costs, expenses, fees and liabilities of any kind whatsoever in law or equity, by statute or
otherwise, whether known or unknown, vested or contingent, suspected or unsuspected and whether or
not concealed or hidden (collectively, the “CLAIMS”), which you ever had, now have, or may have
against any of the Company Entities by reason of any act, omission, transaction, practice, plan,
policy, procedure, conduct, occurrence, or other matter related in any way to your employment by
(including, but not limited to, termination thereof) the Company Entities up to and including the
date on which you sign this Agreement, except as provided in subsection (c) below.

     (b) Without limiting the generality of the foregoing, this Agreement is intended to and shall
release the Company Entities from any and all claims, whether known or unknown, which Releasors
ever had, now have, or may have against the Companies Entities arising out of your employment or
termination thereof, including, but not limited to: (i) any claim under the Age Discrimination in
Employment Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the
Employee Retirement Income Security Act of 1974,(excluding claims for accrued, vested benefits
under any employee benefit or pension plan of the Company Entities subject to the terms and
conditions of such plan and applicable law), the Family and Medical Leave Act, the Worker
Adjustment and Retraining Notification Act of 1988, or the Fair Labor Standards Act of 1938, in
each case as amended; (ii) any claim under the California Fair Employment and Housing Act, the
California Labor Code, the California Family Rights Act, or the California pregnancy Disability
Leave Law; (iii) any other claim (whether based on federal, state, or local law (statutory or
decisional), rule, regulation or ordinance)

 

 

relating to or arising out of your employment, the terms and conditions of such employment, the
termination of such employment, including, but not limited to, breach of contract (express or
implied), wrongful discharge, detrimental reliance, defamation, emotional distress or compensatory
or punitive damages; and (iv) any claim for attorneys’ fees, costs, disbursements and/or the like.

     (c) Notwithstanding the foregoing, nothing in this Agreement shall be a waiver of claims: (1)
that may arise after the date on which you sign this Agreement; (2) with respect to your right to
enforce your rights that survive termination under the Employment Agreement or any other written
agreement entered into between you and the Company (including, without limitation, any agreements
granting you any stock units, stock appreciation rights, stock options or any other equity grants
or equivalents); (3) regarding rights of indemnification, receipt of legal fees and directors and
officers liability insurance to which you are entitled under the Employment Agreement, the
Company’s Certificate of Incorporation or By-laws, pursuant to any separate writing between you and
the Company or pursuant to applicable law; (4) relating to any claims for accrued, vested benefits
under any employee benefit plan or pension plan of the Company Entities subject to the terms and
conditions of such plan and applicable law; or (5) as a stockholder or optionholder of the Company.

     (d) In signing this Agreement, you acknowledge that you intend that this Agreement shall be
effective as a bar to each and every one of the Claims hereinabove mentioned or implied. You
expressly consent that this Agreement shall be given full force and effect according to each and
all of its express terms and provisions, including those relating to unknown, unsuspected or
unanticipated Claims (notwithstanding any state statute that expressly limits the effectiveness of
a general release of unknown, unsuspected or unanticipated Claims), if any, as well as those
relating to any other claims hereinabove mentioned or implied. You acknowledge and agree that this
waiver is an essential and material term of this Agreement, and if you bring your own Claim in
which you seek damages against any Company Entity, or if you seek to recover against any Company
Entity in any Claim brought by a governmental agency on your behalf, the release set forth in this
Agreement shall serve as a complete defense to such Claims, and you shall reimburse each Company
Entity for any attorneys’ fees or expense or other fees and expense incurred in defending such
Claim; provided, however, if a class action claim or governmental claim is brought on your behalf,
your obligations will be limited to (i) opting out of such action or other proceedings received in
connection therewith to the Company, it being agreed that you shall not be liable to the Company
for any attorneys’ fees or expense or other fees or expenses in the case of any such class action
claim or governmental claim.

     (e) Without limiting the generality of the foregoing, you waive all rights under California
Civil Code Section 1542, which provides:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER
MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

13

 

3. (a) This Agreement is not intended, and shall not be construed, as an admission that any of the
Company Entities has violated any federal, state or local law (statutory or decisional), ordinance
or regulation, breached any contract or committed any wrong whatsoever against you.

     (b) Should any provision of this Agreement require interpretation or construction, it is
agreed by the parties that the entity interpreting or constructing this Agreement shall not apply a
presumption against one party by reason of the rule of construction that a document is to be
construed more strictly against the party who prepared the document.

4. For two years from and after the date of your employment termination, you agree not to make any
derogatory, negative or disparaging public statement about any Company Entity, or to make any
public statement (or any statement likely to become public) that could reasonably be expected to
adversely affect or disparage the reputation, or, to the extent applicable, business or goodwill of
any Company Entity, it being agreed and understood that nothing herein shall prohibit you (a) from
disclosing that you are no longer employed by the Company, (b) from responding truthfully to any
governmental investigation or inquiry related thereto, whether by the Securities and Exchange
Commission or other governmental entity or any other law, subpoena, court order or other compulsory
legal process or any disclosure requirement of the Securities and Exchange Commission, or (c) from
making traditional competitive statements in the course of promoting a competing business, so long
as any statements made by you described in this clause (c) are not based on confidential
information obtained during the course of your employment with the Company. The Company agrees that
it will not make any derogatory, negative or disparaging public statement about you in an
authorized press release or authorized public announcement.

5. This Agreement is binding upon, and shall inure to the benefit of, the parties and their
respective heirs, executors, administrators, successors and assigns.

6. This Agreement shall be construed and enforced in accordance with the laws of the State of
California applicable to agreements made and to be performed entirely within such State.

7. You acknowledge that your obligations pursuant to Sections 6, 7 and 8 of the Employment
Agreement survive the termination of your employment in accordance with the terms thereof. The
Company acknowledges that its obligations under Sections 4(a), 4(b), 5, 8 and 10 of the Employment
Agreement survive the termination of your employment in accordance with the terms thereof.

8. You acknowledge that you: (a) have carefully read this Agreement in its entirety; (b) have had
an opportunity to consider for at least twenty-one (21) days the terms of this Agreement; (c) are
hereby advised by the Company in writing to consult with an attorney of your choice in connection
with this Agreement; (d) fully understand the significance of all of the terms and conditions of
this Agreement and have discussed them with your independent legal counsel, or have had a
reasonable opportunity to do so; (e) have had answered to your satisfaction by your independent
legal counsel any questions you have asked with regard to the meaning and significance of any of
the provisions of this Agreement; and (f) are signing this Agreement voluntarily and of your own
free will and agree to abide by all the terms and conditions contained herein.

14

 

9. You understand that you will have at least twenty-one (21) days from the date of receipt of this
Agreement to consider the terms and conditions of this Agreement. You may accept this Agreement by
signing it and returning it to the Company’s Chief Executive Officer at the address specified
pursuant to Section 15 of the Employment Agreement. After executing this Agreement, you shall have
seven (7) days (the “REVOCATION PERIOD”) to revoke this Agreement by indicating your desire to do
so in writing delivered to the Chief Executive Officer at the address above by no later than 5:00
p.m. on the seventh (7th) day after the date you sign this Agreement. The effective date of this
Agreement shall be the eighth (8th) day after you sign the Agreement (the “AGREEMENT EFFECTIVE
DATE”). If the last day of the Revocation Period falls on a Saturday, Sunday or holiday, the last
day of the Revocation Period will be deemed to be the next business day. In the event you do not
accept this Agreement as set forth above, or in the event you revoke this Agreement during the
Revocation Period, this Agreement, including but not limited to the obligation of the Company to
provide the payments and benefits provided in paragraph 1 above, shall be deemed automatically null
and void.

	 	 	 	 	 	 	 
	 	 	EXECUTIVE	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 	 	Brett R. Chapman	 	 
	 
	 	 	 	 	 	 
	 	 	HERBALIFE INTERNATIONAL OF AMERICA, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 

	 	 

15

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