Document:

exhibit10_1.htm

     

    
      

      

    

    
      Exhibit
        10.1 

      
        

 

    

    LICENSE
      AGREEMENT

     

    
      	
              BETWEEN:

            	
              MARIZ
                GESTAO E INVESTIMENTOS LIMITADA, a Madeira corporation duly
                incorporated according to  law, having its registered office at
                Rua dos Murcas, No. 88-3o, 9000 Funchal, Madeira, Portugal,

               

              (the
                "Licensor")

               

            
	 	
              PARTY
                OF THE FIRST PART

            
	
              AND:

            	
              SCHIFF
                NUTRITION GROUP, INC., a corporation duly incorporated in
                accordance with the laws of the State of Utah, herein acting and
                represented by Joseph W. Baty, its Chief Financial Officer,

               

              (the
                “Licensee”)

               

            
	 	
              PARTY
                OF THE SECOND PART

               

            

    

    
      	
              1.  

            	
              RECITALS

            

    

     

    1.1  WHEREAS
      Licensor is the beneficial owner of the registrations of the Trademarks (as
      hereinafter defined) in Japan;

     

    1.2  WHEREAS
      Licensor has licensed to a company (the “Mariz Licensee”) the
      right to use, and sublicense the use of, the Trademarks in Japan;

     

    1.3  WHEREAS
      the Mariz Licensee has granted an exclusive sublicense to JWO Corp. (JWO Corp.,
      together with its Affiliates, being hereinafter collectively referred to as
      “JWO”) to use the Trademarks, pursuant to which and until the
      termination of which JWO holds the registered title in and to the registrations
      of the Trademarks in Japan;

     

    1.4  WHEREAS
      Licensee wishes to obtain a license from Licensor to use the Trademarks
      in connection with the sale of its joint care products in Costco Stores situated
      in Japan;

     

    1.5  WHEREAS
      Licensor has approached and obtained from the Mariz Licensee a
      retrocession of the Mariz Licensee’s exclusive rights (the “Mariz
      Licensee Retrocession”), and the Mariz Licensee has obtained from JWO a
      retrocession of JWO’s exclusive rights (the “JWO Retrocession”,
      and together with the Mariz Licensee Retrocession, the
“Retrocessions”), but in each case only as necessary to permit
      Licensor to grant to Licensee the express licenses contemplated by this
      Agreement, and under the express condition that the products in association
      with
      which the Trademarks are used, and all packaging, materials, invoices, or
      advertising or promotions relating thereto, contain no Weider Designation (as
      defined below).

     

    NOW,
      THEREFORE, THE PARTIES HERETO AGREE AS FOLLOWS:

     

    
      	
              2.  

            	
              DEFINITIONS

            

    

     

    2.1  In
      this
      Agreement:

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    2.1.1  "Affiliate"
      means, with regard to any Person mentioned herein, any other Person that
      directly or indirectly controls, is controlled by, or is under common control
      with such Person mentioned herein.  "Control" of any Person means
      possession, directly or indirectly, of the power to direct or cause the
      direction of management or policies of such Person, whether through ownership
      of
      voting securities, by contract or otherwise;

     

    2.1.2  "Contract
      Year" means any period of four (4) consecutive complete fiscal quarters
      of Licensee, during the Term of this Agreement, which: (i) commences on the
      first day of the first complete fiscal quarter of Licensee that immediately
      follows the Product Launch Quarter, or any anniversary thereof (each, a
“Commencement Date”) and (ii) terminates on the last day of the
      fourth (4th) fiscal quarter of Licensee immediately following such Commencement
      Date (each, an “End Date”), as well as the First Contract Year
      unless the context requires otherwise;

     

    2.1.3    
      "Costco
      Japan" means Costco Wholesale Corporation (or any subsidiary or
      division thereof) operating in the Territory or any successor in interest
      thereto pursuant to a change of ownership or control, including a sale of
      substantially all of its assets;

     

    2.1.4    
      "Costco
      Private Label Products" has the meaning ascribed thereto in Section
X3.6X
      hereof;

     

    2.1.5    
      "Costco
      Stores" means the membership warehouse club stores operated by Costco
      Japan and the related website, www.costco.co.jp, www.costco.co.jp/eng and
      any successor websites, maintained by Costco Japan;

     

    2.1.6  "First
      Contract Year" means the period of time commencing on the date of
      execution hereof by both parties hereto and terminating on the last day of
      the
      fourth (4th) complete fiscal quarter of Licensee following the Product Launch
      Quarter;

     

    2.1.7  "Initial
      Term" means the period of time from the date of execution hereof by
      both parties hereto until the End Date of the third (3rd) Contract
      Year;

     

    2.1.8  "Licensed
      Products" means Products marketed, distributed or sold by Licensee in
      the Territory bearing the Trademarks;

     

    2.1.9  "Net
      Revenue" means the aggregate of the amounts actually paid by Costco
      Japan to Licensee for Licensed Products and Costco Private Label Products sold
      by or on behalf of Licensee to Costco Japan, less: (i) any returns received
      by
      Licensee or refunds or post-payment credits or rebates given to, or other
      post-payment account adjustments made in favour of, Costco Japan in connection
      with Licensed Products and Costco Private Label Products that were previously
      sold by Licensee to Costco Japan, but solely to the extent of the amount
      actually previously paid by Costco Japan to Licensee for any Licensed Product
      or
      Costco Private Label Product that was returned or for which such refund or
      post-payment credit, rebate or other account adjustment was made; and (ii)
      sums
      collected by Licensee for any duly constituted governmental authority and paid
      out to such authority on account of any direct tax or, to the extent not
      reimbursed to Licensee by Costco Japan, duty imposed by such authority upon
      the
      sale of Licensed Products and Costco Private Label Products;

     

    2.1.10  
      "Person"
      means any natural or legal person, partnership, joint venture, association,
      company, corporation, limited liability company, trust, bank, trust company
      or
      other organization, whether or not a legal person or entity, and any government
      or agency or political subdivision thereof;

     

     

    
      
        
        

      

      
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    2.1.11  
      "Products"
      means joint care products for human consumption, in liquid, powder, capsule,
      tablet or gelcap form;

     

    2.1.12  
      "Product
      Launch Date" means the earlier of (i) the date on which Licensee and/or
      Costco Japan commences advertising and promoting the Licensed Products for
      sale
      at Costco Stores in the Territory and (ii) the date on which Licensee commences
      shipping the Licensed Products to Costco Japan;

     

    2.1.13  
      "Product
      Launch Quarter" means the fiscal quarter of Licensee in which the
      Product Launch Date occurs;

     

    2.1.14  
      "Term"
      means the Initial Term and any renewal thereof pursuant to Section X10X
      hereof;

     

    2.1.15  
      "Territory"
      means the country of Japan;

     

    2.1.16  
      "Trademarks"
      means the trademarks set forth in Schedule "A" annexed hereto, incorporated
      herein by reference and forming an integral part hereof;

     

    2.1.17  
      "Use",
      "Used", "Uses" and "Using"
      means (i) the marketing, distribution or sale of Products bearing the
      Trademarks, (ii) the placement of the Trademarks on the Licensed Products or
      their packaging, (iii) the use of the Trademarks in the broadest sense of
      publication, that is any visual or aural form to which the average person would
      indicate that the Licensed Products are associated with the Trademarks
      including, without limitation, advertising, promotion, print media, labels,
      point of sale and showroom displays, signs, packaging, stationery, business
      cards and forms, and electronic media of any nature and (iv) any other use
      of
      the Trademarks approved by Licensor in writing prior to such use;
      and

     

    2.1.18  
      "Weider
      Designation" means the word “Weider”, any combination of words that
      contain the word “Weider” and any derivative word, whether as a name, trademark,
      trade name or otherwise, or any other trademark, symbol or logo, present or
      future, that includes the name or trademark “Weider”.

     

    
      	
              3.  

            	
              GRANT
                OF LICENSE

            

    

     

    3.1  Subject
      to the
      terms and conditions hereof, Licensor hereby grants to Licensee, the latter
      hereby accepting, the non-exclusive, non-transferable right and license to
      Use
      the Trademarks in the Territory, and to sublicense to Costco Japan the
      non-exclusive, non-transferable right and license to Use the Trademarks, jointly
      with Licensee but not separately, in the Territory, in each case solely in
      connection with the marketing and advertising of Products in the Territory
      and
      the distribution and sale of Products solely in Costco Stores in the
      Territory.  Licensee is expressly prohibited from granting to Costco
      Japan the right to sublicense any of the rights and licenses granted to it
      hereunder. For greater certainty, Licensee shall be entitled to manufacture,
      produce and package the Products with labelling bearing the Trademarks outside
      the Territory for distribution and sale to Costco Japan hereunder.

     

    3.2  The
      rights and
      licenses granted hereunder are subject to the express condition that none of
      the
      Licensed Products being sold by Licensee to Costco Japan and resold by Costco
      Japan in the Costco Stores in the Territory, nor any packaging, materials,
      invoices, or advertising or promotion relating thereto, shall contain any Weider
      Designation. The breach of this undertaking shall constitute a material
      violation of this Agreement and entitle Licensor to immediately terminate this
      Agreement as set forth in Section 11.1.3.

     

     

    
      
        
        

      

      
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    3.3  All
      rights and
      licenses granted hereunder to Licensee may be exercised and used by any
      Affiliate of Licensee for so long as it remains an Affiliate of Licensee (each,
      an “Additional Corporation”), provided that: (i) each
      Additional Corporation must in advance execute and deliver an undertaking in
      favour of Licensor in the form annexed to this Agreement as Schedule “B” (the
“Undertaking”); (ii) Licensee shall remain responsible for the
      timely performance by each Additional Corporation of all of the obligations
      of
      Licensee under this Agreement and all of such Additional Corporation’s
      obligations under the Undertaking; and (iii) Licensee shall conscientiously
      and
      in a timely fashion take all steps necessary or appropriate to ensure that
      each
      Additional Corporation fulfills all of the obligations of Licensee under this
      Agreement and all of its obligations under the Undertaking that it shall have
      executed.

     

    3.4  Notwithstanding
      the
      non-exclusive nature of the rights and license granted to Licensee hereunder,
      and provided that Licensee is not in material default hereunder without curing
      such default within the applicable cure period, if any, Licensor shall not
      market, advertise, distribute or sell Licensed Products anywhere in the
      Territory, or grant to any Person the right and license to perform any of the
      foregoing activities anywhere in the Territory with the exception of all
      existing rights (after giving effect to the Retrocessions) of the Mariz
      Licensee, JWO and an existing sublicensee of JWO in respect of the
      Trademarks.  Licensor represents and warrants that, other than with
      respect to the rights granted to Licensee hereunder, it has licensed the
      Trademarks solely to the Mariz Licensee, which has sublicensed the Trademarks
      solely to JWO, in each case for Use in the Territory.  JWO has not
      further sublicensed the Trademarks other than the sublicense to Morinaga &
Co., Ltd. of the right to use the “Move Free” Trademark in association with the
“Weider” trademark.

     

    3.5  Licensee
      shall not
      sell the Licensed Products to any Person other than Costco Japan and shall
      cause
      Costco Japan to sell all Licensed Products purchased from Licensee solely at
      retail at Costco Stores in the Territory.

     

    3.6  Licensee
      shall at
      all times Use one or more of the “Move Free” Trademarks, with or without one or
      more of the “Schiff” Trademarks, in connection with all Products sold to Costco
      Japan, and shall require Costco Japan to Use at all times one or more of the
      “Move Free” Trademarks, with or without one or more of the “Schiff” Trademarks,
      in connection with the marketing, advertising, distribution and sale of Licensed
      Products, in each case as the principal trademarks distinguishing the Licensed
      Products, and for no other purpose. Notwithstanding any provision of this
      Agreement, Licensee shall be entitled to manufacture for and distribute and
      sell
      the Products to Costco Japan under a private label brand of Costco Japan or
      any
      of its Affiliates, and payments by Costco Japan to Licensee for the purchase
      thereof shall form part of Net Revenue to the extent that such private label
      products contain any proprietary elements (i.e. any intellectual property)
      of
      Licensee (the “Costco Private Label Products”).

     

    3.7  Licensee
      agrees not
      to approach, contact or otherwise communicate with, or attempt to approach,
      contact or otherwise communicate with, any of JWO or any sublicensee of JWO
      in
      respect of the Trademarks or any of their respective directors, officers,
      employees or representatives with respect to any matter contemplated by this
      Agreement or relating in any manner to the retrocession of the rights to Use
      the
      Trademarks pursuant to the JWO Retrocession or to any of the Trademarks or
      any
      application therefor or registration thereof, any Products or any Licensed
      Products, Licensee hereby acknowledging that such approach, contact or other
      communication is to be made solely through Licensor.

     

    3.8  Licensor
      hereby
      reserves all rights not expressly granted to Licensee hereunder.

     

     

    
      
        
        

      

      
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              4.  

            	
              CONSIDERATION

            

    

     

    4.1  As
      consideration
      for the entering into of this Agreement by Licensor and for the rights and
      licenses granted herein, Licensee undertakes to pay to Licensor, in the manner
      hereinafter set forth in this Section X4X
      and at
      such place as Licensor may from time to time designate in writing, the following
      royalties (collectively, the "Royalties"):

     

    4.1.1  non-refundable
      guaranteed minimum royalties (the "Guaranteed Minimum
      Royalties") in respect of each Contract Year in the amount set forth
      opposite such Contract Year in the following table:
 

    
      	
              Contract
                Year

            	
              Guaranteed
                Minimum Royalties

            
	
              First
                Contract Year

            	
              $
                100,000

            
	
              Second
                Contract Year

            	
              $
                100,000

            
	
              Third
                Contract Year

            	
              $
                100,000

            
	
              Fourth
                Contract Year

            	
              $
                175,000

            
	
              Fifth
                Contract Year

            	
              $
                175,000

            
	
              Sixth
                Contract Year

            	
              $
                175,000

            
	
              Seventh
                Contract Year

            	
              $
                225,000

            
	
              Eighth
                Contract Year

            	
              $
                225,000

            
	
              Ninth
                Contract Year

            	
              $
                225,000

            

    

    

    The
      Guaranteed
      Minimum Royalties in respect of each Contract Year shall be payable as
      follows:  On the Product Launch Date and on the first business day of
      each complete fiscal quarter of Licensee following the First Royalty Quarter
      (each, a "Royalty Quarter", and the period from the Product
      Launch Date to the last day of the first complete fiscal quarter of Licensee
      thereafter being referred to as the “First Royalty Quarter”),
      Licensee shall pay to Licensor twenty-five percent (25%) of the Guaranteed
      Minimum Royalties for such Contract Year.  Licensee acknowledges that,
      in each of the first three (3) Contract Years, Licensor has declared having
      contractually agreed to remit the entire amount of the Guaranteed Minimum
      Royalties to JWO in consideration of the JWO Retrocession;

     

    AND

     

    4.1.2  a
      continuing and
      non-refundable royalty fee (the "Percentage Royalties") in
      respect of each Contract Year equal to five percent (5%) of Net Revenue, payable
      as follows: Within ninety (90) days following the end of:

     

    4.1.2.1  the
      First Royalty
      Quarter, Licensee shall pay to Licensor the Percentage Royalties based on Net
      Revenue in respect of the period from the Product Launch Date to the end of
      the
      First Royalty Quarter, less all amounts actually paid by Licensee to Licensor
      on
      account of Guaranteed Minimum Royalties for that same period; and

     

     

    
      
        
        

      

      
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    4.1.2.2  each
      subsequent
      Royalty Quarter of any Contract Year, Licensee shall pay to Licensor the
      Percentage Royalties based on the cumulative Net Revenue in respect of such
      Contract Year, less the cumulative amounts actually paid by Licensee to Licensor
      on account of Royalties in respect of such Contract Year.

     

    4.2  Notwithstanding
      the
      provisions of Sections X4.1.1X
      and
X4.1.2X
      hereof,
      at such time during each Contract Year as Licensee shall have paid Royalties
      relating to such Contract Year in an amount equal to the Guaranteed Minimum
      Royalties applicable for such Contract Year, Licensee shall thereafter only
      pay
      Percentage Royalties, if any, for the remainder of such Contract Year. Further,
      notwithstanding the provisions of Section X4.1X
      hereof,
      the Percentage Royalties paid by Licensee to Licensor with regard to any
      Contract Year shall not be applied towards or otherwise reduce the amount of
      Guaranteed Minimum Royalties due and payable by Licensee to Licensor with regard
      to any other Contract Year, it being the parties intent that each Contract
      Year
      shall be treated separately for purposes of determining the Royalties due and
      payable from Licensee to Licensor.

     

        4.3    Within
      ninety (90) days following the end of the First Royalty Quarter and each Royalty
      Quarter during the term of this Agreement, Licensee shall furnish Licensor
      with
      a written statement for such First Royalty Quarter and Royalty Quarter,
      respectively, certified by the Controller or Chief Financial Officer of
      Licensee, disclosing total sales of Licensed Products and Costco Private Label
      Products to Costco Japan during such First Royalty Quarter and Royalty Quarter,
      respectively, and containing the unit sales per type of Licensed Product, Costco
      Private Label Product or SKU thereof, the gross invoice price of all sales
      of
      Licensed Products and Costco Private Label Products for such First Royalty
      Quarter and Royalty Quarter, respectively, all deductions applicable to such
      gross invoice price, the Net Revenue during such First
      Royalty Quarter and Royalty Quarter, respectively, as well as all other
      information relating to the calculation of Percentage Royalties or the unit
      sales per type of Licensed Product, Costco Private Label Product or SKU thereof
      reasonably requested by Licensor.  Concurrently with the delivery of
      each such statement, Licensee shall pay to Licensor the Percentage Royalties
      payable for such First Royalty Quarter and Royalty Quarter, respectively,
      pursuant to Section X4.1.2X
      hereof.

     

        4.4    The
      parties agree that, other than as expressly provided in Sections 2.1.8, X4.1X,
      4.2,
      4.4 and 4.7 of this Agreement, the calculation and payment of Royalties shall
      not be subject to any setoff, compensation or other deduction of any nature
      whatsoever. Notwithstanding the foregoing, Licensee shall promptly advise
      Licensor in writing if it has received written advice from its counsel or
      accountants that, as a result of a change in applicable law or application
      of
      applicable law, Licensee is legally required to withhold and remit to the
      appropriate fiscal authority in the Territory any amount on account of a
      withholding tax in respect of any payment due to Licensor
      hereunder.  To the extent that Licensee effects the withholding and
      remittance of any amount on account of a withholding tax in accordance with
      the
      foregoing, Licensee shall contemporaneously with any payment of Royalties,
      or as
      soon thereafter as the appropriate fiscal authority in the Territory makes
      the
      necessary documents available, provide to Licensor all withholding tax receipts
      or other similar official government certifications evidencing all taxes
      withheld from payments due under this Agreement and the proper and timely
      remittance of those taxes to the government in the name of
      Licensor.

     

        4.5    All
      monetary amounts stated herein refer to the lawful currency of the United States
      of America and all payments to Licensor hereunder shall be made in currency
      of
      the United States of America.

     

     

    
      
        
        

      

      
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        4.6    All
      amounts which become due to Licensor pursuant to the terms hereof shall bear
      interest from their respective due dates at an annual rate of interest equal
      to
      the lesser of: (i) three percent (3%) over the “prime rate” charged in New York
      City by Citibank N.A. or its successor, as published in the Wall Street Journal
      (Eastern Edition) on the date any such payment was due, and (ii) the maximum
      interest rate permitted by law; the whole without prejudice to Licensor's other
      rights hereunder or at law or in equity.

     

        4.7    Licensee
      shall maintain separate and appropriate books and accounts and computer records
      relating to the Licensed Products and the Costco Private Label Products sold
      to
      Costco Japan in accordance with generally accepted accounting principles and
      shall make accurate entries concerning all transactions relevant to this
      Agreement.   Subject to ten (10) business days’ prior notice and
      at a reasonable time during the business day, such books, accounts and computer
      records shall be made available to Licensor throughout the Term of this
      Agreement and for a period of one year thereafter (or in the event of a dispute
      between the parties hereto, until one year after said dispute is resolved,
      whichever is later) for inspection and/ or audit by any duly authorized
      representatives of Licensor at Licensor’s sole expense (such inspection or audit
      shall be limited to once in each Contract Year or such one year
      periods).  Licensee shall have the right to object to the results of
      any such inspection and/or audit, in which case Licensee and Licensor shall
      negotiate in good faith to resolve the matter and, if unresolved after ten
      (10)
      business days, either party may refer the matter to a mutually agreed upon
      independent auditing firm not used by either of Licensee or Licensor for
      resolution of the matter within the following twenty (20) business days; the
      decision of such firm shall be final and binding upon all
      parties.  Whenever any such inspection and/or audit of a Contract Year
      discloses an understatement in excess of five percent (5%) of the payments
      due
      by Licensee hereunder for such Contract Year, all reasonable third party
      expenses in connection with such inspection and/or audit shall be paid by
      Licensee to Licensor within thirty (30) business days following final resolution
      of the matter and receipt of written documentation regarding the
      expenses.  In addition: (i) in the event any such inspection and/or
      audit discloses any understatement of payments owing by Licensee hereunder,
      Licensee shall within thirty (30) business days following final resolution
      of
      the matter pay to Licensor all amounts due and unpaid hereunder, together with
      interest thereon at the rate set forth in Section 4.6 hereof, without prejudice
      to Licensor's rights hereunder or at law; and (ii) in the event any such
      inspection and/or audit discloses any overstatement of payments owing by
      Licensee hereunder Licensor shall credit any such overstatement against the
      immediately following payments of Royalties due by Licensee hereunder, without
      prejudice to Licensee’s rights hereunder or at law.

     

        4.8    Licensor's
      receipt of any statement furnished pursuant hereto or its acceptance of any
      sum
      paid hereunder shall not constitute a waiver of Licensee's obligations or
      Licensor's rights hereunder or at law or in equity.

     

        4.9    Any
      and all information provided by Licensee or its representatives pursuant to
      this
      Section 4 shall be and remain strictly confidential and shall not be disclosed
      by Licensor to any other Person: provided, however, that Licensor shall be
      permitted to disclose such information to the Mariz Licensee, to JWO and to
      the
      legal, financial and tax advisors of each of Licensor, the Mariz Licensee and
      JWO, but then only to the extent required for the purposes of this Agreement,
      including, without limitation, as to the amount of Royalties owed hereunder
      and
      only if the Mariz Licensee, JWO and such legal, financial and tax advisors
      agree
      to keep such information strictly confidential and not to disclose such
      information to any other Person.  None of Licensor, the Mariz
      Licensee, JWO or such legal, financial or tax advisors of each of them shall
      use
      such information for any purpose not relating to this Agreement or the
      Retrocessions.  Licensor represents that the Mariz Licensee
      Retrocession and the JWO Retrocession contain obligations imposed on the Mariz
      Licensee and JWO, respectively, that are commensurate with the obligations
      of
      Licensor under this Section 4.9.  Notwithstanding the foregoing,
      Licensor, the Mariz Licensee, JWO and such legal, financial and tax advisors
      shall be permitted to disclose such information if required, in the opinion
      of
      legal counsel, to do so by subpoena or by other legal or administrative
      process.  If so required, Licensor, the Mariz Licensee, JWO or such
      legal, financial or tax advisors, as the case may be, shall promptly notify
      Licensee of such requirement and, if possible under the circumstances, shall
      notify Licensee prior to any such disclosure.

     

     

    
      
        
        

      

      
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              5.  

            	
              ADVERTISING
                AND MARKETING

            

    

     

    5.1  Licensee
      shall
      ensure that all advertising and promotional material relating to the Licensed
      Products sold to Costco Japan to be resold in the Costco Stores in the Territory
      is of the same standards, prestige and overall quality as the advertising and
      promotional material used by Licensee in connection with the sale of Products
      in
      the United States of America, subject to such differences as are commercially
      reasonable given the differences between the markets.  Upon reasonable
      request by Licensor, Licensee shall provide to Licensor for inspection the
      advertising and promotional material relating to the Licensed Products sold
      to
      Costco Japan to be resold in the Costco Stores in the Territory including,
      without limitation, the catalogues, packaging, labelling, circulars and other
      material bearing the Trademarks.

     

    5.2  Licensee
      shall not,
      and Licensee shall use its best efforts to ensure that Costco Japan does not,
      advertise or promote the Licensed Products and the Trademarks in the Territory
      in a manner that shall denigrate the goodwill and reputation
      thereof.  Licensee shall not, and Licensee shall use its best efforts
      to ensure that Costco Japan does not, conduct any advertising or promotion
      of
      the Licensed Products which is deceptive or otherwise misleading under
      applicable laws in the Territory.  Licensee represents to Licensor
      that Licensee and Costco Japan currently anticipate in-store advertising and
      promotion at Costco Stores in the Territory, as well as in Costco Japan
      newsletters, with potential coupon and similar trade promotions.

     

    
      	
              6.  

            	
              TRADEMARKS
                AND INFRINGEMENT
                THEREOF

            

    

     

    6.1  This
      Agreement does
      not constitute a grant to Licensee of any rights, title or interest in or to
      the
      Trademarks or any application therefor or registration thereof, other than
      the
      limited right to Use the Trademarks in the manner expressly set forth in this
      Agreement. Licensee agrees not to assert the invalidity or contest the ownership
      of the Trademarks, any application therefor or registration thereof at any
      time
      during the Term or after the expiration of the Term or termination of this
      Agreement for any reason whatsoever.

     

    6.2  Licensee
      shall Use,
      and shall use its best efforts to ensure that Costco Japan Uses, the Trademarks
      strictly in accordance with the terms hereof and only as consistent with their
      respective registrations or applications for registration or as currently
      depicted on Licensee’s Product labels and advertising.  Licensee shall
      not Use, nor shall it permit Costco Japan to Use, any of the Trademarks in
      a
      manner that would impair the validity of JWO’s registered title, or Licensor’s
      beneficial title, to any application or registration of the Trademarks and,
      without limiting the generality of Section 6.1 hereof in any manner, shall
      otherwise refrain from taking action which would invalidate the Trademarks
      (or
      any application therefor or registration thereof) in the Territory at any time
      during the Term, and from taking any legal, administrative or regulatory actions
      or proceedings of any nature for the purpose of invalidating the Trademarks
      (or
      any application therefor or registration thereof) in the Territory or of
      challenging the ownership of the Trademarks (or any application therefor or
      registration thereof) in the Territory, during the Term or after the expiration
      of the Term or termination of this Agreement for any reason
      whatsoever.

     

    6.3  At
      Licensor's
      request and expense, Licensee shall execute and deliver such documents,
      applications and other writings and do such things as may be reasonably
      requested by Licensor in order to maintain the validity of the Trademarks and
      obtain, maintain or renew any registration thereof.  Licensor shall,
      at its sole expense, take all actions that a prudent trademark owner in the
      Territory would consider necessary or advisable to take, in order to maintain
      the applications and registrations for the Trademarks set forth in Schedule
      A
      hereto.  Licensor shall, at its sole expense, take all actions that a
      prudent trademark owner in the Territory would consider necessary or advisable
      to take, after consideration of all reasonable legal and commercial
      ramifications of such actions (including, without limitation, opinions from
      its
      legal counsel with respect to same), in order to protect the ownership, validity
      or distinctiveness of the Trademarks, and any of the applications therefor
      or
      registrations thereof, against infringement or third party challenges that
      could
      reasonably be expected, if left uncontested or unchallenged, to impair,
      commercially or otherwise, or negatively impact the right and ability of
      Licensee to Use the Trademarks in the Territory, including, without limitation,
      all filings, prosecution of infringement actions and defending against
      challenges before the courts or in the Japanese Trademark
      Office.  Failure to comply with the foregoing obligations by Licensor
      shall not constitute a breach of the terms hereof by Licensor but shall
      nevertheless entitle Licensee to terminate this Agreement in the circumstances
      contemplated by Section X11.2.1X
      hereof
      without any claim for damages against Licensor, except in the event of
      Licensor’s breach of any of its representations or warranties contained
      herein.  Licensee shall use all commercially reasonable efforts to
      cooperate with Licensor, the Mariz Licensee and/or JWO and their respective
      representatives, at Licensor’s cost and expense, in the prosecution of each
      application for registration of the Trademarks which any of them has filed
      or
      may file anywhere in the Territory. None of the foregoing provisions of this
      Section 6.3 shall limit in any manner the indemnification of Licensor in
      connection with the Trademarks pursuant to Section 9.3 hereof.

     

     

    
      
        
        

      

      
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          8 -

        
          

        

      

      
        
        

      

    

     

     

    6.4  [Reserved.]

     

    6.5  Whenever
      Licensee
      has actual knowledge of any infringement or threatened infringement of any
      of
      the Trademarks or any third party claim that any of the Trademarks causes
      deception or confusion with or infringes upon such third party’s trademarks,
      service marks or other proprietary rights in any manner (other than any
      permitted use by JWO’s sublicensee pursuant to arrangements referenced in
      Section 3.4 hereof), Licensee shall promptly give notice thereof to Licensor
      and
      provide Licensor with all information it acquires with respect
      thereto.  Subject to Section X6.3X
      hereof,
      Licensor shall institute or defend proceedings, as the case may be, at its
      own
      expense with regard to each of the foregoing matters.  Licensee shall
      not institute any proceedings relating to the Trademarks, or any application
      or
      registration thereof, without the prior written consent of
      Licensor.  In the event that Licensor undertakes the defence or
      prosecution of any such proceedings, Licensee agrees to execute and deliver
      such
      documents and do such things, including without limitation being made a party
      to
      such proceedings, at Licensor's expense, as may be deemed reasonably necessary
      or advisable by counsel for Licensor.  Licensor shall use its
      reasonable commercial efforts, as any prudent trademark owner in the Territory
      would consider necessary or advisable to take, after consideration of all
      reasonable legal and commercial ramifications of such efforts (including,
      without limitation, opinions from its legal counsel with respect to same),
      to
      procure the right for Licensee to continue to Use the Trademarks as contemplated
      in this Agreement at Licensor’s sole expense.  However, in the event
      that, as a result thereof, Licensee is prevented from Using any of the
      Trademarks in accordance with the terms hereof, Licensee may terminate this
      Agreement pursuant to Section X11.2.1X
      hereof
      without any claim for damages against Licensor, except in the event of
      Licensor’s breach of any of its representations, warranties or covenants
      contained herein, and shall be relieved from its obligations to pay Royalties
      after such termination.  None of the foregoing provisions of this
      Section 6.5 shall limit in any manner the indemnification of Licensor in
      connection with the Trademarks pursuant to Section 9.3 hereof.

     

    6.6  Licensee
      acknowledges and agrees that all goodwill associated with the Trademarks shall
      inure directly and exclusively to the benefit of and belong to the owner of
      the
      Trademarks.  Without in any way limiting the generality of the
      foregoing, no monetary amount shall be payable for or attributable to any loss
      of clientele, business or goodwill relating to Use of the Trademarks upon
      termination or expiration of the Term of this Agreement.  Nothing
      contained in this Section 6.6 shall be interpreted so as to require Licensee
      to
      treat or account for this Agreement in any particular manner for Licensee’s
      accounting or tax purposes.

     

    
      	
              7.  

            	
              QUALITY
                CONTROL

            

    

     

    7.1  Licensee
      acknowledges that the continued maintenance of the value of the Trademarks
      and
      their associated goodwill, and the continued maintenance of Licensor's quality
      standards associated with the Trademarks are essential elements of the rights
      and license granted hereunder. Licensee agrees that the nature and quality
      of
      all Uses of the Trademarks by Licensee shall be consistent with the reasonable
      standards set by Licensor (and provided in writing to Licensee) on its own
      behalf as beneficial owner of, and on behalf of the registered owner of, the
      registrations of the Trademarks.  Licensee shall maintain appropriate
      quality standards and programs in the manufacture and production of Licensed
      Products by or on behalf of Licensee for sale to Costco Japan, including
      appropriate good manufacturing practices commensurate with those used in
      connection with Products sold by or on behalf of Licensee in the United States
      of America (the “Standards”).  

     

    7.2  Upon
      reasonable
      request, Licensee agrees to cooperate with Licensor in confirming the compliance
      of the Licensed Products with the Standards, including permitting reasonable,
      periodic inspection of Licensee's operations not more often than once in each
      Contract Year, at reasonable times during the business day and with at least
      ten
      (10) business days’ prior notice, and to supply Licensor with specimens of all
      Uses of the Trademarks as set forth in this Agreement, as well as written
      certificates of compliance with respect to any third party plants, factories
      or
      other production, bottling or packaging facilities used by Licensee to produce,
      manufacture or package the Licensed Products, upon the reasonable request of
      Licensor.  In the event that the Licensed Products or components
      thereof are manufactured or produced by any Person other than Licensee, Licensee
      shall at all times ensure compliance with this Section X7X
      by such
      Person.

     

    7.3  Upon
      reasonable
      written request by Licensor from time to time, and solely in order for Licensor
      to determine and assure itself that Licensee is maintaining the Standards in
      manufacturing the Licensed Products, Licensee shall submit to Licensor, without
      charge, a sample of each type of Licensed Product manufactured by or on behalf
      of Licensee.  If at any time, Licensor reasonably determines that the
      sample of a Licensed Product does not meet the Standards, Licensee shall
      promptly take all necessary steps to ensure that the Standards are met in the
      manufacturing of Licensed Products and shall provide a sample from a new
      production run to demonstrate that the quality has improved to the reasonable
      satisfaction of Licensor.

     

    7.4  Licensee
      acknowledges and agrees that although Licensor may upon reasonable written
      request conduct reviews of the Licensed Products produced by or on behalf of
      Licensee under this Agreement and the related advertising and promotional
      materials and samples, and may make various recommendations to Licensee,
      Licensor shall have no responsibility or liability for the operation of
      Licensee’s business or its facilities used in connection therewith, or its
      production, manufacture, marketing, distribution or sales, other than with
      respect to (and solely in connection with) written instructions provided by
      Licensor to Licensee regarding the manner in which to Use the Trademarks.
      Licensor’s review of (and acquiescence to, if any) any samples, advertising or
      promotional materials, artwork or the Licensed Products shall not be construed
      to mean that same conform to the laws, rules and regulations of any
      jurisdiction, other than the fact that the registrations of the Trademarks
      have
      been obtained and maintained in accordance with applicable laws in the
      Territory; without limiting the generality of the foregoing, Licensor shall
      not
      bear any liability or responsibility of any nature whatsoever for such reviews
      (and acquiescence, if any). None of the foregoing provisions of this Section
      X7.4X
      shall
      limit in any manner the indemnification obligations of the Licensor in
      connection with the Trademarks pursuant to Section X9.3X
      hereof.

     

    7.5  Licensee
      shall
      ensure that all Licensed Products are processed, bottled, packaged,
      manufactured, marketed, advertised, distributed and sold in material compliance
      with all applicable laws, rules and regulations in the
      Territory.  Licensee shall affix truthful labelling upon all Licensed
      Product packaging, along with any disclosures required by applicable law or
      Trademark ownership notices reasonably required by Licensor, which shall be
      provided in writing to Licensee by Licensor. Licensee shall promptly inform
      Licensor in writing of any material complaint by any consumer or government
      body
      in the Territory relevant to the Licensed Products, as well as to the status
      and
      resolution thereof.  Licensor shall act expeditiously to resolve any
      such complaint solely to the extent same relates to the ownership or
      registration of the Trademarks or the manner in which the Trademarks are Used
      and such manner of Use is set forth in written instructions provided by Licensor
      to Licensee.  Licensee shall act expeditiously to resolve any such
      complaint otherwise involving the Licensed Products. None of the foregoing
      provisions of this Section X7.5X
      shall
      limit in any manner the indemnification obligations of the Licensor in
      connection with the Trademarks pursuant to Section X9.3X
      hereof.

     

     

    
      
        
        

      

      
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          9 -

        
          

        

      

      
        
        

      

    

     

     

    
      	
              8.  

            	
              REPRESENTATIONS
                AND WARRANTIES

            

    

     

    8.1  Licensor
      hereby
      represents to Licensee that: (i) it has not granted any right or license to
      any
      Person (other than the Mariz Licensee, JWO and its existing sublicensee pursuant
      to arrangements referenced in Section 3.4 hereof) to use any of the Trademarks,
      or any of the applications therefor or registrations thereof, in connection
      with
      marketing, advertising, distribution and sale of Products within the Territory;
      (ii) there are no lawsuits, pending or threatened, relating to the Trademarks,
      or any of the applications therefor or registrations thereof, anywhere in the
      Territory and, to the best of Licensor's knowledge, there are no claims or
      demands of whatsoever nature with respect to or in any manner affecting the
      Trademarks; (iii) the registrations of the Trademarks set forth on Schedule
“A”
hereto are all of the “Schiff” and/or “Move Free” trademarks registered in the
      Territory and are registered in the classes necessary for Schiff to sell the
      Licensed Products into the Territory as an over the counter dietary supplement;
      (iv) to the best of Licensor’s knowledge, after such reasonable inquiry that a
      prudent trademark owner in the Territory would consider necessary, the
      Trademarks do not infringe on any rights of any Person when Used in connection
      with the Licensed Products in the Territory; (v) none of Licensor, the Mariz
      Licensee, JWO nor any of their respective Affiliates or sublicensees has
      licensed the Trademarks, or any of the applications therefor or registrations
      thereof, or any aspect thereof in any manner inconsistent with the rights and
      licenses granted hereunder, except pursuant to arrangements referenced in
      Section 3.4 hereof; (vi) JWO is the registered owner, and Licensor is the
      beneficial owner, of the registrations of the Trademarks in the Territory;
      (vii)
      Licensor has full power, capacity, right and authorization to enter into this
      Agreement, is entitled to grant the rights and licenses contemplated by this
      Agreement and no violation of law or contract to which Licensor is party will
      result therefrom; and (viii) the Retrocessions are in full force and effect,
      enforceable, and cannot be terminated except upon the same terms as this
      Agreement.

     

    8.2  All
      product
      approvals and registrations for the Licensed Products and the Costco Private
      Label Products in the Territory shall be the responsibility, and at the cost
      and
      expense, of Licensee, in the name of Licensee or its designee and Licensee
      shall
      be the sole owner thereof.  Licensor shall comply with all reasonable
      requests, including for the provision of documentation, and otherwise cooperate
      with Licensee in obtaining such approvals and registrations.

     

    8.3  Notwithstanding
      anything contained in any other Section of this Agreement: (i) under no
      circumstances shall any of Licensor, Licensee or JWO or their respective
      Affiliates be liable to any of the others of Licensor, Licensee or JWO or their
      respective Affiliates for any indirect, special, punitive, consequential or
      incidental damages of any kind whatsoever (including, without limitation, lost
      or anticipated revenues or profits) arising from any claim relating to this
      Agreement, whether such claim is based on contract, warranty or tort, even
      if an
      authorized representative is advised of the likelihood or possibility of same;
      and (ii) but subject to Section X12.4X
      hereof,
      in no event shall any of Licensor, Licensee or JWO or their respective
      Affiliates be liable to any of the others of Licensor, Licensee or JWO or their
      respective Affiliates for any direct damages or claims in excess of the amount
      of the Guaranteed Minimum Royalties for the Contract Year in which such claim
      arose.  None of the foregoing provisions of this Section 8.3 shall
      limit in any manner the indemnification under this Agreement in connection
      with
      claims by third parties other than Licensor, the Mariz Licensee, JWO, Licensee
      and their respective Affiliates.

     

    8.4  Licensee
      hereby
      represents to Licensor that Licensee has full power, capacity, right and
      authorization to enter into this Agreement, is entitled to accept the rights
      and
      licenses contemplated by this Agreement and no violation of law or contract
      to
      which Licensee is party will result therefrom.

     

    
      	
              9.  

            	
              INSURANCE
                AND INDEMNIFICATION

            

    

     

    9.1  Throughout
      the term
      of this Agreement and for a period of three (3) years thereafter Licensee shall
      maintain product liability insurance against claims for product liability
      related to the sale or use of the Licensed Products in an amount at least equal
      to two million dollars ($2,000,000) per occurrence.  Such insurance
      shall be written with a reputable insurer.  Licensor and JWO
      Corp.shall be named as additional insureds under each such policy of
      insurance.  That coverage shall not be materially reduced or cancelled
      without thirty (30) days prior written notice having been provided to
      Licensor.  Compliance with the provisions of this Section X9.1X
      shall
      not limit in any manner the indemnification obligations under this
      Agreement.

     

     

    
      
        
        

      

      
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          10 -

        
          

        

      

      
        
        

      

    

     

     

    9.2  Licensee
      shall
      indemnify and save and hold Licensor, JWO, their respective Affiliates and
      their
      respective directors, officers, employees and agents (collectively, the
“Mariz Indemnified Parties”) harmless from and
      against any debts, liabilities, claims, damages, losses, costs and expenses,
      including injury or death to persons, damage to property and reasonable
      attorneys’ fees and costs (collectively, the "Losses"), which
      any of the Mariz Indemnified Parties is or may become liable for or be compelled
      to pay arising or resulting in any way from: (i) any act or omission of Licensee
      or its directors (other than George Lengvari), officers, servants, agents or
      employees in connection with Licensee's performance under the terms of this
      Agreement, including, without limitation, breach of this Agreement by Licensee;
      (ii) use, possession or consumption of, or any representation, warranty or
      statement in respect of, Licensed Products or Costco Private Label Products
      produced, bottled, manufactured, marketed, advertised, distributed and sold
      by
      or on behalf of Licensee and/or Costco Japan in the Territory (whether or not
      any sample thereof may have been approved by Licensor hereunder); (iii) any
      claim that Licensed Products or the Costco Private Label Products produced,
      bottled, manufactured, marketed, advertised, distributed and sold by or on
      behalf of Licensee and/or Costco Japan in the Territory (whether or not any
      sample thereof may have been approved by Licensor hereunder) either infringe
      upon or otherwise violate the rights of any other Person for any reason or
      do
      not comply with any applicable law, rule or regulation relating to the
      protection of intellectual property (unless the infringement, violation or
      non-compliance results from use of the Trademarks in accordance with the
      provisions of this Agreement); or (iv) any claim that the Use by Licensee of
      trademarks or other intellectual property rights (other than the Trademarks)
      in
      association with the Licensed Products and the Costco Private Label Products
      pursuant to Section X3.6X
      hereof
      either infringes upon or otherwise violates the rights of any other Person
      in
      the Territory for any reason; except, in each case, to the extent such Losses
      result from the gross negligence, bad faith or intentional misconduct of
      Licensor, the Mariz Licensee, JWO or their respective Affiliates, sublicensees,
      representatives or agents.

     

    9.3  Licensor
      shall
      indemnify and save and hold Licensee, its Affiliates and their respective
      directors, officers, employees and agents (collectively, the “Schiff
Indemnified Parties” and together with the Mariz
      Indemnified Parties, the “Indemnified Parties”) harmless from
      and against any Losses, which any of the Schiff Indemnified Parties is or may
      become liable for or be compelled to pay arising or resulting in any way from:
      (i) any act or omission of Licensor, JWO, the Mariz Licensee, and their
      respective Affiliates, or their respective directors, officers, servants,
      sublicensees, agents or employees in connection with Licensor's performance
      under the terms of this Agreement, including, without limitation, breach of
      this
      Agreement by Licensor; or (ii) any claim that the Use of the Trademarks in
      accordance with the terms of this Agreement either infringes upon or otherwise
      violates the rights of any other Person in the Territory for any reason or
      does
      not comply with any applicable law, rule or regulation relating to the
      protection of intellectual property (whether or not the relevant Use of the
      Trademark may have been approved by Licensee hereunder); except, in each case,
      to the extent such Losses result from the gross negligence, bad faith or
      intentional misconduct of Licensee or its affiliates, representatives or agents
      (other than George Lengvari).

     

    9.4  In
      the event that a
      claim is made against any of the Indemnified Parties for which it is entitled
      to
      indemnification pursuant to Section X9.2X
      or 9.3
      hereof, such Indemnified Party agrees to promptly notify the party required
      to
      provide such indemnification (the “Indemnifying Party”)
      thereof. In the case of a claim by a third party against any of the Indemnified
      Parties, the Indemnifying Party may, at its option, elect to assume the defence
      of such claim, provided that: (i) such Indemnified Party shall be entitled
      to
      participate therein through counsel of its own choosing, at its own cost and
      expense, and (ii) the Indemnifying Party shall not settle or compromise any
      such
      claim without the prior written consent of such Indemnified Party, unless the
      settlement or compromise includes a general release of such Indemnified Party
      from any and all liability with respect thereto.  Notwithstanding
      Section 9.4(i) above, if the Indemnifying Party’s and the Indemnified Party’s
      respective interests cannot be fully, ethically and adequately represented
      by
      common counsel, such Indemnified Party shall be entitled to be represented
      by
      separate counsel reasonably acceptable to such Indemnified Party, and the
      Indemnifying Party shall bear all reasonable fees and costs of such separate
      counsel.

     

    9.5  [Reserved.]

     

    
      	
              10.  

            	
              TERM

            

    

     

    10.1  Subject
      to the
      terms hereof, the Term of this Agreement shall commence upon the date of
      execution hereof by both parties and terminate on the End Date of the third
      (3rd) Contract Year.  Licensee shall have the option to renew the
      rights and licenses granted hereunder for further two (2) successive terms
      of
      three (3) Contract Years each, provided that in each case:

     

    10.1.1  
      at
      the
      time of such renewal, there shall not exist a material default by Licensee
      in
      respect of its obligations hereunder which has not been cured within the cure
      period provided therefor, if any;

     

    10.1.2  
      the
      Net Revenue during the third (3rd) Contract Year, as concerns the first renewal
      term, shall be at least equal to an amount that has generated the Guaranteed
      Minimum Royalties in respect of that Contract Year; and the Net Revenue during
      the sixth (6th) Contract Year, as concerns the second renewal term, shall be
      at
      least equal to an amount that has generated the Guaranteed Minimum Royalties
      in
      respect of that Contract Year; and

     

    10.1.3  
      Licensee
      shall have
      given Licensor written notice of its exercise of its option to renew not less
      than ninety (90) days nor more than one hundred and eighty (180) days prior
      to
      the expiration of the then current Term hereof.

     

     

    
      
        
        

      

      
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          11 -

        
          

        

      

      
        
        

      

    

     

     

    
      	
              11.  

            	
              TERMINATION

            

    

     

    11.1  The
      occurrence of
      any one or more of the following events shall entitle Licensor to immediately
      terminate this Agreement, at its sole discretion and upon written notice to
      Licensee:

     

    11.1.1  
      subject
      to the
      provisions of Section 4.7 hereof, should Licensee fail to pay when due any
      amount owing to Licensor hereunder and fail to remedy such default within
      fifteen (15) business days after receipt of written notice thereof from
      Licensor;

     

    11.1.2  
      should
      Licensee fail to submit financial information required pursuant to Section
      4.3
      to Licensor and fail to remedy such default within fifteen (15) business days
      after receipt of written notice thereof from Licensor;

     

    11.1.3  
      should
      any Weider Designation be used in connection with the Licensed Products or
      any
      related materials, advertising or promotion in the Territory contrary to
      provisions of Section X3.2X
      hereof;

     

    11.1.4  
      should
      the Product Launch Date not occur by the end of the fifteen (15th) calendar
      month
      following the execution of this Agreement; or

     

    11.1.5  
      should
      Licensee breach any other material provision hereof and fail to remedy same
      within thirty (30) days after receipt of written notice thereof from Licensor
      containing reasonably sufficient particulars thereof.

     

    11.2  The
      occurrence of
      any one or more of the following events shall entitle Licensee to immediately
      terminate this Agreement, at its sole discretion and upon written notice to
      Licensor:

     

    11.2.1  
      should
      Licensor fail to maintain registration of any of the Trademarks in the
      Territory, or should Licensee's right and ability to Use the Trademarks be
      materially impaired or materially, negatively impacted, commercially or
      otherwise;

     

    11.2.2  
      should
      Licensor breach any other material provision hereof and fail to remedy same
      within thirty (30) days after receipt of written notice thereof from Licensee
      containing reasonably sufficient particulars thereof; or

     

    11.2.3  
      should
      Costco Japan elect to no longer carry the Licensed Products and the Costco
      Private Label Products.

     

    11.3  In
      addition, a
      party may terminate this Agreement immediately, upon written notice, if the
      other party makes an assignment for the benefit of its creditors, files a
      petition in bankruptcy, is adjudicated insolvent or bankrupt, files a petition
      or apply to any tribunal for any receiver, trustee, liquidator or sequestrator
      of any substantial portion of its property, commence any proceeding under any
      law or statute of any jurisdiction respecting insolvency, bankruptcy,
      arrangement or readjustment of debt, dissolution, winding-up, composition or
      liquidation, or otherwise takes advantage of any bankruptcy or insolvency
      legislation whether now or hereafter in effect, or if any receiver, trustee,
      liquidator or sequestrator of any substantial portion of its property is
      appointed.

     

    11.4  No
      Person acting
      for the benefit of the creditors of Licensor or Licensee or any receiver,
      trustee, liquidator, sequestrator, trustee in bankruptcy, sheriff, officer
      of a
      court or Person in possession of Licensor’s or Licensee's assets or business
      shall have any right to continue the performance of this Agreement in any
      circumstances whatsoever.

     

    11.5  All
      rights,
      remedies and recourses set forth herein for the benefit of Licensor or Licensee,
      as applicable, shall be in addition and without prejudice to all other rights,
      remedies and recourses available to such party, except as otherwise set forth
      herein.

     

     

    
      
        
        

      

      
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          12 -

        
          

        

      

      
        
        

      

    

     

     

    
      	
              12.  

            	
              EFFECT
                OF TERMINATION OR EXPIRATION OF THE
                TERM

            

    

     

    12.1  Upon
      the
      termination of this Agreement for any reason whatsoever or the expiration of
      the
      Term of this Agreement, or upon the expiration of the Winding-Up Period (as
      hereinafter defined), if any, the following provisions shall apply:

     

    12.1.1  
      all
      rights of Licensee hereunder and all rights of Costco Japan resulting therefrom,
      including without limitation the right and license to Use the Trademarks, shall
      cease immediately, and Licensee shall, and shall use its best efforts to cause
      Costco Japan to, immediately discontinue all Use of the Trademarks subject
      to
      Section 12.2; and

     

    12.1.2  
      all
      undisputed amounts owing by Licensee to Licensor shall become due and payable
      within ten (10) business days following receipt of written demand from Licensor
      therefor.

     

    12.2  In
      addition, upon
      the expiration of the Term of this Agreement or the termination of this
      Agreement for any reason other than pursuant to Section X11.1.5X
      (arising
      from a breach of any of Sections X6X,
X7X
      or X9X
      hereof),
X11.1.1X
      or X11.1.3X
      hereof,
      each of Licensee and Costco Japan shall have the right to distribute and sell
      its remaining inventory of Licensed Products, on a non-exclusive basis, for
      a
      period of one hundred eighty (180) days following the date of termination of
      this Agreement or the expiration of the
      Term (such one hundred eighty (180) day period
      being referred to herein as the “Winding-Up Period”) in the
      ordinary course of business and in strict accordance with the terms of this
      Agreement and the following provisions:

     

    12.2.1  
      no
      later than thirty (30) days prior to the expiration of the Term of this
      Agreement or within thirty (30) days after such termination of this Agreement,
      Licensee shall deliver to Licensor a complete and detailed statement (the
“Inventory Statement”) setting forth the number and description
      of the then remaining inventory of Licensed Products, raw materials therefor,
      work in process and labels therefor destined for the Territory that are owned
      or
      controlled by Licensee, and shall use commercially reasonable best efforts
      to
      obtain and include such information from Costco Japan (collectively, the
“Remaining Inventory”); and

     

    12.2.2  
      within
      twenty (20) days following the earlier of: (i) the expiration of the Winding-Up
      Period, or (ii) the actual liquidation of all Remaining Inventory, Licensee
      and
      Costco Japan shall cease Using the Trademarks in the Territory.

     

    12.3  Termination
      of this
      Agreement for any reason whatsoever or the expiration of the Term shall not
      release either party from any of its obligations which remain unfulfilled at
      such time or release either party from those obligations which survive such
      termination or expiration, including without limitation the obligations set
      forth in Sections X4X,
X6X,
X9X,
X12X
      and
X13X
      hereof.

     

    12.4  Notwithstanding
      anything in this Agreement to the contrary, upon termination of this
      Agreement:

     

    12.4.1  
      by
      Licensee pursuant to Section 11.2.1, 11.2.2 or 11.3 hereof, no additional
      Royalties (including Guaranteed Minimum Royalties) shall accrue or be payable
      in
      respect of any period after the date of such termination;

     

    12.4.2  
      by
      Licensee pursuant to Section 11.2.3 hereof:

     

    12.4.2.1  at
      any time prior
      to the expiration of the Initial Term, Licensee shall pay to Licensor all unpaid
      Guaranteed Minimum Royalties that would have otherwise been payable hereunder
      by
      Licensee to Licensor for the first three (3) Contract Years as set forth in
      Section X4.1.1X
      hereof,
      or

     

    12.4.2.2  at
      any time
      thereafter, Licensee shall pay to Licensor the Guaranteed Minimum Royalties
      that
      would have otherwise been payable hereunder in respect of the four (4) complete
      fiscal quarters of Licensee immediately following such termination and shall,
      conditional upon such payment, be fully discharged and released for any
      additional payment of Guaranteed Minimum Royalties that would have become due
      under this Agreement after such termination; or

     

    12.4.3  
      by
      Licensor pursuant to Section 11.1 or 11.3 hereof:

     

    12.4.3.1  at
      any time prior
      to the expiration of the Initial Term, Licensee shall pay to Licensor all unpaid
      Guaranteed Minimum Royalties that would have otherwise been payable hereunder
      by
      Licensee to Licensor for the first three (3) Contract Years as set forth in
      Section X4.1.1X
      hereof,
      or

     

    12.4.3.2  at
      any time
      thereafter, Licensee shall pay to Licensor the Guaranteed Minimum Royalties
      that
      would have otherwise been payable hereunder in respect of the longer of: (i)
      the
      four (4) complete fiscal quarters of Licensee immediately following such
      termination; or (ii) all of the remaining complete fiscal quarters of Licensee
      following such termination until the expiration of the then-current Term of
      this
      Agreement; and Licensee shall, conditional upon such payment, being fully
      discharged and released for any additional payment of Guaranteed Minimum
      Royalties that would have become due under this Agreement after such
      termination.

     

     

    
      
        
        

      

      
        -
          13 -

        
          

        

      

      
        
        

      

    

     

     

    
      	
              13.  

            	
              MISCELLANEOUS
                PROVISIONS

            

    

     

    13.1  The
      preamble hereto
      shall form an integral part hereof.

     

    13.2  This
      is an
      agreement between separate entities and neither is the agent or servant of
      or
      possesses the power to obligate the other.  This Agreement shall not
      be construed so as to constitute Licensor (or the Mariz Licensee, JWO or any
      of
      their respective Affiliates) and Licensee (or Costco Japan) partners or joint
      venturers or so as to create any other form of legal association which imposes
      liability upon either party for the acts or omissions of the other
      party.

     

    13.3  Failure
      by either
      party to take action against the other shall not affect its right to require
      full performance of this Agreement at any time thereafter.  The waiver
      by either party of the breach of any provision of this Agreement by the other
      shall not operate or be construed as a waiver of any subsequent breach by such
      party.

     

    13.4  Should
      any term,
      covenant or condition of this Agreement or the application thereof to any Person
      or circumstance be invalid or unenforceable, the remainder of this Agreement,
      or
      the application of such term, covenant or condition to Persons or circumstances
      other than those as to which it is held invalid or unenforceable, shall not
      be
      affected thereby and each term, covenant and condition of this Agreement shall
      be valid and enforced to the fullest extent permitted by law.

     

    13.5  Any
      notice, demand
      or request required or permitted to be given hereunder shall be in writing
      and
      shall be deemed effective one (1) business day after having been faxed or four
      (4) business days after been mailed by prepaid, registered or certified mail,
      return receipt requested, to the addressee as follows: (i) if to Licensor,
      at
      the address set forth above or at the following fax number: +44 1534 504 701;
      or
      (ii) If to Licensee, at the address of Licensee set forth above or at the
      following fax number: 801-975-1924.  Any party may change its address
      or fax number for the purposes of this Agreement by giving written notice
      thereof to the other party in accordance with this provision.

     

    13.6  This
      Agreement, and
      the tri-party agreement dated the date hereof among Licensor, Licensee and
      JWO
      (the “Tri-Party Agreement”), sets forth the entire agreement and understanding
      between the parties with respect to the subject matter hereof and supersedes
      all
      prior discussions and negotiations.  Nothing in this Agreement or the
      Tri-Party Agreement shall affect the exclusion of the Territory pursuant to
      the
      terms of or supersede the License Agreement between the parties dated as of
      December 1, 1996, as amended in writing from time to time. Neither party shall
      be bound by any conditions, definitions, representations or warranties with
      respect to the subject matter hereof other than those contained in this
      Agreement, in the Tri-Party Agreement or hereafter set forth in a writing duly
      executed by the parties. No
      provision of this Agreement may be modified, waived or discharged unless such
      waiver, modification or discharge is agreed to in writing signed by each party
      hereto.

     

    13.7  Licensee
      shall not
      be entitled to assign or otherwise transfer any of its rights and obligations,
      or subcontract the performance of substantially all of its obligations, under
      this Agreement, except to an Affiliate of Licensee, or in the event of a change
      of ownership or control of Licensee, including a sale of substantially all
      the
      assets of Licensee. Licensor shall not be entitled to assign or otherwise
      transfer any of its rights and obligations, or subcontract the performance
      of
      substantially all of its obligations, under this Agreement, except to an
      Affiliate of Licensor, or in the event of a change of ownership or control
      of
      Licensor, including a sale of substantially all the assets of Licensor. In
      all
      cases of permitted assignments pursuant to the foregoing: (i) prior written
      notice of such assignment must be given by the assigning party to the other
      party to this Agreement; (ii) the assignee must agree in writing in advance
      to
      be bound by the provisions of this Agreement in favour of the other party to
      this Agreement; and (iii) in the case of an assignment or other transfer in
      connection with a sale of substantially all the assets of either party, the
      assigning party shall be released from all of its obligations under this
      Agreement accruing as and from the date of such assignment.

     

    13.8  The
      parties agree
      to perform such acts and execute and deliver such documents as may be reasonably
      necessary or desirable from time to time in order to give full effect to the
      provisions hereof.

     

    13.9  This
      Agreement
      shall be governed by and construed and enforced in accordance with the laws
      of
      England and Wales, without reference to its conflicts of law
      principles.

     

    (signature
      page
      follows)

     

     

    

     

    
      
        
        

      

      
        -
          14 -

        
          

        

      

      
        
        

      

    

     

    

     

     

    IN
      WITNESS
      WHEREOF, THE PARTIES HAVE EXECUTED THIS AGREEMENT AS OF THE ______ DAY
      OF SEPTEMBER, 2007.

     

    

     

    
      	
              MARIZ
                GESTAO E INVESTIMENTOS LIMITADA

            	 	
              SCHIFF
                NUTRITION GROUP, INC.

            
	
              Per:

            	 	 	
              Per:

            	 
	 	 	 	 	 

    

    

    

    (949485)

    
      
        
        

      

      
        -
          15 -

        
          

        

      

      
        
        

      

    

    

    SCHEDULE
      “A”

    

    TRADEMARKS

    

    

    
      	
              “Move
                Free” Trademarks

            	 	
              International
                Classes

            	 	
              Registration
                Number

            	 	
              Country

            
	 	 	 	 	 	 	 
	
              Move
                Free

            	 	
              05,
                30,
                32

            	 	
              4551035

            	 	
              Japan

            
	 	 	 	 	 	 	 
	
              Move
                Free

            	 	
              29

            	 	
              4630586

            	 	
              Japan

            
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	
              “Schiff”
                Trademarks

            	 	
              International
                Classes

            	 	
              Registration
                Number

            	 	
              Country

            
	 	 	 	 	 	 	 
	
              Schiff

            	 	
              29

            	 	
              4677454

            	 	
              Japan

            
	 	 	 	 	 	 	 
	
              Schiff

            	 	
              29,30

            	 	
              4684595

            	 	
              Japan

            
	 	 	 	 	 	 	 
	
              Schiff

            	 	
              5,
                32

            	 	
              4833460

            	 	
              Japan

            

    

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    SCHEDULE
      “B”

    

    FORM
      OF
      UNDERTAKING

    

    

    [Date]

    

    Mariz
      Gestao e
      Investimentos Limitada

    Rua
      dos Murcas, No.
      88-3o, 9000

    Funchal,
      Madeira,
      Portugal

    

    

    
      	
              Re:

            	
              That
                certain
                License Agreement dated as of September ____, 2007 between Mariz
                Gestao e
                Investimentos Limitada (the “Licensor”) and Schiff Nutrition Group, Inc.
                (the “Licensee”) (as same may be amended, restated or supplemented from
                time to time, the “License
                Agreement”)

            

    

    

    Sirs:

    

    Each
      capitalized
      term used but not defined in this Undertaking has the meaning given to it in
      the
      License Agreement.

    

    The
      undersigned,
      [Name of the undersigned Additional Corporation], a [jurisdiction of the
      undersigned Additional Corporation] corporation and an Additional Corporation,
      hereby undertakes to be a licensee and beneficiary of the rights of the Licensee
      under the License Agreement and hereby assumes and agrees to be bound by all
      of
      the terms and conditions of the License Agreement applicable to the Licensee
      thereunder on a joint and several basis with the Licensee and with all other
      Additional Corporations who have executed and delivered a similar undertaking
      (the Licensee, the undersigned and all other Additional Corporations who have
      executed and delivered a similar undertaking being hereinafter collectively
      referred to as the “Licensee Group”).

    

    The
      undersigned
      confirms that it has received and reviewed a copy of the License Agreement,
      together with all amendments, restatements, supplements, and modifications
      thereto in effect as of the date hereof, and hereby declares being satisfied
      therewith.

    

    All
      notices to the
      undersigned under the License Agreement should be directed to: [Contact person
      with the undersigned], [Name of undersigned], c/o Schiff Nutrition Group, Inc.
      in accordance with the provisions of Section 13.5 of the License
      Agreement.

    

    All
      statements,
      reports and other documents containing information or data relating to the
      Licensee which are required or permitted to be provided by the Licensee to
      the
      Licensor pursuant to the License Agreement shall be provided by the undersigned
      to the Licensee, who will consolidate them with all other similar information
      or
      data relating to all members of the Licensee Group.

    

    All
      decisions,
      consents, approvals, and instructions of the Licensee under or relating to
      the
      License Agreement shall be binding upon the undersigned and all other members
      of
      the Licensee Group to the same extent as it is binding upon the
      Licensee.

    

    Any
      exercise of
      rights, remedies or recourses by Licensor under the License Agreement, this
      Undertaking or any similar undertaking or at law against any member of the
      Licensee Group shall be binding upon and enforceable against all other members
      of the Licensee Group.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    This
      Undertaking
      shall be governed by and construed and enforced in accordance with the laws
      of
      the United Kingdom, without reference to its conflicts of law
      principles.

    

    

    Very
      truly
      yours,

    

    [Name
      of Additional
      Corporation]

     

    
      
        	
                By:

              	 
	
                Title:

              	 
	 	 
	 	 
	 	 
	
                Acknowledged
                  and Agreed:

              
	 	 
	
                Schiff
                  Nutrition Group, Inc.

              
	 	 
	
                By:

              	 
	
                Title:

              	 
	 	 
	 	 
	 	 
	
                Accepted:

              
	 	 
	
                Mariz
                  Gestao
                  e Investimentos Limitada

              
	 	 
	
                By:

              	 
	
                Title:

              	 

      

       

    

    3750871

    051007

    
      
        
        

      

      
        -
          2 -exhibit10_2.htm

    
       

      
        

        

      

      
        Exhibit
          10.2 

        
          

        

      

      

      EMPLOYMENT
        AND
        CHANGE IN CONTROL AGREEMENT

       

      BRUCE
        J.
        WOOD

       

      PARTIES

       

      This
        Employment and
        Change in Control Agreement (this “Agreement”) is entered into effective as of
        June 1, 2007 (the “Effective Date”) by and between Schiff Nutrition Group, Inc.,
        a Utah corporation with offices at 2002 South 5070 West, Salt Lake City,
        Utah
        84104-4836 (the “Company”) and Bruce J. Wood residing at 3983 East Alta
        Approach, Sandy, Utah 84092 (“Executive”).

       

      WITNESSETH:

       

      WHEREAS,
        the
        Company and Executive are parties to that certain Employment Agreement dated
        as
        of June 1, 2002, that expired on May 31, 2007 (the “Prior
        Agreement”);

       

      WHEREAS,
        the
        Company and Executive are also parties to that certain Change in Control
        Agreement dated as of October 1, 2005 (the “Change in Control Agreement”);
        and

       

      WHEREAS,
        the
        Company and the Executive desire to enter into a single agreement setting
        forth
        the terms of a new employment agreement and amending and restating the terms
        of
        the Change in Control Agreement to extend the period during which Executive’s
        employment will be deemed to be terminated “in connection with a Change in
        Control,” to clarify the intent of certain provisions, and to make certain other
        changes.

       

       

      TERMS
        OF
        AGREEMENT

       

      NOW,
        THEREFORE, in
        exchange for good and valuable consideration, the receipt and sufficiency
        of
        which is hereby acknowledged, the Company and Executive agree as
        follows:

       

      1.  Definitions.  For
        purposes of this Agreement, the terms listed below shall be defined as
        indicated.

       

      Affiliate:  A
        domestic or foreign business entity controlled by, controlling, under common
        control with, or in joint venture with, the applicable person or
        entity.

       

      Annual
        Bonus:  See Section 3.2.

       

      Base
        Salary:  Except as otherwise noted in the Agreement, the base
        salary described in Section
        3.1 for a 12 month period, as in effect from time to time, but without regard
        to
        any reduction in Executive’s base salary that would serve as a basis for a
        termination of employment by Executive for “Good Reason” pursuant to Section
        5.2.

       

      Board:  The
        Board of Directors of the Company or Schiff Nutrition International, Inc.
        (“SNI”).

       

      Cause:  See
        Section 5.1.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       

      Change
        in
        Control:  The occurrence of any of the following:

       

      (a)  A
        transaction or
        series of transactions (other than an offering of SNI Class A common stock
        to
        the general public through a registration statement filed with the Securities
        and Exchange Commission) whereby any “person” or related “group” of “persons”
(as such terms are used in Sections 13(d) and 14(d)(2) of the
        Exchange Act (other than SNI, any of its subsidiaries, an employee benefit
        plan
        maintained by SNI or any of its subsidiaries or a “person” that, prior to such
        transaction, directly or indirectly controls, is controlled by, or is under
        common control with, SNI) directly or indirectly acquires beneficial ownership
        (within the meaning of Rule 13d-3 under the Exchange Act) of securities of
        SNI possessing more than 50% of the total combined voting power of SNI’s
        securities outstanding immediately after such acquisition, excluding any
        transaction involving a distribution of SNI’s Class A common stock (or any
        substituted security) held by Weider Health and Fitness (“WHF”) to
        individual stockholders of WHF or their family trusts if and to the extent
        the
        Board finds such distribution to not be within the intent of this subsection
        (a);

       

      (b)  During
        any period
        of two consecutive years, individuals who, at the beginning of such period,
        constitute the Board of Directors of SNI together with any new director(s)
        (other than a director designated by a person who shall have entered into
        an
        agreement with SNI to effect a transaction described in subsection (a) or
        subsection (c)) whose election by the Board of Directors of SNI or nomination
        for election by SNI’s stockholders was approved by a vote of at least two-thirds
        of the directors then still in office who either were directors at the beginning
        of the two year period or whose election or nomination for election was
        previously so approved, cease for any reason to constitute a majority
        thereof;

       

      (c)  The
        consummation by
        SNI (whether directly involving SNI or indirectly involving SNI through one
        or
        more intermediaries) of (x) a merger, consolidation, reorganization, or
        business combination or (y) a sale or other disposition of all or
        substantially all of SNI’s assets or (z) the acquisition of assets or stock
        of another entity, in each case other than a transaction:

       

      (i)  Which
        results in
        SNI’s voting securities outstanding immediately before the transaction
        continuing to represent (either by remaining outstanding or by being converted
        into voting securities of SNI or the person that, as a result of the
        transaction, controls, directly or indirectly, SNI or owns, directly or
        indirectly, all or substantially all of SNI’s assets or otherwise succeeds to
        the business of SNI (SNI or such person, the “Successor Entity”))
        directly or indirectly, at least a majority of the combined voting power
        of the
        Successor Entity’s outstanding voting securities immediately after the
        transaction, and

       

      (ii)  After
        which no
        person or group beneficially owns voting securities representing 50% or more
        of
        the combined voting power of the Successor Entity; provided, however,
        that no person or group shall be treated for purposes of this subsection
        (c)(ii) as beneficially owning 50% or more of combined voting power of the
        Successor Entity solely as a result of the voting power held in SNI prior
        to the
        consummation of the transaction; or

       

      (d)  SNI’s
        stockholders
        approve a liquidation or dissolution of SNI.

       

      Code:  The
        Internal Revenue Code of 1986, as amended.

       

      Competition
        Date:  See Section 8.4.

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

       

      Confidential
        Information:  All secret proprietary information of the Company
        and its Affiliates, not otherwise publicly disclosed, whether or not discovered
        or developed by Executive, known by Executive as a consequence of Executive’s
        employment with the Company at any time as an employee or
        agent.  Without limiting the generality of the foregoing, such
        proprietary information shall include (a) customer lists; (b) acquisition,
        expansion, marketing, financial and other business information and plans;
        (c)
        research and development; (d) computer programs; (e) sources of supply; (f)
        identity of specialized consultants and contractors and confidential information
        developed by them for the Company and its Affiliates; (g) purchasing, operating
        and other cost data; (h) special customer needs, cost and pricing data; (i)
        manufacturing methods; (j) quality control information; (k) inventory
        techniques; (l) employee information; any of which information is not generally
        known in the industries in which the Company and its Affiliates are conducting
        business or shall at any time during Executive’s employment conduct business
        including (without limitation) the Nutraceutical
        Industry.  Confidential Information also includes the overall
        business, financial, expansion and acquisition plans of the Company and its
        Affiliates, and includes information contained in manuals, memoranda,
        projections, minutes, plans, drawings, designs, formula books, specifications,
        computer programs and records, whether or not legended or otherwise identified
        by the Company and its Affiliates as Confidential Information, as well as
        information which is the subject of meetings and discussions and not so
        recorded. Notwithstanding the foregoing, Confidential Information shall not
        include (i) information, from a source other than the Company,  which
        is in Executive’s possession on the date hereof or subsequently becomes
        available to Executive so long as such information was lawfully obtained
        and is
        not, to the knowledge of Executive, subject to another confidentiality agreement
        or obligation of secrecy to the Company or another person, or (ii) information
        which becomes generally available to the public other than directly or
        indirectly as a result of disclosure by Executive.

       

      Closing
        Price:  The closing price, as reported in The Wall Street
        Journal, of a share of Common Stock (or any successor company’s equivalent
        shares) on the principal exchange on which such shares are traded (currently
        the
        New York Stock Exchange), subject to equitable adjustment for stock splits,
        recapitalizations or similar transactions including stock received or exchanged
        on any merger, consolidation or similar event.

       

      Common
        Stock:  Class A common stock of SNI.

       

      Developments:  Those
        discoveries, inventions, improvements, advances, methods, practices and
        techniques, concepts and ideas, whether or not patentable, relating to or
        arising out of Executive’s employment activities with the Company and/or the
        Products.

       

      Effective
        Date:  See preamble.

       

      Employment
        Period:  The period from the Effective Date through the Expiration
        Date, except as terminated earlier or extended as provided in this
        Agreement.

       

      Equity
        Awards:  Restricted stock or other equity awards granted pursuant
        to the Equity Incentive Plan.

       

      Exchange
        Act:  The Securities Exchange Act of 1934, as
        amended.

       

      Expiration
        Date:  May 31, 2008.

       

      Good
        Reason:  See Section 5.2.

       

      Good
        Reason
        Date:  The day on which the material breach or event occurs
        resulting in “Good Reason” pursuant to Section 5.2.

       

      Inventions:  Those
        discoveries, developments, concepts and ideas, whether or not patentable,
        relating to the present, future and prospective activities and Products and
        Services of the Company and its Affiliates, which such activities and Products
        and Services are known to Executive by virtue of Executive’s employment with the
        Company and its Affiliates.

       

      Equity
        Incentive
        Plan:  SNI’s 1997 Equity Participation Plan, SNI’s 2004 Incentive
        Award Plan, as either may be amended from time to time, and any other plan
        or
        arrangement under which SNI (or any successor thereto) or its subsidiaries
        grant
        equity-based awards.

       

      Options:  Stock
        option awards granted pursuant to the Equity Incentive Plan.

       

      Nutraceutical
        Industry:  The manufacture and sale of nutritional products
        whether in the form of drinks, bars, herbs, minerals, supplements, powders,
        vitamins or pills or otherwise but not the food and beverage industry
        generally.

       

      Products
        and
        Services:  All products or services sold, rented, leased, rendered
        or otherwise made available to its customers by the Company and its Affiliates,
        or otherwise the subject of the business of the Company and its
        Affiliates.

       

      Termination
        Date:  The effective date of the termination of Executive’s
        employment with the Company for any reason.  In the event of
        Executive’s death, the Termination Date shall be his date of
        death.  In the event of termination under Sections 5.1 through 5.4,
        the Termination Date shall be specified in the written notice.

       

      Weider
        Group:  Weider Health and Fitness (or its successor) and its
        Affiliates.

       

      SNI:  Schiff
        Nutrition International, Inc., a Delaware corporation and the parent of the
        Company.

       

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

       

      2.  Employment.  Subject
        to the terms and conditions of this Agreement, Executive hereby agrees to
        continue his employment as the President and Chief Executive Officer of the
        Company reporting to the Board and to continue to perform to the best of
        Executive’s ability, experience and talent those acts and duties and to furnish
        those services to the Company and its Affiliates in connection with and related
        to such position as the Board shall from time to time direct, provided such
        acts
        and directives are consistent with the duties of a chief executive
        officer.  Executive shall continue to use Executive’s best and most
        diligent efforts to promote the interests of the Company and its Affiliates.
        Executive shall continue to devote his full business time to his duties to
        the
        Company. Executive shall continue to be provided with secretarial services,
        an
        office and similar support services and facilitates as appropriate to
        Executive’s position and responsibilities.

       

      3.  Compensation
        and
        Benefits; Disability.

       

      3.1.  Salary.  During
        the Employment Period, the Company shall pay Executive a Base Salary at an
        annual rate of $488,000, payable in equal installments pursuant to the Company’s
        customary payroll policies in force at the time of payment (but in no event
        less
        frequently than monthly), less required payroll deductions. Executive’s Base
        Salary shall be subject to review and increase in the sole discretion of
        the
        Compensation Committee of the Board.

       

      3.2.  Annual
        Bonus.  In addition to Executive’s Base Salary, during the
        Employment Period Executive shall be eligible to participate in a bonus plan
        established by the Board or the Board’s Compensation Committee for senior
        executives.  The bonus plan will correspond to the Company’s fiscal
        year and payments under the bonus plan shall be paid to Executive within
        75 days
        after the end of the Company’s fiscal year.  Executive’s target bonus
        percentage shall be equal to 70% of his Base Salary, subject to review and
        increase in the sole discretion of the Board’s Compensation
        Committee.  Executive shall not have earned, and shall not be entitled
        to payment of, the Annual Bonus unless he remains employed through the end
        of
        such fiscal year, except as provided in Sections 5.4(c) and
        6.1(a)(ii).

       

      3.3.  Other
        Benefits.  Executive shall be entitled, during the Employment
        Period, to participate, in any life insurance, disability insurance, health
        insurance or hospital plans or other fringe benefits or benefit plans presently
        in effect and hereafter maintained by the Company for executives generally.
        Executive shall also be entitled to an automobile allowance in the amount
        of
        $970 per month, subject to review and increase in the sole discretion of
        the
        Board’s Compensation Committee..

       

      3.4.  Vacation.  Executive
        shall be entitled to the great of four weeks vacation time per year, or such
        amount of vacation time provided to senior executives of the Company under
        the
        Company’s vacation pay policies as in effect from time to time.

       

      3.5.  Expenses.  Pursuant
        to the Company’s customary policies in force at the time of payment, Executive
        shall be promptly reimbursed, against presentation of vouchers or receipts
        therefor, for all authorized expenses properly incurred by Executive on the
        Company’s behalf in the performance of Executive’s duties
        hereunder.

       

      4.  Employment
        Period.

       

      4.1.  Termination
        of Employment Period.  The Employment Period shall continue
        through the Expiration Date unless terminated prior to such date by the earliest
        of (a) Executive’s discharge for Cause pursuant to Section 5.1, (b) Executive’s
        discharge without Cause pursuant to Section 5.3, (c) Executive’s death, (d)
        Executive’s termination because of disability, pursuant to Section 5.4(b) or (e)
        termination of this Agreement by Executive for Good Reason pursuant to
        Section 5.2; unless, however, the Employment Period is extended pursuant to
        the following sentence. The Employment Period shall automatically be extended
        for up to three successive one year terms unless either party hereto gives
        written notice (pursuant to Section 12) of non-extension to the other no
        later
        than three months prior to the end of the otherwise applicable term. In all
        events, the post employment provisions of Section 8 shall survive termination
        of
        the Employment Period.

       

       

      
        
          
          

        

        
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      5.  Termination
        of
        Employment.

       

      5.1.  By
        Company for Cause.  The Company may discharge Executive and
        terminate this Agreement for Cause upon written notice to
        Executive.  As used in this Section, “Cause” shall mean any one or
        more than one of the following:

       

      (a)  Gross
        or willful
        misconduct of Executive during (i) the Employment Period or (ii) any prior
        period of employment of Executive in an executive capacity by any person
        or
        entity if not disclosed to the Company prior to the execution
        hereof;

       

      (b)  Executive’s
        conviction or plea of guilty or nolo contendere to a fraud or felony
        during the Employment Period;

       

      (c)  Executive’s
        substantial and willful failure to follow specific and lawful substantive
        written directives or resolutions of the Board;

       

      (d)  Executive’s
        willful
        and knowing violation of any rules or regulations of any governmental or
        regulatory body, which is materially injurious to the financial condition
        of the
        Company;

       

      (e)  Executive’s
        drug,
        alcohol or substance abuse (to the extent not protected by the Americans
        with
        Disabilities Act or similar state law) during the Employment Period;
        or

       

      (f)  any
        material breach
        of any of the terms of this Agreement which is not corrected after written
        notice and a reasonable cure period not to exceed 15 days.

       

      Upon
        discharge of
        Executive for Cause, the Company shall be relieved and discharged of all
        obligations to make payments to Executive which would otherwise be due under
        this Agreement, except as to Base Salary earned for actual services rendered
        prior to the date of discharge.

       

      5.2.  By
        Executive.  Executive may terminate this Agreement for “Good
        Reason” upon written notice to the Company.  As used in this Section
        5.2, “Good Reason” shall mean: (a) the Company’s material breach of any of the
        terms of this Agreement; or (b) a Change in Control occurs and Executive
        does
        not become the chief executive officer of the principal operating business
        of
        the surviving entity.

       

      5.3.  By
        Company  without Cause.  The Company may, on 30 days
        written notice to Executive, terminate this Agreement without cause at any
        time
        during the Employment Period.

       

      5.4.  Termination
        on
        Executive’s Death or Disability.

       

      (a)  This
        Agreement and
        the Employment Period shall terminate, and the Company shall be relieved
        and
        discharged of all obligations to make further payment to Executive after
        the
        date of the death of Executive, except as described in subsection
        (c).

       

      (b)  If,
        during the
        Employment Period, Executive shall become ill, disabled, or otherwise
        incapacitated so as to be unable regularly to perform Executive’s usual duties
        for a period in excess of 180 total days during any consecutive 12 months,
        then
        the Company shall have the right to terminate this Agreement on 10 days written
        notice to Executive.

       

      (c)  In
        case of
        termination of employment described in subsections (a) or (b), the Company
        shall
        pay to Executive, or his estate, all salary earned for actual services rendered
        prior to the Termination Date and, in addition, a pro-rated bonus at the
        level
        of 100% of his Base Salary (calculated as the product of his then rate of
        Base
        Salary and the fraction of the fiscal year elapsed through the date of
        termination of Executive’s employment) in a single lump sum within ten (10)
        business days of the Termination Date.

       

      (d)  Upon
        a termination
        of Executive’s employment pursuant to subsections (a) or (b),  unless
        otherwise provided in the applicable equity award agreement all Options (or
        Equity Awards) that would have become exercisable (or vested) on or before
        the
        first anniversary of the date of grant following the Termination Date shall
        become exercisable (or vested) upon the Termination Date.

       

       

      
        
          
          

        

        
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      6.  Payments
        on
        Certain Terminations.

       

      6.1.  Severance
        Payments.  Upon a termination of Executive’s employment pursuant
        to Sections 5.2 or 5.3 or a notice of non-renewal
        given by the Company pursuant to Section 4.1, and in consideration of and
        subject to Executive’s delivery to the Company of a release that becomes
        irrevocable within 30 days of Executive’s Separation from Service (as defined
        below), in form and substance reasonably satisfactory to the Company, of
        any
        claims that Executive might have against the Company:

       

      (a)  the
        Company shall
        make payments to Executive, as liquidated damages in lieu of all other claims,
        of an amount equal to the sum of:

       

      (i)  Executive’s
        Base
        Salary, and

       

      (ii)  the
        greater of
        Executive’s Annual Bonus for the prior fiscal year or Executive’s Base
        Salary.

       

      Subject
        to Section
        9, such amount shall be paid in 24 equal semi-monthly installments, without
        interest, beginning on the first business day of the first month that is
        at
        least 30 days following Executive’s separation from service with the Company
        and/or its Affiliates within the meaning of Section 409A(a)(2)(A)(i) of the
        Internal Revenue Code and the regulations thereunder (the “Separation from
        Service”).  The Company shall have no obligation to make such payments
        in the event of a breach by Executive of Executive’s covenants in Section
        8.

       

      (b)  Unless
        otherwise
        provided in the applicable equity award agreement, all Options (or Equity
        Awards) that would have become exercisable (or vested) on or before the first
        anniversary of the date of grant following the Termination Date shall become
        exercisable (or vested) upon the Termination Date; and,

       

      (c)  In
        the event
        Executive’s employment with the Company is terminated pursuant to Section 5.2 or
        5.3, subject to Section 9 of this Agreement, Executive and Executive’s covered
        dependents shall be entitled to continue to receive, at the expense of the
        Company (other than Executive’s continued payments of the current portion of
        such costs for Executive and his covered dependents), and participate in,
        for a
        period of 12 months from the Termination Date, any life insurance, disability
        insurance, dental insurance, health insurance or hospital plans of the Company
        in effect at the Termination Date (as such plans may be amended from time
        to
        time thereafter); provided, that, in the event of Executive’s
        termination of employment “in connection with a Change in Control” (as defined
        in Section 7), such benefits shall be substantially similar in the aggregate
        to
        (or greater than) the benefits provided to Executive and his covered dependents
        immediately prior to the Change in Control (or, if greater, the benefits
        provided to Executive and his covered dependents immediately prior to
        Executive’s termination of employment).

       

      7.  Change
        in
        Control Severance Payment.

       

      In
        addition to any
        severance payments Executive may be entitled to receive under Section 6.1,
        if
        Executive’s employment with the Company is terminated pursuant to Section 5.2 or
        5.3 and such termination is made “in connection with a Change in Control,” then
        in consideration of and subject to the delivery by Executive to the Company
        of a
        release, in form and substance reasonably satisfactory to the Company, of
        any
        claims that Executive might have against the Company, the Company shall pay
        to
        Executive an amount equal to his then current Base Salary (the “CIC Severance
        Benefit”).  Subject to Section 9 of this Agreement and the execution
        and non-revocation by Executive of the release described above, the Enhanced
        Severance Benefit shall be paid to Executive, without interest, in 24 equal
        semi-monthly installments, beginning on the first business day of the
        thirteenth  month following Executive’s Separation from Service. For
        purposes of this Agreement, any termination “in connection with a Change in
        Control” shall be any termination pursuant to Section 5.2 or 5.3 of the
        Employment Agreement during the period beginning 90 days prior to and concluding
        12 months following the consummation of a Change in Control, provided that
        the
        Change in Control is both (i) subject to a definitive written purchase, sale,
        merger or similar agreement entered into during the period beginning on the
        Effective Date and ending on the Expiration Date and (ii) consummated on
        or
        prior to the expiration of six months following the Expiration
        Date.  The payments provided herein are expressly in addition to and
        not a substitution for any payments Executive is entitled to receive under
        Section 6.1 of this Agreement for such terminations.

       

      
        8.  Parachute
          Payments.

         

        8.1.  If
          it is determined
          (as hereafter provided) that any payment, compensation or other benefit
          provided
          by the Company (or any successor entity) to or for the benefit of Executive
          under this Agreement or any other plan, agreement or arrangement (the
“Payments”) would be subject to the excise tax imposed by Code Section 4999 (a
“Parachute Tax”), or any tax, interest, penalty or other expense incurred by
          Executive pursuant to Code Section 409A (a “Deferred Compensation Tax”) to which
          Executive would not have been subject but for the Company’s failure to pay any
          severance amounts pursuant to the provisions of Section 6, 7 and 9 of this
          Agreement or other failure to make such payments in a manner that avoids
          such
          payments qualifying as deferred compensation under Section 409A of the
          Code
          (collectively, a “Payment”), then Executive shall be entitled to receive an
          additional payment or payments (a “Gross-Up Payment”) in an amount such that,
          after payment by Executive of all taxes (including any Parachute Tax or
          Deferred
          Compensation Tax) imposed upon the Gross-Up Payment, Executive retains
          an amount
          of the Gross-Up Payment equal to the Parachute Tax and/or Deferred Compensation
          Tax imposed upon the Payment.

         

         

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

       

       

      8.2.  Subject
        to the
        provisions of Section 8.1 hereof, all determinations required to be made
        under
        this Section 8, including whether a Parachute Tax or Deferred Compensation
        Tax
        is payable by Executive with regard to a Payment and the amount of such
        Parachute Tax or Deferred Compensation Tax and whether a Gross-Up Payment
        is
        required and the amount of such Gross-Up Payment, shall be made by the
        nationally recognized firm of certified public accountants (the “Accounting
        Firm”) used by the Company prior to the Change in Control (or, if such
        Accounting Firm declines to serve, the Accounting Firm shall be a nationally
        recognized firm of certified public accountants selected by the
        Company).  For purposes of making the calculations required by this
        Section, the Accounting Firm may make reasonable assumptions and approximations
        concerning applicable taxes and may rely on reasonable, good faith
        interpretations concerning the application of Sections 280G, 4999 and 409A
        of
        the Code, provided that the Accounting Firm’s determinations must be made with
        substantial authority (within the meaning of Section 6662 of the
        Code).  The Accounting Firm shall be directed by the Company or
        Executive to submit its preliminary determination and detailed supporting
        calculations to both the Company and Executive within 15 calendar days after
        the
        determination date, if applicable, and any other such time or times as may
        be
        requested by the Company or Executive.  If the Accounting Firm
        determines that any Parachute Tax or Deferred Compensation Tax is payable
        by
        Executive with regard to a Payment, the Company shall pay the required Gross-Up
        Payment to, or for the benefit of, Executive within five business days after
        receipt of such determination and calculations.  If the Accounting
        Firm determines that no Parachute Tax or Deferred Compensation Tax is payable
        by
        Executive with regard to a Payment, it shall, at the same time as it makes
        such
        determination, furnish Executive with an opinion that he has substantial
        authority not to report any Parachute Tax or Deferred Compensation Tax on
        his
        federal tax return.  Any good faith determination by the Accounting
        Firm as to whether a Gross-Up Payment is to be made with regard to a Payment
        and
        the amount of the Gross-Up Payment shall be binding upon the Company and
        Executive absent a contrary determination by the Internal Revenue Service
        or a
        court of competent jurisdiction; provided, however, that no such determination
        shall eliminate or reduce the Company’s obligation to provide any Gross-Up
        Payments that shall be due as a result of such contrary
        determination.  As a result of the uncertainty in the application of
        Code Section 4999 or Code Section 409A at the time of any determination by
        the
        Accounting Firm hereunder, it is possible that Gross-Up Payments that will
        not
        have been made by the Company should have been made (an “Underpayment”),
        consistent with the calculations required to be made hereunder.  In
        the event that the Company exhausts or fails to pursue its remedies pursuant
        to
        Section 8.6 hereof and Executive thereafter is required to make a payment
        of any
        Parachute Tax or Deferred Compensation Tax, Executive shall direct the
        Accounting Firm to determine the amount of the Underpayment that has occurred
        and to submit its determination and detailed supporting calculations to both
        the
        Company and Executive as promptly as possible.  Any such Underpayment
        shall be promptly paid by the Company to, or for the benefit of, Executive
        within five business days after receipt of such determination and
        calculations.

       

      8.3.  The
        Company and
        Executive shall each provide the Accounting Firm access to and copies of
        any
        books, records and documents in the possession of the Company or Executive,
        as
        the case may be, reasonably requested by the Accounting Firm, and otherwise
        cooperate with the Accounting Firm in connection with the preparation and
        issuance of the determination contemplated by Section 8.2 hereof.

       

      8.4.  The
        federal tax
        returns filed by Executive (or any filing made by a consolidated tax group
        which
        includes the Company) shall be prepared and filed on a basis consistent with
        the
        determination of the Accounting Firm with respect to the Parachute Tax or
        Deferred Compensation Tax payable by Executive.  Executive shall make
        proper payment of the amount of any Parachute Tax or Deferred Compensation
        Tax,
        and at the request of the Company, provide to the Company true and correct
        copies (with any amendments) of his federal income tax return as filed with
        the
        Internal Revenue Service, and such other documents reasonably requested by
        the
        Company, evidencing such payment.  If prior to the filing of
        Executive’s federal income tax return, the Accounting Firm determines in good
        faith that the amount of the Gross-Up Payment should be reduced, Executive
        shall
        within five business days pay to the Company the amount of such
        reduction.

       

      8.5.  The
        fees and
        expenses of the Accounting Firm for its services in connection with the
        determinations and calculations contemplated by Sections 8.2 and 8.4 hereof
        shall be borne by the Company.  If such fees and expenses are
        initially advanced by Executive, the Company shall reimburse Executive the
        full
        amount of such fees and expenses within five business days after receipt
        from
        Executive of a statement therefor and reasonable evidence of his payment
        thereof.

       

      8.6.  In
        the event that
        the Internal Revenue Service claims that any payment or benefit received
        under
        this Agreement constitutes an “excess parachute payment” within the meaning of
        Code Section 280G(b)(1), Executive shall notify the Company in writing of
        such
        claim.  Such notification shall be given as soon as practicable but
        not later than 10 business days after Executive is informed in writing of
        such
        claim and shall apprise the Company of the nature of such claim and the date
        on
        which such claim is requested to be paid.  Executive shall not pay
        such claim prior to the expiration of the 30 day period following the date
        on
        which Executive gives such notice to the Company (or such shorter period
        ending
        on the date that any payment of taxes with respect to such claim is
        due).  If the Company notifies Executive in writing prior to the
        expiration of such period that it desires to contest such claim, Executive
        shall
        (i) give the Company any information reasonably requested by the Company
        relating to such claim; (ii) take such action in connection with contesting
        such
        claim as the Company shall reasonably request in writing from time to time,
        including without limitation, accepting legal representation with respect
        to
        such claim by an attorney reasonably selected by the Company and reasonably
        satisfactory to Executive; (iii) cooperate with the Company in good faith
        in
        order to effectively contest such claim; and (iv) permit the Company to
        participate in any proceedings relating to such claim; provided, however,
        that
        the Company shall bear and pay directly all costs and expenses (including,
        but
        not limited to, additional interest and penalties and related legal, consulting
        or other similar fees) incurred in connection with such contest and shall
        indemnify and hold Executive harmless, on an after-tax basis, for and against
        for any Parachute Tax or income tax or other tax (including interest and
        penalties with respect thereto) imposed as a result of such representation
        and
        payment of costs and expenses.

       

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

       

      8.7.  The
        Company shall
        direct Executive with regard to all proceedings taken in connection with
        such
        contest and, at its sole option, may pursue or forgo any and all administrative
        appeals, proceedings, hearings and conferences with the taxing authority
        in
        respect of such claim and may, at its sole option, either direct Executive
        to
        pay the tax claimed and sue for a refund or contest the claim in any permissible
        manner and Executive agrees to prosecute such contest to a determination
        before
        any administrative tribunal, in a court of initial jurisdiction and in one
        or
        more appellate courts, as the Company shall determine; provided, however,
        that
        if the Company directs Executive to pay such claim and sue for a refund,
        the
        Company shall advance the amount of such payment to Executive on an
        interest-free basis (to the extent permitted by applicable law), and shall
        indemnify and hold Executive harmless, on an after tax basis, from any Parachute
        Tax or Deferred Compensation Tax (or other tax including interest and penalties
        with respect thereto) imposed with respect to such advance or with respect
        to
        any imputed income with respect to such advance; and provided, further, that
        if
        Executive is required to extend the statue of limitations to enable the Company
        to contest such claim, Executive may limit this extension solely to such
        contested amount.  The Company’s right to direct Executive with regard
        to the contest shall be limited to issues with respect to whether and the
        extent
        to which a payment or benefit is an “excess parachute payment” pursuant to Code
        Section 280G(b)(1), the imposition of the Parachute Tax under Code Section
        4999
        and the imposition of the Deferred Compensation Tax under Code Section 409A,
        and
        Executive shall be entitled to settle or contest, as the case may be, any
        other
        issue raised by the Internal Revenue Service or any other taxing
        authority.  In addition, the Company shall not direct Executive to
        take a position or agree to any final resolution if such position or resolution
        could reasonably be expected to adversely affect Executive unrelated to matters
        covered hereto, unless Executive consents in writing to such position or
        agreement.

       

      8.8.  If,
        after the
        receipt by Executive of an amount advanced by the Company in connection with
        the
        contest of the Parachute Tax or Deferred Compensation Tax claim, Executive
        receives any refund with respect to such claim, Executive shall promptly
        pay to
        the Company the amount of such refund (together with any interest paid or
        credited thereon after taxes applicable thereto); provided, however, if the
        amount of that refund exceeds the amount advanced by the Company Executive
        may
        retain such excess.  If, after the receipt by Executive of an amount
        advanced by the Company in connection with a Parachute Tax or Deferred
        Compensation Tax claim, a determination is made that Executive shall not
        be
        entitled to any refund with respect to such claim and the Company does not
        notify Executive in writing of its intent to direct Executive to contest
        the
        denial of such refund prior to the expiration of 30 days after such
        determination such advance shall be deemed to be in consideration for services
        rendered after the Termination Date.

       

      9.  Code
        Section
        409A.  If Executive is a “specified employee”, as defined in Code
        Section 409A(a)(2)(B)(i), with respect to the Company and its
        affiliates,  any benefit payable under this Agreement that constitutes
        a deferral of compensation subject to Internal Revenue Code Section 409A
        that is
        payable upon or within the six months following Executive’s Separation from
        Service, shall be paid upon the date which is six months after the date of
        Executive’s Separation from Service (or, if earlier, the date of Executive’s
        death). If any benefit payable under this Agreement is exempt from Code Section
        409A (for example certain amounts payable upon an involuntary separation
        from
        service), such benefit shall not be delayed, but shall be paid in accordance
        Sections 6 and/or 7 of this Agreement.

       

      10.  Inventions,
        Confidential Information and Related Matters.

       

      10.1.  Assignment
        of
        Inventions.  Executive hereby assigns and transfers to the Company
        any and all works of authorship, inventions and innovations (whether deemed
        patentable or not), which relate to the business of the Company and which
        are
        made by Executive (or by Executive jointly with others) during the term of
        Executive’s employment and/or within one year after the termination of
        Executive’s employment with the Company or any of its Affiliates, if such work
        of authorship, invention, or innovation is based upon or relates to Confidential
        Information acquired by Executive during the term of employment with the
        Company
        or any of its Affiliates.  For purposes of copyright law, any such
        work of authorship shall be deemed a work made for hire.  Executive
        agrees to promptly disclose to the Company and its Affiliates all such works
        of
        authorship, inventions, and innovations.  Executive agrees to execute
        any document reasonably requested by the Company and/or its Affiliates that
        is
        necessary or appropriate to document, perfect, or effect the intention of
        this
        Section 10 or to secure any patent, copyright registration (as a work made
        for hire), trademark registration or other protection thereof for the Company
        and its Affiliates.

       

      10.2.  Restrictions
        on
        Use and Disclosure.  Except as otherwise required by Executive’s
        employment duties for the Company or any of its Affiliates, Executive shall
        maintain in strict confidence and shall not directly, indirectly or otherwise,
        use, publish, disclose or disseminate, or use for Executive’s benefit or the
        benefit of any person, firm, corporation or entity, any Confidential Information
        of or relating to the Company or its Affiliates (or which the Company or
        its
        Affiliates has a right to use).  For purposes of this Agreement
“Confidential Information” shall mean all confidential and proprietary
        information of the Company and its parents, subsidiaries and affiliates,
        whether
        in oral, written or electronic form or obtained by observation or otherwise,
        whether or not legended or otherwise identified as confidential or proprietary
        information, and whether or not discovered or developed by Executive or known
        or
        obtained by Executive as a consequence of Executive’s employment with the
        Company or any of its Affiliates at any time as employee or
        agent.  Confidential Information shall include, without limitation,
        all scientific, clinical, engineering, technical, process, method or commercial
        data, information or know-how, relating to the research, development,
        manufacture, distribution, sale or marketing of any vitamins, minerals,
        nutritional supplements, sports nutrition products, beverages, food bars,
        powdered food supplements, or other products or product lines of the Company
        and
        its Affiliates.  Confidential Information shall also include, without
        limitation, all customer lists, pricing data, sources of supply and related
        supplier and vendor information, purchasing, operating or other cost data,
        manufacturing methods, quality control information, regulatory information,
        employee and compensation information, financial data, trade secrets, formulas,
        intellectual property, manuals, financial data, forecasts, business plans,
        expansion or acquisition plans and product development information and
        plans.  Notwithstanding the foregoing, Confidential Information shall
        not include (i) information, from a source other than the Company and its
        Affiliates, which is in Executive’s possession on the date hereof or
        subsequently becomes available to Executive so long as such information was
        lawfully obtained and is not, to the knowledge of Executive, subject to another
        confidentiality agreement or obligation of secrecy to the Company, its
        Affiliates or another person, or (ii) information which becomes generally
        available to the public other than directly or indirectly as a result of
        disclosure by Executive or another party bound by legal obligations prohibiting
        such disclosure.

       

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

       

      10.3.  Return
        of
        Documents and Materials.  Upon termination of Executive’s
        employment, Executive shall forthwith deliver to the Company all Confidential
        Information and Inventions embodied in any form, including all copies, then
        in
        Executive’s possession or control, whether prepared by Executive or others, as
        well as all other Company property in Executive’s possession or
        control.

       

      10.4.  Competitive
        Activities.  From the date hereof and (a) during the term of this
        Agreement and (b) thereafter until the “Competition Date” which shall
        be

       

      (i)  in
        the case of
        terminations of Executive’s employment pursuant to Sections 5.2 or 5.3, the
        182nd day
        following the Termination Date, or

       

      (ii)  in
        the case of any
        other termination of Executive’s employment, the first anniversary of the
        Termination Date,

       

      Executive
        shall
        not, directly or indirectly, within the territorial United States, become
        an
        employee or consultant or otherwise render services to, lend funds to, serve
        on
        the board of, invest in (other than as a 1% or less shareholder of a
        publicly-traded corporation) or guarantee the debts of, any of: Leiner Health
        Products, Perrigo, NBTY, Nutraceutical, Inc. or Pharmavite or any newly created,
        successor or acquired businesses of same which competes with the Company
        in the
        Nutraceutical Industry or any business newly created by Executive following
        termination of employment which competes with the Company in the Nutraceutical
        Industry; provided, however, that in no event shall the restrictions set
        forth
        in this Section 10.4 prohibit Executive from providing services to, lending
        funds to, serving on the board of, investing in or guaranteeing the debts
        of any
        entity which is an Affiliate of the Company at the time such action is
        taken.  The Board may in its sole discretion give Executive written
        approval to engage in such activities or render such services after termination
        of this Agreement if Executive and such prospective firm or business
        organization gives the Company written assurances, satisfactory to the Board
        in
its sole discretion, that the integrity of the Confidential Information,
        the
        Inventions and the good will of the Company and its majority owned Affiliates
        will not be jeopardized by such employment.  Executive shall, for a
        period of 12 months after the Competition Date notify the Company of any
        change
        in address and identify each subsequent employment or business activity in
        which
        Executive shall engage during such 12 months, stating the name and address
        of
        the employer or business organization and the nature of Executive’s
        position.

       

      10.5.  Solicitation
        of
        Executives.  From the date hereof until 12 months after the
        termination of Executive’s employment with the Company, Executive shall not,
        without the prior written approval of the Board of the Company, directly
        or
        indirectly, solicit, raid, entice or induce any person who presently is or
        at
        any time during the term hereof shall be an employee of the Company or its
        majority owned Affiliates and who was or is eligible for a grant under the
        Equity Incentive Plan or any successor plan, to become employed by any other
        person, firm or corporation in any business in competition with the
        Company.

       

      11.  No
        Other
        Contracts.  Executive represents and warrants that neither the
        execution and delivery of this Agreement by Executive nor the performance
        by
        Executive of Executive’s obligations hereunder, shall constitute a default under
        or a breach of the terms of any other agreement, indenture or contract to
        which
        Executive is a party or by which Executive is bound, nor shall the execution
        and
        delivery of this Agreement by Executive or the performance of Executive’s duties
        and obligations hereunder give rise to any claim or charge against either
        Executive or the Company based upon any other contract, indenture or agreement
        to which Executive is a party or by which Executive is bound.

       

      12.  Notices.  Any
        notices or communication given by any party hereto to the other party shall
        be
        in writing and personally delivered or mailed by registered or certified
        mail,
        return receipt requested, postage prepaid.  Notices shall be addressed
        to the parties at the addresses set forth above.  Mailed notices shall
        be deemed given when received.  Any person entitled to receive notice
        may designate in writing, by notice to the others, such other address to
        which
        notices to such party shall thereafter be sent.

       

      13.  Miscellaneous.

       

      13.1.  Entire
        Agreement. This Agreement constitutes the entire agreement of the parties
        with respect to the subject matter hereof and supersede any and all prior
        agreements of the parties with respect to such subject matter.

       

      13.2.  Amendment;
        Waiver.  This Agreement may not be amended, supplemented, canceled
        or discharged, except by written instrument executed by the party affected
        thereby.  No failure to exercise, and no delay in exercising, any
        right, power or privilege hereunder shall operate as a waiver
        thereof.  No waiver of any preceding or succeeding breach of this
        Agreement.

       

      13.3.  Binding
        Effect;
        Successors; Assignment.

       

      (a)  The
        Company will
        require any successor (whether direct or indirect, by purchase, merger,
        consolidation, reorganization or otherwise, including, without limitation,
        any
        successor due to a Change in Control) to the business or assets of the Company,
        by agreement in form and substance reasonably satisfactory to Executive,
        to
        expressly assume and agree to perform this Agreement in the same manner and
        to
        the same extent the Company would be required to perform if no such succession
        had taken place.  This Agreement will be binding upon and inure to the
        benefit of the Company and any successor to the Company, including, without
        limitation, any person directly or indirectly acquiring the business or assets
        of the Company in a transaction constituting a Change in Control (and such
        successor shall thereafter be deemed the “Company” for the purpose of this
        Agreement), but will not otherwise be assignable, transferable or delegable
        by
        the Company.

       

      (b)  This
        Agreement will
        inure to the benefit of and be enforceable by Executive’s personal or legal
        representatives, executors, administrators, successors, heirs, distributees
        and
        legatees, but will not otherwise be assignable, transferable or delegable
        by
        Executive.

       

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

       

      13.4.  Headings.  The
        headings contained in this Agreement (except those in Section 1) are for
        reference purposes only and shall not affect the meaning or interpretation
        of
        this Agreement.

       

      13.5.  Governing
        Law;
        Interpretation.  This Agreement shall be construed in accordance
        with and governed for all purposes by the laws and public policy of the State
        of
        Utah applicable to contracts executed and to be wholly performed within such
        State.  Service of process in any dispute shall be effective (a) upon
        the Company, if served on any senior officer of the Company; (b) upon Executive,
        if served at Executive’s residence last known to the
        Company.  Executive acknowledges that breach of Sections
        10.1 through 10.5 would entail irreparable injury and that, in addition to
        the
        Company’s other express and implied remedies, the Company shall be entitled to
        injunctive and other equitable relief to prevent any actual, intended or
        likely
        such breach.

       

      13.6.  Further
        Assurances.  Each party agrees at any time, and from time-to-time,
        to execute, acknowledge, deliver and perform, and/or cause to be executed,
        acknowledged, delivered and performed, all such further acts, deeds assignments,
        transfers, conveyances, powers of attorney and/or assurances as may be
        necessary, and/or proper to carry out the provisions and/or intent of this
        Agreement.

       

      13.7.  Gender;
        Singular/Plural.  In this Agreement, the use of one gender (e.g.,
“he”, “she” and “it”) shall mean each other gender; and the singular shall mean
        the plural, and vice versa, all as the context may require.

       

      13.8.  Severability.  The
        parties acknowledge that the terms of this Agreement are fair and reasonable
        at
        the date signed by them.  However, in light of the possibility of a
        change of conditions or differing interpretations by a court of what is fair
        and
        reasonable, the parties stipulate as follows: if any one or more of the terms,
        provisions, covenants and restrictions of this Agreement shall be determined
        by
        a court of competent jurisdiction to be invalid, void or unenforceable, the
        remainder of the terms, provisions, covenants and restrictions of this Agreement
        shall remain in full force and effect and shall in no way be affected, impaired
        or invalidated; further, if any one or more of the provisions contained in
        this
        Agreement shall for any reason be determined by a court of competent
        jurisdiction to be excessively broad as to duration, geographical scope,
        activity or subject, it shall be construed, by limiting or reducing it, so
        as to
        be enforceable to the extent compatible with then applicable law.

       

      13.9.  Counterparts.  This
        Agreement may be executed in two or more counterparts, each of which will
        be
        deemed an original.

       

      13.10.  
        Indemnification.  The
        Company indemnifies Executive to the full extent available under the Company’s
        Articles of Incorporation and Bylaws.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      EXECUTION

       

      The
        parties,
        intending to be legally bound, executed this Agreement as of the date first
        above written, whereupon it became effective in accordance with its
        terms.

       

      

      

      
        	
                BRUCE
                  J.
                  WOOD

                 

                ___________________________________

                 

              	
                SCHIFF
                  NUTRITION GROUP, INC.

                 

                By:
                  ___________________________________

              
	 	
                Title:
                  __________________________________

              

      

      

      
        
          
          

        

        
          11

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