Usana Distributor Agreement

Our associated compensation plan, or the changes we make there, may be viewed negatively by some partners, may not achieve our desired objectives and could have a negative impact on our business. Our industry is very competitive and sensitive to the introduction of new competitors, new products and/or new compensation plans for distributors. Network marketing companies often try to attract new distributors by offering generous compensation plans for distributors. From time to time, we modify the components of our compensation plan to (i) keep it competitive and attractive to existing and potential partners, (ii) to provoke or address a change in associative behaviour, (iii) to encourage employees to develop our activities, (iv) to meet legal and regulatory requirements and (v) to meet other business requirements. Given the size and diversity of our associated strength and the complexity of our compensation plan, it is difficult to predict how changes to the association plan will be addressed and whether such changes will achieve the desired results. In 2013, we made several changes to our product pricing structure and associated compensation plan to improve our business, including increasing partner loyalty and satisfaction and acquiring new employees. It cannot be certain that the above changes or future changes to our partner could affect the loss of key administrative staff in our business. Our executives are primarily responsible for our day-to-day operations and we believe that our success depends in part on our ability to retain our senior managers, compensate our executives at an attractive level and continue to attract additional qualified staff to our management team. We depend on the services of our General Manager Kevin Guest, Our President and Chief Operating Officer Jim Brown and Our Chief Financial Officer Douglas Hekking, as well as other important members of our management team. We cannot guarantee additional service through our key management positions. We do not have life insurance for key men for one of our senior managers, nor do we have an employment contract with one of our senior managers.

This entry was posted in Uncategorized.