EMPLOYMENT AGREEMENT
EXHIBIT 10.1
This
Employment Agreement (this “Agreement”) is made as of this 11th day of September 2008,
by and between SinoHub, Inc., a Delaware corporation (the “Company”), and Xxxxx
X. Xxxxxxx (the "Employee").
WHEREAS,
the Company wishes to secure the employment of the Employee and the Employee
wishes to be so employed by the Company.
NOW,
THEREFORE, in consideration of the mutual covenants and promises herein
contained and intending to be legally bound hereby, it is hereby agreed by and
between the parties as follows:
(1) Employment. Subject
to the terms and conditions of this Agreement, the Company hereby employs the
Employee to perform such duties as may from time to time be prescribed by the
Chief Executive Officer of the Company, subject in all instances to the general
supervision and direction of the Board of Directors of the
Company. The Employee hereby accepts such employment.
(2) Duties. The
Employee shall serve as Chief Financial Officer and Corporate Secretary of the
Company and shall perform and discharge fully and faithfully such duties as are
assigned to him pursuant to Section 1. The Employee’s initial duties
hereunder shall include, but not be limited to, overseeing the day-to-day
financial operations of the Company and its subsidiaries and such other duties
and responsibilities as are customarily undertaken by a chief financial officer
of a corporation. The Employee will operate within the guidelines,
budgets, policies and procedures now or hereafter established by the Company,
copies of which shall be provided to the Employee or of which the Employee is
aware.
(3) Salary. The
Company shall pay the Employee, during the Term (as defined below) of this
Agreement, a salary of US$180,000 (as calculated on an
annualized basis) (the “Salary”), before applicable withholding taxes, payable
in accordance with normal Company pay policies. The Employee understands and
agrees that the Salary may be reviewed on an annual or more frequent basis, and
may be subject to modification.
(4) Bonus. During
the Term (as defined below), the Employee will be eligible to receive a bonus of
up to US$10,000 per
fiscal quarter subject to the achievement of and based upon criteria to be
determined in the sole discretion of the Chief Executive Officer of the
Company. The Employee agrees and acknowledges that in the event that
his employment with the Company is terminated for any reason, he will not be
entitled to any bonus, including a pro rata bonus, potentially payable relative
to the year in which his employment is terminated.
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(5) Equity. The Company
and the Employee acknowledge and agree that the Company intends to, but has not
yet, adopted an equity incentive plan (the “Plan”). Consequently, the
Company and the Employee agree that after the adoption of the Plan the Company
shall issue to the Employee, as mutually agreed upon by the Company and the
Employee, either: (a) 200,000 shares of restricted Common Stock of the Company
(the “Restricted Shares”); or (b) a stock option to purchase 200,000 shares of
Common Stock (the “Option Shares”) of the Company (the “Option”). If
the Company and the Employee agree that the Employee shall receive the
Restricted Shares, the issuance of such Restricted Shares shall be contingent
upon the Restricted Shares: (i) being issued to the Employee at a price per
share mutually agreeable to the parties; (ii) being subject to all of the terms
and conditions of the Plan; and (iii) being subject to the terms and conditions
of a restricted stock agreement (the “Restricted Stock Agreement”) mutually
agreeable to the parties which will provide, in part, that the Restricted Shares
shall be subject to a four (4) year reverse vesting schedule which shall lapse
as follows: 25% on the first anniversary of the Employee’s start date and then
6.25% at the end of each subsequent fiscal quarter. If the Company
and the Employee agree that the Employee shall receive the Option, the issuance
of the Option shall be contingent upon the Option: (x) being
exercisable as to each Option Share at a price per share not less than the fair
market value of a share of Company’s Common Stock on the day that the Option is
issued; and (y) being subject to all of the terms of the Plan and a stock option
agreement by and between the Company and the Employee (the “Option Agreement”),
which will provide, in part, that the Option shall vest as to 25% of the Option
Shares on the first anniversary of the Employee’s start date and then 6.25% at
the end of each fiscal quarter thereafter.
(6) Expenses. The
Employee shall be reimbursed for all reasonable, ordinary, and necessary
business expenses in accordance with Company policy. The Employee
shall furnish the Company with the appropriate documentation relating to such
expenses and shall comply with any additional requirements of the Company
generally applicable to the Company's employees in connection
therewith.
(7) Benefits. During
the Term hereof, the Employee shall be entitled to the benefits generally made
available to similarly situated employees of the Company as offered from time to
time and as approved by the Board of Directors of the Company.
(8) Vacation. For
each year during the Term, the Employee shall be entitled to fifteen (15)
business days paid vacation to be taken at such times as not to unduly disrupt
the business of the Company in accordance with the vacation policies of the
Company in effect from time to time.
(9) Full-Time
Duties. The Employee shall devote the Employee’s full working
time, attention and best efforts to fulfill his duties hereunder and, to the
business and interest of the Company and its affiliates during the Term of this
Agreement.
(10) Term and
Termination. The Employee shall be an “at will” employee of
the Company. The Employee’s employment pursuant to the terms and
conditions of this Agreement shall commence on the date hereof and shall
continue unless and until terminated under any of the following circumstances
(the “Term”):
(a) Disability. The
Company may terminate the Employee’s employment hereunder at any time and
without further obligation after having established the Employee’s long-term
disability. For purposes of this Agreement, "long-term disability"
shall mean the incapacity, by accident, sickness or otherwise so as to render
the Employee mentally or physically incapable of devoting to the business of the
Company the Employee’s full time, commercially reasonable efforts, skill and
attention, and such condition continues for a period of sixty (60) consecutive
days or ninety (90) total days in any twelve (12) month period.
(b) With
Cause. The Company may terminate the Employee’s employment
hereunder at any time and without further obligation for cause. For
purposes of this Agreement, "cause" shall mean the occurrence of any of the
following events on the part of the Employee during the Term
hereof:
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(i)
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any
act of personal dishonesty or a breach of trust in connection with the
Employee’s responsibilities to the Company and intended to result in
substantial personal enrichment of the
Employee;
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(ii)
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the
commission by the Employee of any crime classified as a felony under any
Federal, state or local law;
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(iii)
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continued
violations by the Employee of the Employee’s obligations under this
Agreement after there has been delivered to the Employee a written demand
for performance from the Company which describes the basis for the
Company’s belief that the Employee has not substantially performed his
duties and such violations have not been corrected by the Employee within
ten (10) days following such
demand;
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(iv)
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any
breach by the Employee of the Non-Solicitation, Invention Assignment and
Non-Disclosure Agreement dated as of the date hereof by and between the
Company and the Employee (the “Inventions
Agreement”);
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(v)
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the
use by the Employee of a controlled substance without a prescription or
the use of alcohol which in any way impairs the Employee’s ability to
carry out his duties and responsibilities;
or
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(vi)
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any
violation or refusal to obey the lawful directives and/or instructions of
the Chief Executive Officer, President or Board of Directors of the
Company after there has been delivered to the Employee a written demand
for performance by the Company which describes the basis for the Company’s
belief that the Employee has not obeyed the lawful directives and/or
instructions of the Chief Executive Officer, President or Board of
Directors of the Company and such violation or refusal has not been
corrected by the Employee within five (5) days following such
demand.
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(c) Without
Cause. The Company may terminate the Employee’s employment
hereunder at any time and for any reason without cause.
(d) Employee
Termination. The Employee may terminate the Employee’s
employment hereunder at any time.
(11) Severance. If
the Company terminates the Employee without cause pursuant to Section 10(c) of
this Agreement, the Company shall pay to the Employee a sum equal to the lesser
of: (a) one month of the Employee’s Salary (calculated as of the last day of the
Term) per year of the Employee’s employment with the Company; and (b) six (6)
months of the Employee’s Salary (calculated as of the last day of the
Term). Notwithstanding the foregoing, the Company shall not owe any
monies to the Employee pursuant to the previous sentence unless the Employee has
been employed by the Company for one year after the date of this
Agreement.
(12) Indemnity. The
parties will work together in good faith to enter an Indemnity Agreement with
terms and conditions consistent with those provided to directors and officers of
the Company generally.
(13) Notices. Any
notice or other communication in connection with this Agreement shall be deemed
to be delivered if in writing (addressed as provided below) and if either: (a)
actually delivered (electronically or physically) at said address; or (b) in the
case of a letter, three (3) business days shall have elapsed after the same
shall have been deposited in the United States mail, postage prepaid and
registered or certified, return receipt requested or forty eight (48) hours
shall have elapsed after the same shall have been deposited with an
internationally recognized overnight courier; or (c) by facsimile, when
transmission acknowledged by telephonic receipt to the following
addresses:
If to the Company:
2/F,
X-00
Xxxxxxxx
Xxxx Xxxx Xxxx
Xxxxxxxx,
Xxxxx 000000
Fax:
000-00-000-00000000
Attn:
Chief Executive Officer
With a
copy to:
Seyfarth
Xxxx XXX
Xxx
Xxxxxxx Xxxx
Xxxxxx,
XX 00000
Fax:
(000) 000-0000
Attn:
Xxxxxxx Xxxxxx, Esquire
If to the
Employee:
Xxxxx X.
Xxxxxxx
0000 00xx
Xxxxxx
Xxxxx
Xxxxxx, XX 00000
Fax:
(000) 000-0000
(14) Entire
Agreement/Amendment. This Agreement (and the agreements
referred to herein) constitute the entire agreement between the parties with
respect to the subject matter hereof, and all promises, representations,
understandings, warranties and agreements with reference to the subject matter
hereof and inducements to the making of this Agreement relied upon by any party
hereto have been expressed herein and will be expressed in the: (a) Option Plan;
(b) Option Agreement or Restricted Stock Agreement (as applicable); and (c)
Inventions Agreement. This Agreement may be amended only by a writing
signed by both parties hereto.
(15) Governing
Law. This Agreement shall be deemed a contract made under the
laws of the State of California (without regard to its conflict of law
provisions) and, together with the rights and obligations of the parties
hereunder, shall be construed under and governed by the laws of such
state.
(16) Counterparts. This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument.
(17) Effect of
Headings. Any title of a section heading herein contained is
for convenience of reference only, and shall not affect the meaning of
construction or any of the provisions hereof.
(18) Successors and
Assigns. All covenants, promises and agreements by or on
behalf of the parties contained in this Agreement shall inure to the benefit of,
and be binding upon, the successors and assigns of the parties
hereto.
IN
WITNESS WHEROF, the parties hereto have caused this Agreement to be executed in
multiple counterparts as of the date set forth above by their duly authorized
representative.
EMPLOYEE
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/s/ Xxxxx X. Xxxxxxx |
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By:
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/s/ Xxxxx X. Xxxxxxx |
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Xxxxx
X. Xxxxxxx
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Xxxxx
X. Xxxxxxx
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Chief Executive Officer |
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