EXHIBIT 10.21
EMPLOYMENT AGREEMENT
AGREEMENT, dated as of 15th of December 2004 between Yang Yasheng residing
at ____________________________ ("Executive"), and Origin BVI a British Virgin
Islands corporation having its principal office at __________________________
("Company")
WHEREAS, the Company believes that Executive provides unique management
services for the Company and wishes to retain the continued services of
Executive as its Chief Executive Officer; and
WHEREAS, the Company and Executive have reached an understanding with
respect to the extension of Executive's employment with the Company for a three
year period commencing as of January 1st 2005 and
WHEREAS, the Company and Executive desire to evidence their agreement in
writing and to provide for the employment of Executive by the Company on the
terms set forth herein.
IT IS AGREED:
1. Employment, Duties and Acceptance.
1.1. Effective as of January 1st 2005 the Company hereby
agrees to the continued employment of Executive as Co- Chief
Operating Officer and hereby accepts such continued employment on
the terms and conditions contained in the Agreement. During the term
of this Agreement, the Executive shall make himself available to the
Company to pursue the business of the Company subject to the
supervision and direction of the Board of Directors of the Company
("Board" or "Board of Directors") of which he shall be nominated to
be a member during the term hereof.
1.2. The Board may assign the Executive such general
management and supervisory responsibilities and executive duties for
the Company as are appropriate and commensurate with Executive's
position as Chief Operating Officer of the Company and would
otherwise be consistent in stature and prestige with the
responsibilities of a Chairman.
1.3. Executive accepts such employment and agrees to devote
substantially all of his business time, energies and attention to
the performance of his duties; provided, however, that Executive may
continue to be actively involved in eleemosynary, educational and
civic activities to the extent that such activities do not
materially detract from the reasonable performance of his duties
(such material detraction to be evidenced by a resolution approved
by the majority of the Board and a written notice to Executive, in
which event Executive shall have one hundred and twenty (120) days
to reduce the level of such activities in a reasonable manner). The
Company recognizes the value to it of Executive's continued
involvement in these activities and will reimburse Executive for
reasonable expenses incurred by him in connection with such
activities. Nothing herein shall be construed as preventing
Executive from (i) making and supervising investments on a personal
or family basis (including trusts, funds and investment entities in
which Executive or members of his family have an interest) and (ii)
in serving on the Board of Directors of not more than three
corporations involved primarily in "for profit" business activities;
provided, however, that these activities do not materially interfere
with the performance of his duties hereunder or violate the
provisions of Section 4.4 hereof.
2. Compensation and Benefits.
2.1 The Company shall pay to Executive a salary at an annual
base rate of not less than $250,000 for the first two-year period
during the term hereof . During the Executive's employment salary
will be paid not less frequently than every two weeks without the
prior written consent of Executive. Executive's annual base rate
will be reviewed one month prior to the commencement of the third
year for purposes of determining what the new base salary will be.
2.2. The Company shall also pay to Executive such bonuses as
may be determined from time to time by the Compensation Committee of
the Board of Directors. The amount of annual bonus payable to
Executive may vary at the discretion of the Compensation Committee
of the Board of Directors; provided, however, that the total bonus
shall not exceed 100% of Executive's annual base rate under Section
2.1 as of the date the bonus is awarded. In determining the annual
bonus to be paid to the Executive, the Compensation Committee may,
among other factors they believe to be appropriate, consider, and
give varying degrees of importance to, the Executive's contribution
to the following:
(1) growth in the Company's per share value;
(2) achievement by the Company of specific identified
targets selected by the Committee from time to time;
(3) the attraction and retention of key executive
personnel by the Company;
(4) satisfaction of the Company's capital requirements;
(5) the establishment of strategic direction and
significant Company goals;
and
(6) Such other criteria as the Compensation Committee
deems to be relevant.
2.3. Executive shall be entitled to such insurance and other
benefits including, among others, medical and disability coverage
and life insurance as are afforded to other senior executives of the
Company, subject to applicable waiting periods and other conditions
which may be generally applicable. The Company also shall purchase
if possible (i) long term disability insurance of not less than 50%
of Executive's then current annual salary and (ii) split dollar life
insurance with coverage of not less than $1.0 million. The
beneficiary of these policies shall be designated by Executive and
these policies shall be transferred to Executive or his designees by
the Company at his written request.
2.4. Executive shall be entitled to five weeks of vacation in
each calendar year and to a reasonable number of other days off for
religious and personal reasons.
2.5. Executive shall be entitled, at his option, to maintain a
suitable automobile for business use. The Company shall reimburse
Executive for the costs of leasing such automobile and for all other
costs associated with the use of the vehicle, including insurance
costs, repairs and maintenance.
2.6. The Company will pay or reimburse executive for all
transportation, hotel and other expenses incurred by Executive on
business trips (including business or first class air travel on
scheduled flights of more than two (5) consecutive hours) and for
all other ordinary and reasonable out-of-pocket expenses actually
incurred by him in the conduct of the business of the Company
against itemized vouchers submitted with respect to any such
expenses.
2.7. Executive agrees that his services shall be rendered
primarily at the Company's executive offices which shall be located
in, or within thirty (30) miles of, the Company's current executive
offices located in )______________________.
2.8. The Company shall not move its executive offices without
Executive's written consent. If such consent is provided, the
Company will reimburse Executive for the following, which may be
taxable to Executive:
(1) Usual and customary expenses incurred if Executive sells
his home himself or through a broker; however, reimbursement for the
broker's commission (if Executive utilizes the services of a broker)
may not exceed six (6) percent of the sales proceeds;
(2) Reasonable expenses incurred in moving furniture, normal
household goods and personal belongings to the new location and
incidental expenses related to the move;
(3) Reasonable expenses (including travel and hotel) while
house-hunting, including four trips to the new location with
Executive's spouse and children;
(4) Reasonable and customary closing costs incurred in buying
Executive's new home; and
(5) Reasonable temporary living expenses incurred while
awaiting occupancy in Executive's new quarters.
3. Term and Termination.
3.1. The term of this Agreement commences as of January 1st
2005 and shall continue until January 1st 2008 unless sooner
terminated as herein provided.
3.2. If Executive dies during the term of this Agreement, this
Agreement shall thereupon terminate, except that the Company shall
pay to the legal representative of Executive's estate the base
salary due Executive pursuant to Section 2.1 hereof through the
first anniversary of Executive's death (or the scheduled expiration
under Section 3.1, if earlier than the first anniversary date) as
well as a pro rata allocation of bonus payments under Section 2.2
based on the days of service during the year of death, and all
amounts owing to Executive at the time of termination, including for
previously accrued but unpaid bonuses, expense reimbursements and
accrued but unused vacation pay.
3.3. If Executive shall be rendered incapable by an
incapacitating illness or disability (either physical or mental) of
complying with the terms, provisions and conditions hereof on his
part to be performed for a period in excess of 180 consecutive days
during any consecutive twelve (12) month period, then the Company,
at its option, may terminate this Agreement by written notice to
Executive (the "Disability Notice") delivered prior to the date
Executive resumes the rendering of services hereunder; provided,
however, if requested by Executive (or a representative thereof)
such termination shall not occur until after examination of
Executive by a medical doctor (retained by the Company with the
consent of the Executive which consent shall not be unreasonably
withheld) who certifies in a written report to the Board with a copy
of such report delivered simultaneously to Executive that Executive
is and shall be incapable of performing his duties for in excess of
two additional months because of the continuing existence of such
incapacitating illness or disability. Notwithstanding such
termination, the Company (a) shall make a payment to Executive of a
pro rata allocation of payments under Section 2.2 based on the days
of service during the year in which the Disability Notice is
delivered and (b) shall pay to Executive the base salary due
Executive pursuant to Section 2.1 hereof through the second
anniversary of the date of such notice (the "Disability Period"),
less any amount Executive receives for such period from any
Company-sponsored or Company-paid for source of insurance,
disability compensation or governmental program. The Company shall
also pay to Executive all amounts owing to Executive at the time of
termination, including for previously accrued but unpaid bonuses,
expense reimbursements and accrued but unused vacation pay.
3.4. The Company, by notice to Executive, may terminate this
Agreement for cause. As used herein, "cause" shall include (a) the
refusal in bad faith by Executive to carry out specific written
directions of the Board, (b) intentional fraud or dishonest action
by Executive in his relations with the Company ("dishonest" for
these purposes shall mean Executive's knowingly making of a material
misstatement to the Board for the purpose of obtaining direct
personal benefit); or (c) the conviction of Executive of any crime
involving an act of significant moral turpitude after appeal or the
period for appeal has elapsed without an appeal being filed by
Executive. Notwithstanding the foregoing, no "cause" for termination
shall be deemed to exist with respect to Executive's acts described
in clause (a) or (b) above, unless the Board shall have given
written notice to Executive (after five (5) days advance written
notice to Executive and a reasonable opportunity to Executive to
present his views with respect to the existence of "cause"),
specifying the "cause" with particularity and , within twenty (20)
business days after such notice, Executive shall not have disputed
the Board's determination or in reasonably good faith taken action
to cure or eliminate prospectively the problem or thing giving rise
to such "cause," provided, however, that a repeated breach after
notice and cure, of any provision of clause (a) or (b) above,
involving the same or substantially similar actions or conduct,
shall be grounds for termination for cause upon not less than five
(5) days additional notice from the Company.
3.5. The Executive, by notice to the Company, may terminate
this Agreement if a "Good Reason" exists. For purposes of this
Agreement, "Good Reason" shall mean the occurrence of any of the
following circumstances without the Executive's prior express written
consent:
(a) a material adverse change in the nature of Executive's
title, duties or responsibilities with the Company that
represents a demotion from his title, duties or
responsibilities as in effect immediately prior to such
change;
(b) a material breach of this Agreement by the
Company;
(c) a failure by the Company to make any payment to
Executive when due, unless the payment is not material and is
being contested by the Company, in good faith;
(d) a liquidation, bankruptcy or receivership of the
Company; or
(e) if Executive is at any time not a member of the
Board of Directors of the Company and a member of the
Executive Committee thereof (if such a committee exists),
unless he voluntarily resigns therefrom; or
(f) any person or entity other than the Company and/or
any officers or directors of the Company as of the date of
this Agreement acquires securities of the Company other than
from Executive or his affiliates (in one or more transactions)
having 51% or more of the total voting power of all the
Company's securities then outstanding. Notwithstanding the
foregoing, no Good Reason shall be deemed to exist with
respect to the Company's acts described in clauses (a), (b) or
(c) above, unless Executive shall have given written notice to
the Company specifying the Good Reason with reasonable
particularity and, within twenty (20) business days after such
notice, the Company shall not have cured or eliminated the
problem or thing giving rise to such Good Reason; provided,
however, that a repeated breach after notice and cure of any
provision of clauses (a), (b) or (c) above involving the same
or substantially similar actions or conduct, shall be grounds
for termination for Good Reason without any additional notice
from Executive.
3.6. In the event that Executive terminates this Agreement for
Good Reason, pursuant to the provisions of paragraph 3.5, or the
Company terminates this Agreement without "Cause," as defined in
paragraph 3.4, the Company shall continue to pay to Executive (or in
the case of his death, the legal representative of Executive's
estate or such other person or persons as Executive shall have
designated by written notice to the Company), all payments,
compensation and benefits required under paragraph 2 hereof through
the earlier of (y) two (2) years from the date of termination or (z)
through the term of this Agreement; provided, however, that
Executive's insurance coverage shall terminate upon the Executive
becoming covered under a similar program by reason of employment
elsewhere. If Executive's employment is terminated for Good Reason
or without "Cause," Executive shall have no duty to mitigate awards
paid or payable to him pursuant to this subsection, and any
compensation paid or payable to Executive from sources other than
the Company will not offset or terminate the Company's obligation to
pay to Executive the full amounts pursuant to this subsection 3.6.
4. Protection of Confidential Information; Non-Competition.
4.1. Executive acknowledges that:
(1) As a result of his current employment with the Company,
Executive will obtain secret and confidential information concerning
the business of the Company and its subsidiaries and affiliates
(referred to collectively in this Article 4 as the "Company"),
including, without limitations, financial information, designs and
other proprietary rights, trade secrets and "know-how," customers
and sources ("Confidential Information").
(2) The Company will suffer substantial damage which will be
difficult to compute if, during the period of his employment with
the Company or thereafter, Executive should enter a business
competitive with the Company or divulge Confidential Information.
(3) The provisions of this Agreement are reasonable and
necessary for the protection of the business of the Company.
4.2. Executive agrees that he will not at any time, either
during the term of this Agreement or thereafter, divulge to any
person or entity any Confidential Information obtained or learned by
him as a result of his employment with the Company, except (i) in
the course of performing his duties hereunder, (ii) to the extent
that any such information is in the public domain other than as a
result of Executive's breach of any of his obligations hereunder,
(iii) where required to be disclosed by court order, subpoena or
other government process or (iv) if such disclosure is made without
Executive's knowing intent to cause material harm to the Company. If
Executive shall be required to make disclosure pursuant to the
provisions of clause (iii) of the preceding sentence, Executive
promptly, but in no event more than 72 hours after learning of such
subpoena, court order, or other government process, shall notify, by
personal delivery or by electronic means, confirmed by mail, the
Company and, at the Company's expense, Executive shall: (a) take
reasonably necessary and lawful steps required by the Company to
defend against the enforcement of such subpoena, court order or
other government process, and (b) permit the Company to intervene
and participate with counsel of its choice in any proceeding
relating to the enforcement thereof.
4.3. Upon termination of his employment with the Company,
Executive will promptly deliver to the Company all memoranda, notes,
records, reports, manuals, drawings, blue-prints and other documents
(and all copies thereof) relating to the business of the Company and
all property associated therewith, which he may then possess or have
under his control; provided, however, that the Executive shall be
entitled to retain one copy of such documents for his personal use
and records.
4.4. During the period commencing January 1st 2005 and
terminating three years after termination of employment: (A)
Executive, without the prior written permission of the Company,
shall not, anywhere in the People's Republic of China, (i) enter
into the employ of or render any services to any person, firm or
corporation engaged in any business which is directly in competition
with the Company's principal existing business at the time of
termination ("Competitive Business"); (ii) engage in any Competitive
Business as an individual, partner, shareholder, creditor, director,
officer, principal, agent, employee, trustee consultant, advisor or
in any other relationship or capacity; (iv) employ, or have or cause
any other person or entity to employ, any person who was employed by
the Company at the time of termination of Executive's employment by
the Company (other than Executive's personal secretary and
assistant); or (v) solicit, interfere with, or endeavor to entice
away from the Company, for the benefit of a Competitive Business,
any of its customers. Notwithstanding the foregoing, Executive shall
not be precluded from investing and managing the investment of, his
or his family's assets in the securities of any corporation or other
business entity which is engaged in a Competitive Business if such
securities are traded on a national stock exchange or in the
over-the-counter market and if such investment does not result in
his beneficially owning, at any time, more than 5% of any class of
the publicly-traded equity securities of such Competitive Business;
provided, however, that for a period commencing January 1st 2005 and
terminating three years after termination of Executive's employment
(except for investments in a class of securities trading on public
markets), Executive shall refer to the Company for consideration (
before any other party) any and all opportunities to acquire or
purchase, or otherwise make equity or debt investments in, companies
primarily involved in a Competitive Business if such opportunities
becomes known to Executive while he is the Chairman and Chief
Executive Officer of the Company. If the Company determines not to
exploit any opportunity referred to in the foregoing sentence, the
Company shall determine what, if anything, should be done with such
opportunity. Executive shall not be entitled to any compensation, as
a finder or otherwise, if either the Company or Executive introduces
such opportunity to other persons, it being understood that all such
compensation shall be paid to the Company. Notwithstanding the
foregoing, in the event the Company terminates this Agreement
without "cause" or if Executive terminates this Agreement for Good
Reason under Section 3.5 hereof, Executive's obligations under this
Section 4.4 shall terminate one month following termination.
4.5. If Executive commits a breach of any of the provisions of
Sections 4.2 or 4.4, the Company shall have the right:
(1) to have the provisions of this Agreement specifically
enforced by any court having equity jurisdiction, it being
acknowledged and agreed by Executive that the services being
rendered hereunder to the Company are of a special, unique and
extraordinary character and that any breach or threatened breach
will cause irreparable injury to the Company and that money damages
will not provide an adequate remedy to the Company; and
(2) to require Executive to account for and pay over to the
Company all monetary damages determined by a non-appealable decision
by a court of law to have been suffered by the Company as the result
of any actions constituting a breach of any of the provisions of
Section 4.2 or 4.4, and Executive hereby agrees to account for and
pay over such damages to the Company (up to the maximum of all
payments made under the Agreement).
4.6. If Executive shall violate any covenant contained in
Section 4.4, the duration of such covenant so violated shall be
automatically extended for a period of time equal to the period of
such violation.
4.7. If any provision of Sections 4.2 or 4.4 is held to be
unenforceable because of the scope, duration or area of its
applicability, the tribunal making such determination shall not have
the power to modify such scope, duration, or area, or all of them
and such provision or provisions shall be void ab initio.
5. Miscellaneous Provisions.
5.1. All notices provided for in this Agreement shall be in
writing, and shall be deemed to have been duly given when delivered
personally to the party to receive the same, when transmitted by
electronic means, or when mailed first class postage prepared, by
certified mail, return receipt requested, addressed to the party to
receive the same at his or its address set forth below, or such
other address as the party to receive the same shall have specified
by written notice given in the manner provided for in this Section
5.1. All notices shall be deemed to have been given as of the date
of personal delivery, transmittal or mailing thereof.
If to Executive:
If to the Company:
5.2. In the event of any claims, litigation or other
proceedings arising under this Agreement (including, among others,
arbitration under Section 3.4), the Executive shall be reimbursed by
the Company within thirty (30) days after delivery to the Company of
statements for the costs incurred by the Executive in connection
with the analysis, defense and prosecution thereof, including
reasonable attorneys' fees and expenses; provided, however, that
Executive shall reimburse the Company for all such costs if it is
determined by a non-appealable final decision of a court of law that
the Executive shall have acted in bad faith with the intent to cause
material damage to the Company in connection with any such claim,
litigation or proceeding.
5.3. The Company, shall to the fullest extent permitted by
law, indemnify Executive for any liability, damages, losses, costs
and expenses arising out of alleged or actual claims (collectively,
"Claims") made against Executive for any actions or omissions as an
officer and/or director of the Company or its subsidiary. To the
extent that the Company obtains director and officers insurance
coverage for any period in which Executive was an officer, director
or consultant to the Company, Executive shall be a named insured and
shall be entitled to coverage thereunder.
5.4. The provision of Article 4, Sections 5.2 and 5.3 and any
provisions relating to payments owed to Executive after termination
of employment shall survive termination of this Agreement for any
reason.
5.5. This Agreement and the Stock Option Agreements executed
simultaneously herewith set forth the entire agreement of the
parties relating to the employment of Executive and are intended to
supersede all prior negotiations, understandings and agreements. No
provisions of this Agreement or the Stock Option Agreements may be
waived or changed except by a writing by the party against whom such
waiver or change is sought to be enforced. The failure of any party
to require performance of any provision hereof or thereof shall in
no manner affect the right at a later time to enforce such
provision.
5.6. All questions with respect to the construction of this
Agreement, and the rights and obligations of the parties hereunder,
shall be determined in accordance with the law of the State of
California applicable to agreements made and to be performed
entirely in California.
5.7. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of the Company. This
Agreement shall not be assignable by Executive, but shall inure to
the benefit of and be binding upon Executive's heirs and legal
representatives.
5.8. Should any provision of this Agreement become legally
unenforceable, no other provision of this Agreement shall be
affected, and this Agreement shall continue as if the Agreement had
been executed absent the unenforceable provision.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
BY: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
