EMPLOYMENT AGREEMENT
EXHIBIT 10.10(a)
THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into this 8th day of April, 2010, effective as of April 10, 2010 (the “Effective Date”), between American Oriental Bioengineering, Inc., a Nevada corporation with its principal place of business located at 1 Liangshuihe First Ave, Beijing E-Town Economic and Technology Development Area, E-Town, Beijing, 100176, People’s Republic of China (the “Company”), and Xxxx Xxx, residing at Nangang District, Harbin, China (the “Executive”).
1
2
7. STOCK AWARDS AND STOCK OPTIONS. The Executive shall receive 129,638 shares of the Company's common stock and N/A stock options for services to be rendered during the Term. The exercise price of the stock options is at $N/A per share, as determined by the Compensation Committee of the Board, equal to the average closing price of the Company's common stock on the five trading days immediately prior to and including April 8, 2010, as reported on Yahoo Finance, on the New York Stock Exchange, or any such securities exchange on which the Company’s common stock is listed or quoted for trading, on April 8, 2010, the date of grant (both the "Stock Awards" and the “Stock Options”). The Stock Awards and Stock Options shall vest in five equal installments on each April 7 of the first, second, third, fourth and fifth anniversary of the grant, subject to the Executive’s continued employment with the Company on each vesting date, and further to subject to accelerated vesting under the applicable incentive plan, the applicable grant agreement and the terms of this Agreement. The Stock Awards and Stock Options shall be granted under the Company’s 2006 Equity Incentive Plan and pursuant to the terms of the Company’s standard form of stock award and stock option agreement approved by the Board of Directors. The Compensation Committee shall determine, on an annual basis, the number of Stock Awards and Stock Options to be granted to the Executive for each renewal period.
9. TERMINATION.
3
c. “CAUSE.” At any time during the term of this Agreement, the Company may terminate this Agreement and the Executive’s employment with the Company, at any time, for “Company Cause.” For purposes of this Agreement, “COMPANY CAUSE” shall mean: (i) the good faith determination by the Company’s Board of Directors that there has been continued neglect by the Executive of his duties hereunder, or (ii) willful misconduct on the Executive’s part in connection with the performance of his duties hereunder, PROVIDED HOWEVER, that the Executive shall have been given one (1) written notice of such determination by the Company’s Board of Directors of continued neglect or willful misconduct and thereafter the Executive shall not have cured such neglect or willful misconduct to the satisfaction of the Company’s Board of Directors within fifteen (15) days of the Executive’s receipt of such written notice, (iii) the Executive is convicted of or pleads guilty or no contest to a felony or other conduct involving moral turpitude. If this Agreement and the Executive’s employment is terminated for “Company Cause,” following the Executive’s last date of employment with the Company, the Company shall have no further obligations or liability to the Executive or his heirs, administrators or Executors with respect to compensation and benefits thereafter, except for the obligation to pay the Executive (x) any earned but unpaid base salary through the Executive’s last date of employment, at the rate then in effect, (y) for any unused accrued and unforfeited vacation, and (z) subject to paragraph 8 hereinabove, for any unreimbursed business expenses incurred by the Executive prior to the last date of employment with the Company. The Company shall deduct, from all payments made hereunder, all applicable taxes, including income tax, FICA and FUTA, and other appropriate deductions.
4
a. The Executive expressly acknowledges that, in the performance of his duties and responsibilities relating to his employment with the Company, he has been exposed and will continue to be exposed to the trade secrets, business and/or financial secrets and confidential and proprietary information of the Company, its affiliates and/or its clients or customers (“Confidential Information”). The term “Confidential Information” means information or material that has actual or potential commercial value to the Company, its affiliates and/or its clients or customers and is not generally known to and is not readily ascertainable by proper means to persons outside the Company, its affiliates and/or its clients or customers, and includes, without limitation, the following, whether or not expressed in a document or medium, regardless of the form in which it is communicated, whether or not such information is on the Company’s forms, memos, computer disc or tape, or otherwise, whether or not such information is in written or verbal form, and whether or not marked “trade secret” or “confidential” or any similar legend: (i) sales information, (ii) operations information, (iii) financial information, (iv) administrative information, (v) research information, (vi) customer information, (vii) supplier information, and (viii) any other information concerning the Company, its business, its properties or its affairs that the Company deems to be confidential or that is confidential according to industry practices.
b. Except as authorized in writing by the Board of Directors, during the term of this Agreement, any renewal periods, and thereafter until such time as any such Confidential Information becomes generally known to and readily ascertainable by proper means to persons outside the Company, its affiliates and/or its clients or customers, the Executive agrees to keep strictly confidential and not use or disclose, cause to be used or disclosed, or permit to be used or disclosed, to any person or entity and/or for his personal benefit or the benefit to any other person or entity, any Confidential Information.
c. The Executive agrees that upon termination of his employment with the Company for any reason, he will promptly return to the Company all Confidential Information within his possession or within his power to control, including, without limitation all copies of such Confidential Information, all abstracts of such Confidential Information and any other information containing such Confidential Information in whole or in part.
d. The Executive affirms that he did not and does not possess, and has not relied and will not rely upon the protected trade secrets or confidential or proprietary information of the Executive’s prior employer(s) in providing services to the Company.
5
a. The Executive acknowledges that, in connection with his duties and responsibilities relating to his employment with the Company, the Executive and/or other employees of the Company working with the Executive, without the Executive or under the Executive’s supervision, may have created, conceived of, made, prepared, worked on or contributed to, and/or may create, conceive of, make, prepare, work on or contribute to, the creation of, or may have been or may be asked by the Company and/or its affiliates or customers to create, conceive of, make, prepare, work on or contribute to the creation of, without limitation, lists, business diaries, business address books, documentation, ideas, concepts, inventions, designs, works of authorship, computer programs, audio/visual works, developments, proposals, works for hire or other materials (“Inventions”). To the extent that any such Inventions related or relate to any actual or reasonably anticipated business of the Company or any of its affiliates or customers, or falls within, is suggested by or results from any tasks assigned to the Executive for or on behalf of the Company or any of its affiliates or customers, the Executive expressly acknowledges that all of his activities and efforts relating to any Inventions, whether or not performed during the Executive’s or the Company’s regular business hours, are within the scope of the Executive’s employment with the Company and that the Company owns all right, title and interest in and to all Inventions, including, to the extent that they exist, all intellectual property rights thereto, including, without limitation, copyrights, patents and trademarks in and to all Inventions. The Executive also acknowledges and agrees that the Company owns and is entitled to sole ownership of all rights and proceeds to all Inventions.
b. The Executive expressly acknowledges and agrees to assign to the Company, and hereby assigns to the Company, all of the Executive’s right, title and interest in and to all Inventions, including, to the extent they exist, all intellectual property rights thereto, including, without limitation, copyrights, patents and trademarks in and to all Inventions.
c. In connection with all Inventions, the Executive agrees to disclose any Invention promptly to the Company and to no other person or entity. The Executive further agrees to execute promptly, at the Company’s request, specific written assignments of the Executive’s right, title and interest in any Inventions, and do anything else reasonably necessary to enable the Company to secure or obtain a copyright, patent, trademark or other form of protection in or for any Invention in the United States or other countries. The Executive further agrees that the Company is not required to designate the Executive as an author of or contributor to any Invention or to secure the Executive’s permission to change or otherwise alter any Invention.
d. The Executive acknowledges that all rights, waivers, releases and/or assignments granted herein and made by the Executive are freely assignable by the Company and are made for the benefit of the Company and its affiliates, subsidiaries, licensees, successors and assigns.
e. The Executive agrees to waive, and hereby does waive, for the benefit of all persons, any and all right, title and interest in the nature of “moral rights” or “droit moral” granted to the Executive in any country in the world.
6
a. The Executive agrees that, during his employment with the Company and for a period of three (3) years following the termination of his employment with the Company, he and his affiliates shall not directly or indirectly own, manage, operate, control, be employed by, consult for, be a shareholder of, be an officer of, participate in, contract with or be connected in any capacity or any manner with any person or entity whose business activities directly or indirectly (whether through related persons, entities or otherwise) compete with the Business anywhere in the United States, Canada and the People’s Republic of China, where the Company or its affiliates is engaged in the Business, PROVIDED HOWEVER, that the Executive shall not be prevented from owning an interest in a publicly traded company so long as the fair market value of such interest at the date of acquisition is less than US$100,000.
b. The Executive agrees that during the period of his employment with the Company and for a period of three (3) years following the termination of his employment with the Company, for any reason, he will not, within the United States, Canada and the People’s Republic of China, where the Company or its affiliates is engaged in the Business, directly or indirectly recruit, induce, divert, supervise, employ, manage, hire or entice, or cause to be recruited, induced, diverted, supervised, employed, managed, hired or enticed, any employee, consultant or independent contractor of the Company or its affiliates to leave or terminate the employment or other relationship thereof, for any reason.
c. The Executive agrees that during the period of his employment with the Company and for a period of three (3) years following the termination of his employment with the Company, he will not, within the United States, Canada and the People’s Republic of China, where the Company or its affiliates is engaged in the Business, directly or indirectly appropriate, call on, induce, divert or solicit, or assist another to appropriate, call on, induce, divert or solicit any actual or potential business or customer away from the Company or its affiliates, or attempt to do any of the foregoing, or otherwise induce or attempt to induce any actual or potential business or customer of the Company or its affiliates, to terminate or adversely modify its relationship with the Company or its affiliates, or to enter into a relationship with or conduct business with the Company or its affiliates, which actual or potential business or customer the Executive was involved with or had a relationship with or whose identity became known to the Executive in connection with the Executive’s employment with the Company.
7
d. If any of the restrictive covenants set forth in paragraphs 12(a), (b) and (c) of this Agreement is held to be invalid, illegal or unenforceable (in whole or in part), such restrictive covenant shall be deemed modified to the extent, but only to the extent, of such invalidity, illegality or unenforceability, and a court of competent jurisdiction shall have the power to modify, any such restrictive covenant to the extent necessary to render such provision enforceable, and the remaining restrictive covenant shall not be affected thereby.
e. In the event of a violation of any of the restrictive covenants set forth in paragraphs 12(a), (b) and (c) of this Agreement, if the Executive is prevented by a court or arbitrator from committing any further violation, whether by a temporary restraining order, injunction or otherwise, the time periods set forth in paragraphs 12(a), (b) and (c) of this Agreement shall be computed by commencing the periods on the date of the applicable court or arbitrators’ order and continuing them from that date for the full period provided.
f. The Executive shall have the right to request a waiver of all or part of the restrictive covenants contained in paragraphs 12(a), (b) and (c) of this Agreement by providing the Company with a written request for such a waiver that contains all relevant details. The Company may, in its sole discretion, waive all or part of the restrictive covenants contained in paragraphs 12(a), (b) and (c) of this Agreement on such terms and conditions, and to such extent, as it, in its sole discretion, deems appropriate. Such waiver must be in writing.
g. The parties acknowledge that this Agreement would not have been entered into, that the benefits described in paragraphs 5, 6 and 7 would not have been promised to the Executive by the Company, in the absence of the Executive’s covenants and promises set forth in paragraphs 12(a), (b) and (c) of this Agreement.
8
14. MISCELLANEOUS.
a. Telephones, stationery, postage, e-mail, the internet and other resources made available to the Executive by the Company, are solely for the furtherance of the Company’s business.
b. All issues concerning, relating to or arising out of this Agreement and from the Executive’s employment by the Company, including, without limitation, the construction and interpretation of this Agreement, shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to that State’s principles of conflicts of law.
c. The Executive and the Company agree that any provision of this Agreement deemed unenforceable or invalid may be reformed to permit enforcement of the objectionable provision to the fullest permissible extent. Any provision of this Agreement deemed unenforceable after modification shall be deemed stricken from this Agreement, with the remainder of the Agreement being given its full force and effect.
d. The Company shall be entitled to equitable relief, including injunctive relief and specific performance as against the Executive, for the Executive’s threatened or actual breach of paragraphs 10, 11 or 12 of this Agreement, as money damages for a breach thereof would be incapable of precise estimation, uncertain, and an insufficient remedy for an actual or threatened breach of paragraphs 10, 11 or 12 of this Agreement. The Executive and the Company agree that any pursuit of equitable relief in respect of paragraphs 10, 11 or 12 of this Agreement shall have no effect whatsoever regarding the continued viability and enforceability of paragraph 13 of this Agreement.
e. Any waiver or inaction by the Company for any breach of this Agreement shall not be deemed a waiver of any subsequent breach of this Agreement.
f. The Executive and the Company independently have made all inquiries regarding the qualifications and business affairs of the other which either party deems necessary. The Executive affirms that he fully understands this Agreement’s meaning and legally binding effect. Each party has participated fully and equally in the negotiation and drafting of this Agreement. Each party assumes the risk of any misrepresentation or mistaken understanding or belief relied upon by his or it in entering into this Agreement.
g. The Company and the Executive agree that the Executive’s obligations to the Company during the Executive’s employment with the Company, as well as any other obligation of the Executive under this Agreement, may be assigned to any successor in interest to the Company or any division or affiliate of the Company in its sole discretion and without additional consideration or prior notice to the Executive, but that nothing requires the Company to do so. The Executive’s obligations under this Agreement are personal in nature and may not be assigned by the Executive to any other person or entity.
9
h. The Company and the Executive acknowledge and agree that future alterations to the Executive’s work hours, working title, management or supervisory responsibilities, number of subordinate employees, sales or promotional budgets, reporting relationships within the Company or with businesses affiliated with the Company, management responsibilities or duties, or similar changes or alterations may occur periodically during the Executive’s employment with the Company. The Company and the Executive agree that the Company, in its sole discretion, may implement such alterations or adjustments for any or no reason and that any such action shall not constitute a breach of this Agreement so long as the Company continues to perform its remaining obligations as provided by this Agreement.
i. This instrument constitutes the entire Agreement between the parties regarding its subject matter. When signed by all parties, this Agreement supersedes and nullifies all prior or contemporaneous conversations, negotiations, or agreements, oral and written, regarding the subject matter of this Agreement. In any future construction of this Agreement, this Agreement should be given its plain meaning. This Agreement may only be amended only by a writing signed by the Company and the Executive.
j. Notwithstanding the termination of this Agreement and of the Executive’s employment with the Company for any reason, paragraphs 10, 11 and 12 of this Agreement shall continue in full force and effect in accordance with their terms following such termination.
k. This Agreement may be executed in counterparts, a counterpart transmitted via facsimile, and all executed counterparts, when taken together, shall constitute sufficient proof of the parties’ entry into this Agreement. The parties agree to execute any further or future documents which may be necessary to allow the full performance of this Agreement. This Agreement contains headings for ease of reference. The headings have no independent meaning.
THE EXECUTIVE STATES THAT HE HAS FREELY AND VOLUNTARILY ENTERED INTO THIS AGREEMENT AND THAT HE HAS READ AND UNDERSTOOD EACH AND EVERY PROVISION THEREOF. THIS AGREEMENT IS EFFECTIVE UPON THE EXECUTION OF THIS AGREEMENT BY BOTH PARTIES.
UNDERSTOOD, AGREED, AND ACCEPTED:
XXXX XXX
|
AMERICAN ORIENTAL BIOENGINEERING, INC.
|
|||
Name: | ![]() |
By:
|
![]() |
|
Name: Xxxxxxx Xx
Title: Chief Financial Officer
|
||||
Date:
|
April 8, 2010 |
Date:
|
April 8, 2010 |
10