DIRECTOR AGREEMENT
This DIRECTOR AGREEMENT is made as of
this _15_ day of August, 2009 (the "Agreement"), by and between China Advanced
Construction Materials Group, Inc., a Delaware corporation (the "Company") and
Xxxxx Xxxxxxx (the “Director”).
WHEREAS, the Company wishes to appoint
the Director as a non-executive member of the Board of Directors of the Company
and enter into an agreement with the Director with respect to such appointment;
and
WHEREAS, the Director wishes to accept
such appointment and to serve the Company on the terms set forth herein, and in
accordance with, the provisions of this Agreement.
NOW, THEREFORE, in consideration of the
mutual covenants contained herein, the parties hereto agree as
follows:
1. Position. Subject
to the terms and provisions of this Agreement, the Company shall cause the
Director to be appointed as non-executive member of the Board of Directors (the
“Board”) to fill an existing but now vacant directorship and the Director hereby
agrees to serve the Company in that position upon the terms and conditions
hereinafter set forth, provided, however, that the Director's continued service
on the Board after the initial term on the Board shall be subject to any
necessary approval by the Company's stockholders. This Agreement is subject to
the satisfactory completion of a third party background check within sixty (60)
days of the date hereof.
2. Duties. During
the Directorship Term (as defined in Section 5 hereof), the Director shall serve
as a member of the Board, and the Director shall make reasonable business
efforts to attend all Board meetings, serve on appropriate subcommittees as
reasonably requested by the Board, make himself available to the Company at
mutually convenient times and places, attend external meetings and
presentations, as appropriate and convenient, and perform such duties, services
and responsibilities and have the authority commensurate to such
position..
The Director will use his best efforts
to promote the interests of the Company. The Company recognizes that the
Director (i) is a full-time executive employee of another entity and that his
responsibilities to such entity must have priority and (ii) sits on the Board of
Directors of other entities. Notwithstanding same, the Director will
use reasonable business efforts to coordinate his respective commitments so as
to fulfill his obligations to the Company and, in any event, will fulfill his
legal obligations as a director. Other than as set forth above, the Director
will not, without the prior written approval of the Board, engage in any other
business activity which could materially interfere with the performance of his
duties, services and responsibilities hereunder or which is in violation of the
reasonable policies established from time to time by the Company, provided that
the foregoing shall in no way limit his activities on behalf of (i) his current
employer and its affiliates or (ii) the Board of Directors of those entities on
which he sits.
3. Board
Committees. The Director hereby agrees
to Chair the Audit Committee of the Board and to perform all of the duties,
services and responsibilities necessary thereunder.
4. Monetary
Remuneration.
(a) Fees and
Compensation. During the Directorship Term the Director shall receive
the following compensation and benefits:
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—
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A
monthly fee of U.S $2,083.33
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The Director's status during the
Directorship Term shall be that of an independent contractor and not, for any
purpose, that of an employee or agent with authority to bind the Company in any
respect. All payments and other consideration made or provided to the Director
under Sections 3 and 4 shall be made or provided without withholding or
deduction of any kind, and the Director shall assume sole responsibility for
discharging, all tax or other obligations associated therewith.
(b) Restricted Stock
Award. During the Directorship Term, the Company shall grant a
Restricted Stock in the amount of 10,000 shares of the Company’s restricted
common stock (the “Restricted Stock”). The Restricted Stock shall vest according
to the following schedule:
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·
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2,500
shares of the Company’s common stock shall vest three (3) months from the
date hereof (the “Three Month Vesting Date”) provided that the Director
maintains a position on the Board as of the Three Month Vesting
Date;
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·
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an
additional 2,500 shares of the Company’s common stock shall vest six (6)
months from the date hereof (the “Six Month Vesting Date”) provided that
the Director maintains a position on the Board as of the Six Month Vesting
Date;
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·
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an
additional 2,500 shares of the Company’s common stock shall vest nine (9)
months from the date hereof (the “Nine Month Vesting Date”) provided that
the Director maintains a position on the Board as of the Nine Month
Vesting Date;
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·
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an
additional 2,500 shares of the Company’s common stock shall vest twelve
(12) months from the date hereof (the “Twelve Month Vesting Date”)
provided that the Director maintains a position on the Board as of the
Twelve Month Vesting Date;
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(c) Expense
Reimbursements. During the Directorship Term, the Company shall
reimburse the Director for all reasonable out-of-pocket expenses incurred by the
Director in attending any in-person meetings, provided that the Director
complies with the generally applicable policies, practices and procedures of the
Company for submission of expense reports, receipts or similar documentation of
such expenses. However, all reimbursements must be approved in advance by the
Company.
5. Directorship
Term. The "Directorship Term", as used in this Agreement,
shall mean the period commencing on the date hereof and terminating on the
earliest of the following to occur:
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(a)
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one
(1) year from the date hereof, subject to a one (1) year renewal term upon
re-election by a majority of the shareholders of the
Company;
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(b) the
death of the Director ("Death");
(c) the termination of the Director
from the position of member of the Board by the mutual agreement of the Company
and the Director;
(d) the removal of the Director from
the Board by the shareholders of the Company;
(e) the resignation by the Director
from the Board if after the date hereof, the Chief Executive Officer of his
current employer determines that the Director's continued service on the Board
conflicts with his fiduciary obligations to his current employer (a "Fiduciary
Resignation"); and
(f) the resignation by the Director
from the Board if the board of directors or the Chief Executive Officer of his
current employer requires the Director to resign and such resignation is not a
Fiduciary Resignation.
6. Director's Representation
and Acknowledgment. The Director represents to the Company
that his execution and performance of this Agreement shall not be in violation
of any agreement or obligation (whether or not written) that he may have with or
to any person or entity, including without limitation, any prior employer. The
Director hereby acknowledges and agrees that this Agreement (and any other
agreement or obligation referred to herein) shall be an obligation solely of the
Company, and the Director shall have no recourse whatsoever against any
stockholder of the Company or any of their respective affiliates with regard to
this Agreement.
7. Director
Covenants.
(a) Unauthorized
Disclosure. The Director agrees and understands that in the
Director's position with the Company, the Director has been and will be exposed
to and receive information relating to the confidential affairs of the Company,
including but not limited to technical information, business and marketing
plans, strategies, customer information, other information concerning the
Company's products, promotions, development, financing, expansion plans,
business policies and practices, and other forms of information considered by
the Company to be confidential and in the nature of trade secrets. The Director
agrees that during the Directorship Term and thereafter, the Director will keep
such information confidential and will not disclose such information, either
directly or indirectly, to any third person or entity without the prior written
consent of the Company; provided, however, that (i) the Director shall have no
such obligation to the extent such information is or becomes publicly known or
generally known in the Company's industry other than as a result of the
Director's breach of his obligations hereunder and (ii) the Director may, after
giving prior notice to the Company to the extent practicable under the
circumstances, disclose such information to the extent required by applicable
laws or governmental regulations or judicial or regulatory process. This
confidentiality covenant has no temporal, geographical or territorial
restriction. Upon termination of the Directorship Term, the Director will
promptly return to the Company all property, keys, notes, memoranda, writings,
lists, files, reports, customer lists, correspondence, tapes, disks, cards,
surveys, maps, logs, machines, technical data or any other tangible product or
document which has been produced by, received by or otherwise submitted to the
Director in the course or otherwise as a result of the Director's position with
the Company during or prior to the Directorship Term, provided that, the Company
shall retain such materials and make them available to the Director if requested
by him in connection with any litigation against the Director under
circumstances in which (i) the Director demonstrates to the reasonable
satisfaction of the Company that the materials are necessary to his defense in
the litigation, and (ii) the confidentiality of the materials is preserved to
the reasonable satisfaction of the Company.
(b) Non-Solicitation. During
the Directorship Term and for a period of three (3) years thereafter, the
Director shall not interfere with the Company's relationship with, or endeavor
to entice away from the Company, any person who, on the date of the termination
of the Directorship Term, was an employee or customer of the Company or
otherwise had a material business relationship with the Company.
(c) Remedies. The
Director agrees that any breach of the terms of this Section 7 would result in
irreparable injury and damage to the Company for which the Company would have no
adequate remedy at law; the Director therefore also agrees that in the event of
said breach or any threat of breach, the Company shall be entitled to an
immediate injunction and restraining order to prevent such breach and/or
threatened breach and/or continued breach by the Director and/or any and all
entities acting for and/or with the Director, without having to prove damages,
in addition to any other remedies to which the Company may be entitled at law or
in equity. The terms of this paragraph shall not prevent the Company from
pursuing any other available remedies for any breach or threatened breach
hereof, including but not limited to the recovery of damages from the Director.
The Director acknowledges that the Company would not have entered into this
Agreement had the Director not agreed to the provisions of this Section
7.
The provisions of this Section 7 shall
survive any termination of the Directorship Term, and the existence of any claim
or cause of action by the Director against the Company, whether predicated on
this Agreement or otherwise, shall not constitute a defense to the enforcement
by the Company of the covenants and agreements of this Section
7.
8. Indemnification. The
Company agrees to indemnify the Director for his activities as a director of the
Company to the fullest extent permitted by law, and to cover the Director under
any directors and officers liability insurance obtained by the
Company. Further, the Company and the Director agree to enter into an
indemnification agreement substantially in the form of agreement entered into by
the Company and its other Board members.
9. Non-Waiver of
Rights. The failure to enforce at any time the provisions of
this Agreement or to require at any time performance by the other party of any
of the provisions hereof shall in no way be construed to be a waiver of such
provisions or to affect either the validity of this Agreement or any part
hereof, or the right of either party to enforce each and every provision in
accordance with its terms. No waiver by either party hereto of any breach by the
other party hereto of any provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions at that
time or at any prior or subsequent time.
10. Notices. Every
notice relating to this Agreement shall be in writing and shall be given by
personal delivery or by registered or certified mail, postage prepaid, return
receipt requested; to:
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If
to the Company:
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Xxxxx
Xxxxx, 0 Xxxxxxxxxxx Xxxx, Xxxxx 0000
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Xxxxxxx
Xxxxxxxx, Xxxxxxx 100080 PRC
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with
a copy to:
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Xxxxx
Xxxx
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Xxxxxxxxx
Xxxxxxxx Xxxx Xxxxxxx LLP
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0000
X Xxxxxx, X.X. Xxxxxxxxxx, XX 00000-0000
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Tel:
000.000.0000 | Fax: 000.000.0000
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If
to the Director:
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Xxxxx
Xxxxxxx
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Either of the parties hereto may change
their address for purposes of notice hereunder by giving notice in writing to
such other party pursuant to this Section 10.
11. Binding
Effect/Assignment. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective heirs, executors,
personal representatives, estates, successors (including, without limitation, by
way of merger) and assigns. Notwithstanding the provisions of the immediately
preceding sentence, neither the Director nor the Company shall assign all or any
portion of this Agreement without the prior written consent of the other
party.
12. Entire
Agreement. This Agreement (together with the other agreements
referred to herein) sets forth the entire understanding of the parties hereto
with respect to the subject matter hereof and supersedes all prior agreements,
written or oral, between them as to such subject matter.
13. Severability. If
any provision of this Agreement, or any application thereof to any
circumstances, is invalid, in whole or in part, such provision or application
shall to that extent be severable and shall not affect other provisions or
applications of this Agreement.
14. Governing
Law. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Delaware, without reference to
the principles of conflict of laws. All actions and proceedings arising out of
or relating to this Agreement shall be heard and determined in any Delaware
state or federal court and the parties hereto hereby consent to the jurisdiction
of such courts in any such action or proceeding; provided, however, that neither
party shall commence any such action or proceeding unless prior thereto the
parties have in good faith attempted to resolve the claim, dispute or cause of
action which is the subject of such action or proceeding through mediation by an
independent third party.
15. Legal
Fees. The parties hereto agree that the non-prevailing party
in any dispute, claim, action or proceeding between the parties hereto arising
out of or relating to the terms and conditions of this Agreement or any
provision thereof (a "Dispute"), shall reimburse the prevailing party for
reasonable attorney's fees and expenses incurred by the prevailing party in
connection with such Dispute; provided, however, that the Director shall only be
required to reimburse the Company for its fees and expenses incurred in
connection with a Dispute, if the Director's position in such Dispute was found
by the court, arbitrator or other person or entity presiding over such Dispute
to be frivolous or advanced not in good faith.
16. Modifications. Neither
this Agreement nor any provision hereof may be modified, altered, amended or
waived except by an instrument in writing duly signed by the party to be
charged.
17. Tense and
Headings. Whenever any words used herein are in the singular
form, they shall be construed as though they were also used in the plural form
in all cases where they would so apply. The headings contained herein are solely
for the purposes of reference, are not part of this Agreement and shall not in
any way affect the meaning or interpretation of this Agreement.
18. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument.
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of this page intentionally left blank)
IN
WITNESS WHEREOF, the Company has caused this Director Agreement to be executed
by authority of its Board of Directors, and the Director has hereunto set his
hand, on the day and year first above written.
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By:
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Name:
Xxxxxx Xxx
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Title:
Chief Executive
Officer
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DIRECTOR
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Name:
Xxxxx Xxxxxxx
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