AMENDMENT TO LOANOUT AGREEMENT
Exhibit
10.1
AMENDMENT
TO LOANOUT AGREEMENT
THIS
AMENDMENT TO LOANOUT AGREEMENT (“Amendment”) is made and entered into as of May
26, 2009, by and between Skystar Bio-Pharmaceutical Company, a Nevada
corporation (the “Company”), and Worldwide Officers, Inc. a California
Corporation (the “Lender”). Capitalized terms used herein and undefined shall
have the meanings set forth in that certain Loanout Agreement (defined in the
Recitals below).
RECITALS:
WHEREAS,
reference is made to that certain Loanout Agreement dated as of May 5, 2008 (the
“Loanout Agreement”), by and between the Company and the Lender, pursuant to
which the Company retained the services of Bennet P. Tchaikovsky (“Executive”)
as the Company’s Chief Financial Officer;
WHEREAS, pursuant to its term,
the Loanout Agreement expired on May 4, 2009, although at the request of the
Company, Executive has continued to provide services to the Company as its Chief
Financial Officer;
WHEREAS, the Company desires that
Executive continue to provide services as its Chief Financial Officer under the
Loanout Agreement, which is acceptable to the Lender subject to certain
amendments to certain terms and conditions of the Loanout Agreement as set forth
hereinafter;
NOW,
THEREFORE, in consideration of the foregoing recitals and the mutual agreements
herein contained and for other good and valuable consideration, the parties
hereto agree as follows:
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A.
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AMENDMENT
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1.
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Section
1.1 of the Loanout Agreement shall read in its entirety as
follows:
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“Effective
as of May 5, 2009 (the “Effective Date”), the Company engages the Lender and the
Lender agrees to supply and make available to the Company, the services of
Executive to serve as the Company’s Chief Financial Officer (“CFO”) during the
term of this Agreement, on the terms and conditions contained in this
Agreement. During the term of this Agreement, Executive shall make
himself available to the Company and to any of its subsidiaries or affiliates as
directed to pursue the business of the Company subject to the supervision and
direction of the Board of Directors of the Company (the “Board”).”
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2.
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Section
2.1 of the Loanout Agreement shall read in its entirety as
follows:
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“As
compensation for the services rendered by Executive from the Effective Date as
well as for all services to be rendered by Executive for the term hereof
pursuant to this Agreement, the Company shall pay to the Lender a fee at an
annual base rate of $75,000 to be paid in twelve installments of
$6,250. During Executive’s employment, the fee will be paid, at the
beginning of each period within seven calendar days. Reimbursement for travel
expenses will paid by the Company within thirty (30) calendar days of submission
by the Lender to the Company. Payment shall be made to Executive via wire
transfer, and the Company shall be responsible for any applicable wire transfer
fees in connection therewith. Failure to make payments within the prescribed
time period shall result in an 18% annual interest or the maximum amount
permitted by law (computed on a daily basis) to the past due
balances.”
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3.
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Section
2.2 of the Loanout Agreement shall read in its entirety as
follows:
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“Executive
will have the right to receive 7,220 shares of the Company’s Common Stock,
$0.001 par value, which shall vest during the term of this Agreement, in the
form of a restricted stock grant (the “Restricted Stock”). The shares
of the Restricted Stock shall vest in four (4) equal installments of one
thousand eight hundred and five (1,805) shares every three calendar
months, with the first installment to vest on August 5, 2009 (the “Vesting
Schedule”). The Restricted Stock shall be “restricted” and cannot be resold
without their prior registration or compliance with the terms of Rule 144
promulgated by the Act or an exemption from the Act. In addition, the
Restricted Stock shall further be subject to the terms and conditions of this
Agreement.
The
number of shares of Restricted Stock referenced in this section is subject to
adjustment in the case of any stock split, reverse stock split, combination or
similar events.
Upon the
filing of an election pursuant to Section 83(b) of the Internal Revenue Code
(the “Code”) with respect to such grant of Restricted Stock, the Company will
not reimburse the Executive for any federal and state taxes due as a result of
such election.
During
the term of this Agreement, Executive shall not, directly or indirectly, (i)
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend or otherwise transfer or dispose of, directly or indirectly, any
of the shares of the Restricted Stock or any shares received by Executive from
the Company as the result of the prior Loanout Agreements (collectively
“Shares”), or (ii) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of
any of the Shares, whether any such transaction described in clause (i) or (ii)
above is to be settled by delivery of the Shares, in cash or otherwise. The
Shares may not be resold by Executive until 91 days after Executive ceases to be
Chief Financial Officer of the Company.”
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4.
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Section
3.1 of the Loanout Agreement shall read in its entirety as
follows:
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The term
of this Agreement commences as of May 5, 2009 and shall continue for one (1)
years unless sooner terminated as herein provided.”
B.
CONFLICTS. Except
as expressly set forth in this Amendment, the terms and provisions of the
Loanout Agreement shall continue unmodified and in full force and
effect. In the event of any conflict between this Amendment and the
Loanout Agreement, this Amendment shall control.
C.
GOVERNING LAW. This
Amendment shall be governed and construed under the laws of the State of Nevada,
and shall be binding on and shall inure to the benefit of the parties and their
respective successors and permitted assigns.
D.
COUNTERPARTS. This
Amendment may be executed in any number of counterparts, each of which shall be
an original, but all of which together shall constitute one instrument. A
facsimile or other electronic transmission of this signed Amendment shall be
legal and binding on all parties hereto.
[Remainder
of page left blank intentionally.]
IN
WITNESS WHEREOF, the parties have executed this Amendment as of the date first
above written.
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“COMPANY”
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“EXECUTIVE”
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BENNET
P. TCHAIKOVSKY
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By:
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By:
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Title
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