THIS EMPLOYMENT AGREEMENT (the "Agreement") is made on the 25th day of March,
2002
BETWEEN:
1. Intermost Corporation, a corporation duly organized, validly existing and
in good standing under the laws of the State of Utah (the "Company"); and
2. Zacky Sun, an individual resident in Hong Kong (the "Executive").
WHEREBY IT IS AGREED as follows:
1. INTERPRETATION
1.1 In this Agreement, unless the context requires otherwise:
"Board" means the board of directors from time to time of the Company;
"Group" means the Company and its subsidiaries from time to time and
"member of the Group" shall be constructed accordingly;
"HK$" means Hong Kong dollars;
"Hong Kong" means the Hong Kong Special Administrative Region of The
People's Republic of China;
"Listing Rules" means the Rules governing the Listing of Securities on The
National Association of Securities Dealers/NASD;
"Month" means calendar month.
1.2 References herein to Clauses are to clauses in this Agreement unless the
context requires otherwise.
1.3 The headings are inserted for convenience only and shall not affect the
construction of the Agreement.
1.4 Unless the context requires otherwise, words importing the singular include
the plural and vice versa and words importing a gender include every
gender.
2. EMPLOYMENT
Subjectto the terms and conditions herein, the Company hereby employs the
Executive, and the Executive hereby accepts employment by the Company, as
an executive of the Company.
3. EXECUTIVE'S DUTIES
The Executive shall, during the continuance of this employment hereunder:
a) comply with any lawful instructions or directions from time to time
reasonably given or made by the Board, or with the authority of the Board,
and shall comply with the Company's rules, regulations, policies and
procedures from time to time in force;
b) faithfully and diligently serve the Group and use his reasonable best
endeavours to promote the business and interests thereof;
c) vote himself exclusively and diligently to the business and interest of the
Group and personally attend thereto at all times during usual business
hours and during such other times as the Company may reasonably require
except in case of incapacity through illness or accident in which case he
shall forthwith notify the Secretary of the Company of such capacity and
shall furnish to the Board such evidence thereof as it may require;
d) keep the Board promptly and full informed (in writing if so requested) of
his conduct of the business or affairs of the Group and provide such
explanations as the Board may reasonably require in connection therewith;
e) carry out his duties and exercise his powers jointly with any other
director or executive member of the Group as shall from time to time be
appointed by the Board to act jointly with the Executive and the Board may
at any time require the Executive to cease performing or exercising any of
his duties or powers under this Agreement; and
f) comply with the relevant requirements of all applicable laws, regulations,
codes of practice and rules Ordinance (including the Listing Rules and any
rules of any other stock exchange, market or dealing system on which the
securities of any member of the Group is traded and the applicable laws,
regulations, codes of practice in that jurisdiction).
4. RUMUNERATION
The remuneration of the Executive shall be as follows:
a) The Company shall pay the Executive an annual salary of HK$600,000, payable
no less frequently than semi-monthly, without any deductions, withholdings
or offsets. Such salary shall include any sum receivable as director's fees
or other remuneration from any other member of the Group (if any), and
shall be reviewed by the Board each year at the time of the annual salary
reviews for senior executives provided that the Executive shall abstain
from voting and shall not be counted in the quorum in respect of any
resolution regarding the amount payable to himself in relation to his
employment under this Agreement which is proposed at any meeting of the
Board;
b) The Company shall, immediately upon the Executive's execution and delivery
of this Agreement, and on each anniversary date of this Agreement, issue to
the Executive such number of the Company's freely tradable Common Shares
valued at HK$400,000. After each such issuance each year, the Company shall
have the right to repurchase such shares issued with respect to such year
at HK$1 if either the Executive voluntarily terminates his employment under
this Agreement or the Company terminates the Executive's employment under
this Agreement under Clause 8.2 below, provided that at the end of each
90-day period after each date of each issuance, the Company's repurchase
right under this Clause 4(b) with respect to one quarter of such shares
issued with respect to such year terminates. For the avoidance of doubt,
for each annual issuance, the right of repurchase terminates 360 days after
such issuance. The shares issuable under this Clause 4(b), if freely
tradable, shall be valued at the last trade on the exchange where they are
primarily traded or, if not traded on an exchange, generally at the
reported last sale or reported closing bid price last quoted by an
established over-the-counter quotation service (the "Market Price").
Restricted securities will be valued at a 15% discount from the Market
Price. Notwithstanding any provision herein to the contrary, if the Company
fails to issue any such Common Shares to the Executive as provided in this
Clause 4(b) for whatever reason within six months after such issuance is
due, the Company shall immediately pay the Executive HK$200,000 and shall
pay the Executive an additional HK$200,000 on the anniversary of the date
when such issuance is due, and the Company's obligation to issue Common
Shares under this Clause 4(b) for such year shall then be deemed
discharged;
c) The Company's Board may, in respect of every financial year of the Company,
grant to the Executive a discretionary bonus, provided that bonuses payable
by the Company to its executive directors in any financial year shall not
exceed ten per cent of the net profits (after tax and after extraordinary
items) of the Company for such year as shown in its audited accounts. Said
discretionary bonus shall be payable within thirty (30) days after the
Company's accounts for the relevant year have been audited and certified,
provided that such discretionary bonus shall be paid only on a pro rata
basis in respect of any financial year of the Company during a portion only
of which the Executive has served the Company hereunder, unless his
employment shall have been terminated pursuant to Clause 8.2, in which case
no discretionary bonus is payable.
In addition to the above benefits, the Executive shall also be entitled to such
other benefits under any applicable employee benefit plan (including medical &
hospital coverage insurance, spouse and dependable medical insurance).
5. INSURANCE
The Company shall purchase for the Executive (i) directors' and officers'
insurance in an amount and on terms and conditions no less favorable than that
purchased for any other director or officer of the Company or that is reasonable
and customary in the Company's industry; and (ii) travel insurance for the
Executive's travels for the Company.
6. EXPENSES
The Company shall promptly reimburse the Executive (against receipts or such
other reasonable evidence of expenditure as the Board may require) for all
reasonable expenses incurred in the course of his employment hereunder or in
promoting or otherwise in connection with the business of the Company.
7. LEAVE
The Executive shall be entitled to 21 days of annual leave (in addition to
public holidays) with full pay. The Executive accrues annual leave at the rate
of 1.75 days per month, and may accumulate and carry forward a maximum of 21
leave days. Any balance in excess of 21 days cannot be carried forward. Unused
leave may be taken after the Executive has submitted his resignation. Upon
termination of employment, the Executive is paid for unused accrued leave.
8. TERMINATION
8.0 There is a probation period of three months. During the probation period,
both the Executive and the Company may then terminate this employment
with seven (7) days notice in writing without compensation.
8.1 From the second year of the Executive employment, i.e. after the
Executive fully employed by the Company for one year, if the Executive is
at any time prevented from performing his duties hereunder due to death,
illness, injury or accident, or if the Executive terminates his
employment hereunder at any time due to the Company failure to perform
its obligations hereunder (including without limitation Clauses 4, 5, 6
and 7 above), he (or in the case of death, his estate) shall be entitled
to receive his full salary for the first three (3) months (or in the case
of illness, injury or accident, any shorter period during which such
incapacity continues). In the case of incapacity, if the Executive
continues to be incapacitated for a period longer than three (3)
consecutive months, the Company may then terminate his employment with
one (1) month notice in writing.
8.2 If at any time during the term of his employment hereunder the Executive
shall be guilty of or commit any serious misconduct which in the
reasonable opinion of the Board is in any way detrimental to the
interests of any member of the Group, or shall be in breach of any of the
terms of this Agreement, or shall commit any act of bankruptcy or become
insolvent, or make any arrangements or composition with his creditors
generally, or fail to pay his personal debts or shall be guilty of
persistent insobriety or be convicted of any criminal offence involving
his integrity or honesty, the Company may terminate the Executive
employment hereunder forthwith without any bonus or payment in lieu of
notice and upon termination, the Executive shall not entitled to any
bonus.
8.3 Either party may also terminate this Agreement and the employment hereunder
with three (3) months written notice.
8.4 In the event of termination of the Executive employment for whatever
reason, the Executive shall resign as a director of the Company and from
all directorships or other offices held by him in any member of the Group.
The Executive irrevocably authorizes the Company in his name and on his
behalf to execute all documents and do all things necessary to effect such
resignation in the event of his failure to do so.
8.5 Any delay or forbearance by either party in exercising any right under this
Agreement shall not constitute a waiver of such right.
9. EXECUTIVE UNDERTAKINGS
9.1 The Executive shall not either during the continuance of his employment
hereunder or at any time thereafter divulge to any person whomsoever or
to any body corporate or unincorporated (except to those officers of the
Group whose province it is to know the same) or use for his own purposes
or for any purposes other than those of the Group and shall use his
reasonable endeavours to prevent the unauthorized publication or
disclosure of any trade secret or any confidential information concerning
the business or finances of any member of the Group or any of its
dealings, transactions or affairs or those of its customers, suppliers,
management and shareholders which may come to his knowledge during or in
the course of his employment. Confidential information shall include,
without limitation, lists or details of customers and suppliers,
information relating to the working of any process of invention carried
on or used by any member of the Group, information relating to research
and other Projects, prices, discounts, xxxx-ups, future business strategy
and development, marketing, price-sensitive information and any other
information which is not generally available to the public.
9.2 Forthwith upon the termination of the employment of the Executive
hereunder, and/or at any other time if the Company shall so request, the
Executive shall deliver to the Company all documents (including
correspondence, lists of customers, notes, memoranda, plans, drawings and
other documents of whatsoever nature), models or sample made or compiled
by or delivered to the Executive during his employment or affairs of any
member of the Group and credit cards and any equipment used by or made
available to the Executive by the Company or any member of the Group. For
the avoidance of doubt it is hereby declared that the property in all
such documents as aforesaid shall at all times be vested in the relevant
member of the Group.
9.3 The Executive shall not at any time during the continuance of his
employment hereunder or for a period of six (6) months thereafter either
on his own account or in conjunction with or on behalf of any other
person or body corporate or unincorporated in competition with any member
of the Group directly or indirectly solicit or entice away from any
member of the Group, any person or body corporate or unincorporated who
now is or at any time during or at the date of the termination of the
said employment have been or become a customer or supplier or prospective
customer or supplier of any member of the Group and with whom the
Executive had personal contact or dealings during his said employment.
9.4 The Executive shall not at any time during the continuance of his
employment hereunder or for a period of six (6) months thereafter solicit
or entice away from any member of the Group or employ or otherwise engage
any person who now is or at any time during or at the date of the
termination of the said employment have become an employee of any member
of the Group and with whom the Executive had contact during his said
employment, whether or not such person would commit any breach of his
contract of employment by reason of leaving the service of the relevant
member of the Group, provided that this Clause 9.4 shall not prevent the
Executive from hiring any employee of the Company or any member of the
Group who responds to an advertisement or other public solicitations of
employment.
9.5 The Executive shall not at any time or for any purpose after termination
of his employment hereunder use either the English or Chinese name of the
Company or any name similar thereto in connection with his own or any
other name in any way calculated to suggest that he is or has been
connected with the Company business, nor in any way hold himself out as
having had any such connection.
9.6 While the restrictions contained in this Clause 9 are considered by the
parties to be reasonable for the protection of the business and interest
of the Group and in all the circumstances and do not work harshly upon
die Executive it is recognized that restrictions of the nature in
question may fail for technical reasons unforeseen and accordingly it is
hereby agreed and declared that if any such restrictions shall be
adjudged to be void as going beyond what is reasonable in all the
circumstances for the protection of the interests of the member(s) of the
Group but would be valid if part of the wording thereof were deleted or
the periods (if any) thereof were reduced or the range of products or
area dealt with thereby were reduced in scope, the said restriction shall
apply with such modifications as may be necessary to make it valid and
effective.
10. INTELLECTUAL PROPERTY RIGHTS
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10.1 The Company (or any other member of the Group as the case may be) shall
be entitled free of charge to the sole ownership and exclusive use of any
invention or improvement made or discovered by the Executive and of any
copyright, design right, trade xxxx, service xxxx or trade name created
or used by the Executive (hereinafter referred to as the ntellectual
property rights in the course of or for the purpose of providing services
hereunder to the Company or any other member of the Group.
10.2 The Executive shall forthwith and from time to time both during and after
the term of this Agreement and at the request and cost of the Company,
insofar as it is within his power, do such acts and things and executive
such documents, as may in the opinion of the Company be reasonable
necessary for obtaining letters patent, registration or other protection
for any such intellectual property rights in any part of the world and
shall effect such registration and vest such letters patent or other
protection in the Company (or any other member of the Group as the case
may be) or its nominees. The Executive irrevocably authorizes the Company
for the purposes aforesaid in the name of the Executive and execute any
document or do anything on his behalf. The Executive shall at the cost
and request of the Company render all reasonable assistance to the
Company (or any other member of the Group as the case may be) for and in
connection with the purposes aforesaid.
10.3 The Executive shall not during or after the termination of the Agreement
use to the detriment or prejudice of the Group or divulge to any person
any confidential information concerning the intellectual property rights
of the Group which may have come to his knowledge.
11. MISCELLANEOUS
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11.1 This Agreement shall be in substitution for any subsisting agreement or
arrangement (oral or otherwise) made between the Company and the
Executive which shall be deemed to have been terminated by mutual consent
as from the date on which the Executive employment under this Agreement
commences.
11.2 The expiration or termination of this Agreement howsoever arising shall
not operate to affect such of the provisions hereof as in accordance with
their terms are expressed to operate or have effect thereafter.
11.3 In the event of any variation of the remuneration payable to the
Executive hereunder being made by consent of the parties hereto, such
variation shall not constitute a new agreement but (subject to any
express agreement to the contrary) the employment of the Executive
hereunder shall continue subject in all respects to the terms and
conditions of this Agreement with such variation as aforesaid.
11.4 Each notice, demand or other communication given or made under this
Agreement shall be in writing and delivered or sent to the relevant party
at its address or facsimile number set out below (or such other address
or facsimile number as the addressee has by five (5) days prior written
notice specified to the other parties):
To the Company:
Xxxxx 0000, Xxxxxxx Xxxxx, 00 Xxxxxxx Xxxx, Xxxxxxx, Xxxx Xxxx
To the Executive:
Xxxx 00X, Xxxxxxxx, 0 Xxx Xxxx Xxxxxx, Xxxx Xxxx.
Any notice, demand or other communication so addressed to the relevant
Party shall be deemed to have been delivered (a) if given or made by
letter, by post, two (2) clear business days after the date of posting,
or by recorded delivery, when actually delivered to the relevant address;
and (b) if given or made by facsimile, when dispatched subject to receipt
of machine-printed confirmation of error-free dispatch of the whole of
the notice, demand or communication to the facsimile number of the
intended addressee.
11.5 If at any time any Provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect, the legality, validity and
enforceability of the remaining provisions of this Agreement shall not be
affected or impaired thereby.
11.6 No failure or delay by the Company in exercising any right, power remedy
under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of the same preclude any further exercise
thereof or the exercise of any other right, power or remedy. Without
limiting the foregoing, no waiver by the Company of any breach by the
Executive of any provision in this Agreement shall be deemed to be a
waiver of any subsequent breach of that or any other provision in this
Agreement.
11.7 This Agreement shall be governed by and construed in accordance with the
laws Hong Kong and the parties hereby irrevocably submit to the
non-exclusive jurisdiction of the Hong Kong courts.
IN WITNESS WHEREOF, this Agreement has been executed on the day and year first
above written.
Signed by Xxxx Xxx )
For and on behalf of )
Intermost Corporation )
In the presence of )
Signed by Zacky Sun )
)
)
