PACIFICNET INC. EXECUTIVE EMPLOYMENT CONTRACT
EXHIBIT
10.19
 |
PacificNet
Inc. (Nasdaq:PACT)
|
HK
Office: Xxxx 0000, XxxxxXxxx Xxxxxxx Xxxxx, 000 Xxxxxxxxxx Xxxx, Xxxxxxx, Xxxx
Kong. Tel:
(000) 00000000 Fax: (000) 0000 0000
THIS
EMPLOYMENT CONTRACT (“CONTRACT”) is made as of the 25th
day of March, 2003,
by and
between PacificNet Inc., a company registered in the State of Delaware, USA,
with its primary office located at 000 Xxxx Xxxxxxx Xxxx, Xxxxx 000, Xxxxx,
XX
00000-0000, XXX (“PacificNet” or “Company”);
and
Xx.
Xxxxxx
Xxxx.
(“Executive”).
WHEREAS,
PacificNet desires to employ Executive, and Executive is willing to accept
such
employment upon the terms and conditions hereinafter set forth;
NOW,
THEREFORE, in consideration of the premises and of the agreements hereinafter
contained, the parties agree as follows:
1.
Position and Duties.
The
Company hereby affirms its employment of Executive as its Vice
President of North America Operations, Executive Director, and Company
Secretary,
to
perform the duties and functions as are specified by the Company’s Articals of
Incorporation and ByLaws, under the authority of the Board of Directors.
Duties
include but not limited to:
| l |
IR/PR
in North America, communication with
instutional investors, retail investors, brokers, research analysts,
market makers, road-shows,
etc.
|
| l |
Business
development in North America, business promotion, developing new
customers, identifying and negotiating with potential customers in
North
America.
|
| l |
Corporate
Compliance: keep compliance with NASDAQ, the SEC, federal and state
regulatory requirements, federal/state/IRS tax compliance, social
security
compliance, Code of Ethics,
etc.
|
| l |
Company
Secretary: keeping track of all company records, board minutes, company
registration records, critical corporate records and file backup,
etc.
|
In
addition to performing the duties and exercising the powers in connection with
the business of the Company which the Board of Directors may from time to time
assign to the Executive, the Executive shall further exercise the power and
the
business of any associated and/or subsidiary companies of the Company and/or
the
parent company of the Company, PacificNet Inc., 000 Xxxx Xxxxxxx Xxxx, Xxxxx
000, Xxxxx, XX 00000-0000, XXX, as may be requested by the Board of Directors
from time to time.
Executive
hereby accepts such continued employment and, during the Employment Term shall
perform his duties (as set forth herein) in a diligent, trustworthy, loyal,
businesslike and efficient manner, all for the purpose of advancing the business
of the Company and increase shareholder value.
2.
Term.
The
commencement date of this employment CONTRACT is January
1, 2003,
and
shall continue on for a term of three
(3) years,
or
until he resigns or is terminated in accordance with Section 5 of this
CONTRACT.
3.
Compensation.
As
compensation for his services, Executive shall receive the following
compensation, expense reimbursement and other benefits:
| a. |
Base
Salary. For
all services rendered by Executive pursuant to this CONTRACT, the Company
shall pay Executive an annual salary of US$58,000,
out of which US$48,000 is payable in Cash and US$10,000 is payable
in
freely tradable and fully registered PACT Shares (the number of PACT
Shares to be issued each month is based on the average price of PACT
shares during the month). Such annual salary shall be paid once per
month
in equal installments and shall
be subject to such periodic cost of living and/or merit increases as
PacificNet’s Board of Directors in its discretion as it may deem
appropriate.
|
| b. |
Performance
Bonuses.
For distinguished services, Executive may be entitled to a annual
performance bonus (payable in Cash, stock options or free trading PACT
shares) as granted by the Compensation Committee as it may deem
appropriate.
|
| c. |
Quarterly
Stock Options.
Executive shall be entitled to quarterly stock options grant as
recommended by the CEO and approved the Compensation Committee as it
may
deem appropriate
|
| d. |
Housing
Allowance. Executive
shall be entitled to US$2,000
per month
as
accommodation allowance. This accommodation allowance should be used
to
minimize any possible hotel and lodging expenses in Minneapolis, Hong
Kong, ShenZhen, GuangZhou, Beijing.
|
| e. |
Allowances
for Automobile. Executive
shall be entitled to an Automobile Allowance of US$500
per month.
|
| f. |
Reimbursement
of Expenses.
Executive shall be reimbursed, upon submission of appropriate vouchers
and
supporting documentation, for all travel, communications, entertainment
and other out-of-pocket expenses incurred by Executive in the performance
of his duties hereunder.
|
| g. |
Medical
and Life Insurance Coverage.
Executive and his immediate family shall be entitled to medical, dental,
out-patient, hospitalization, health and life insurance coverages.
The
Company also agrees to provide Executive with a term life insurance
policy. The amount of such policy shall be determined by the Company
provided that such policy shall provide benefits in an amount at least
equal to US$200,000. The Company’s Board of Directors may from time to
time grant Executive further benefits.
|
| h. |
Relocation
and Moving Allowances.
If
relocation is needed, Executive
shall be compensated for all the necessary moving and relocation expenses,
visa fees, regular family visit travel expenses, and children’s education
and school expenses as a result of the move or relocation.
|
| i. |
Annual
Leave.
Executive shall be entitled to paid annual vacation of thirty
(30) days.
Any unused vacation in a particular year may be carried over into the
following year.
|
4.
Other Terms of Employment.
All
other conditions of employment will be in accordance with the terms and
conditions outlined in the Company's Conditions of Employment Handbook.
5.
Termination.
| a. |
Termination
Upon Notice.
Executive’s employment by PacificNet may be terminated at the discretion
of either the Board of Directors of the Company or Executive by means
of
written notice given to the other at
least 90 days
prior to the effective date of such termination. Executive’s employment
shall terminate immediately in the event of Executive’s death or
“Disability” (as defined below).
|
| x. |
Xxxxxxxxx
Pay.
In
the event Executive’s employment by PacificNet is terminated by PacificNet
for reasons that do not constitute “Cause” (as defined below)
then:
|
| (i) |
PacificNet
shall continue to pay Executive
his base salary (in cash, stock and options, and on the same dates
as
would have been paid had he remained an employee) at the same rate
(combined base rate and annual bonus rate per pay period as was in
effect
at the time of termination for a period
of six
(6) months
after the date of termination. The severance period shall increase
to
twelve
(12) months
in
the event of a Change in control of the Company.
|
‘Change
in Control’ shall mean (1) the consummation of a merger or consolidation of the
Company with or into another entity or any other corporate reorganization,
if
more than 50% of the combined voting power of the continuing or surviving
entity’s securities outstanding immediately after such merger, consolidation or
other reorganization is owned by persons who were not stockholders of the
Company immediately prior to such merger, consolidation or other reorganization;
or (2) the sale, transfer or other disposition of all or substantially all
of
the Company’s assets; or (3) the consummation of transactions that result in
more than 50% of the combined voting power or beneficial interests of the
Company’s securities being owned by persons who are current stockholders of the
Company. A transaction shall not constitute a Change of Control if its sole
purpose is to change the state of the Company’s incorporation or to create a
holding company that will be owned in substantially the same proportions by
the
persons who held the Company’s securities immediately before such
transaction."
| (ii) |
Those
options to purchase shares in PacificNet which have been granted to
Executive by PacificNet, and which would have (but for such termination)
vested and become exercisable at the next vesting date following such
termination, shall become vested as of the date of termination and
(together with any options which have already vested) shall be exercisable
for a period of up to 5
years
after the date of termination, at which time any unexercised options
shall
terminate.
|
| (iii) |
PacificNet
shall provide medical, dental, and life insurance benefits for a period
of
12
months
after termination.
|
| c. |
“Cause”
Defined.
For purposes of this CONTRACT, “Cause” means: (i) a material violation of
a specific written resolution by the majority of the Board of Directors;
(ii) gross negligence or willful misconduct by Executive as to a
matter
which is material to PacificNet. No termination shall be for “Cause” under
clauses (i) or (ii) above unless Executive shall have first received
written notice from the Company’s Board of Directors advising Executive of
the act or omission that constitutes Cause and, if such act or omission
is
capable of cure, has continued uncured for 60
days
or
such longer period for cure as is specified in PacificNet’s notice
identifying such act or omission.
|
| d. |
“Disability”
Defined.
For purposes of this CONTRACT, “Disability” means that Executive shall
have failed, because of illness or incapacity, to render services
of the
character contemplated by this CONTRACT for a period of three consecutive
months and on the date of determination continues to be so disabled.
The
existence or nonexistence of disability shall be determined in good
faith
by the Board of Directors after notice in writing given to Executive
at
least 30 days prior to such determination. During such 30-day period,
Executive shall be permitted to make a presentation to the Board
of
Directors for its consideration.
|
| e. |
Surrender
of Records and Property.
Upon
termination of his employment with PacificNet, Executive shall deliver
promptly to PacificNet all records, documents, letters, memoranda,
notes,
notebooks, reports, data, tables, calculations or copies thereof,
which
are the property of PacificNet.
|
6.
General
Provisions.
| a. |
Successors;
Assignment.
This CONTRACT shall be binding upon and inure to the benefit of PacificNet
and its respective successors and assigns, and any entity which purchases
all or substantially all of the business assets of PacificNet, and
any
such other entity shall be deemed “PacificNet” hereunder. Company
agrees that Executive shall have to right to assign the compensation
and
terms of this CONTRACT to a consulting company designated by Executive.
This
CONTRACT shall be binding upon and inure to the benefit of Executive
and
its respective successors and
assignees.
|
| b. |
Entire
Agreement; Modifications.
This
CONTRACT constitutes the entire agreement between the parties respecting
the subject matter hereof, and supersedes all prior negotiations
agreements with respect thereto, whether written or oral. No provision
of
this CONTRACT may be modified or waived except by a written agreement
signed by the parties hereto.
|
| c. |
Obligations
and Benefits.
The obligations and benefits set forth in this CONTRACT shall be binding
and inure to the benefit of the respective parties hereto and their
personal representatives, successors and permitted
assigns.
|
| d. |
Governing
law.
This
CONTRACT shall in all respects be interpreted, construed and governed
by
and in accordance with the laws of Minnesota, USA and the parties hereby
submit to the non-exclusive jurisdiction of the Minnesota, USA
courts.
|
| e. |
Severability.
If
any portion or portions of this CONTRACT shall be, for any reason,
invalid
or unenforceable, the remaining portion or portions shall nevertheless
be
valid and enforceable.
|
| f. |
Counterparts.
This CONTRACT may be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together
shall
constitute one and the same CONTRACT.
|
7.
Non-Disclosure Agreement. Executive
acknowledges the interest of the Company in maintaining the confidentiality
of
information related to its business and shall not at any time during the
Employment Term or thereafter, regardless of the reason for or circumstances
of
termination of employment, directly or indirectly, reveal or cause to be
revealed to any person or entity the production processes, inventions, trade
secrets, customers lists or other confidential business information obtained
by
him as a result of his employment or relationship with the Company, except
when
authorized in writing to do so by the Board of Directors of the Company;
provided, however, that the parties acknowledge that it is not the intent of
this section to include within its subject matter (i) information not
proprietary to the Company, or (ii) information which is in the public
domain.
8.
Notices.
All
notices and other communications under this CONTRACT will be sufficient if
written and sent by registered or certified mail, return receipt requested,
in
the case of Executive, to his residence as shown on the Company’s records, and
in the case of the Company, to its registered office.
In
Witness Whereof, this CONTRACT has been executed as of the date first written
above.
EXECUTIVE:
/s/
Xxxxxx
Xxxx
Xxxxxx
Xxxx
Approval
by the CEO.
Xxxx
Xxxx, CEO: /s/
Xxxx Xxxx Date of Approval:
__________
Approval
by the Compensation Committee.
Xxxxxx
Xxxx, Chairman of Compensation Committee: /s/
Xxxxxx Xxxx Date
of
Approval: __________
Approval
by the Board of Directors of PacificNet Inc.
Date
of
Approval: _____________________________________
