EMPLOYMENT AGREEMENT
Exhibit
10.19
THIS
EMPLOYMENT AGREEMENT (this "Agreement") is
entered into as of the 25th day of
June, 2009, by and between Nanchang Best Animal Husbandry Co., Ltd., a
corporation organized under the laws of the People's Republic of China (the
"Company"), and
Xxxxxxx Xxxxx (the "Executive").
WHEREAS,
the Company desires to set forth the nature and terms upon which the Company
will employ Executive, including the amount of compensation and other benefits
to be provided to Executive and any of the rights of the Executive in the event
of the Executive's termination of employment with the Company. The
Executive is willing to commit to serve the Company on the terms and conditions
herein provided.
NOW,
THEREFORE, in consideration of the promises and the respective covenants and
agreements of the parties herein contained, and intending to be legally bound
hereby, the parties hereto agree as follows:
1. Employment. The
Company hereby agrees to employ the Executive, and the Executive hereby agrees
to serve the Company, on the terms and conditions set forth
herein. So long as Executive is employed by the Company, Executive
shall devote substantially all of his business time and energy and his best
efforts to the performance of his duties as an employee of the
Company.
2. Term. The
term ("Term") of Executive's employment under Section 1 will commence on the
date hereof (the "Effective Date") and shall continue until the third
anniversary of the Effective Date, subject to renewal or earlier termination as
may be set forth in this Agreement.
3. Position and
Duties. Subject to the ultimate control of the Company, the
Executive shall serve as the Chief Executive Officer of the Company and its
parent, AgFeed Industries, Inc. ("AgFeed"), and shall handle such
responsibilities and duties as are normally associated with this position and as
may be delegated by the Chairman of AgFeed from time to time, including, but not
limited to supervising and controlling all of the business and affairs of the
Company. The Executive shall report directly to the Chairman of
AgFeed.
4. Compensation and Related
Matters.
(a) Base
Salary. During the Executive's employment with the Company,
the Company shall pay to the Executive a base salary at a rate of Thirty Six
Thousand Dollars ($36,000) per annum (Three Thousand Dollars ($3,000 per
month), commencing
on the Effective Date. The Chairman of AgFeed, together with AgFeed's
Compensation Committee, shall review the Executive's performance and base salary
no less than annually and shall decide whether to grant any increase or decrease
in the Executive's base salary and, if so, the amount of such increase or
decrease based upon such review.
(b) Payment of Base
Salary. The base salary (as determined in accordance with
Section 4(a)) shall be to the Executive in immediately available funds by wire
transfer as directed by the Executive no less frequently than monthly in
arrears.
(c) Bonuses. The
Executive shall be eligible for and may receive bonuses. The amount,
if any, and timing of any bonuses, shall be solely within the discretion of the
Company.
(d) Expenses. During
the Term, the Executive shall be entitled to receive prompt reimbursement for
all pre-approved expenses incurred by the Executive in performing services
hereunder, including all expenses of travel and lodging while on business at the
request of and in the service of the Company, provided that such expenses are
incurred and accounted for in accordance with the policies and procedures
established by the Company.
(e) Benefits. The
Company shall provide the Executive with welfare benefits in accordance with the
Company's employee manual.
(f) Vacation. The
Executive will be entitled to receive vacations as specified in the Company's
employee manual.
5. Directors
and Officers Liability Insurance. During the term of this Agreement,
AgFeed shall have in force and effect (at its own cost) Directors and Officers
Liability Insurance, with coverage in such amounts as may be deemed appropriate
by AgFeed’s Board of Directors. The Executive shall be a covered
employee under such insurance.
6. Termination.
(a) The
Executive's employment under this Agreement may be terminated by the Executive
or the Company at any time, with or without Cause (as defined
below).
(b) In
the event of termination by the Company without Cause, or in the event of the
Executive's death or disability or a Constructive Termination (as defined
below), the Company shall pay the Executive a lump sum severance amount equal to
Two Hundred Thousand Dollars ($200,000). In the event of
termination by the Company with Cause, or if the Executive voluntarily
terminates his employment, then the Executive shall not be entitled to the
severance payment described in Section 6(b).
(c) In
the event of termination by the Company without Cause, or in the event of the
Executive's death or disability or a Constructive Termination, any options
granted to the Executive (including the Option) shall vest immediately and may
be exercised in full or in part within one (1) year from the date of
termination, the Executive's death or disability, or Constructive
Termination. The effect of any other termination of the Executive's
employment on options granted to the Executive shall be the immediate
cancellation and forfeiture of any unexercised portion of the Option (whether or
not vested).
(d) For
the purposes of this Agreement, "Cause" shall mean (1) a refusal, failure, or
inability to perform any reasonable assigned duties; (2) a material breach or
violation of this Agreement; (3) conduct by the Executive that constitutes gross
negligence or wilful misconduct; (4) material failure to follow AgFeed's or the
Company's policies, directives, or orders applicable to AgFeed or Company
employees holding comparable positions; (5) intentional destruction or theft of
AgFeed or Company property or falsifications of AgFeed or Company documents; (6)
conviction of a felony or any crime involving moral turpitude or a misdemeanor
where imprisonment in excess of fifteen (15) days is imposed; or (7) violation
of AgFeed's Code of Conduct.
(e) For
the purposes of this Agreement, "Constructive Termination" shall mean: (1)
material reduction by the Company of the scope of the Executive's duties for
forty (40) consecutive Business Days, (2) a material reduction in the
Executive's base salary, or (3) the continued assignment to the Executive of any
duties materially inconsistent with the level of his position with the Company;
provided that none of the foregoing events shall be deemed to result in a
Constructive Termination if the Executive consents to such events or if such
events are the result of actions of the Company or its Board of Directors that
are applicable to all officers of the Company.
(f) The
Company may extend the Term of this Agreement for successive two year terms so
long as the Company provides the Executive at least sixty (60) calendar days
advance written notice and with the consent of the Executive prior to the
expiration of the Term.
(g) A
“Business Day”
means any day other than (1) a Saturday, Sunday or legal holiday, or (2) a day
on which commercial banks in Beijing, PRC are authorized or required by law to
close.
7. Confidential
Information. In the course of the Executive’s employment with the
Company, the Executive may become aware of confidential information including,
without limitation, financial information, computer system and software designs,
customer lists, market research, strategic plans, and other non-public or
similar information that relates to the business of AgFeed, the Company and
their affiliates, investors, business partners, customers and/or
clients. The Executive will not use or disclose any such confidential
information of AgFeed, the Company and their affiliates, investors, business
partners, customers or clients except in the course of his duties to AgFeed or
the Company or unless ordered to do so by a court of competent jurisdiction (in
which latter case the Executive will promptly inform AgFeed or the Company of
such order). The Executive will comply with AgFeed’s or the Company's
policies and procedures for the protection of confidential
information. Further, the Executive’s obligation not to disclose or
use such confidential information will continue after the termination of the
Executive’s employment for whatever reason. Confidential information
excludes any information which was not obtained from AgFeed or the Company (or a
director, officer, employee or agent of AgFeed or the Company) or which is or
becomes known by the public or in AgFeed’s or the Company's industry other than
by a breach by the Executive of a confidentiality obligation to AgFeed and the
Company.
8. Non-Solicitation
and Non-Compete
(a) The
Company and the Executive agree that until the Termination Date, the Executive
shall devote substantially all of his working time to the business and affairs
of AgFeed and the Company.
(b) The
Executive agrees that for a period of twelve (12) months following the date of
termination of the Executive’s employment with the Company for any reason (the
“Termination
Date”), the Executive will not, and will not assist anyone else to,
directly or indirectly solicit or induce any of AgFeed or the Company’s
employees to terminate their employment with AgFeed or the Company or divert,
interfere with or take away from AgFeed or the Company any person, company or
entity which, within the six month period immediately preceding the Termination
Date, was an investor, customer, client, supplier, business partner, prime
contractor, subcontractor, employee or independent contractor of AgFeed or the
Company.
(c) From
the Termination Date and for a period of twelve (12) months thereafter, the
Executive agrees that he will not, directly or indirectly, as an equity owner,
director, employee, consultant, lender, agent or in any other capacity, (1)
engage or participate in, or have any interest in any corporation, entity or
other person that engages or participates in any actual, contemplated, or
proposed business or activity engaged or participated in by AgFeed or the
Company or their subsidiaries on the Termination Date, or (2) engage or
participate in, or have an interest in any corporation, entity or other person
that participates in a merger, acquisition or consolidation with AgFeed or the
Company or any of their subsidiaries.
(d) For
purposes of Section 8(c), the Executive will be deemed directly or indirectly to
be engaged or participating in the operation of such a business or activity, or
to have an interest in a corporation, entity or other person, if he is a
proprietor, partner, joint venturer, shareholder, director, officer, lender,
manager, employee, consultant, advisor or agent or if he, directly or indirectly
(including as a member of a group), controls all or any part thereof; provided,
that nothing in Section 8(c) shall prohibit the Executive from holding less than
five percent (5%) of a class of an entity's outstanding securities that are
listed on a national securities exchange or traded in the over-the-counter
market.
9. Binding
Agreement. This Agreement and all rights of the Executive hereunder
shall inure to the benefit of and be enforceable by the Executive's personal or
legal representatives, executors, administrators, successors, heirs,
distributes, devisees and legatees. If the Executive should die while
any amounts would still be payable to the Executive hereunder if the Executive
had continued to live, all such amounts, unless otherwise provided herein, shall
be paid in accordance with the terms of this Agreement to the Executive's
devisee, legatee, or other designee or, if there be no such designee, to the
Executive's estate. This Agreement and all rights of the Company
hereunder shall inure to the benefit of and be enforceable to the Company, and
its successors and assigns.
10. Prior
Agreements. All prior agreements between the Company and the
Executive with respect to the employment of the Executive are hereby superseded
and terminated effective as of the date hereof and shall be without further
force or effect.
11. Miscellaneous. No
provisions of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in a writing signed by the
Executive and a duly authorized officer of the Company. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not set forth expressly in this Agreement.
12. Governing
Law/Venue. This Agreement shall be governed by and construed under
the laws of the PRC, without regard to that country's conflicts of laws
principles.
13. Validity. The
invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision of this
Agreement, which shall remain in full force and effect.
14. Severability;
Headings. If any portion of this Agreement is held invalid or
inoperative, the other portions of this Agreement shall be deemed valid and
operative and, so far as is reasonable and possible, effect shall be given to
the intent manifested by the portion held invalid or inoperative. The
paragraph headings herein are for reference purposes only and are not intended
in any way to describe, interpret, define or limit the extent of intent of the
Agreement or of any part hereof.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, the parties have executed this Employment Agreement on the date
and year first above written.
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COMPANY:
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NANCHANG
BEST ANIMAL HUSBANDRY CO., LTD.,
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By:
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/s/ Xxxxxx Xxxxxxxxx
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Name: Xxxxxx
Xxxxxxxxx
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Title: Chief
Operating Officer
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EXECUTIVE:
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/s/ Xxxxxxx Xxxxx
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Xxxxxxx
Xxxxx
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