EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (this “Agreement”),
dated as of April 16, 2010 by and between Xxxxxxx Hongjie Lan, residing at 00
Xxxxxxxx, Xxxxxx, Xxxxxxxxxx 00000 (“Executive”),
and Skystar Bio-Pharmaceutical Company, a Nevada corporation having its
principal office at Room 10601, Jiezuo Plaza, No. 4, Fenghui Road South, Gaoxin
District, Xian Province, People’s Republic of China (the “Company”).
WHEREAS,
the Company desires to employ Executive as its Chief Financial Officer on the
terms and conditions as set forth hereinafter, and Executive desires to be so
employed;
NOW,
THEREFORE, IN CONSIDERATION of the foregoing facts, the mutual covenants and
agreements contained herein and other good and valuable consideration, the
parties hereby agree as follows:
1. Employment, Duties and
Acceptance.
1.1 Effective
as of the date of this Agreement, the Company hereby agrees to employ Executive
as its Chief Financial Officer, and Executive hereby accepts such employment 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”).
1.2 The
Board may assign Executive such general management and supervisory
responsibilities and executive duties for the Company as are appropriate and
commensurate with Executive’s position as Chief Financial Officer of the Company
(“CFO”).
1.3 Executive
accepts such employment and agrees to devote all of his business time, energies
and attention to the performance of his duties hereunder and as an executive
officer of the Company.
2. Compensation and
Benefits.
2.1 The
Company shall pay to Executive a salary at an annual base rate of $100,000 for
the term hereof. During Executive’s employment, salary will be paid
in four (4) equal payments payable on the last day of every third month, with
the first payment on July 31, 2010.
2.2 During
Executive’s employment under this Agreement, the Company shall include Executive
as an insured under an officers
and directors insurance policy with coverage not to exceed $1,000,000.
2.3 The
Company shall reimburse Executive for all reasonable business expenses incurred
by Executive during Executive’s employment hereunder to the extent in compliance
with the Company’s business expense reimbursement policies in effect from time
to time and upon presentation by Executive of such documentation and records as
the Company shall from time to time require, provided that any expense in excess
of $500.00 shall require the prior written approval of the Company.
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3. Term and
Termination.
3.1 The
term of this Agreement commences as of the consummation of the Agreement and
shall continue for one (1) year unless sooner terminated as herein
provided.
3.2 If
Executive dies during the term of this Agreement, this Agreement shall thereupon
terminate, except that the Company shall pay to the legal representative of
Executive’s estate any accrued and unpaid base salary due Executive pursuant to
Section 2.1 hereof based on the days of service prior to the death and all
amounts owing to Executive at the time of termination, including for previously
accrued but unpaid expense reimbursements.
3.3 The
Company reserves the right to terminate Executive’s employment upon ten (10)
days written notice if, for a continuous or accumulated period of forty-five
(45) days during the one year term of this Agreement, Executive is prevented
from discharging his duties under this Agreement due to any physical or mental
disability. With the exception of the covenants included in Section 4
below, upon such termination, the obligations of Executive and Company under
this Agreement shall immediately cease. In the event of a termination
pursuant to this section, Executive shall be entitled to receive any accrued and
unpaid amounts earned pursuant to Section 2.1 hereof based on the days of
service prior to the death and all amounts owing to Executive at the time of
termination, including for previously accrued but unpaid expense
reimbursements.
3.4 The
Company reserves the right to declare Executive in default of this Agreement if
Executive willfully breaches or habitually neglects the duties which he is
required to perform under the terms of this Agreement, or if Executive commits
such acts of dishonesty, fraud, misrepresentation, gross negligence or willful
misconduct as would prevent the effective performance of his duties or which
results in material harm to the Company or its business. The Company
may terminate this Agreement for cause by giving written notice of termination
to Executive. With the exception of the covenants included in Section
4 below, upon the date of delivery of the written notice of such termination,
the obligations of Executive and the Company under this Agreement shall
immediately cease. Such termination shall be without prejudice to any
other remedy to which the Company may be entitled either at law, in equity, or
under this Agreement. In the event of a termination pursuant to this
section, Executive shall be entitled to receive any accrued and unpaid amounts
earned pursuant to Section 2.1 hereof. The Company shall also pay to
Executive all amounts owing to Executive at the time of termination, including
for previously accrued but unpaid expense reimbursements.
3.5 Executive’s
employment may be terminated at any time by Executive upon not less than thirty
(30) days written notice by Executive to the Board. With the
exception of the covenants included in section 4 below, upon such termination
the obligations of Executive and the Company under this Agreement shall
immediately cease. In the event of a termination pursuant to this
section, Executive shall be entitled to receive any accrued and unpaid amounts
earned pursuant to Section 2.1 hereof. The Company shall also pay to
Executive all amounts owing to Executive at the time of termination, including
for previously accrued but unpaid expense reimbursements.
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3.6 Company
may terminate Executive’s employment upon not less than thirty (30) days written
notice by Company to Executive. With the exception of the covenants
included in section 4 below, upon such termination the obligations of Executive
and the Company under this Agreement shall immediately cease. In the
event of a termination pursuant to this section, Executive shall be entitled to
receive any accrued and unpaid amounts earned pursuant to Section 2.1 hereof
based on the days of service prior to the termination and all amounts owing to
Executive at the time of termination, including for previously accrued but
unpaid expense reimbursements.
4. Protection of Confidential
Information; Non-Competition, Corporate Opportunities.
4.1 Executive
acknowledges that:
(a) As
a result of his employment with the Company, Executive will obtain secret and
confidential information concerning the business of the Company and its
subsidiaries and affiliates (referred to collectively in this Article 4 as the
“Group”),
including, without limitation, trade secrets and any information concerning
products, processes, formulas, designs, inventions (whether or not patentable or
registrable under copyright or similar laws, and whether or not reduced to
practice), discoveries, concepts, ideas, improvements, techniques, methods,
research, development and test results, specifications, data, know-how,
software, formats, marketing plans, and analyses, business plans and analyses,
strategies, forecasts, customer and supplier identities, characteristics and
agreement (“Confidential
Information”). In addition, Executive may become aware of
business opportunities that may be beneficial to the Group including, but not
limited, opportunities to acquire or purchase, or, except for Permitted
Competitive Investments, otherwise make equity or debt investments in, companies
primarily involved in a Competitive Business (“Corporate
Opportunities”), while Executive is an employee of Company, whether in
the course of his employment or otherwise, and that such Corporate Opportunities
shall considered to be business opportunities of the Group.
(b) The
Group will suffer substantial damage which will be difficult to compute if,
during the period of his employment with the Group or thereafter, Executive
should enter a business competitive with the Group or divulge Confidential
Information.
(c) The
provisions of this Agreement are reasonable and necessary for the protection of
the business of the Group.
4.2 Executive
agrees that he will not at any time, either during the term of this Agreement or
thereafter, divulge to any person or entity any Confidential Information
obtained or learned by him as a result of his employment with the Group, except
(i) in the course of performing his duties hereunder, (ii) to the
extent that any such information is in the public domain other than as a result
of Executive’s breach of any of his obligations hereunder, (iii) where
required to be disclosed by court order, subpoena or other government process,
or (iv) if such disclosure is made without Executive’s knowing intent to
cause material harm to the Group. If Executive shall be required to
make disclosure pursuant to the provisions of clause (iii) of the preceding
sentence, Executive promptly, but in no event more than 24 hours after learning
of such subpoena, court order, or other government process, shall notify, by
personal delivery or by electronic means, confirmed by mail, the Company and, at
the Company’s expense, Executive shall: (a) take reasonably necessary and lawful
steps required by the Group to defend against the enforcement of such subpoena,
court order or other government process, and (b) permit the Group to intervene
and participate with counsel of its choice in any proceeding relating to the
enforcement thereof.
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4.3 Upon
termination of his employment with the Company, Executive will promptly deliver
to the Group all memoranda, correspondence, notes, records, reports, manuals,
drawings, blue-prints and other documents (and all copies thereof) relating to
the business of the Group and all property associated therewith, which he may
then possess or have under his control whether prepared by Executive or
others.
4.4 During
the term of this Agreement and terminating three years after termination of
employment, Executive, without the prior written permission of the Company,
shall not for any reason whatsoever, (i) enter into the employ of or render any
services to any person, firm or corporation engaged in any business which is in
competition with the Group’s principal existing business at the time of
termination (“Competitive
Business”); (ii) engage in any Competitive Business as an individual,
partner, shareholder, creditor, director, officer, principal, agent, employee,
trustee consultant, advisor or in any other relationship or capacity; (iii)
employ, or have or cause any other person or entity to employ, any person who
was employed by the Group at the time of termination of Executive’s employment
by the Company; or (iv) solicit, interfere with, or endeavor to entice away from
the Group, for the benefit of a Competitive Business, any of its
customers. Notwithstanding the foregoing, (i) Executive shall not be
precluded from investing and managing the investment of, his or his family’s
assets in the securities of any corporation or other business entity which is
engaged in a Competitive Business if such securities are traded on a national
stock exchange or in the over-the-counter market and if such investment does not
result in his beneficially owning, at any time, more than 2% of any class of the
publicly-traded equity securities of such Competitive Business (“Permitted
Competitive
Investment”); and (ii) during the term of this Agreement and terminating
one year after termination of Executive’s employment (except for investments in
a class of securities trading on public markets), Executive: (a) shall be
prohibited from taking for himself personally any Corporate Opportunities, and
(b) shall refer to the Company for consideration (before any other party) any
and all Corporate Opportunities that arise during the term of this Agreement or
for a period of one year thereafter. If the Company determines not to
exploit any Corporate Opportunity, the Company shall determine what, if
anything, should be done with such opportunity. Executive shall not
be entitled to any compensation, as a finder or otherwise, if either the Company
or Executive introduces such opportunity to other persons, it being understood
that any such compensation shall be paid to the Company.
4.5 If
Executive commits a breach of any of the provisions of Sections 4.2 or 4.4, the
Company shall have the right:
(a) to
have the provisions of this Agreement specifically enforced by any court having
equity jurisdiction, it being acknowledged and agreed by Executive that the
services being rendered hereunder to the Company are of a special, unique and
extraordinary character and that any breach or threatened breach will cause
irreparable injury to the Group and that money damages will not provide an
adequate remedy to the Group; and
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(b) to
require Executive to account for and pay over to the Company all monetary
damages determined by a non-appealable decision by a court of law to have been
suffered by the Group as the result of any actions constituting a breach of any
of the provisions of Section 4.2 or 4.4, and Executive hereby agrees to account
for and pay over such damages to the Company.
(c) to
not perform any obligation owed to Executive under this Agreement, to the
fullest extent permitted by law. Company shall also have the right,
to the fullest extent permitted by law, to adjust any amount due and owing or to
be due and owing to Executive, whether under this Agreement or any other
agreement between Company and Executive in order to satisfy any losses to the
Group as a result of Executive’s breach.
4.6 If
Executive shall violate any covenant contained in Section 4.4, the duration of
such covenant so violated shall be automatically extended for a period of time
equal to the period of such violation.
5. Miscellaneous
Provisions.
5.1 All
notices provided for in this Agreement shall be in writing, and shall be deemed
to have been duly given when delivered personally to the party to receive the
same, when delivered via overnight courier providing for next day delivery
service (“Overnight Courier”), when transmitted by facsimile (electronic receipt
confirmed), or when mailed first class postage prepaid, by certified mail,
return receipt requested, addressed to the party to receive the same at his or
its address set forth below, or such other address as the party to receive the
same shall have specified by written notice given in the manner provided for in
this Section 5.1. All notices shall be deemed to have been given: (a)
as of the date of personal delivery, (b) the first business day after delivery
via Overnight Courier, (c) on the electronically confirmed date of receipt
during business hours of the facsimile transmittal (or the following business
day if the facsimile is received after 5:30 p.m. PDT), or (d) three calendar
days after the date of deposit (postage pre-paid) with the U.S. Postal Service
if delivered via first class or certified mail.
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If
to Executive:
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Xxxxxxx
Hongjie Lan
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00
Xxxxxxxx
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Xxxxxx,
XX 00000
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Fax:
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If
to the Company:
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Xxxx
00000, Xxxxxx Xxxxx
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Xx.
0, Xxxxxxx Xxxx Xxxxx
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Xxxxxx
Xxxxxxxx, Xxxx Xxxxxxxx, PRC
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Attn:
Xxxxxxx Xx
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Fax:
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With
a copy to:
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Xxxxxxxxxx
& Xxxxx, LLP
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Xxxxxxx
Plaza
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00000
Xxxxxxxx Xxxxxxxxx, Xxxxx 000
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Xxx
Xxxxxxx, XX 00000
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Attn:
Xxxxx X. Xxxxx, Esq.
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Fax:
(000) 000-0000
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5.2 In
the event of any claims, litigation or other proceedings arising under this
Agreement, Executive shall be reimbursed by the Company within sixty (60) days
after delivery to the Company of statements for the costs incurred by Executive
in connection with the analysis, defense and prosecution thereof, including
reasonable attorneys’ fees and expenses; provided, however, that Executive shall
reimburse the Company for all such costs if it is determined by a non-appealable
final decision of a court of law that Executive shall have acted in bad faith
with the intent to cause material damage to the Company in connection with any
such claim, litigation or proceeding.
5.3 The
Company, shall to the fullest extent permitted by law, indemnify Executive for
any liability, damages, losses, costs and expenses arising out of alleged or
actual claims (collectively, “Claims”)
made against Executive for any actions or omissions as an officer and/or
director of the Company or its subsidiary. To the extent that the
Company obtains directors and officers insurance coverage for any period in
which Executive was an officer, director or consultant to the Company, Executive
shall be a named insured and shall be entitled to coverage
thereunder.
5.4 The
provisions of Article 4, Sections 5.2 and 5.3 and any provisions relating to
payments owed to Executive after termination of employment shall survive
termination of this Agreement for any reason.
5.5 This
Agreement sets forth the entire agreement of the parties relating to the
employment of Executive and is intended to supersede all prior negotiations,
understandings and agreements. No provisions of this Agreement may be
waived or changed except by writing by the party against whom such waiver or
change is sought to be enforced. The failure of any party to require
performance of any provision hereof or thereof shall in no manner affect the
right at a later time to enforce such provision.
5.6 All
questions with respect to the construction of this Agreement, and the rights and
obligations of the parties hereunder, shall be determined in accordance with the
law of the State of Nevada applicable to agreements made and to be performed
entirely in the State of Nevada. Any disputes, claims or causes of
action by one party against the other arising out of, in related to or
concerning this Agreement shall be commenced and maintained in any state or
federal court located in Xxxxx County of the State of Nevada, and Executive
hereby submits to the jurisdiction and venue of any such court.
5.7 This
Agreement shall inure to the benefit of and be binding upon the successors and
assigns of the Company. This Agreement shall not be assignable by
Executive, but shall inure to the benefit of and be binding upon Executive’s
heirs and legal representatives.
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5.8 It
is the desire and intent of the parties that the terms, provisions, covenants
and remedies contained in this Agreement shall be enforceable to the fullest
extent permitted by law. If any such term, provision, covenant or
remedy of this Agreement or the application thereof to any person or
circumstances shall, to any extent, be construed to be invalid or unenforceable
in whole or in part, then such term, provision, covenant or remedy shall be
construed in a manner so as to permit its enforceability under the applicable
law, to the fullest extent permitted by law. In any case, the
remaining provisions of the Agreement and the application thereof to any person
or circumstance other than those to which they have been held invalid or
unenforceable, shall remain valid and in full force and effect.
[Remainder
of Page Intentionally Blank]
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IN
WITNESS WHEREOF, the parties have executed this Employment Agreement as of the
date first above written.
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“COMPANY”
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“EXECUTIVE”
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SKYSTAR
BIO-PHARMACEUTICAL
COMPANY
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XXXXXXX
HONGJIE LAN
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By:
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/s/ Xxxxxxx Xx
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By:
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/s/ Xxxxxxx Hongjie Lan
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Title:
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Chief Executive Officer
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