EMPLOYMENT AGREEMENT
EXHIBIT 10.18
THIS AGREEMENT, made as of the 1st day of October 2007, by and between BEIJING MED-PHARM
CORPORATION, a Delaware corporation (“BMP”), and Xxxx Xxxxxxx (the “Executive”).
WHEREAS, BMP desires to offer the Executive’s employment as Corporate Vice President and the
Executive desires to accept such employment with BMP, upon the terms and conditions set forth in
her Agreement.
WHEREAS, the Agreement will formalize the terms and conditions governing the Executive’s employment
with BMP and the termination of that employment.
NOW, HEREFORE, the parties hereto agree as follows:
PART
ONE – DEFINITIONS
For purposes of her Agreement, the following definitions shall be in effect:
1. “Agreement” means the Employment Agreement, as the same may, from time to time, be amended in
accordance with the provisions hereof.
2. “Board” means BMP’s Board of Directors.
3. “Change in Control” means a change in the ownership or control of BMP effected through any of
the following transactions:
(i) a merger, consolidation or other reorganization approved by BMP’s stockholders, unless
securities representing more than fifty percent (50%) of the total combined voting power of the
voting securities of the successor corporation are immediately hereafter beneficially owned,
directly or indirectly and in substantially the same proportion, by the persons who beneficially
owned BMP’s outstanding voting securities immediately prior to such transaction,
(ii) a stockholder-approved sale, transfer or other disposition of all or substantially all of
BMP’s assets,
(iii) the closing of any transaction or series of related transactions pursuant to which any person
or any group of persons comprising a “group” within the meaning of Rule 13d-5(b)(1) of the 1934 Act
(oher than BMP or a person that, prior to such transaction or series of related transactions,
directly or indirectly controls, is controlled by or is under common control with, BMP) becomes
directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 of the 0000 Xxx) of
securities possessing (or convertible into or exercisable for securities possessing) more than
fifty percent (50%) of the total combined voting power of BMP’s securities (as measured in terms of
the power to vote with respect to the election of Board members) outstanding immediately after the
consummation of such transaction or series of related transactions, wheher such
transaction involves a direct issuance from BMP or the acquisition of outstanding securities held
by one or more of BMP’s existing stockholders, or
However,
the term Change of Control shall not include either of the following events undertaken at
the election of BMP:
a. any transaction, the sole purpose of which is to change the state in which BMP is incorporated;
or
b. a transaction, the result of which is to sell all or substantially all of the assets of BMP to
another corporation (the “surviving corporation”) provided that the surviving corporation is owned
directly or indirectly by the shareholders of BMP immediately following such transaction in
substantially the same proportions as their ownership of BMP’s common stock immediately preceding
such transaction.
4. “Change in Control Severance Benefits” means the various payments and benefits to which the
Executive may become entitled to under Paragraph 14 of Part Four of her Agreement upon her
Involuntary Termination in connection with a Change in Control.
5. “Code” means the Internal Revenue Code of 1986, as amended.
6. “Competing Organization” means any person or legal entity engaged in, about to engage in, or
intending to engage in, the business of providing services to foreign and/or domestic
pharmaceutical companies, specifically: drug distribution; physician-oriented drug promotion;
product registration; clinical trial management; and pre-market entry analyses.
7. “Competing Service” means any service of any person or legal entity oher than BMP, or a parent,
subsidiary or affiliate of BMP, in existence or under development, which during the term of her
Agreement, competes with or is an alternative to any present or planned future service of BMP,
whether or not actively marketed by BMP.
8. “Customer” means any individual, firm, partnership, corporation, company, joint venture or
governmental or military unit or any oher entity or any parent, subsidiary or affiliate of any of
them which is negotiating or has a contract with BMP or a parent, subsidiary or affiliate of BMP
for the purchase, sale or lease of BMP’s or a parent’s, subsidiary’s or affiliate’s services or
which has been solicited by BMP or a parent, subsidiary or affiliate of BMP with respect to such
purchase or lease during the Executive’s employment with BMP.
9. “Disability” means a physical or mental disability which renders it impracticable for the
Executive to continue to perform her duties under her Agreement, wheher with or without reasonable
accommodation. The Executive shall be deemed to have incurred such disability if (i) a physician
selected by BMP and reasonably satisfactory to the Executive advises BMP that the Executive’s
physical or mental condition will render her unable to perform her duties under her Agreement for a
period of six (6) consecutive months, or (ii) due to a physical or mental condition the Executive
has not substantially
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performed the material duties required of her hereunder for eighty percent (80%) or more of the
normal working days during a period of six (6) consecutive months.
10. “Employment Period” means the duration of the Executive’s employment with BMP pursuant to the
terms of her Agreement.
11. “Involuntary Termination” means (i) BMP’s termination of the Executive’s employment for any
reason oher than a Termination for Cause, (ii) the termination of the Executive’s employment by
reason of her death or Disability, or (iii) the Executive’s voluntary resignation within thirty
(30) days following (A) a material reduction in the scope of her duties and responsibilities, (B) a
change in her level of reporting so that he no longer directly reports to the Board, (C) a
reduction in the annual rate of her base salary by more than fifteen percent (15%), (D) a
relocation of her principal place of employment by more than fifty (50) miles, or (E) a material
breach by BMP of any of its obligations under her Agreement and the failure of BMP to cure such
breach within thirty (30) days after receipt of written notice from the Executive in which the
actions or omissions constituting such material breach are specified.
A greater than fifteen percent (15%) aggregate reduction in the Executive’s base salary shall not
constitute grounds for an Involuntary Termination under clause (C) above if substantially all of
the other executive officers of BMP are subject to the same aggregate reduction to their base
salary.
12. “1934 Act” means the Securities Exchange Act of 1934, as amended.
13. “Option” means any option granted to the Executive under the Plan or otherwise to purchase
shares of common stock which is outstanding at the time of (i) a Change in Control or (ii) her
Involuntary Termination, whether or not in connection with a Change in Control.
14. “Plan” means (i) BMP’s 2007 Omnibus Equity Compensation Plan, as subsequently amended or
restated from time to time, and (ii) any oher stock incentive plan established or implemented by
BMP.
15. “Termination for Cause” means the termination of the Executive’s employment for any of the
following reasons: (i) the Executive’s conviction of a felony or her commission of any act of
personal dishonesty involving the property or assets of BMP, (ii) a material breach by the
Executive of one or more of her obligations under her Agreement or her Proprietary Information and
Inventions Agreement with BMP, (iii) any intentional misconduct by the Executive which has a
material adverse effect upon BMP’s business or reputation, (iv) the Executive’s material
dereliction of the major duties, functions and responsibilities of her executive position, (v) a
material breach by the Executive of any of her fiduciary obligations as an officer of BMP, or (vi)
the Executive’s willful and knowing participation in the preparation or release of false or
materially misleading financial statements relating to the false or erroneous certification
required of her under the Xxxxxxxx-Xxxxx Act of 2002 or any securities exchange on which shares of
BMP’s common stock are at the time listed for trading.
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PART
TWO – TERMS AND CONDITIONS OF EMPLOYMENT
1. Duties and Responsibilities.
A. The Executive shall serve as the Corporate Vice President of BMP and shall in such capacity
report to the President and Chief Executive Officer. As the Corporate
Vice President, Chief
Representative of BMP Beijing representative office and Executive Director of Hong Kong Fly
Healthcare Ltd., the Executive shall have responsibility for BMP corporate functions in China,
assisting CEO to manage BMP China subsidiaries as well as BMP corporate strategic development
including merge and acquisition.
B. During the employment period specified in Paragraph 2, the Executive agrees that she will: (i)
serve BMP faithfully, diligently and to the best of her ability under the direction of the Board,
(ii) devote her best efforts and her entire working time, attention and energy to the performance
of her duties hereunder and to promoting and furthering the interests of BMP, and (iii) not,
without the prior written approval of the Board, become associated with or engaged in, any business
other than that of BMP, and he will do nothing inconsistent with her duties to BMP.
2. Employment Period. The Executive’s employment with BMP shall be governed by the
provisions of her Agreement for the period commencing October 1, 2007, and continuing
through September 30, 2010. However, the term of the Executive’s employment pursuant to the terms
of her Agreement shall automatically be extended for successive one-year periods hereafter,
unless either BMP or the Executive elects, by written notice delivered to the other not later than
sixty (90) days prior to the start of any such one-year period, not to renew the term of her
Agreement. Her Agreement may also be terminated at any time in accordance with the termination of
employment provisions set forth in Paragraph 10.
3. Cash Compensation.
A. For all services to be rendered by the Executive under her Agreement and such duties as the
President and Chief Executive Officer may assign her, BMP agrees to pay the Executive a base salary
in two portion: $120,000 USD and 840,000 RMB per annum, payable at such times as is customary for
salaried employees of BMP and in accordance with the normal payroll practices of BMP. The Dollar
portion will be paid from US or Hong Kong. The RMB portion will be paid from BMP China under a
separate employment contract between BMP China and Executive.
B. For each fiscal year of BMP during the Employment Period, beginning with the fiscal year
commencing January 1, 2008, the Executive shall be entitled to receive a cash bonus in an
amount determined by the Chief Executive Officer and approved by the Compensation Committee of the
Board of Directors.
C. BMP China shall deduct and withhold from the compensation payable to the Executive hereunder any
and all applicable taxes and any other amounts required to be deducted or withheld by BMP China
under applicable statutes, regulations, ordinances or
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orders governing or requiring the withholding or deduction of amounts otherwise payable as
compensation or wages to employees.
D. Employee will be responsible to pay all applicable taxes for the compensation
4. Equity Compensation.
A. The Executive has received 120,000 Options prior to the period of employment with BMP.
Each of those Options shall vest and become exercisable for the shares of common stock subject to
that Option in accordance with the applicable vesting schedule currently in effect for each such
Option.
B. The Executive shall be eligible to receive one or more additional Option grants during the
Employment Period, as the President and Chief Executive Officer and Compensation Committee may deem
appropriate in order to provide her with sufficient equity incentive for her position.
C. The shares of common stock subject to the Options summarized in Paragraph 4.A., together with
each additional Option which the Executive may subsequently receive over the remainder of the
Employment Period, shall be subject to the applicable vesting acceleration provisions of either
Paragraph 12 or Paragraph 14 should an Involuntary Termination of her employment occur during the
Employment Period.
5. Expense Reimbursement. BMP shall reimburse the Executive for reasonable out-of-pocket
expenses incurred in connection with BMP’s and/or BMP China’s business, including travel expenses,
food and lodging while away from home, subject to such polices as BMP may from time to time
reasonably establish for its employees and subject to substantiation of expenses as required under
applicable tax laws and regulations.
6. Fringe Benefits.
A. The Executive shall, throughout the Employment Period, be eligible to participate in all benefit
plans which are made available to BMP’s China executives and for which the Executive qualifies.
B. The Executive shall be entitled to receive three weeks of paid vacation each year, which shall
be taken at such time or times as will not unreasonably hinder or interfere with BMP business or
operations. Vacation time may be accrued from year to year in accordance with BMP’s general
vacation policy.
C. BMP will obtain and maintain at all times directors’ and officers’ liability insurance for
Executive, so long as such insurance can be obtained on terms acceptable to the Board.
7. Indemnification. BMP agrees to defend the Executive and shall indemnify and hold
harmless the Executive to the fullest extent permitted by law from any and all liability, costs and
expenses which may be assessed against the Executive by reason of
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the performance of her responsibilities and duties under the terms of her Agreement, provided such
liability does not result from the willful misconduct or gross negligence of the Executive.
8. Proprietary Information.
A. The Executive hereby acknowledges that BMP and/or BMP China may, from time to time during the
Employment Period, disclose to the Executive confidential information pertaining to BMP’s and/or
BMP China’s business, strategic plans, technology or financial affairs. All information, data and
know-how, whether or not in writing, of a private or confidential nature concerning BMP’s and/or
BMP China’s trade secrets, inventions, processes, systems, designs, drawings, product innovations
and developments, engineering, marketing strategies and future marketing plans, customer lists,
prospective customers, finances and financial reports, employee information and other
organizational information (collectively, “Proprietary Information”) is and shall remain the sole
and exclusive property of BMP and/or BMP China and shall not be used or disclosed by the Executive
except to the extent necessary to perform her duties and responsibilities under her Agreement. All
tangible manifestations of such Proprietary Information (whether written, printed or otherwise
reproduced) shall be returned by the Executive upon the termination of the Employment Period, and
the Executive shall not retain any copies or excerpts of the returned items. The foregoing
restrictions on the use, disclosure and disposition of BMP’s and/or BMP China’s Proprietary
Information shall also apply to the Executive’s use, disclosure and disposition of any confidential
information relating to the business, technology or financial affairs of BMP’s and/or BMP China’s
customers.
B. The Executive shall, concurrently with the execution of her Agreement, execute and deliver to
BMP a copy of the BMP standard form Proprietary Information and Inventions Agreement and shall
remain subject to the terms and provisions of that agreement throughout the Employment Period and
for such period hereafter as provided pursuant to the terms of that agreement.
9. Death or Disability. Upon the Executive’s death or Disability during the Employment
Period, the employment relationship created pursuant to her Agreement shall immediately terminate,
and BMP shall pay the Executive or her estate: (i) any unpaid base salary earned under Paragraph
3.A. for services rendered through the date of death or Disability, (ii) the dollar value of all
accrued and unused vacation benefits based upon the Executive’s most recent level of base salary,
and (iii) any bonus actually earned pursuant to Paragraph 3.B. for one or more fiscal years but not
previously paid to the Executive at the time of her death or Disability.
10. Termination of Employment.
A. BMP may terminate the Executive’s employment under her Agreement at any time for any reason,
with or without cause, by giving at least sixty (90) days prior written notice of such termination
to the Executive. If such termination notice is given to the Executive, BMP may, if it so desires,
immediately relieve the Executive of some or all of
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her duties. However, during any such notice period, the Executive shall continue to be entitled to
her regular compensation and benefits hereunder.
B. The Executive may terminate her employment under her Agreement at any time by giving BMP at
least sixty (60) days prior written notice of such termination.
C. BMP may, at any time, upon written notice discharge the Executive from employment under her
Agreement pursuant to a Termination for Cause. Such termination will be effective immediately upon
such notice.
D. Upon the termination of the Executive’s employment for any reason (other than Termination for
Cause), during the Employment Period, the Executive shall be paid (i) any unpaid base salary earned
under Paragraph 3.A. for services rendered through the date of such termination, (ii) the dollar
value of all accrued and unused vacation benefits based upon the Executive’s most recent level of
base salary, and (iii) any bonus amount actually earned pursuant to paragraph 3.B. for one or more
fiscal years but not previously paid to the Executive at the time of such termination of
employment. In addition, the Executive shall be entitled to the payments and benefits provided
under Part Three or Part Four of her Agreement, to the extent applicable.
E. If the Executive’s employment is terminated by reason of a Termination for Cause or should the
Executive voluntarily resign (other than for a reason which qualifies as grounds for an Involuntary
Termination), then the following provisions shall apply:
(i) BMP shall only be required to pay the Executive (a) any unpaid base salary earned under
Paragraph 3.A. for services rendered through the date of such termination, (b) the dollar value of
all accrued and unused vacation benefits based upon the Executive’s most recent level of base
salary, and (c) any bonus amount actually earned pursuant to Paragraph 3.B. for one or more fiscal
years but not previously paid to the Executive at the time of such termination of employment.
(ii) All vesting in the Executive’s outstanding Options shall cease at the time of such termination
or resignation, and the Executive shall have until the termination of each such Option (as
determined in accordance with the applicable stock option agreement) in which to exercise that
Option for any shares for which that Option is vested at the time of to the extent of the
Executive’s termination or resignation.
(iii) The Executive shall not be entitled to any payments or benefits under Part Three or Part Four
of her Agreement.
PART THREE – NORMAL SEVERANCE BENEFITS
11. Entitlement.
A. Should the Executive’s employment with BMP terminate during the Employment Period by reason of
an Involuntary Termination in the absence of a Change in Control or more than twelve (12) months
after a Change in Control event, the Executive shall be entitled to receive the severance benefits
provided under her Part Three. Those benefits
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shall be subject to the Executive’s compliance with the restrictive covenants of Part Six of her
Agreement, and shall in all cases be in lieu of any other severance benefits to which the Executive
might otherwise be entitled by reason of her termination of employment under such circumstances.
B. In addition, the Executive’s entitlement to any severance benefits under her Part Three shall be
subject to the Executive’s execution and delivery to BMP of a general release which becomes
effective in accordance with applicable law and pursuant to which the Executive releases BMP and
its officers, directors, employees and agents from any and all claims the Executive may otherwise
have with respect to the terms and conditions of her employment with BMP and the termination of
that employment. In no event, however, shall such release cover any claims, causes of action,
suits, demands or oher obligations or liabilities relating to any payments or benefits to which the
Executive is or becomes entitled pursuant to the provisions of her Agreement.
12. Severance Benefits. The severance benefits payable to the Executive under her Part
Three shall consist of the following:
(a) Salary Continuation Payment. The Executive shall receive her base salary, at the monthly rate
in effect for her under Paragraph 3.A. at the time of her Involuntary Termination, for a period of
12 months in equal installments in accordance with BMP’s normal payroll practices, Subject to the
deferral restrictions of Paragraph 19, the first such payment shall be made not later than the
first pay day following the Executive’s Involuntary Termination. Each such salary continuation
payment shall be subject to all applicable withholding requirements as set forth in Paragraph 3.C.
(b) Option Acceleration. Each Option outstanding at the time of such Involuntary Termination, to
the extent not otherwise vested and exercisable for all the shares at the time subject to that
Option, will immediately vest and become exercisable for all those option shares and may be
exercised for any or all of those shares as fully vested shares until the termination of that
Option in accordance with the applicable stock option agreement.
PART FOUR – CHANGE IN CONTROL SEVERANCE BENEFITS
13. Entitlement.
A. Should an Involuntary Termination occur within twelve (12) months after a Change in Control
event, the Executive shall be entitled to receive the severance benefits provided under her Part
Four. Those benefits shall be subject to the Executive’s compliance with the restrictive covenants
of Part Six of her Agreement and shall in all cases be in lieu of any oher severance benefits to
which the Executive might otherwise be entitled by reason of her termination of employment under
such circumstances.
B. In addition, the Executive’s entitlement to any severance benefits under her Part Four shall be
subject to the Executive’s execution and delivery to BMP of a general release which becomes
effective in accordance with applicable law and pursuant to which the Executive releases BMP and
its officers, directors, employees and agents from any
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and all claims the Executive may otherwise have with respect to the terms and conditions of her
employment with BMP and the termination of that employment. In no event, however, shall such
release cover any claims, causes of action, suits, demands or oher obligations or liabilities
relating to any payments or benefits to which the Executive is or becomes entitled pursuant to the
provisions of her Agreement.
14. Change in Control Severance Benefits. The Change in Control Severance Benefits to
which the Executive shall receive under her Part Four shall consist of the following payments and
benefits:
(a) Salary Continuation Payments. The Executive shall receive her base salary, at the monthly rate
in effect for her under Paragraph 3.A. at the time of her Involuntary Termination, for a period of
eighteen (18) months in accordance with BMP’s normal payroll practices, Subject to the deferral
restrictions of Paragraph 19, the first such payment shall be made not later than the first payroll
date following the Executive’s Involuntary Termination. Each such salary continuation payment
shall be subject to all applicable withholding requirements as set forth in Paragraph 3.C.
However, these payments, together with the benefits provided pursuant to Paragraph 14(b), shall be
subject to the benefit limitation provisions of Part Five of her Agreement.
(b) Option Acceleration. Each Option outstanding at the time of such Involuntary Termination, to
the extent not otherwise vested and exercisable for all the shares at the time subject to that
Option, will immediately vest and become exercisable for all those option shares and may be
exercised for any or all of those shares as fully vested shares until the termination of that
Option in accordance with the applicable stock option agreement.
In no event shall the Executive be entitled to payments and benefits under both Part Three and Part
Four of her Agreement.
PART FIVE – LIMITATION ON BENEFITS
15. Benefit Limit. The benefit limitations of her Part Five shall be applicable in the
event the Executive receives any benefits under her Agreement which are deemed to constitute
parachute payments under Code Section 280G.
In the event that any payments to which the Executive becomes entitled in accordance with the
provisions of her Agreement would otherwise constitute a parachute payment under Code Section 280G,
then such payments will be subject to reduction to the extent necessary to assure that the
Executive receives only the greater of (i) the amount of those payments which would not constitute
such a parachute payment or (ii) the amount which yields the Executive the greatest after-tax
amount of benefits after taking into account any excise tax imposed under Code Section 4999 on the
payments provided to the Executive under her Agreement (or any other benefits to which the
Executive may become entitled in connection with any change in control or ownership of BMP or the
subsequent termination of her employment with BMP).
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Should a reduction in benefits be required to satisfy the benefit limit of her Paragraph 15, then
the salary continuation payments shall accordingly be reduced to the extent necessary to comply
with such benefit limit. Should such benefit limit still be exceeded following such reduction,
then the number of shares which would otherwise be purchasable under the vesting-accelerated
portion (if any) of each Option (based on the amount of the parachute payment attributable to such
Option under Code Section 280G) shall be reduced to the extent necessary to eliminate such excess.
PART SIX – RESTRICTIVE COVENANTS
16. Non-Compete. The Executive agrees that, during the Employment Period and for a period
of two (2) years following the date of her termination of employment with BMP, she will
not, without the prior written approval of BMP, directly or indirectly, under any circumstances
whatsoever, own, manage, operate, engage in, control or participate in the ownership, management,
operation or control of, or be connected in any manner, whether as an individual, partner,
stockholder, director, officer, principal, agent, employee or consultant, or in any other relation
or capacity whatsoever, with any Competing Organization, wherever located, who was a Customer at
any time during the period one year prior to the termination of the Executive’s employment with
BMP, for the purpose of inducing such Customer to purchase or lease a Competing Service.
Notwithstanding the foregoing, nothing contained in her Paragraph 16 shall restrict the Executive
from making any investment in any company, so long as such investment consists of no more than five
percent (5%) of any class of equity securities of a company whose securities are traded on a
national securities exchange or in the over-the-counter market.
17. Non-Interference. The Executive agrees that she will not, for a period of two (2)
years following the date of her termination of employment with BMP, directly or indirectly,
employ, hire, solicit or, in any manner, encourage any employee of BMP to leave the employ of BMP.
PART SEVEN – MISCELLANEOUS PROVISIONS
18. Cessation of Benefits. In the event of a material breach by the Executive of any of
her obligations under Paragraph 16 or Paragraph 17 of her Agreement or any of her obligations under
her Proprietary Information and Inventions Agreement with BMP, she shall cease to be entitled to
any further benefits under Part Three or Part Four of her Agreement, including (without limitation)
any subsequent right to exercise any outstanding Options or to receive any further salary payments.
19. Deferred Commencement Date. To the extent (i) any payments to which the Executive
becomes entitled under her Agreement in connection with her Involuntary Termination constitute
deferred compensation subject to Code Section 409A and (ii) the Executive is deemed at the time of
such Involuntary Termination to be a key employee under Code Section 416(i), then such payment or
payment shall not be made or commence until the earlier of (i) the expiration of the six (6)-month
period measured from the date of the Executive’s “separation from service” (as such term is at the
time defined in Treasury Regulations under Code Section 409A) with BMP (or any successor
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entity) or (ii) the date of the Executive s death following such separation from service; provided,
however, that such deferral shall only be effected to the extent required to avoid adverse tax
treatment to the Executive, including (without limitation) the additional twenty percent (20%) tax
for which the Executive would otherwise be liable under Code Section 409A(a)(1)(B) in the absence
of such deferral. During any period payment or payments to the Executive are deferred pursuant to
the foregoing, the Executive shall be entitled to interest on the deferred payment or payments at a
per annum rate equal to the highest rate of interest applicable to six (6)-month money market
accounts offered by the following institutions: Citibank N.A., Xxxxx Fargo Bank, N.A. or Bank of
America, on the date of such “separation from service”. Upon the expiration of the applicable
deferral period, any payments which would have otherwise been made during that period in the absence
of her Paragraph 19 shall be paid to the Executive or her beneficiary in one lump sum. Any
remaining amounts shall be paid as and when they would otherwise become due under her Agreement.
20. Representations and Warranties of the Executive. The Executive represents and warrants
that her employment by BMP does not and will not violate any agreement or instrument to which he is
a party or by which she is bound, and the Executive agrees that she will indemnify and hold
harmless BMP, its directors, officers and employees against any claims, damages, liabilities and
expenses (including reasonable attorneys’ fees) which may be incurred, including amounts paid in
settlement, by any of them in connection with any claim based upon or related to a breach of the
Executive’s representations and warranties set forth in her Paragraph 20. In the event of any
claim based upon or related to a breach of the Executive’s representations and warranties set forth
herein, BMP will give prompt written notice hereof to the Executive and the Executive shall have
the right to defend such claim with counsel reasonably satisfactory to BMP.
21. Successors and Assigns. The provisions of her Agreement shall inure to the benefit of,
and shall be binding upon, (i) BMP and its successors and assigns, including any successor entity
by merger, consolidation or transfer of all or substantially all of BMP’s assets (whether or not
such transaction constitutes a Change in Control), and (ii) the Executive, the personal
representative of her estate and her heirs and legatees.
22. Notices. Any notice required or permitted to be given under her Agreement shall be in
writing and shall be deemed given when personally delivered or sent by overnight courier or
certified mail, postage prepaid, return receipt requested, to the respective addresses of the
parties hereto as set forth above or to such other address as either party may designate by notice
to the other party given as herein provided.
23. Waivers. Any waiver of the performance of the terms or provisions of her Agreement
shall be effective only if in writing and signed by the party against whom such waiver is to be
enforced. The failure of either party to exercise any of her or its rights under her Agreement or
to require the performance of any term or provision of her Agreement, or the waiver by either party
of any breach of her Agreement, shall not prevent a subsequent exercise or enforcement of such
rights or be deemed a waiver of any subsequent breach of the same or any other term or provision of
her Agreement.
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24. Survival of Terms. The terms of her Agreement and the respective obligations of the
parties hereto shall survive the termination of the Executive’s employment with BMP for as long as
any obligation or duty remains outstanding.
25. General Creditor Status. The benefits to which the Executive may become entitled under
Part Three or Part Four of her Agreement shall be paid, when due, from BMP’s general assets, and no
trust fund, escrow arrangement or other segregated account shall be established as a funding
vehicle for such payments. Accordingly, the Executive’s right (or the right of the executors or
administrators of the Executive’s estate) to receive such benefits shall at all times be that of a
general creditor of BMP and shall have no priority over the claims of other general creditors.
26. Governing Documents. Her Agreement, together with (i) the stock option agreements
evidencing the Executive’s currently outstanding Options and any future Option grants, and (ii) the
Proprietary Information and Inventions Agreement, shall constitute the entire agreement and
understanding of BMP and the Executive with respect to the terms and conditions of the Executive’s
employment with BMP and the payment of severance benefits and shall supersede all prior and
contemporaneous written or verbal agreements and understandings between the Executive and BMP
relating to such subject matter. Her Agreement may only be amended by written instrument signed by
the Executive and an authorized officer of BMP. Any and all prior agreements, understandings or
representations relating to the Executive’s employment with BMP, oher than the stock option
agreements evidencing the Executive’s currently outstanding Options, are hereby terminated and
cancelled in their entirety and are of no further force or effect.
27. Governing Law. The provisions of her Agreement shall be construed and interpreted
under the laws of the PRC, without giving effect to the conflict of laws rules of such state.
28. Severability. The provisions of her Agreement shall be severable and if any part of
any provision shall be held invalid or unenforceable, or any separate covenant contained in any
provision is held to be unduly restrictive and void by a final decision of any court or other
tribunal of competent jurisdiction, such part, covenant or provision shall be construed or limited
in scope to give it maximum lawful validity, and the remaining provisions of her Agreement shall
nonetheless remain in full force and effect.
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29. Injunctive Relief. The Executive expressly agrees that the covenants set forth in
Paragraph 16 and Paragraph 17 of her Agreement are reasonable and necessary to protect BMP and its
legitimate business interests, and to prevent the unauthorized dissemination of Proprietary
Information to competitors of BMP. The Executive also agrees that BMP will be irreparably harmed
and that damages alone cannot adequately compensate BMP if here is a violation of Paragraph 16 or
Paragraph 17 of her Agreement by the Executive, and that, in addition to any rights or remedies BMP
may have under Paragraph 18, injunctive relief against the Executive is essential for the
protection of BMP. Therefore, in the event of any such breach, it is agreed that, in addition to
any oher rights or remedies available to BMP, BMP shall be entitled as a matter of right to pursue
injunctive relief in any court of competent jurisdiction.
30. Arbitration.
A. Each party agrees that any and all disputes which arise out of or relate to the Executive’s
employment, the termination of the Executive’s employment or the terms of her Agreement shall be
resolved through final and binding arbitration. Such arbitration shall be in lieu of any trial
before a judge and/or jury, and the Executive and BMP expressly waive all rights to have such
disputes resolved through trial before a judge and/or jury. Such disputes shall include, without
limitation, claims for breach of contract or of the covenant of good faith and fair dealing, claims
of discrimination, claims under any federal, state or local law or regulation now in existence or
hereinafter enacted and as amended from time to time concerning in any way the subject of the
Executive’s employment with BMP or its termination. The only claims not covered by her Agreement
to arbitrate disputes are: (i) claims for benefits under the unemployment insurance benefits, (ii)
claims for workers’ compensation benefits under any of BMP’s workers’ compensation insurance policy
or fund, (iii) claims arising from or relating to the restrictive covenants imposed upon the
Executive pursuant to the provisions of Paragraph 16 and Paragraph 17 of her Agreement, and
(iv) claims concerning the validity, infringement, ownership, or enforceability of any trade
secret, patent right, copyright, trademark or any oher intellectual property right, and any claim
pursuant to or under any existing confidential/proprietary/trade secrets information and inventions
agreement(s) such as, but not limited to, the Proprietary Information and Inventions Agreement.
With respect to such disputes, they shall not be subject to arbitration; rather, they will be
resolved pursuant to applicable law.
B. Arbitration shall be held in Xxxxxxxxxx County, Pennsylvania and conducted in accordance with
the National Rules for the Resolution of Employment Disputes of the American Arbitration
Association (“AAA Rules”), provided, however, that the arbitrator shall allow the discovery
authorized by applicable law in arbitration proceedings, including, but not limited to, discovery
available under the applicable state and/or federal arbitration statutes. Also, to the extent that
any of the AAA Rules or anything in her arbitration section conflicts with any arbitration
procedures required by applicable law, the arbitration procedures required by applicable law shall
govern.
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31. Counterparts. Her Agreement may be executed in more than one counterpart, each of
which shall be deemed an original, but all of which together shall constitute but one and the same
instrument.
IN WITNESS WHEREOF, the parties have executed her Employment Agreement as of the day and year
written above.
| BEIJING MED-PHARM CORPORATION |
||||
| By: | XXXXXXXX XXX | |||
| Title: | President and Chief Executive Officer | |||
| EXECUTIVE |
||||
| XXXX XXXXXXX | ||||
| Xxxx Xxxxxxx | ||||
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