INDEPENDENT DIRECTOR’S CONTRACT
Execution
Version
THIS
AGREEMENT (the “Agreement”)
is
made as of August 3, 2007 and is by and between Puda Coal, Inc. a Florida
corporation (hereinafter referred to as the “Company”),
and
Xxxxxxxx X. Xxxxx (the “Director”).
BACKGROUND
The
Company desires to retain the Director for the duties of independent director
and the Director desires to be retained for such position and to perform the
duties required of such position in accordance with the terms and conditions
of
this Agreement.
AGREEMENT
In
consideration for the above recited promises and the mutual promises contained
herein, the adequacy and sufficiency of which are hereby acknowledged, the
Company and the Director hereby agree as follows:
1. DUTIES.
The
Company hereby requires that the Director be available to perform such duties
(i) as may be determined and assigned by the Board of Directors of the
Company, and (ii) that are specified in the Company’s Articles of
Incorporations and Bylaws to be performed by directors. The Director agrees
to
devote as much time as is necessary to perform completely the duties as the
Director of the Company as described in the preceding sentence.
2. TERM.
Except
in the case of early termination, as hereinafter specifically provided, the
term
of this Agreement shall commence as of August 3, 2007 and shall continue
for as
long as the Director serves as a director of the Company.
3. COMPENSATION.
For all
services to be rendered by the Director in any capacity hereunder, the Company
agrees to pay the Director an annual fee of (i) $40,000 in cash and (ii)
12,500
shares of common stock of the Company. The initial fee should be 50% of the
annual fee, which is considered earned when paid and is nonrefundable. The
initial payment for the services of the Director for services rendered is
due
upon execution of this Agreement; thereafter, payment of 50% of the annual
fee
shall be due on or before the first date of
each
six succeeding months. Such fee may be adjusted from time to time as agreed
by
the parties.
4. EXPENSES.
In
addition to the compensation provided in paragraph 3 hereof, the Company
will
reimburse the Director for business related travel, including business class
flight tickets for trips between U.S. and China, meal and other miscellaneous
expenses incurred in the performance of the Director’s duties for the Company;
provided, however, that such expenses shall be approved by the Company in
writing prior to the Director incurring such expenses. Such payments shall
be
made by the Company upon submission by the Director of a signed statement
itemizing the expenses incurred. Such statement shall be accompanied by
sufficient documentary matter to support the expenditures.
5. CONFIDENTIALITY
AND XXXXXXX XXXXXXX.
The
Company and the Director each acknowledge that, in order for the intents
and
purposes of this Agreement to be accomplished, the Director shall necessarily
be
obtaining access to certain confidential or non-public information concerning
the Company and its affairs, including, but not limited to business methods,
information systems, financial data and strategic plans which are unique
assets
of the Company (“Confidential
Information”).
The
Director covenants not to, either directly or indirectly, in any manner,
utilize
or disclose to any person, firm, corporation, association or other entity
any
Confidential Information or engage in any illegal inside trading
activities.
6. NOTICE
OF MATERIAL CHANGE IN FINANCIAL CONDITION OF THE COMPANY.
The
Company shall endeavor to notify the Director in writing, at the earliest
practicable time, of any material adverse change in the financial condition
of
the Company.
7. TERMINATION.
With or
without cause, the Company and the Director may each terminate this Agreement
at
any time upon ten (10) days written notice, and the Company shall be obligated
to pay to the Director the compensation and expenses due up to the date of
the
termination and incurred in accordance with this Agreement. If termination
occurs prior to the last date of any succeeding six months after the first
six
months of this agreement, the Company shall be entitled to receive, within
thirty (30) days after written request by the Company, a prorated refund
of the
portion of the fee that relates to the period after the termination date.
Such
written request must be submitted within ninety (90) days of the termination
date. Nothing contained herein or omitted herefrom shall prevent the Director(s)
of the Company from removing the Director with immediate effect at any time
for
any reason.
8. INDEMNIFICATION.
The
Company shall indemnify, defend and hold harmless the Director, to the full
extent allowed by the law of the State of Florida, and as provided by, or
granted pursuant to, any charter provision, both as to action in the Director’s
official capacity and as to action in another capacity while holding such
office, except for matters arising out of the Director’s gross negligence or
willful misconduct. The Company shall carry a minimum of $10,000,000 directors
and officers insurance.
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9. EFFECT
OF WAIVER.
The
waiver by either party of the breach of any provision of this Agreement shall
not operate as or be construed as a waiver of any subsequent breach
thereof.
10. NOTICE.
Any and
all notices referred to herein shall be sufficient if furnished in writing
and
delivered in person or mailed at the following addresses or facsimiled to
the
following number:
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To
the Company:
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Attention:
Xxxxxx Xxxx
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Address:
000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxx Xxxxxxxx, The People’s Republic of
China
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Facsimile:
01186-351-703-4404
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To
the Director:
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Xxxxxxxx
X. Xxxxx
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Address:
00 Xxxx xxxxx, Xxxxxxxxx, XX 00000
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Facsimile:
0-000-000-0000
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12. GOVERNING
LAW AND DISPUTE RESOLUTION.
This
Agreement shall be interpreted in accordance with, and the rights of the
parties
hereto shall be determined by, the laws of China without reference to its
conflicts of laws principles. Any dispute arising from or in connection
with
this contract shall be submitted to China International Economic and Trade
Arbitration Commission (“CIETAC”)
in
Beijing for arbitration, which shall be conducted in accordance with CIETAC’s
arbitration rules in effect at the time of applying for arbitration. The
arbitral award is final and biding upon both parties. The parties agree
that:
(a) The venue of arbitration is Beijing. The hearing of arbitration may
be
conducted in Beijing or, to the extent permitted by CIETAC’s arbitration rules,
any other place as agreed on by the parties as the most convenient place;
(b)
The language to be used during the arbitration proceedings should be English;
(c) A one-arbitrator tribunal will be appointed jointly by both parties
and the
arbitration should follow the ordinary proceeding. In case the parties
fail to
jointly appoint the arbitrator, the arbitrator should be appointed by the
chairman of CIETAC upon the joint authorization of the parties. The parties
may
select arbitrators from the panel of arbitrators provided by CIETAC, and
to the
extent permitted by CIETAC’s arbitration rules, from outside of the panel.
13. ASSIGNMENT.
The
rights and benefits of the Company under this Agreement shall be transferable,
and all the covenants and agreements hereunder shall inure to the benefit
of,
and be enforceable by or against, its successors and assigns. The duties
and
obligations of the Director under this Agreement are personal and therefore
the
Director may not assign any right or duty under this Agreement without
the prior
written consent of the Company.
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14. MISCELLANEOUS.
(a) If
any provision of this Agreement shall be declared invalid or illegal, for
any
reason whatsoever, then, notwithstanding such invalidity or illegality,
the
remaining terms and provisions of the within Agreement shall remain in
full
force and effect in the same manner as if the invalid or illegal provision
had
not been contained herein; (b) This Agreement shall be binding upon and
shall
inure to the benefit of the parties hereto, and their respective heirs,
executors, administrators, successors and assigns.
15. ARTICLE
HEADINGS.
The
article headings contained in this Agreement are for reference purposes
only and
shall not affect in any way the meaning or interpretation of this
Agreement.
16. COUNTERPARTS.
This
Agreement may be executed in any number of counterparts, all of which taken
together shall constitute one instrument.
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IN
WITNESS WHEREOF, the parties hereto have caused this independent director’s
contract to be duly executed and signed as of the day and year first above
written.
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a
Florida corporation
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| By: | /s/ Xxxx Xxxx | |
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| Xxxx Xxxx, Chief Executive Officer | ||
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INDEPENDENT
DIRECTOR
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| By: | /s/ Xxxxxxxx X. Xxxxx | |
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Xxxxxxxx
X. Xxxxx
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