EMPLOYMENT AGREEMENT
EXHIBIT
10.17
EMPLOYMENT
AGREEMENT (this “Agreement”),
effective as of August 6, 2010, by and between Top Flight GameBirds, Inc., a
Delaware corporation having its principal office at Room 2503-2505, New World
Centre, No.6009, Yintian Road, Futian District, Shenzhen, Guangdong Province,
People’s Republic of China (the “Company”),
and Yunlu Yin (the "Executive").
WHEREAS,
the Company desires to employ Executive upon the terms and conditions
hereinafter set forth to provide services to the Company and
WHEREAS,
Executive desires to accept such employment.
NOW,
THEREFORE, in consideration of the foregoing, and in consideration of the mutual
covenants and promises hereinafter set forth, it is agreed as
follows:
1. Engagement of Services,
Duties and Acceptance.
1.1 Effective
as of the date of this Agreement, the Company engages the Executive and the
Executive agrees to supply and make available to the Company, the services of
the Executive to serve as the Company’s Chief Executive Officer (“CEO”)
during the term of this Agreement, 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 CEO with the understanding that the
Executive will be based where his principal offices are located.
1.3 The
Executive agrees that he shall devote up to one hundred and sixty hours per
month of Executive’s business time, energies and attention to the performance of
his duties hereunder and as an executive officer of the
Company. Nothing herein shall be construed as precluding Executive
from owning, purchasing, selling, or otherwise dealing in any manner with any
property or engaging in any business whatsoever, including without limitation,
providing consulting services, acting as a CEO or a director of another company,
or starting a new business, without notice to the Company, without participation
of the Company, and without liability to the Company; provided, however, that
these activities do not materially interfere with the performance of his duties
hereunder or violate the provisions of Section 4.4 hereof.
1
2. Compensation.
2.1 As
compensation for all services to be rendered by Executive pursuant to this
Agreement, the Company shall pay to at a monthly base rate of $6,000 in cash.
During Executive’s employment, compensation will be paid not less frequently
than one month in arrears. Payment will be made to Executive via wire
transfer. Company shall be responsible for any applicable wire transfer fees for
the compensation and/or expense reimbursement.
2.2 During the term of this
Agreement, the Company shall include Executive as insured under a directors and officers
insurance policy (the “D&O Insurance”) with initial coverage of $5,000,000
from an insurance carrier that has a minimum rating of XII A as defined by the
A.M. Best Company. If any member of the Board enters into an
indemnification agreement with the Company as part of the D&O Insurance,
Executive shall be entitled to enter into an agreement of like tenor with the
Company. Additionally, if the Board decides to increase the coverage of the
D&O Insurance, Executive shall be covered by such policy.
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. When Executive is required to travel on behalf of the
Company’s business, the cost of a business class airline ticket shall be
included hereunder as a reimbursable business expense.
3. Term and
Termination.
3.1 The
term of this Agreement commences as of the consummation of the Agreement and
shall continue for three (3) years 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 Executive any accrued and unpaid
fee due Executive pursuant to Section 2.1 hereof, and all previously accrued but
unpaid expense reimbursements at the time of termination, including
for.
3.3 The
Company reserves the right to terminate this Agreement upon ten (10) days
written notice if, for a continuous or accumulated period of forty-five (45)
days during the two years 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 as well as a pro rata
allocation of the shares of the Restricted Stock under Section 2.3 based on the
days of service prior to the cessation of Executive’s services in conjunction
with the Vesting Schedule, and all previously accrued but unpaid expense
reimbursements.
2
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 with immediate effect, 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 previously accrued but unpaid expense
reimbursements at the time of termination.
3.5 Executive’s
employment may be terminated at any time by Executive upon not less than ninety
(90) 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 previously accrued but unpaid expense reimbursements at the time
of termination.
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,
and all previously accrued but unpaid expense reimbursements at the time of
termination.
4. Protection of Confidential
Information; Non-Competition, Corporate Opportunities.
4.1 Executive
acknowledge that:
(a) As
a result of his association with the Company pursuant to this Agreement,
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
registable 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”), during the term of this Agreement, whether in the course
of his employment or otherwise, and that such Corporate Opportunities shall
considered to be business opportunities of the Group.
3
(b) The
Group will suffer substantial damage which will be difficult to compute if,
during the term of this Agreement 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.
4.3 Upon
termination of this Agreement, 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
two years 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 two years 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
4.5 If
Executive commits a breach of any of the provisions of Sections 4.2,
4.3 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
(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 4.2, 4.3 and 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 Executive
will be responsible for the payment of all withholding, payroll and other taxes
payable in respect of the payments received by Executive under this Agreement
and hereby agrees to indemnify and hold the Company harmless from any obligation
or penalty arising from the failure to pay such taxes.
5
5.2 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.
|
If to Executive:
|
Xxxxx
Xxx
|
|
Xx
X, 00/X, Xxxxx X,
|
|
|
Xxxxxxxxxxxxxx,
Futian district,
|
|
|
Shenzhen,
Guangdong, China
|
|
|
If to the Company:
|
|
|
Rm
2503-2505, New World Centre, No.6009
|
|
|
Yitian
Road, Futian District,
|
|
|
Shenzhen,
Guangdong, China
|
|
|
Attn:
Mr. Yunlu Yin
|
5.3 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.
5.4 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 made against Executive for any actions or omissions as an officer
of the Company or its subsidiaries pursuant to the terms and conditions of a
certain Indemnification Agreement, a copy of which is attached hereto as Exhibit
A. 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.
5.5 The
provisions of Article 4, Sections 5.1 and 5.2 and any provisions relating to
payments owed to Executive after termination of employment shall survive
termination of this Agreement for any reason.
6
5.6 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.
5.7 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.
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]
7
IN
WITNESS WHEREOF, the parties have executed this Employment Agreement as of the
date first above written.
|
“COMPANY”
|
“EXECUTIVE”
|
|||
|
TOP
FLIGHT GAMEBIRDS, INC
|
YUNLU
YIN
|
|||
|
By:
|
/s/Yunlu Yin
|
By:
|
/s/Yunlu Yin
|
|
|
Title
|
Chairman |
Title
|
||
8
EXHIBIT
A
(Form of
Indemnification Agreement)
INDEMNIFICATION
AGREEMENT
THIS
AGREEMENT is entered into, effective as of August 6, 2010, by and between Top
Flight Gamebirds, Inc., a Delaware corporation (the “Company”), and Yunlu Yin
(“Indemnitee”).
WHEREAS,
it is essential to the Company to retain and attract as directors and officers
the most capable persons available;
WHEREAS,
pursuant to a certain Employment Agreement dated as of the date hereof by and
between the Company and Yunlu Yin, Indemnitee shall be engaged as the Chief
Executive Officer of the Company; and
WHEREAS,
in recognition of Indemnitee’s need for substantial protection against personal
liability in order to enhance Indemnitee’s continued and effective service to
the Company, and in order to induce Indemnitee to provide services to the
Company as the Chief Executive Officer, the Company wishes to provide in this
Agreement for the indemnification of and the advancing of expenses to Indemnitee
to the fullest extent (whether partial or complete) permitted by the laws of the
Company’s state of incorporation and as set forth in this Agreement, and, to the
extent insurance is maintained, for the coverage of Indemnitee under the
Company’s directors’ and officers’ liability insurance policies.
NOW,
THEREFORE, in consideration of the above premises and of Indemnitee’s continuing
to serve the Company directly or, at its request, with another enterprise, and
intending to be legally bound hereby, the parties agree as follows:
1. Certain
Definitions.
(a) “Board” means the
Board of Directors of the Company.
(b) “Change in Control”
shall be deemed to have occurred if (i) any “person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
“Act”)), other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or a corporation owned directly or
indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company (collectively “excluded
persons”), is or becomes the “Beneficial Owner” (as defined in Rule 13d-3 under
the Act), directly or indirectly, of securities of the Company representing 30%
or more of the total voting power represented by the Company’s then outstanding
Voting Securities, or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board and any new
director whose election by the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority of the Board, or (iii) the
stockholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation that would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 50% of the
total voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
(iv) the stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company (in one
transaction or a series of transactions) of all or substantially all of the
Company’s assets.
9
(c) “Expenses” means any
expense, liability, or loss, including attorneys’ fees, judgments, fines,
amounts paid or to be paid in settlement, any interest, assessments, or other
charges imposed thereon, and any federal, state, local, or foreign taxes imposes
as a result of the actual or deemed receipt of any payments under this
Agreement, paid or incurred in connection with investigating, defending, being a
witness in, or participating in (including on appeal), or preparing for any of
the foregoing in, any Proceeding relating to any Indemnifiable
Event.
(d) “Indemnifiable Event”
means any event or occurrence that takes place either prior to or after the
effective date of this Agreement, related to the fact that Indemnitee is or was
a director or an officer (if the Indemnitee should be appointed as an officer)
of the Company, or while a director or officer is or was serving at the request
of the Company as a director, officer, employee, trustee, agent, or fiduciary of
another foreign or domestic corporation, partnership, joint venture, employee
benefit plan, trust, or other enterprise, or was a director, officer, employee,
or agent of a foreign or domestic corporation that was a predecessor corporation
of the Company or of another enterprise at the request of such predecessor
corporation, or related to anything done or not done by Indemnitee in any such
capacity.
(e) “Independent Counsel”
means the person or body appointed in connection with Section 3.
(f) “Potential Change in
Control” shall be deemed to have occurred if (i) the Company enters into
an agreement or arrangement, the consummation of which would result in the
occurrence of a Change in Control, (ii) any person (including the Company)
publicly announces an intention to take or to consider taking actions that, if
consummated, would constitute a Change in Control, (iii) any person (other than
an excluded Person) who is or becomes the Beneficial Owner, directly or
indirectly, of securities of the Company representing 10% or more of the
combined voting power of the Company’s then outstanding Voting Securities,
increases his beneficial ownership of such securities by 5% or more over the
percentage so owned by such person on the date hereof, or (iv) the Board adopts
a resolution to the effect that, for purposes of this Agreement, a Potential
Change in Control has occurred.
(g) “Proceeding” means (i)
any threatened, pending, or complete action, suit, or proceeding, whether civil,
criminal, administrative, investigative, or other, or (ii) any inquiry, hearing,
or investigation, whether conducted by the Company or any other party, that
Indemnitee in good faith believes might lead to the institution of any such
action, or proceeding.
10
(h) “Reviewing Party”
means the person or body appointed in accordance with Section 3 of this
Agreement.
(i) “Voting Securities”
any securities of the Company that vote generally in the election of
directors.
2. Agreement to
Indemnify.
(a) General Agreement. In
the event Indemnitee was, is, or become a party to or witness or other
participant in, or is threatened to be made a party to or witness or other
participant in, a Proceeding by reason of (or arising in part out of) an
Indemnifiable Event, the Company shall indemnify Indemnitee from and against any
and all Expenses to the fullest extent permitted by law, as the same exists or
may hereafter be amended or interpreted (but in the case of any such amendment
or interpretation, only to the extent that such amendment or interpretation
permits the Company to provide broader indemnification rights than were
permitted prior thereto). The parties hereto intend that this Agreement shall
provide for indemnification in excess of that expressly permitted by statute,
including, without limitation, any indemnification provided by the Company’s
Articles of Incorporation as amended, its bylaws as amended, vote of its
stockholders or disinterested directors, or applicable law.
(b) Initiation of
Proceeding. Notwithstanding anything in this Agreement to the contrary,
Indemnitee shall not be entitled to indemnification pursuant to this Agreement
in connection with any Proceeding initiated by Indemnitee against the Company or
any director or officer of the Company unless (i) the Company has joined in or
the Board has consented to the initiation of such Proceeding, (ii) the
Proceeding is one to enforce indemnification rights under Section 5, or (iii)
the Proceeding is instituted after a Change in Control and Independent Counsel
has approved its initiation.
(c) Expense Advances. If
so requested by Indemnitee, the Company shall advance (within ten business days
of such request) any and all Expenses to Indemnitee (an “Expense Advance”);
provided that such request shall be accompanied by reasonable evidence of the
expenses incurred by Indemnitee and that, if and to the extent that the
Reviewing Party determines that Indemnitee would not be permitted to be so
indemnified under applicable law, the Company shall be entitled to be reimbursed
by Indemnitee (who hereby agrees to reimburse the Company) for all such amounts
theretofore paid. If Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, as provided in Section 4, any determination
made by the Reviewing Party that Indemnitee would not be permitted to be
indemnified under applicable law shall not be binding and Indemnitee shall not
be required to reimburse the Company for any Expense Advance until a final
judicial determination is made with respect thereto (as to which all rights of
appeal therefrom have been exhausted or have lapsed).
(d) Mandatory
Indemnification. Notwithstanding any other provision of this Agreement
(other than Section 2(f) below), to the extent that Indemnitee has been
successful on the merits in defense of any Proceeding relating in whole or in
part to an Indemnifiable Event or in defense of any issue or matter therein,
Indemnitee shall be indemnified against all Expenses incurred in connection
therewith.
11
(e) Partial
Indemnification. If Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of Expenses,
but not, however, for the total amount thereof, the Company shall nevertheless
indemnify Indemnitee for the portion thereof to which Indemnitee is
entitled.
(f) Prohibited
Indemnification. No indemnification pursuant to this Agreement shall be
paid by the Company on account of any Proceeding in which judgment is rendered
against Indemnitee for an accounting of profits made from the purchase or sale
by Indemnitee of securities of the Company pursuant to the provisions of Section
16(b) of the Act or similar provisions of any federal, state or local
laws.
3. Reviewing Party.
Prior to any Change in Control, the Reviewing Party shall be any appropriate
person or body consisting of a member or members of the Board or any other
person or body appointed by the Board who is not a party to the particular
Proceeding with respect to which Indemnitee is seeking indemnification; after a
Change in Control, the Reviewing Party shall be the Independent Counsel referred
to below. With respect to all matters arising after a Change in Control (other
than a Change in Control approved by a majority of the directors on the Board
who were directors immediately prior to such Change in Control) concerning the
rights of Indemnitee to indemnity payments and Expense Advances under this
Agreement or any other agreement or under applicable law or the Company’s
Articles of Incorporation as amended or bylaws now or hereafter in effect
relating to indemnification for Indemnifiable Events, the Company shall seek
legal advice only from Independent Counsel selected by Indemnitee and approved
by the Company and who has not otherwise performed services for the Company or
the Indemnitee (other than in connection with indemnification matters) within
the last five years. The Independent Counsel shall not include any person who,
under the applicable standards of professional conduct then prevailing would
have a conflict of interest in representing either the Company or Indemnitee in
an action to determine Indemnitee’s rights under this Agreement. Such counsel,
among other things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent the Indemnitee should be permitted
to be indemnified under applicable law. The Company agrees to pay the reasonable
fees of the Independent Counsel and to indemnify fully such counsel against any
and all expenses (including attorney’s fees), claims, liabilities, loss, and
damages arising out of or relating to this Agreement or the engagement of
Independent Counsel pursuant hereto.
4. Indemnification Process and
Appeal.
(a) Suit To Enforce
Rights. Regardless of any action by the Reviewing Party, if Indemnitee
has not received full indemnification within 60 days after making a request in
accordance with Section 2(c), Indemnitee shall have the right to enforce its
indemnification rights under this Agreement by commencing litigation, in any
appropriate court having subject matter jurisdiction thereof and in which venue
is proper, seeking an initial determination by the court or challenging any
determination by the Reviewing Party or any aspect thereof, provided, however,
that such 60-day period shall be extended for reasonable time, not to exceed
another 60 days, if the reviewing party in good faith requires additional time
for the obtaining or evaluating of documentation and information relating
thereto. The Company hereby consents to service of process and to appear in any
such proceeding. Any determination by the Reviewing Party not challenged by the
Indemnitee shall be binding on the Company and Indemnitee. The remedy provided
for in this Section 4 shall be in addition to any other remedies available to
Indemnitee in law or equity.
12
(b) Defense to Indemnification,
Burden of Proof, and Presumptions. It shall be a defense to any action
brought by Indemnitee against the Company to enforce this Agreement (other than
an action brought to enforce a claim for Expenses incurred in defending a
Proceeding in advance of its final disposition where the required undertaking
has been tendered to the Company) that is not permissible under applicable law
for the Company to indemnify Indemnitee for the amount claimed. In connection
with any such action or any determination by the Reviewing Party or otherwise as
to whether Indemnitee is entitled to be indemnified hereunder, the burden of
proving such a defense or determination shall be on the Company. Neither the
failure of the Reviewing Party or the Company (including its Board, independent
legal counsel, or its stockholders) to have made a determination prior to the
commencement of such action by Indemnitee that indemnification of the claimant
is proper under the circumstances because Indemnitee has met the standard of
conduct set forth in applicable law, nor an actual determination by the
Reviewing Party or Company (including its Board, independent legal counsel, or
its stockholders) that the Indemnitee had not met such applicable standard of
conduct, shall be a defense to the action or create a presumption that the
Indemnitee has not met the applicable standard of conduct. For purposes of this
Agreement, the termination of any claim, action, suit, or proceeding, by
judgment, order, settlement (whether with or without court approval),
conviction, or upon a plea of nolo contendere, or its equivalent shall not
create a presumption that Indemnitee did not meet any particular standard of
conduct or have any particular belief or that a court has determined that
indemnification is not permitted by applicable law.
5. Indemnification For Expenses
Incurred In Enforcing Rights. The Company shall indemnify Indemnitee
against any and all Expenses and, if requested by Indemnitee, shall (within ten
business days of such request), advance such Expenses to Indemnitee, that are
incurred by Indemnitee in connection with any claim asserted against or covered
action brought by Indemnitee for (i) indemnification of Expenses or Expense
Advances by the Company under this Agreement or any other agreement or under
applicable law or the Company’s Articles of Incorporation as amended, or bylaws
now or hereafter in effect relating to indemnification for Indemnifiable Events,
and or (ii) recovery under directors’ and officers’ liability insurance policies
maintained by the Company, regardless of whether Indemnitee ultimately is
determined to be entitled to such indemnification, Expense Advances, or
insurance recovery, as the case may be.
6. Notification and Defense of
Proceeding.
(a) Notice. Promptly
after receipt by Indemnitee of notice of the commencement of any Proceeding,
Indemnitee shall, if a claim in respect thereof is to be made against the
Company under this Agreement, notify the Company of the commencement thereof,
but the omission so to notify the Company will not relieve the Company from any
liability that it may have to Indemnitee, except as provided in Section
6(c).
13
(b) Defense. With respect
to any Proceeding as to which Indemnitee notifies the Company of the
commencement thereof, the Company shall be entitled to participate in the
Proceeding at its own expense and except as otherwise provided below, to the
extent the Company so wishes, it may assume the defense thereof with counsel
reasonably satisfactory to Indemnitee. After notice from the Company to
Indemnitee of its election to assume the defense of any Proceeding, the Company
shall not be liable to Indemnitee under this Agreement or otherwise for any
Expenses subsequently incurred by Indemnitee in connection with the defense of
such Proceeding other than reasonable costs of investigation or as otherwise
provided below. Indemnitee shall have the right to employ his or her own legal
counsel in such Proceeding, but all Expenses related thereto incurred after
notice from the Company of its assumption of the defense shall be at
Indemnitee’s expense unless: (i) the employment of legal counsel by Indemnitee
has been authorized by the Company, (ii) Indemnitee has reasonably determined
that there may be a conflict of interest between Indemnitee and the Company in
the defense of the Proceeding, (iii) after a Change in Control, the employment
of counsel by Indemnitee has been approved by the Independent Counsel, or (iv)
the Company shall not in fact have employed counsel to assume the defense of
such Proceeding, in each of which case all Expenses of the Proceeding shall be
borne by the Company. The Company shall not be entitled to assume the defense of
any Proceeding brought by or on behalf of the Company or as to which Indemnitee
shall have made the determination provided for in (ii) above.
(c) Settlement of Claims.
The Company shall not be liable to indemnify Indemnitee under this Agreement or
otherwise for any amounts paid in settlement of any Proceeding effected without
the Company’s written consent, provided, however, that if a Change in Control
has occurred, the Company shall be liable for indemnification of Indemnitee for
amounts paid in settlement if the Independent Counsel has approved the
settlement. The Company shall not settle any Proceeding in any manner that would
impose any penalty or limitation on Indemnitee without Indemnitee’s written
consent. The Company shall not be liable to indemnify the Indemnitee under this
Agreement with regard to any judicial award if the Company was not given a
reasonable and timely opportunity, at its expense, to participate in the defense
of such action; the Company’s liability hereunder shall not be excused if
participation in the Proceeding by the Company was barred by this
Agreement.
7. Non-Exclusivity. The
rights of Indemnitee hereunder shall be in addition to any other rights
Indemnitee may have under the Company’s Articles of Incorporation as amended,
bylaws, applicable law, or otherwise. To the extent that a change in applicable
law (whether by statute or judicial decision) permits greater indemnification by
agreement than would be afforded currently under the Company’s Articles of
Incorporation as amended, bylaws, applicable law, or this Agreement, it is the
intent of the parties that Indemnitee enjoy by this Agreement the greater
benefits so afforded by such change.
8. Liability Insurance.
To the extent the Company maintains an insurance policy or policies providing
directors’ and officers’ liability insurance, Indemnitee shall be covered by
such policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director or
officer.
14
9. Amendment of this
Agreement. No supplement, modification, or amendment of this Agreement
shall be binding unless executed in writing by both of the parties hereto. No
waiver of any of the provisions of this Agreement shall operate as a waiver of
any other provisions hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver. Except as specifically provided herein, no
failure to exercise or any delay in exercising any right or remedy hereunder
shall constitute a waiver thereof.
10. Subrogation. In the
event of payment under this Agreement, the Company shall be subrogated to the
extent of such payment to all of the rights of recovery of Indemnitee, who shall
execute all documents required and shall do everything that may be necessary to
secure such rights, including the execution of such documents necessary to
enable the Company effectively to bring suit to enforce such
rights.
11. No Duplication Of
Payments. The Company shall not be liable under this Agreement to make
any payment in connection with any claim made against Indemnitee to the extent
Indemnitee has otherwise received payment (under any insurance policy, bylaw, or
otherwise) of the amounts otherwise indemnifiable hereunder.
12. Binding Effect. This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors (including any direct or
indirect successor by purchase, merger, consolidation, or otherwise to all or
substantially all of the business and/or assets of the Company), assigns,
spouses, heirs, and personal and legal representatives. The indemnification
provided under this Agreement shall continue as to Indemnitee for any action
taken or not taken while serving in an indemnified capacity pertaining to an
Indemnifiable Event even though he or she may have ceased to serve in such
capacity at the time of any Proceeding.
13. Severability. If any
provision (or portion thereof) of this Agreement shall be held by a court of
competent jurisdiction to be invalid, void, or otherwise unenforceable, the
remaining provisions shall remain enforceable to the fullest extent permitted by
law. Furthermore, to the fullest extent possible, the provisions of this
Agreement (including, without limitation, each portion of this Agreement
containing any provision held to be invalid, void, or otherwise unenforceable,
that is not itself invalid, void, or unenforceable) shall be construed so as to
give effect to the intent manifested by the provision held invalid, void, or
unenforceable.
14. Governing Law. This
Agreement shall be governed by and construed and enforced in accordance with the
laws of the state of incorporation of the Company applicable to contracts made
and to be performed in such state without giving effect to the principles of
conflicts of laws.
15. Notices. All notices,
demands, and other communications required or permitted hereunder shall be made
in writing and shall be deemed to have been duly given if delivered by hand,
against receipt, or mailed, postage prepaid, certified or registered mail,
return receipt requested, and addressed to the Company at:
15
Rm
2503-2505, New World Centre, No.6009
Yitian
Road, Futian District,
Shenzhen,
Guangdong, China
Attn:
Mr. Yunlu Yin
Fax:
Notice
of change of address shall be effective only when given in accordance with this
Section. All notices complying with this Section shall be deemed to have been
received on the date of delivery or on the third business day after
mailing.
16. Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
IN
WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Indemnification Agreement as of the day specified above.
|
COMPANY:
|
|
|
TOP
FILGHT GAMEBIRDS, INC.
|
|
|
By:
|
/s/Yunlu Yin
|
|
Yunlu
Yin
|
|
|
Chairman
|
|
|
INDEMNITEE:
|
|
|
/s/Yunlu Yin
|
|
|
Printed
Name: Yunlu Yin
|
|
16
