Executive Service Agreement - Xinhua Finance Media Ltd.
DATED [_____]
XINHUA FINANCE MEDIA LIMITED
AND
[NAME]
EXECUTIVE SERVICE AGREEMENT
----------
<PAGE>
DATE: ___________________
PARTIES:
(1) XINHUA FINANCE MEDIA LIMITED, a company registered in the Cayman Islands
whose registered office is at Unit 3905-3909, 1 Grand Gateway, 1 Hongqiao
Road, Shanghai, PRC, 200030 (the "Company");
and
(2) [name] (the "Executive").
RECITALS:
The Company has agreed to employ the Executive and the Executive has agreed to
serve the Company as [office] on the following terms and conditions.
TERMS AGREED:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Agreement where the context so admits the following words and
expressions shall have the following meanings:
"ASSOCIATED COMPANY" means in relation to the Company, any subsidiary or
holding company of the Company, any subsidiary of
such holding company, and any company in which the
Company or any such holding company holds or
controls directly or indirectly not less than 20% of
the issued share capital;
"BOARD" means the board of directors of the Company from
time to time;
"HK$" means Hong Kong dollars;
"HONG KONG" means the Hong Kong Special Administrative Region of
the People's Republic of China.
1.2 Terms defined in Section 2 of the Companies Ordinance shall in this
Agreement have the meanings ascribed to them in that section.
1.3 All references in this Agreement and the Schedule attached hereto to the
Company or any Associated Companies shall include their successors in title
or assigns.
-1-
<PAGE>
1.4 References herein to Clauses and the Schedules are references to the
clauses and the schedules of this Agreement which shall be deemed to form
part of this Agreement. The headings in this Agreement are inserted for
convenience of reference only and do not affect the interpretation hereof.
2. EMPLOYMENT
The Company shall employ the Executive and the Executive shall serve the
Company as [office] on and subject to the terms and conditions specified
herein.
3. COMMENCEMENT
3.1 The Executive agrees that he will remain in the employ of the Company or an
Associated Company for the period commencing the date of this Agreement and
ending on the date that is five years after the date of this Agreement,
with a five year renewal at the option of the Executive. The renewal will
be at identical terms as this contract, with the exception of the starting
salary which will begin at [_____] per month due to annual cost of living
increases; PROVIDED, HOWEVER, that nothing in this Clause 3 shall affect
the termination provisions pursuant to clause 12.
4. DUTIES
4.1 Subject to Clause 6.1 below, the Executive shall be employed in the
position of [office] in which capacity he shall devote such time, attention
and skill as is necessary in order to fulfill his duties hereunder, and
shall at all times during such employment act in the interests of the
Company and its Associated Companies, and shall faithfully and diligently
perform such duties and exercise such powers consistent therewith as may
from time to time be assigned to or vested in him by the Board or the
Company.
4.2 The Executive shall fulfill the reasonable and lawful orders of the Board,
given by or with the authority of the Board provided such orders comply
with recognizable pertinent ethical standards in effect at such time, and
shall comply with all the Company's rules, regulations, policies and
procedures from time to time in force.
4.3 The Executive may be required in pursuance of his duties hereunder to
perform services not only for the Company but also for any Associated
Company and, without further remuneration (except as otherwise agreed), to
accept any such office or position in any Associated Company which is
consistent with his position with the Company, as the Board or the Company
may from time to time reasonably require, provided that such office and/or
position does not inhibit the Executive from performing his duties
hereunder or entail services which are well beyond his duties hereunder (in
which event the parties shall mutually agree to acceptable additional
remuneration in connection with such position and/or office).
4.4 The Executive will keep the [Chief Executive Officer/Board of Directors]
promptly and fully informed (in writing if so requested) of his conduct of
the business or
-2-
<PAGE>
affairs of the Company and any Associated Company and provide such
explanations as the [CEO/Board] may require in connection therewith.
5. PLACE OF WORK
The Executive's place of work shall be in Hong Kong and in Shanghai, PRC as
the Company shall from time to time advise him or any location outside
Shanghai, PRC as the Company and the Executive shall mutually agree. In the
performance of his duties hereunder, the Executive may be required to
travel both throughout and outside Asia.
6. EXCLUSIVITY OF SERVICE/CONFLICTS
6.1 During the period of the Executive's employment hereunder the Executive
shall devote such of his time and attention to his duties hereunder as is
required to fulfill those duties and he shall not (without the prior
written consent of the Board) directly or indirectly either on his own
account or on behalf of any other person, company, business entity or other
organisation:
6.1.1 (i) engage in, or (ii) be concerned with, or (iii) provide services
to, (whether as an employee, officer, director, agent, partner,
consultant or otherwise) any other business in direct competition with
the Company or any Associated Company; or
6.1.2 accept any public office;
PROVIDED THAT the Executive may not hold shares in a private company which
is in direct competition with the Company; and
FURTHER PROVIDED THAT the Executive is entitled to devote his time and
attention to other existing business interests provided that such interests
do not conflict or interfere with the duties of the Executive as set out in
this Agreement.
The Company acknowledges that Executive is a member of the board of
directors and/or an officer in other private and public companies, and the
Company consents to the Executive remaining in such positions, and
acknowledges that these positions do not constitute a conflict of
Executive's duties hereunder. The Company further acknowledges the
Executive's duties to Xinhua Finance Limited, and agrees that the
Executives responsibilities to Xinhua Finance Limited in no way conflict
with this agreement. All of the Executives responsibilities are excluded
from any conflict with this Agreement.
7. REMUNERATION
The remuneration of the Executive shall be:
-3-
<PAGE>
(a) a monthly salary of US$[_____] payable in arrears such salary to
include any sum receivable as other remuneration from any Associated
Company, except as set forth herein. This salary shall be
automatically increased cumulatively by ten percent per annum during
the term of this Agreement;
(b) a monthly living allowance in the sum of US$[_____]. This monthly
living allowance shall increase by ten percent per annum during the
term of this Agreement, and any termination provisions with regard to
monthly salary shall also apply;
(c) Mandatory Provident Entitlement.;
(d) Additional compensation in shares as determined by the Compensation
Committee; and
(e) [_____] Shares in Xinhua Finance Media. Xinhua Finance Media shall use
its reasonable efforts to allow Executive to sell no less than % of
his securities in the offering.
8. OTHER BENEFITS
8.1 In addition to the foregoing remuneration and benefits, the Executive shall
also be entitled to the following:
(a) the provision of medical, dental, travel and optical insurance under
such insurance scheme as the Board may decide from time to time at the
expense of the Company for the benefit of the Executive, his spouse
and dependant children and independent grandchildren under the age of
21;
(b) participation in any share option scheme which may be adopted by the
Company, subject to the terms and conditions of such scheme from time
to time in place; and
8.2 Details of the scheme(s) referred to in Clauses 8.1(a), (b) and (c) above
can be obtained from the HR Department. The Company reserves the right to
substitute other scheme(s) for such scheme(s) or amend the scale of
benefits of such scheme(s) provided the level of benefits to the Executive
is not diminished.
8.3 The Company represents that it has taken all corporate action necessary in
order to enter into this Agreement and comply with the terms contained
herein, including the payment of bonus and issuance of shares in accordance
with terms of this Agreement and the Compensation Share Agreement.
8.4 The Company agrees that it shall obtain Officers and Directors liability
insurance covering the Board and the Executive from a reputable
internationally recognized
-4-
<PAGE>
insurance carrier, at such levels as is customary in the business conducted
by the Company.
9. EXPENSES
The Company shall reimburse the Executive (against receipts or other
satisfactory evidence) for all reasonable expenses properly incurred in the
course of her employment hereunder or in promoting or otherwise in
connection with the business of the Company and as set forth in this
Agreement.
10. DEDUCTIONS
The Company shall, to the extent permitted by s.32 of the Employment
Ordinance of the Laws of Hong Kong, be entitled to deduct from the
Executive's remuneration hereunder any monies due from him to the Company
or any Associated Company including, but not limited to, any outstanding
loans, advances, the cost of repairing any damage to or loss of the
Company's property caused by her (and of recovering the same, only as
adjudged by a court of competent jurisdiction) and any other monies owed by
her to the Company or any Associated Company.
11. LEAVE
11.1 The Executive shall be entitled to ten working days' per calendar quarterly
leave (in addition to public holidays) with full pay, which leave shall be
taken at such time or times which do not interfere with the Executive
carrying out his duties hereunder.
11.2 Unused annual leave may not be carried forward without the approval of
Board. Failure to take holiday entitlement in the appropriate holiday year
will lead to forfeiture of any accrued holiday not taken without any right
to payment in lieu thereof.
12. TERMINATION
12.1 Notwithstanding the provisions of Sections 2 and 3, the Executive's
employment with the Company may be earlier terminated as follows:
12.1.1 By action taken by the Board, the Executive may be discharged for cause
(as hereinafter defined), effective as of such time as the Board shall
determine. Upon discharge of the Executive pursuant to this Section 12.1.1,
the Company shall have no further obligation or duties to the Executive,
except for payment of salary, issuance of Shares earned, benefits, expenses
and any earned but unpaid bonus, through the effective date of termination,
and the Executive shall have no further obligations or duties to the
Company. Cause is hereby defined as a criminal conviction in a court of law
for fraud that involves the performance of his duties as [Office] of Xinhua
Finance Media and more than $250,000 USD.
-5-
<PAGE>
12.1.2 In the event of (i) the death of the Executive or (ii) by action of the
Board and the inability of the Executive, by reason of physical or mental
disability, to continue substantially to perform his duties hereunder for a
period of 180 consecutive days, during which 180 day period salary and any
other benefits hereunder shall not be suspended or diminished. Upon any
termination of the Executive's employment under this Section 12.1.2, the
Company be responsible for paying to the Executive (or the Executive's
estate if applicable) a lump sum equal to the annual salary of the
Executive in effect at the time of termination plus shares or bonus as
provided in Section 7 above, plus the benefits in Section 8.1(a) for a
period of five years following such termination. Provided that by way of
example, if either of the aforementioned events occur, the Executive shall
be entitled to such bonus enumerated in Clause 7 if at the end of such
calendar year the Executive has achieved the predetermined milestones for
which a bonus is to be paid.
12.1.3 In the event (i) that Executive's employment with the Company is
terminated by action taken by the Board without cause or (ii) there is a
Change in Control (as hereinafter defined), or (iii) the Company fails to
pay such bonus due to Executive in accordance with Section 7 in a timely
fashion (in such event the Executive shall have the right to terminate this
Agreement upon written notice to the Company, in which case the Company
shall be responsible for the payments set forth below), then the Company
shall be responsible for payment to the Executive of the salary amounts and
such earned but unpaid bonus as provided in Section 7 above plus expenses
incurred by the Executive as per Section 9 above and the benefits in
Section 8.1(a) all of which shall be for a period through the life of this
contract plus option extension following such termination, and Executive
shall have no further obligations or duties to the Company. In the event
such aforementioned termination and/or event occurs, the Company shall pay
to the Executive within five business days after such termination/event a
lump sum due the Executive whether due to Executive in cash or shares per
section 7 above. Additionally, all options granted but not vested shall
become immediately vested. Additionally, the Company or it successors shall
be required at the Executive's option to purchase all of the Executives
shares at the then market price of the Company's shares.
All amounts payable to the Executive pursuant to this Section 12.1.3 shall
be paid to the Executive in one lump-sum payment within five business days
after such termination. Provided that by way of example, if either of the
aforementioned events occur, the Executive shall be entitled to such
compensation enumerated in Clause 7 if at the end of such calendar year the
Executive has achieved the predetermined milestones
12.2 For purposes of this Agreement a "Change in Control" shall be deemed to
occur, unless previously consented to in writing by the Executive, in case
the Company shall, consolidate or merge with or into another corporation
(whether or not the Company is the surviving corporation or where there is
a change in or distribution with respect to the stock of the Company), or
sell, transfer or otherwise dispose of all or substantially all its
property, assets or business to another corporation and, pursuant to the
terms of such reorganization, reclassification, merger, consolidation or
disposition of assets, shares of common stock of the successor or acquiring
-6-
<PAGE>
corporation, or any cash, shares of stock or other securities or property
of any nature whatsoever (including warrants or other subscription or
purchase rights) in addition to or in lieu of common stock of the successor
or acquiring corporation. In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the
successor or acquiring corporation (if other than the Company) shall
expressly assume the due and punctual observance and performance of each
and every covenant and condition of this Agreement to be performed and
observed by the Company and all the obligations hereunder.
12.3 Forthwith upon the termination of the employment of the Executive
hereunder, provided the parties are not involved in a dispute over such
materials, if the Company shall so request, the Executive shall deliver to
the Company all documents (including correspondence, lists of customers,
notes, memoranda, plans, drawings and other documents of whatsoever
nature), models or samples made or compiled by or delivered to the
Executive during his employment hereunder, in connection with her duties
hereunder, and concerning the business, finances or affairs of the Company
or any Associated Company. For the avoidance of doubt it is hereby declared
that the property in all such documents as aforesaid shall at tall times be
vested in the relevant Associated Company.
12.4 The Executive acknowledges that the Company may, during all or any part of
any period of notice whether given by the Company or the Executive to
terminate the Executive's employment under this Agreement require the
Executive not to attend work and/or not to undertake all or any of hisr
duties and/or exclude him from any premises of the Company, provided that
for the avoidance of doubt during such period the Executive shall continue
to receive salary and other contractual benefits provided by this
Agreement.
12.5 The Executive agrees that he will not at any time after the termination of
the Employment represent herself as still having any connection with the
Company or any Associated Company, save as a former employee for the
purpose of communicating with prospective employers or complying with any
applicable statutory requirements.
13. DIRECTORSHIPS
13.1 The Executive is currently a Director on the Company's Board of Directors.
The Company represents that the other members of its Board of Directors
have agreed in writing for the Executive to remain a member of the Board of
Directors for so long as this Agreement is in effect. The Executive shall
forthwith resign in writing from all directorships, trusteeships and other
offices she may hold from time to time with the Company or any Associated
Company without compensation for loss of office in the event of:
13.1.1 the Executive serving notice on the Company of termination of her
employment.
-7-
<PAGE>
14. REASONABLENESS OF RESTRICTIONS
The Executive recognises that, whilst performing his duties for the
Company, he will have access to and come into contact with trade secrets
and confidential information belonging to the Company or to Associated
Companies and will obtain personal knowledge of and influence over its or
their customers and/or employees. The Executive therefore agrees that the
restrictions contained or referred to in Clauses 15 and 16 and Schedule 1
are reasonable and necessary to protect the legitimate business interests
of the Company and the Associated Companies both during and after the
termination of his employment.
15. CONFIDENTIALITY
15.1 The Executive shall neither during the Employment (except in the proper
performance of his duties) nor one year after the termination thereof by
the Company for cause (as defined above) or termination by the Executive,
directly or indirectly
15.1.1 use for his own purposes or those of any other person, company,
business entity or other organisation whatsoever; or
15.1.2 disclose to any person, company, business entity or other
organisation whatsoever.
any trade secrets or confidential information belonging to the Company or
any Associated Company including but not limited to any such information
relating to customers, customer lists or requirements, price lists or
pricing structures, sales and marketing information, business plans or
dealings, employees or officers, source codes and computer systems,
software, financial information and plans, designs, formulae, prototypes,
product lines, services, research activities, which are expressly
proprietary to the Company or any Associated Company and not in the
knowledge of the Executive prior to the date of this Agreement, any
document marked 'Confidential' (or with a similar expression), or any
information which the Executive has been told is confidential or which he
might reasonably expect the Company would regard as confidential, or any
information which has been given to the Company or any Associated Company
in confidence by customers, suppliers or other persons.
15.2 The obligations contained in Clause 15.1 shall cease to apply to any
information or knowledge which may subsequently come into the public domain
other than by way of unauthorised disclosure, or any such information which
is the subject of a lawful court order then in effect.
16. COPYRIGHT, INVENTIONS AND PATENTS
-8-
<PAGE>
16.1 The Executive will promptly disclose to the Company and to no one else all
copyright works or designs originated, conceived, written or made by him
alone or with others in the course of his employment (except only those
works originated, conceived, written or made by him wholly outside his
normal working hours and which are wholly unconnected with his employment).
16.2 All records, documents, papers (including copies and summaries thereof) and
other copyright protected works made or acquired by him in the course of
his employment shall, together with all the worldwide copyright and design
rights in all such works, be and at all times remain the absolute property
of the Company.
16.3 The Executive hereby irrevocably and unconditionally waives in favour of
the Company all rights granted by the Copyright Ordinance 1997 in
connection with his authorship of any copyright works in the course of his
employment with the Company, including without limitation any moral rights
and any right to claim an additional payment with respect to use or
exploitation of those works.
16.4 The Executives agree that his compensation in this Agreement are full
compensation for his services and all present and future uses of copyright
works made by him in the course of his employment.
16.5 If, at any time during the Executive's employment under this Agreement, he
(whether alone or with any other person or persons) shall make any
invention which relates directly to the business of the Company or any
Associated Company or was made or acquired in course of his employment, he
will promptly disclose to the Company and no-one else full details,
including drawings and models, of such invention.
16.6 If the Executive makes any inventions that do not belong to the Company
under the Patents Ordinance 1997, she agrees that he will forthwith agree
that the Company shall have the first right to exclusively license such
inventions. The Company will pay to the Executive such compensation for the
license as the Executive and the Company agree, with such compensation
being in lines with the standard in such industry. If the parties do not
agree then the Executive shall be entitled to license such invention to
other parties.
16.7 The Executive will, at the request and expense of the Company both during
and after the termination of his employment under this Agreement, do all
things necessary or desirable to perfect the rights of the Company under
this Clause 16, provided no bona fide dispute exists.
16.8 Nothing in this Agreement shall prohibit the Executive from maintaining and
publishing a diary relating to his life and experiences, some of which
include his experiences with the Company, provided such diary does not
disclose any copyright protected material made by Executive in the course
of his employment. It being agreed that the Executive is entitled to any
and all profits related thereto.
17. POST-TERMINATION OBLIGATIONS
-9-
<PAGE>
17.1 The Executive agrees that he will observe the post-termination obligations
set out in Schedule 1 for a period of one year.
18. [INTENTIONALLY OMITTED]
19. WARRANTY
The Executive represents and warrants that he is not prevented by any
agreement, arrangement, contract, understanding, court order or otherwise,
which in any way directly or indirectly restricts or prohibits him from
fully performing the duties of his employment hereunder, or any of them, in
accordance with the terms and conditions of this Agreement.
20. INDEMNIFICATION
The Company shall indemnify and hold harmless the Executive against any and
all expenses reasonably incurred by him in connection with or arising out
of (a) the defense of any action, suit or proceeding in which he is a
party, or (b) any claim asserted or threatened against him in either case
by reason of or relating to him being or having been an employee, officer
or director of the Company, provided the Executive has acted in the best
interests of the Company and has not acted in bad faith, whether or not he
continues to be such an employee, officer or director at the time of
incurring such expenses, except insofar as such indemnification is
prohibited by law. Such expenses shall include, without limitation, the
fees and disbursements of attorneys, amounts of judgments and amounts of
any settlements. Such amounts do not need to be agreed to in advance by the
Company. The foregoing indemnification obligation is independent of any
similar obligation provided in the Company's organization documents or
Articles of Association, and to matters attributable to her employment
hereunder, without regard to when asserted. No indemnification shall be
available to the Executive in the event of actions by Executive which are
in violation of this Agreement, however, in the event of actions by
Executives which are in violation of this Agreement, however, in the event
of the Company terminates the Executives, the Company shall pay for
Executive's legal representation in any settlement discussions.
Additionally, in the event of any disputes, the Company shall pay all costs
of Executives separate counsel, whether or not the Company deems those
expenses reasonable.
21. NOTICES
21.1 Each notice, demand or other communication given or made under this
Agreement shall be in writing and delivered or sent to the relevant party
at its address or fax number set out below (or such other address or fax
number as the addressee has by five business days' prior written notice
specified to the other party):
-10-
<PAGE>
To the Company: XINHUA FINANCE MEDIA LIMITED
Fax number: 852-2541-8266
Attention: Board of Directors
To the Executive: [_____]
Suite 2003-5, Vicwood Plaza, 199 Des Voeux Rd, Hong Kong
21.2 Any notice, demand or other communication so addressed to the relevant
party shall be deemed to have been delivered (a) if given or made by
letter, when actually delivered to the relevant address; and (b) if given
or made by fax, when dispatched subject to receipt of machine-printed
confirmation of error-free dispatch.
21.3 Any notice to be given hereunder may be delivered (a) in the case of the
Company by first class post addressed to its Registered Office or via
facsimile, and (b) in the case of the Executive, either to her personally
or by first class postage to her last known address.
22. MISCELLANEOUS
22.1 The various provisions and sub-provisions of this Agreement and the
Schedules are severable and if any provision or sub-provision is held to be
unenforceable by any court of competent jurisdiction then such
unenforceability shall not affect the enforceability of the remaining
provisions or sub-provisions in this Agreement or the Schedules.
22.2 The benefit of each agreement and obligation of the Executive under Clause
15 and Schedule 1 may be assigned to and enforced by all successors and
assigns for the time being of the Company and each Associated Company and
such agreements and obligations shall operate and remain binding
notwithstanding the termination of this Agreement.
22.3 This Agreement cancels and is in substitution for all previous letters of
engagement, agreements and arrangements (whether oral or in writing)
relating to the subject-matter hereof between the Company and the Executive
all of which shall be deemed to have been terminated by mutual consent.
This Agreement constitutes the entire terms and conditions of the
Executive's employment and no waiver or modification thereof shall be valid
unless in writing, signed by the parties and only to the extent therein set
forth.
22.4 No failure or delay by the Company in exercising any right, power or remedy
under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of the same preclude any further exercise
thereof or the exercise of any other right, power or remedy. Without
limiting the foregoing, no waiver by the Company of any breach by the
Executive of any provision in this Agreement shall be deemed to be a waiver
of any subsequent breach of that or any other provision in this Agreement.
-11-
<PAGE>
22.5.1 This Agreement shall be governed by and construed in accordance with the
laws of Hong Kong and the parties hereby irrevocably submit to the
non-exclusive jurisdiction of the Hong Kong courts.
SIGNED by the parties on the date first above written.
----------------------------------------
For and on behalf of
XINHUA FINANCE MEDIA LIMITED
in the presence of:
----------------------------------------
SIGNED SEALED AND DELIVERED
AS A DEED by
[ ]
--------------------------------------
in the presence of:
----------------------------------------
-12-
<PAGE>
SCHEDULE 1
POST-TERMINATION RESTRICTIONS
1. NON-COMPETITION
The Executive hereby agrees that she shall not (without the written consent
of the Board) for the Relevant Period within the Prohibited Area and
whether on her own behalf or in conjunction with or on behalf of any other
person, firm, company or other organisation, (and whether as an employee,
director, principal, agent, consultant or in any other capacity
whatsoever,) in competition with the Company directly or indirectly (i) be
employed or engaged in, or (ii) perform services in respect of, or (iii) be
otherwise concerned with:
1.1 the research into, development, manufacture, supply or marketing of any
product which is of the same or similar type to any product researched, or
developed, or manufactured, or supplied, or marketed by the Company during
the 12 months immediately preceding the Termination Date;
1.2 the development or provision of any services (including but not limited to
technical and product support, or consultancy or customer services) which
are of the same or similar type to any services provided by, or known by
the Executive to be in development by, the Company during the 12 months
immediately preceding the Termination Date;
2. NON-SOLICITATION OF CUSTOMERS
The Executive hereby agrees that she shall not for the Relevant Period
whether on her own behalf or in conjunction with or on behalf of any
person, company, business entity or other organisation (and whether as an
employee, director, principal, agent, consultant or in any other capacity
whatsoever), directly or indirectly (i) solicit or, (ii) assist in
soliciting, or (iii) accept, or (iv) facilitate the acceptance of, or (v)
deal with, in competition with the Company, the custom or business of any
Customer or Prospective Customer.
3. NON-SOLICITATION OF EMPLOYEES
The Executive hereby agrees that she will not for the Relevant Period
either on her own behalf or in conjunction with or on behalf of any other
person, company, business entity, or other organization (and whether as an
employee, principal, agent, consultant or in any other capacity
whatsoever), directly or indirectly:-
3.1 (i) induce, or (ii) solicit, or (iii) entice or (iv) procure, any person
who is a Company Employee to leave the Company's or any Associated
Company's employment (as applicable) where that person is a Company
Employee on the Termination Date or during the Relevant Period;
-13-
<PAGE>
3.2 be personally involved to a material extent in (i) accepting into
employment or (ii) otherwise engaging or using the services of, any person
who is a Company Employee on the Termination Date.
4. INTERFERENCE WITH SUPPLIERS/JOINT VENTURE PARTNERS/COMPANY EMPLOYEES
The Executive hereby agrees that she shall not (i) for the Relevant Period,
and (ii) in relation to any contract or arrangement which the Company has
with any joint venture partner, Company Employee, or Supplier for the
exclusive supply of goods or services to the Company and/or to its
Associated Companies, for the duration of such contract or arrangement,
whether on her own behalf or in conjunction with or on behalf of any
person, company, business entity or other organization, (and whether as an
employee, director, agent, principal, consultant or in any other capacity
whatsoever), directly or indirectly:
4.1 interfere with the supply of goods or services to the Company from any
Supplier, Company Employee, or joint venture partner;
4.2 induce any Company Employee, joint venture partner, or Supplier of goods or
services to the Company to cease or decline to supply such goods or
services in the future.
5. ASSOCIATED COMPANIES
5.1 Paragraphs 1, 2, 3, 4, and 6 in this Schedule 1 shall apply as though
references to the "Associated Company" were substituted for references to
the "Company". The obligations undertaken by the Executive pursuant to this
Schedule shall, with respect to each Associated Company, constitute a
separate and distinct covenant and the invalidity or unenforceability of
any such covenant shall not affect the validity or enforceability of the
covenants in favour of the Company or any other Associated Company.
5.2 In relation to each Associated Company referred to in paragraphs 5.1 above,
the Company contracts as trustee and agent for the benefit of each such
Associated Company. The Executive agrees that, if required to do so by the
Company, she will enter into covenants in the same terms as those set out
in paragraphs 1, 2, 3, 4, and 6 hereof directly with all or any of such
Associated Companies, mutatis mutandis. If the Executive fails, within
seven business days of receiving such a request from the Company, to sign
the necessary documents to give effect to the foregoing, the Company shall
be entitled, and is hereby irrevocably and unconditionally authorised by
the Executive, to execute all such documents as are required to give effect
to the foregoing, on her behalf.
-14-
<PAGE>
6. DEFINITIONS
For the purposes of this Schedule, the following words and expressions
shall have the meanings set out below:
6.1 "Associated Company", "Board", and "Company" shall have the meanings set
out in the Agreement attached hereto, and shall include their successors in
title and assigns (as applicable).
6.2 "Company Employee" means any person who was employed by (i) the Company or
(ii) any Associated Company, for at least one month during Executive's
employment with the Company or during the Relevant Period.
6.3 "Customer" shall mean any person, firm, company or other organisation
whatsoever to whom the Company has supplied goods or services.
6.4 "Prohibited Area" means:
6.4.1 Hong Kong;
6.4.2 any other country in the world where, on the Termination Date, the
Company develops, sells, supplies, manufactures or researches its
products or services or where the Company is intending within 3 months
following the Termination Date to develop, sell, supply or manufacture
its products or services and in respect of which the Executive has
been responsible (whether alone or jointly with others), concerned or
active on behalf of the Company during any part of the 12 months
immediately preceding the Termination Date.
6.5 "Prospective Customer" shall mean any person, firm, company or other
organisation with whom the Company has had any material negotiations or
material discussions regarding the possible supply of goods or services by
the Company.
6.6 The "Relevant Period" shall mean, solely in the event of termination by the
Company of the Executive with cause (as defined in the Agreement) the 12
months immediately following the Termination Date. PROVIDED that the
Relevant Period shall be the Termination Date in the event of termination
of the Executive Services Agreement for any other reason whatsoever.
6.7 "Supplier" means any person, company, business entity or other organisation
whatsoever who:
6.7.1 has supplied goods or services to the Company during any part of the
12 months immediately preceding the Termination Date; or
6.7.2 has agreed prior to the Termination Date to supply goods or services
to the Company to commence at any time in the 12 months following the
Termination Date; or
-15-
<PAGE>
6.7.3 as at the Termination Date, supplies goods or services to the Company
under a contract or arrangement between that Supplier and the Company.
6.8 "Termination Date" shall mean the date upon which the Executive's
employment with the Company terminates.
-16-