EXHIBIT 10.1

 

CONTRIBUTION AGREEMENT

 

This CONTRIBUTION AGREEMENT (this “ Agreement ”) is entered into effective as of February 5, 2013 (the “ Effective Date ”), by and between EastBridge Investment Group Corporation, a Delaware corporation (“ Parent ”) and EastBridge Investment Corp., a Delaware corporation (“ Subsidiary ”).

 

R E C I T A L S :

 

A.            Parent has caused the formation of Subsidiary.

 

B.            Parent desires to contribute and assign all of its assets and liabilities to Subsidiary in return for common stock, par value $0.001 per share, of Subsidiary (the “ Common Stock ”).

 

C.            Subsidiary agrees to accept such asset contribution and assume such liabilities of Parent pursuant to the terms of this Agreement.

 

NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which the parties hereby acknowledge, the parties hereto agree as follows:

 

 

(a)    As of the Effective Date, Parent does hereby assign, transfer and deliver to Subsidiary all of Parent’s right, title and interest in and to all assets, both tangible and intangible, owned by Parent prior the date hereof, and all rights, privileges, duties and obligations of Parent associated with same (the “ Assigned Assets and Assumed Liabilities ”), including, without limitation:

 

(i)             all accounts, including, without limitation, deposit accounts, investment accounts, all present and future rights of Parent to payment for services rendered, all accounts receivable, notes receivable, contract rights, book debts, debentures, drafts and other obligations or indebtedness owing to Parent, no matter how they arise (including, without limitation, any such obligation that might be characterized as an account, contract right or general intangible under the UCC in effect in any jurisdiction);

(ii)            all inventory, including, without limitation, all goods, merchandise and other personal property, now owned by the Parent;

(iii)           all intellectual property, including, without limitation, royalty rights, copyrights, trademarks and domain names;

 

(iv)           all real property owned by Parent;

 

(v)            all contract rights, including without limitation, (A) leases and options and the documents evidencing such rights, (B) all employment agreements, (C) those rights of Parent pursuant to that certain Agreement and Plan of Merger by and among Parent, CBMG Merger Sub, and Cellular Biomedicine Group Ltd., dated November 13, 2012, as amended (the “ Merger Agreement ”);

 

(vi)           all furniture, fixtures and equipment;

 

(vii)          all of Parent’s unsatisfied debts, claims, commitments, suits, obligations, and other liabilities, (whether absolute, accrued, asserted or unasserted, fixed, contingent or otherwise) arising out of Parent’s ownership of the Assigned Assets and from the operation of Parent’s business or other activities of Parent prior to the Effective Date including, without limitation, contractual obligations (including lease obligations), local, state and federal taxes, license fees, accrued and unpaid costs of overhead, employment related liabilities (including wages and liabilities related to employee benefit), liabilities that may arise from adverse claims, disputes, proceedings, investigations or inquiries (asserted, instituted or rendered, or otherwise existing or occurring, prior to, on or at any time after, the Effective Date) arising out of Parent’s ownership of the Assigned Assets, from the operation of the Parent’s business or other activities of Parent prior to the Effective Date, accounts payable and trade debts and commitments based on express or implied warranties, and any taxes, fees, expenses, liabilities, debts or obligations of Parent relating to this Agreement;

 

(viii)         the indemnification liabilities and Parent’s indemnification responsibilities as set forth in or arising under (A) its Certificate of Incorporation or Bylaws prior to the Effective Date and (B) any indemnity obligations or agreements entered into with its officers and directors; and

 

(ix)           any costs and expenses incurred or to be incurred in connection with the transfer and assumption of the same.

 

(b)    Notwithstanding anything contained herein to the contrary, Parent does not assign and Subsidiary does not assume any obligations of Parent arising under the Merger Agreement.

 

(c)    Subject to Section 1(b) above, Subsidiary hereby accepts the assignment and assumption of the Assigned Assets and Assumed Liabilities and agrees to assume and perform all agreements, covenants and obligations required of Parent thereunder.

 

(d)    In consideration of the Assigned Assets and Assumed Liabilities, Subsidiary shall issue to Parent One Thousand (1,000) shares of fully paid and non-assessable Common Stock.

 

 

2.    Further Assurances .   Each party hereto agrees to execute, acknowledge, deliver, file, record and publish such further instruments and documents and do all such further action things as may be required by law, or as may be required to carry out the intent and purpose of this Agreement.

 

3.    Third Party Consents .   If and to the extent the assignment of any contract of Parent requires third party consent, Parent agrees to use its best efforts to pursue and obtain such consent as soon as practicable following the Effective Date.

 

4.    Successors and Assigns .   This Agreement shall be binding upon the parties hereto and their respective executors, administrators, successors and assigns, and shall inure to the benefit of the parties hereto and, except as otherwise provided herein, their respective executors, administrators, successors and assigns.

 

5.    Venue; Governing Law .   Each of the parties hereto consents to the jurisdiction of any court in Wilmington, Delaware for any action arising out of matters relating to this Agreement.  This Agreement shall be interpreted, construed and governed by and in accordance with the laws of the State of Delaware without regard to the conflicts of law principles thereof.

 

6.    Notices .   All notices required or permitted hereunder shall be sent in accordance with the provisions and to the addresses maintained in the records of each party.

 

7.    Waiver . No failure or delay by either party in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder. Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party.

 

8.    Entire Agreement . This Agreement (including any schedules and exhibits hereto) constitutes the entire agreement, and supersedes all other prior agreements, understandings, representations and warranties, both written and oral, among the parties hereto with respect to the subject matter hereof.

 

9.    Severability . The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. If any provision of this Agreement, or the application thereof to any person or any circumstance is determined by a court of competent jurisdiction to be invalid, illegal, void or unenforceable the remaining provisions hereof, shall, subject to the following sentence, remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner adverse to any party. Upon such determination that any provision or the application thereof is invalid, illegal, void or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner so that the transactions contemplated hereby are consummated as originally contemplated to the fullest extent permitted by applicable law.

 

 

10.    Amendment .   This Agreement may be changed only by an agreement in writing signed by the parties hereto.

 

11.    Counterparts .   This Agreement may be executed in one or more counterparts and as so executed shall constitute a single instrument.

 

12.    Miscellaneous .   This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to the principles of conflict of laws. If any one or more of the provisions of this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, then such invalidity, illegality or unenforceability shall not affect any other provision hereof.  Section headings throughout this Agreement are solely for the convenience of the parties and are intended to have no legal meaning.  All waivers shall be in writing and signed by the party to be charged therewith.

 

 

[Signatures To Follow]

 

 

IN WITNESS WHEREOF , the parties hereto have executed this Agreement effective as of the date set forth in the introductory paragraph hereof.

 

 

 

EXHIBIT 10.2

 

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made as of February 6, 2013 (the “ Agreement Date ”) by and between EASTBRIDGE INVESTMENT GROUP CORPORATION (OTCQB: EBIG) (the “ Company ”), and the undersigned individual (“ Executive ”), with reference to the following facts:

A.          Cellular Biomedicine Group Ltd. (“ CBMG ”) is a developer of cell therapies for the treatment of certain cancers and degenerative diseases.

B.          Executive has extensive experience in the field of executive management.

C.           The Company expects to complete a merger with CBMG (“ Merger ”) whereby CBMG will become its wholly-owned subsidiary, which the Company anticipates will be consummated in February 2013 (the date of closing of the Merger shall be referred to as the “ Effective Date ”).

D.           The Company desires to employ Executive to perform the duties and responsibilities described herein on the terms and conditions hereinafter set forth.

NOW, THEREFORE, the parties agree as follows:

1.            Employment .  The Company hereby employs Executive and Executive hereby accepts such employment upon the terms and conditions hereinafter set forth.

 

2.            Duties .  Subject to the terms and provisions of this Agreement, Executive is hereby employed by the Company as Chairman and Chief Executive Officer of the Company.  Executive shall have full responsibility and authority for such duties as customarily are associated with service as the Chairman and Chief Executive Officer of the Company at the direction of the Board of Directors of the Company (the “ Board ”).  Executive shall faithfully and diligently perform, on a full time basis, such duties assigned to Executive and shall report directly to the Board.

 

3.            Scope of Services .  Executive shall devote substantially all of his business time, attention, energies, skills, learning and efforts to the Company’s business.

 

4.            Term .  Subject to prior termination of this Agreement as hereinafter provided, the term of this Agreement shall commence on the Effective Date and shall continue for three (3) years thereafter unless earlier terminated as provided in this Agreement.  After the foregoing three (3) year term, the Executive shall continue to be employed on an at-will basis and this Agreement shall automatically renew for successive one year terms, until and unless this Agreement is terminated.

 

 

5.           Compensation .

 

5.1           Salary .  Executive’s annual compensation (“ Base Compensation ”) under this Agreement shall be USD $150,000 per year, prorated for any partial year, commencing upon the Effective Date; provided however that the Executive’s Base Compensation shall be reviewed annually by the Board of Directors and/or its Compensation Committee (as applicable).  The Base Compensation shall be payable semi-monthly in arrears from the Effective Date in accordance with the ordinary payroll procedures of the Company.  Executive agrees that the Base Compensation may be paid by the Company, any of the Company’s subsidiaries or any combination thereof.  Any changes in Base Compensation shall be in the sole and absolute discretion of the Board and/or its Compensation Committee (as applicable).

 

5.2           Participation in Plan .  Executive shall be eligible to participate in any executive incentive plans established by Company for all of its executive employees.

 

5.3           Expenses .  The Company shall reimburse Executive for:

 

(a)           all reasonable business, entertainment and travel expenses actually incurred or paid by Executive in the performance of his services on behalf of the Company, in accordance with the Company’s expense reimbursement policy as from time to time in effect;

 

(b)           the cost of continuing education courses in furtherance of Executive’s performance of his duties of up to USD $5,000 per annum;

 

(c)           reasonable moving expenses if the Company requires the Executive to relocate, and as a result Executive must change his place of residence to a place more than 50 miles away from his current place of residence (which expenses shall be appropriately documented by Executive); and

 

(d)           if the Company requires the Executive to relocate (in excess of 50 miles), and after relocation the Executive is terminated without Cause pursuant to Section 7.1(b) and chooses to return to his original place of residence immediately prior to the Effective Date, reasonable moving expenses incurred by Executive (which expenses shall be appropriately documented by Executive).

 

5.4           Options .  The Executive shall be eligible to participate in the Company’s 2011 Equity Incentive Plan, and receive option grant(s) thereunder for the purchase common stock of the Company (“ Options ” or “ Option ”) at the discretion of the Board of Directors.  Options granted to the Executive shall be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the Board of Directors (“ Option Agreement ”).

 

6.           Other Rights and Benefits .  Executive shall receive other rights and benefits, life insurance, vacation time, sick pay and retirement plan participation, as determined by the Board of Directors.

 

7.           Termination .  Executive’s employment may be terminated as follows:

 

7.1           Termination by the Company or Executive .

 

(a)           During the one (1) year period after the Effective Date, this Agreement may not be voluntarily terminated by either party except pursuant to Section 7.2, 7.3 or 7.4 below.

 

 

(b)           After the one (1) year period in Section 7.1(a), for two (2) years thereafter, Executive may not be voluntarily terminated by the Company except pursuant to Section 7.2, 7.3 or 7.4 below, provided, however that during said two year period the board of directors of the Company may alter the responsibilities of the Executive to other senior-level functions, and change the Executive’s title to a mutually agreeable alternative title.

 

(c)          If during the initial three (3) year period following the Agreement Date, the employment of the Executive is terminated for any reason other than pursuant to Section 7.2, 7.3, or 7.4, or for no good reason, the Company shall be obligated to:

 

(i)           Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to one (1) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination;

 

(ii)          Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of such termination;

 

(iii)         Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month; and

 

(iv)         Pay any bonus amounts that have been earned by the Executive but have not yet been paid as of the date of termination.

 

7.2           Termination for Death . Executive’s employment shall terminate immediately upon Executive’s death.

 

7.3           Termination Upon Disability .  Executive’s employment shall terminate if Executive should become totally and permanently disabled.  For purposes of this Agreement, Executive shall be considered “totally and permanently disabled” if Executive is treated as permanently “disabled” under any permanent disability insurance policy maintained by the Company and is entitled to full benefits payable under such policy upon a total and permanent disability.  In the event any such policy is either not in force or the benefits are not available under such policy, then “total and permanent disability” shall mean the inability of Executive, as a result of substance abuse, any mental, nervous or psychiatric disorder, or physical condition, injury or illness to perform substantially all of his current duties on a full-time basis for a period of six (6) consecutive months, as determined by a licensed physician selected by the Board.

 

 

7.4           Termination by Company for “Cause ”.  The Company may terminate this Agreement for “Cause” upon three days written notice so long as the Company has given Executive written notice describing the Cause pursuant to subsections (c) and/or (e) Executive has not cured such Cause within a reasonable time, but no less than 14 days.  For purposes of this Agreement, “Cause” shall mean the existence or occurrence of any of the following:

 

(a)           Executive’s conviction for or pleading of nolo contendre to any felony involving the Company or moral turpitude.

 

(b)            Executive’s misappropriation of Company assets.

 

(c)           Executive’s willful violation of a Company policy or a directive of the Board previously delivered to him in writing.

 

(d)           Executive’s breach of his obligations set forth in Sections 11, 12, or 13 below.

 

(e)           Any willful neglect or material breach of duty by Executive under this Agreement, or any failure by Executive to perform duties under this Agreement, including the duties set forth in Section 2.

 

(f)           A failure, upon request of the Company, to relocate to a corporate office of the Company designated by the Board of Directors.

 

8.           Change in Control .  If Executive’s employment with the Company is not assumed and the Executive’s employment relationship is terminated by the Company, upon or within two (2) years following the date of a Change in Control, the Company shall:

 

(a)           Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination.

 

(b)           Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of termination within the two (2) year period following the occurrence of a Change in Control.

 

(c)           Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month.

 

 

If the Executive’s employment is terminated by Executive without Cause or terminated for Cause, death or disability of Executive, Executive shall not be entitled to the benefits or payments in Section 8(a) or (b), except as mandated by law.

 

For purposes of this Agreement, a “ Change in Control ”   means (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of the Company after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the directors on the board of directors who are not affiliates of the offeror do not recommend such stockholders accept; (iii) the sale, transfer, or other disposition of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.  A transfer or distribution by the majority shareholder Global Health Investment Holdings Ltd. (“ Global Health ”), of 50% or more of the total shares of the Company held by Global Health to its shareholders shall not constitute a Change in Control.

 

9.           Representations and Warranties .  Executive hereby represents and warrants to Company that as of the date of execution of this Agreement: (i) this Agreement will not cause or require Executive to breach any obligation to, or agreement or confidence with, any other person; (ii) Executive is not representing, or otherwise affiliated in any capacity with, any other research organizations, lines of products, manufacturers, vendors or customers of the Company; and (iii) Executive has not been induced to enter into this Agreement by any promise or representation other than as expressly set forth in this Agreement.

 

10.          Non-Solicitation .

 

10.1         Non-Solicitation of Employees . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment:

 

(a)           directly solicit, encourage, or take any other action which is intended to induce any other employee of the Company to terminate his or her employment with the Company; or

 

 

(b)           directly interfere in any manner with the contractual or employment relationship between the Company and any such employee of the Company.

 

The foregoing shall not prohibit Executive or any entity with which Executive may later be affiliated from hiring a former or existing employee of the Company or any of its subsidiaries, provided that such hiring does not result from the direct actions of Executive.  For purposes of this Article 10, Article 11, Article 12 and Article 13, any reference to the Company shall include all of the Company’s Affiliates.  As used herein, “Affiliate” means any person or entity controlling, controlled by or under common control with another person or entity.

 

10.2        Non-Solicit of Customers with respect to Competitive Business Activity . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment, directly or indirectly, whether for his own account or for the account of any other individual or entity, solicit the business or patronage of any customers of the Company with respect to products and/or services directly related to a Competitive Business Activity.  “ Competitive Business Activity ” shall mean engaging in, whether independently or as an employee, agent, consultant, advisor, independent contractor, partner, stockholder, officer, director or otherwise, any business which is materially competitive with the business of the Company as conducted or actively planned to be conducted by the Company during his employment by it, provided that Executive shall not be deemed to engage in a Competitive Business Activity solely by reason of (i) owning 1% or less of the outstanding common stock of any corporation if such class of common stock is registered under Section 12 of the Securities Exchange Act of 1934, or (ii) after the termination of his employment by the Company, being employed by or otherwise providing services to a corporation having total revenue of at least $500 million (or such lower number as may be agreed by the Board) so long as such services are provided solely to a division or other business unit of such corporation which does not engage in a business which is then competitive with the business of the Company.

 

11.          Confidentiality .  Executive hereby acknowledges that the Company has made and will make available to Executive certain customer lists, product design information, performance standards and other confidential and/or proprietary information of the Company or licensed to the Company, including without limitation trade secrets, copyrighted materials and/or financial information of the Company (or any of its Affiliates), including without limitation, financial statements, reports and data (collectively, the “ Confidential Material ”); however, Confidential Material does not include any of the foregoing items which has become publicly known or made generally available through no wrongful act of Executive or of others who were under confidentiality obligations as to the item or items involved.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any disclosure of this Agreement, the terms of this Agreement, or any of the Confidential Material.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any duplication or other copy of any of the Confidential Material.  Immediately upon request from the Company, Executive shall return to the Company all Confidential Material.  Executive shall notify each person to whom any disclosure is made that such disclosure is made in confidence, that the Confidential Material shall be kept in confidence by such person.  Nothing contained in this Section 11 shall be construed as preventing Executive from providing Confidential Material in compliance with a valid court order issued by a court of competent jurisdiction, providing Executive takes reasonable steps to prevent dissemination of such Confidential Material.

 

 

12.          Proprietary Information .  For purposes of this Agreement, “ Proprietary Information ” shall mean any information, observation, data, written material, record, document, software, firmware, invention, discovery, improvement, development, tool, machine, apparatus, appliance, design, promotional idea, customer list, practice, process, formula, method, technique, trade secret, product and/or research related to the actual or anticipated research, marketing strategies, pricing information, business records, development, products, organization, business or finances of the Company.  Proprietary Information shall not include information in the public domain as of execution of this Agreement except through any act or omission of Executive.  All right, title and interest of every kind and nature whatsoever in and to the Proprietary Information made, discussed, developed, secured, obtained or learned by Executive during the term of this Agreement shall be the sole and exclusive property of  the Company for any purposes or uses whatsoever, and shall be disclosed promptly by Executive to the Company.  The covenants set forth in the preceding sentence shall apply regardless of whether any Proprietary Information is made, discovered, developed, secured, obtained or learned (a) solely or jointly with others, (b) during the usual hours of work or otherwise, (c) at the request and upon the suggestion of the Company or otherwise, or (d) with the Company’s materials, tools, instruments or on the Company’s premises or otherwise.  All Proprietary Information developed, created, invented, devised, conceived or discovered by Executive that is subject to copyright protection is explicitly considered by Executive and the Company to be works made for hire to the extent permitted by law.  Executive hereby forever fully releases and discharges the Company, and the Company and their respective officers, directors and employees, from and against any and all claims, demands, damages, liabilities, costs and expenses of Executive arising out of, or relating to, any Proprietary Information.  Executive shall execute any documents and take any action the Company may deem necessary or appropriate to effectuate the provisions of this Agreement, including without limitation assisting the Company in obtaining and/or maintaining patents, copyrights or similar rights to any Proprietary Information assigned to the Company, if the Company, in their sole discretion, requests such assistance.  Executive shall comply with any reasonable rules established from time to time by the Company for the protection of the confidentiality of any Proprietary Information.  Executive irrevocably appoints the President of the Company to act as Executive’s agent and attorney-in-fact to perform all acts necessary to obtain and/or maintain patents, copyrights and similar rights to any Proprietary Information assigned by Executive to the Company under this Agreement if (a) Executive refuses to perform those acts, or (b) is unavailable, within the meaning of any applicable laws.  Executive acknowledges that the grant of the foregoing power of attorney is coupled with an interest and shall survive the death or disability of Executive.  Executive shall promptly disclose to the Company, in confidence (a) all Proprietary Information that Executive creates during the term of this Agreement, and (b) all patent applications, copyright registrations or similar rights filed or applied for by Executive within six months after termination of this Agreement.  Any application for a patent, copyright registration or similar right filed by Executive within six months after termination of this Agreement shall be presumed to relate to Proprietary Information created by Executive during the term of this Agreement, unless Executive can prove otherwise.  Nothing contained in this Agreement shall be construed to preclude the Company from exercising all of its rights and privileges as sole and exclusive owner of all of the Proprietary Information owned by or assigned to the Company under this Agreement.  The Company, in exercising such rights and privileges with respect to any particular item of Proprietary Information, may decide not to file any patent application or any copyright registration on such Proprietary Information, may decide to maintain such Proprietary Information as secret and confidential, or may decide to abandon such Proprietary Information or dedicate it to the public.  Executive shall have no authority to exercise any rights or privileges with respect to the Proprietary Information owned by or assigned to the Company under this Agreement.  This Agreement does not apply to any Proprietary Information that qualifies fully under the provisions of California Labor Code Section 2870 or any similar or successor statute.

 

 

13.          Business Opportunities .  During the term of this Agreement, if Executive (or any agent, employee, officer or independent contractor of or retained by Executive) becomes aware of, or develops, creates, invests, devises, conceives or discovers, any project, investment, venture, business or other opportunity (any of the preceding, an “ Opportunity ”) that is similar to, competitive with, related to or in the same field as the Company, or any project, investment, venture, or business of the Company, then Executive shall so notify the Company immediately in writing of such Opportunity and shall use Executive’s good-faith efforts to cause the Company to have the opportunity to invest in, participate in or otherwise become affiliated with such Opportunity.

 

14.          Miscellaneous .

 

14.1        Section Headings .  The section headings or captions in this Agreement are for convenience of reference only and do not form a part hereof, and do not in any way modify, interpret or construe the intent of the parties or affect any of the provisions of this Agreement.

 

14.2         Survival .  The obligations and rights imposed upon the parties hereto by the provisions of this Agreement which relate to acts or events subsequent to the termination of this Agreement shall survive the termination of this Agreement and shall remain fully effective thereafter, including without limitation the obligations of Executive with to any Confidential Material under Section 11.

 

14.3         Arbitration .

 

(a)           Any claim, dispute or other controversy (a “ Controversy ”) relating to this Agreement shall be settled and resolved by binding arbitration in Los Angeles County, California before a single arbitrator under the Employment Rules of the American Arbitration Association (“ AAA ”) in effect at the time a demand for arbitration is made.  If there is any conflict between the AAA rules and this arbitration clause, this arbitration clause will govern and determine the rights of the parties.  The Parties to this Agreement (the “ Parties ”) shall be entitled to full discovery regarding the Controversy as permitted by the California Code of Civil Procedure.  The arbitrator’s decision on the Controversy shall be a final and binding determination of the Controversy and shall be fully enforceable as an arbitration award in any court having jurisdiction and venue over the Parties.  The arbitrator shall also award the prevailing Party any reasonable attorneys’ fees and reasonable expenses the prevailing Party incurs in connection with the arbitration, and the non-prevailing Party shall pay the arbitrator’s fees and expenses.  The arbitrator shall determine who is the prevailing Party.  Each Party also agrees to accept service of process for all arbitration proceedings in accordance with AAA’s rules.

 

 

(b)           The obligation to arbitrate shall not be binding upon either party with respect to requests for temporary restraining orders, preliminary injunctions or other procedures in a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution by arbitration of the actual dispute between the Parties.

 

(c)           The provisions of this Section shall be construed as independent of any other covenant or provision of this Agreement; provided that, if a court of competent jurisdiction determines that any such provisions are unlawful in any way, such court shall modify or interpret such provisions to the minimum extent necessary to have them comply with the law.

 

(d)           This arbitration provision shall be deemed to be self-executing and shall remain in full force and effect after expiration or termination of this Agreement.  In the event either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against such party by default or otherwise notwithstanding said failure to appear.

 

14.4         Severability .  Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable in any relevant jurisdiction, then such illegal or unenforceable provision shall be modified by the proper court, if possible, but only to the extent necessary to make such provision enforceable, and such modified provision and all other provisions of this Agreement shall be given effect separately from the provision or portion thereof determined to be illegal or unenforceable and shall not be affected thereby; provided that, any such modification shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such determination of illegality or unenforceability is made.

 

14.5         Waiver .  The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.  The rights granted both parties herein are cumulative and the election of one shall not constitute a waiver of such party’s right to assert all other legal remedies available under the circumstances.

 

14.6         Parties in Interest .  Nothing in this Agreement, except as expressly set forth herein, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties to this Agreement and the successors, assigns and affiliates of the Company, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of action over or against any party to this Agreement.

 

14.7         Assignment .  The rights and obligations under this Agreement shall be binding upon, and inure to the benefit of, the heirs, executors, successors and assigns of Executive and the Company.  Except as specifically provided in this Section 14, neither the Company nor Executive may assign this Agreement or delegate their respective responsibilities under this Agreement without the consent of the other party hereto. Upon the sale, exchange or other transfer of substantially all of the assets of the Company, the Company shall assign this Agreement to the transferee of such assets.  No assignment of this Agreement by the Company shall relieve the Company of, and the Company shall remain obligated to perform, its duties and obligations under this Agreement, including, without limitation, payment of the Base Compensation set forth in Section 5, above.

 

 

14.8         Attorneys’ Fees .  In the event of any Controversy, suit, action or arbitration to enforce any of the terms or provisions of this Agreement, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs.  The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing party on any appeal of a judgment and for any action to enforce a judgment.

 

14.9         Modification .  This Agreement may be modified only by a contract in writing executed by the party(ies) to this Agreement against whom enforcement of such modification is sought.

 

14.10      Prior Understandings .  This Agreement contains the entire agreement between the parties to this Agreement with respect to the subject matter of this Agreement, is intended as a final expression of such parties’ agreement with respect to such terms as are included in this Agreement, is intended as a complete and exclusive statement of the terms of such agreement, and supersedes all negotiations, stipulations, understandings, agreements, representations and warranties, if any, with respect to such subject matter, which precede or accompany the execution of this Agreement.

 

14.11      Interpretation .  Whenever the context so requires in this Agreement, all words used in the singular shall be construed to have been used in the plural (and vice versa), each gender shall be construed to include any other genders, and the word “person” shall be construed to include a natural person, a corporation, a firm, a partnership, a joint venture, a trust, an estate or any other entity.

 

14.12       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.

 

14.13      Applicable Law .  This Agreement and the rights and obligations of the parties hereunder shall be construed under, and governed by, the laws of the State of California without giving effect to conflict of laws provisions.

 

14.14      Drafting Ambiguities .  Each party to this Agreement has reviewed and revised this Agreement.  Each party to this Agreement has had the opportunity to have such party’s legal counsel review and revise this Agreement.  The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or of any amendments or exhibits to this Agreement.

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.

 

EXHIBIT 10.3

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made as of February 6, 2013 (the “ Agreement Date ”) by and between EASTBRIDGE INVESTMENT GROUP CORPORATION (OTCQB: EBIG) (the “ Company ”), and the undersigned individual (“ Executive ”), with reference to the following facts:

A.          Cellular Biomedicine Group Ltd. (“ CBMG ”) is a developer of cell therapies for the treatment of certain cancers and degenerative diseases.

B.          Executive has extensive experience in the field of product development and corporate management.

C.            The Company expects to complete a merger with CBMG (“ Merger ”) whereby CBMG will become its wholly-owned subsidiary, which the Company anticipates will be consummated in February 2013 (the date of closing of the Merger shall be referred to as the “ Effective Date ”).

D.            The Company desires to employ Executive to perform the duties and responsibilities described herein on the terms and conditions hereinafter set forth.

NOW, THEREFORE, the parties agree as follows:

1.            Employment .  The Company hereby employs Executive and Executive hereby accepts such employment upon the terms and conditions hereinafter set forth.

 

2.            Duties .  Subject to the terms and provisions of this Agreement, Executive is hereby employed by the Company as President and Chief Operating Officer of the Company.  Executive shall have full responsibility and authority for such duties as customarily are associated with service as the President and Chief Operating Officer of the Company at the direction of the Board of Directors of the Company (the “ Board ”).  Executive shall faithfully and diligently perform, on a full time basis, such duties assigned to Executive and shall report directly to the Board.

 

3.            Scope of Services .  Executive shall devote substantially all of his business time, attention, energies, skills, learning and efforts to the Company’s business.

 

4.            Term .  Subject to prior termination of this Agreement as hereinafter provided, the term of this Agreement shall commence on the Effective Date and shall continue for three (3) years thereafter unless earlier terminated as provided in this Agreement.  After the foregoing three (3) year term, the Executive shall continue to be employed on an at-will basis and this Agreement shall automatically renew for successive one year terms, until and unless this Agreement is terminated.

 

 

5.            Compensation .

 

5.1             Salary .  Executive’s annual compensation (“ Base Compensation ”) under this Agreement shall be USD $150,000 per year, prorated for any partial year, commencing upon the Effective Date; provided however that the Executive’s Base Compensation shall be reviewed annually by the Board of Directors and/or its Compensation Committee (as applicable).  The Base Compensation shall be payable semi-monthly in arrears from the Effective Date in accordance with the ordinary payroll procedures of the Company.  Executive agrees that the Base Compensation may be paid by the Company, any of the Company’s subsidiaries or any combination thereof.  Any changes in Base Compensation shall be in the sole and absolute discretion of the Board and/or its Compensation Committee (as applicable).

 

5.2             Participation in Plan .  Executive shall be eligible to participate in any executive incentive plans established by Company for all of its executive employees.

 

5.3             Expenses .  The Company shall reimburse Executive for:

 

(a)             all reasonable business, entertainment and travel expenses actually incurred or paid by Executive in the performance of his services on behalf of the Company, in accordance with the Company’s expense reimbursement policy as from time to time in effect;

 

(b)             the cost of continuing education courses in furtherance of Executive’s performance of his duties of up to USD $5,000 per annum;

 

(c)             reasonable moving expenses if the Company requires the Executive to relocate, and as a result Executive must change his place of residence to a place more than 50 miles away from his current place of residence (which expenses shall be appropriately documented by Executive); and

 

(d)             if the Company requires the Executive to relocate (in excess of 50 miles), and after relocation the Executive is terminated without Cause pursuant to Section 7.1(b) and chooses to return to his original place of residence immediately prior to the Effective Date, reasonable moving expenses incurred by Executive (which expenses shall be appropriately documented by Executive).

 

5.4             Options .  The Executive shall be eligible to participate in the Company’s 2011 Equity Incentive Plan, and receive option grant(s) thereunder for the purchase common stock of the Company (“ Options ” or “ Option ”) at the discretion of the Board of Directors.  Options granted to the Executive shall be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the Board of Directors (“ Option Agreement ”).

 

6.            Other Rights and Benefits .  Executive shall receive other rights and benefits, life insurance, vacation time, sick pay and retirement plan participation, as determined by the Board of Directors.

 

7.            Termination .  Executive’s employment may be terminated as follows:

 

7.1             Termination by the Company or Executive .

 

(a)             During the one (1) year period after the Effective Date, this Agreement may not be voluntarily terminated by either party except pursuant to Section 7.2, 7.3 or 7.4 below.

 

 

(b)             After the one (1) year period in Section 7.1(a), for two (2) years thereafter, Executive may not be voluntarily terminated by the Company except pursuant to Section 7.2, 7.3 or 7.4 below, provided, however that during said two year period the board of directors of the Company may alter the responsibilities of the Executive to other senior-level functions, and change the Executive’s title to a mutually agreeable alternative title.

 

(c)            If during the initial three (3) year period following the Agreement Date, the employment of the Executive is terminated for any reason other than pursuant to Section 7.2, 7.3, or 7.4, or for no good reason, the Company shall be obligated to:

 

(i)          Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to one (1) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination;

 

(ii)         Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of such termination;

 

(iii)        Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month; and

 

(iv)        Pay any bonus amounts that have been earned by the Executive but have not yet been paid as of the date of termination.

 

7.2             Termination for Death . Executive’s employment shall terminate immediately upon Executive’s death.

 

7.3             Termination Upon Disability .  Executive’s employment shall terminate if Executive should become totally and permanently disabled.  For purposes of this Agreement, Executive shall be considered “totally and permanently disabled” if Executive is treated as permanently “disabled” under any permanent disability insurance policy maintained by the Company and is entitled to full benefits payable under such policy upon a total and permanent disability.  In the event any such policy is either not in force or the benefits are not available under such policy, then “total and permanent disability” shall mean the inability of Executive, as a result of substance abuse, any mental, nervous or psychiatric disorder, or physical condition, injury or illness to perform substantially all of his current duties on a full-time basis for a period of six (6) consecutive months, as determined by a licensed physician selected by the Board.

 

 

7.4               Termination by Company for “Cause ”.  The Company may terminate this Agreement for “Cause” upon three days written notice so long as the Company has given Executive written notice describing the Cause pursuant to subsections (c) and/or (e) Executive has not cured such Cause within a reasonable time, but no less than 14 days.  For purposes of this Agreement, “Cause” shall mean the existence or occurrence of any of the following:

 

(a)             Executive’s conviction for or pleading of nolo contendre to any felony involving the Company or moral turpitude.

 

(b)              Executive’s misappropriation of Company assets.

 

(c)             Executive’s willful violation of a Company policy or a directive of the Board previously delivered to him in writing.

 

(d)             Executive’s breach of his obligations set forth in Sections 11, 12, or 13 below.

 

(e)             Any willful neglect or material breach of duty by Executive under this Agreement, or any failure by Executive to perform duties under this Agreement, including the duties set forth in Section 2.

 

(f)             A failure, upon request of the Company, to relocate to a corporate office of the Company designated by the Board of Directors.

 

8.            Change in Control .  If Executive’s employment with the Company is not assumed and the Executive’s employment relationship is terminated by the Company, upon or within two (2) years following the date of a Change in Control, the Company shall:

 

(a)             Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination.

 

(b)             Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of termination within the two (2) year period following the occurrence of a Change in Control.

 

(c)             Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month.

 

 

If the Executive’s employment is terminated by Executive without Cause or terminated for Cause, death or disability of Executive, Executive shall not be entitled to the benefits or payments in Section 8(a) or (b), except as mandated by law.

 

For purposes of this Agreement, a “ Change in Control ”   means (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of the Company after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the directors on the board of directors who are not affiliates of the offeror do not recommend such stockholders accept; (iii) the sale, transfer, or other disposition of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.  A transfer or distribution by the majority shareholder Global Health Investment Holdings Ltd. (“ Global Health ”), of 50% or more of the total shares of the Company held by Global Health to its shareholders shall not constitute a Change in Control.

 

9.            Representations and Warranties .  Executive hereby represents and warrants to Company that as of the date of execution of this Agreement: (i) this Agreement will not cause or require Executive to breach any obligation to, or agreement or confidence with, any other person; (ii) Executive is not representing, or otherwise affiliated in any capacity with, any other research organizations, lines of products, manufacturers, vendors or customers of the Company; and (iii) Executive has not been induced to enter into this Agreement by any promise or representation other than as expressly set forth in this Agreement.

 

10.          Non-Solicitation .

 

10.1           Non-Solicitation of Employees . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment:

 

(a)            directly solicit, encourage, or take any other action which is intended to induce any other employee of the Company to terminate his or her employment with the Company; or

 

(b)             directly interfere in any manner with the contractual or employment relationship between the Company and any such employee of the Company.

 

 

The foregoing shall not prohibit Executive or any entity with which Executive may later be affiliated from hiring a former or existing employee of the Company or any of its subsidiaries, provided that such hiring does not result from the direct actions of Executive.  For purposes of this Article 10, Article 11, Article 12 and Article 13, any reference to the Company shall include all of the Company’s Affiliates.  As used herein, “Affiliate” means any person or entity controlling, controlled by or under common control with another person or entity.

 

10.2           Non-Solicit of Customers with respect to Competitive Business Activity . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment, directly or indirectly, whether for his own account or for the account of any other individual or entity, solicit the business or patronage of any customers of the Company with respect to products and/or services directly related to a Competitive Business Activity.  “ Competitive Business Activity ” shall mean engaging in, whether independently or as an employee, agent, consultant, advisor, independent contractor, partner, stockholder, officer, director or otherwise, any business which is materially competitive with the business of the Company as conducted or actively planned to be conducted by the Company during his employment by it, provided that Executive shall not be deemed to engage in a Competitive Business Activity solely by reason of (i) owning 1% or less of the outstanding common stock of any corporation if such class of common stock is registered under Section 12 of the Securities Exchange Act of 1934, or (ii) after the termination of his employment by the Company, being employed by or otherwise providing services to a corporation having total revenue of at least $500 million (or such lower number as may be agreed by the Board) so long as such services are provided solely to a division or other business unit of such corporation which does not engage in a business which is then competitive with the business of the Company.

 

11.          Confidentiality .  Executive hereby acknowledges that the Company has made and will make available to Executive certain customer lists, product design information, performance standards and other confidential and/or proprietary information of the Company or licensed to the Company, including without limitation trade secrets, copyrighted materials and/or financial information of the Company (or any of its Affiliates), including without limitation, financial statements, reports and data (collectively, the “ Confidential Material ”); however, Confidential Material does not include any of the foregoing items which has become publicly known or made generally available through no wrongful act of Executive or of others who were under confidentiality obligations as to the item or items involved.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any disclosure of this Agreement, the terms of this Agreement, or any of the Confidential Material.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any duplication or other copy of any of the Confidential Material.  Immediately upon request from the Company, Executive shall return to the Company all Confidential Material.  Executive shall notify each person to whom any disclosure is made that such disclosure is made in confidence, that the Confidential Material shall be kept in confidence by such person.  Nothing contained in this Section 11 shall be construed as preventing Executive from providing Confidential Material in compliance with a valid court order issued by a court of competent jurisdiction, providing Executive takes reasonable steps to prevent dissemination of such Confidential Material.

 

 

12.          Proprietary Information .  For purposes of this Agreement, “ Proprietary Information ” shall mean any information, observation, data, written material, record, document, software, firmware, invention, discovery, improvement, development, tool, machine, apparatus, appliance, design, promotional idea, customer list, practice, process, formula, method, technique, trade secret, product and/or research related to the actual or anticipated research, marketing strategies, pricing information, business records, development, products, organization, business or finances of the Company.  Proprietary Information shall not include information in the public domain as of execution of this Agreement except through any act or omission of Executive.  All right, title and interest of every kind and nature whatsoever in and to the Proprietary Information made, discussed, developed, secured, obtained or learned by Executive during the term of this Agreement shall be the sole and exclusive property of  the Company for any purposes or uses whatsoever, and shall be disclosed promptly by Executive to the Company.  The covenants set forth in the preceding sentence shall apply regardless of whether any Proprietary Information is made, discovered, developed, secured, obtained or learned (a) solely or jointly with others, (b) during the usual hours of work or otherwise, (c) at the request and upon the suggestion of the Company or otherwise, or (d) with the Company’s materials, tools, instruments or on the Company’s premises or otherwise.  All Proprietary Information developed, created, invented, devised, conceived or discovered by Executive that is subject to copyright protection is explicitly considered by Executive and the Company to be works made for hire to the extent permitted by law.  Executive hereby forever fully releases and discharges the Company, and the Company and their respective officers, directors and employees, from and against any and all claims, demands, damages, liabilities, costs and expenses of Executive arising out of, or relating to, any Proprietary Information.  Executive shall execute any documents and take any action the Company may deem necessary or appropriate to effectuate the provisions of this Agreement, including without limitation assisting the Company in obtaining and/or maintaining patents, copyrights or similar rights to any Proprietary Information assigned to the Company, if the Company, in their sole discretion, requests such assistance.  Executive shall comply with any reasonable rules established from time to time by the Company for the protection of the confidentiality of any Proprietary Information.  Executive irrevocably appoints the President of the Company to act as Executive’s agent and attorney-in-fact to perform all acts necessary to obtain and/or maintain patents, copyrights and similar rights to any Proprietary Information assigned by Executive to the Company under this Agreement if (a) Executive refuses to perform those acts, or (b) is unavailable, within the meaning of any applicable laws.  Executive acknowledges that the grant of the foregoing power of attorney is coupled with an interest and shall survive the death or disability of Executive.  Executive shall promptly disclose to the Company, in confidence (a) all Proprietary Information that Executive creates during the term of this Agreement, and (b) all patent applications, copyright registrations or similar rights filed or applied for by Executive within six months after termination of this Agreement.  Any application for a patent, copyright registration or similar right filed by Executive within six months after termination of this Agreement shall be presumed to relate to Proprietary Information created by Executive during the term of this Agreement, unless Executive can prove otherwise.  Nothing contained in this Agreement shall be construed to preclude the Company from exercising all of its rights and privileges as sole and exclusive owner of all of the Proprietary Information owned by or assigned to the Company under this Agreement.  The Company, in exercising such rights and privileges with respect to any particular item of Proprietary Information, may decide not to file any patent application or any copyright registration on such Proprietary Information, may decide to maintain such Proprietary Information as secret and confidential, or may decide to abandon such Proprietary Information or dedicate it to the public.  Executive shall have no authority to exercise any rights or privileges with respect to the Proprietary Information owned by or assigned to the Company under this Agreement.

 

 

13.          Business Opportunities .  During the term of this Agreement, if Executive (or any agent, employee, officer or independent contractor of or retained by Executive) becomes aware of, or develops, creates, invests, devises, conceives or discovers, any project, investment, venture, business or other opportunity (any of the preceding, an “ Opportunity ”) that is similar to, competitive with, related to or in the same field as the Company, or any project, investment, venture, or business of the Company, then Executive shall so notify the Company immediately in writing of such Opportunity and shall use Executive’s good-faith efforts to cause the Company to have the opportunity to invest in, participate in or otherwise become affiliated with such Opportunity.

 

14.          Miscellaneous .

 

14.1           Section Headings .  The section headings or captions in this Agreement are for convenience of reference only and do not form a part hereof, and do not in any way modify, interpret or construe the intent of the parties or affect any of the provisions of this Agreement.

 

14.2           Survival .  The obligations and rights imposed upon the parties hereto by the provisions of this Agreement which relate to acts or events subsequent to the termination of this Agreement shall survive the termination of this Agreement and shall remain fully effective thereafter, including without limitation the obligations of Executive with to any Confidential Material under Section 11.

 

14.3           Arbitration .

 

(a)             Any claim, dispute or other controversy (a “ Controversy ”) relating to this Agreement shall be settled and resolved by binding arbitration in Los Angeles County, California before a single arbitrator under the Employment Rules of the American Arbitration Association (“ AAA ”) in effect at the time a demand for arbitration is made.  If there is any conflict between the AAA rules and this arbitration clause, this arbitration clause will govern and determine the rights of the parties.  The Parties to this Agreement (the “ Parties ”) shall be entitled to full discovery regarding the Controversy as permitted by the California Code of Civil Procedure.  The arbitrator’s decision on the Controversy shall be a final and binding determination of the Controversy and shall be fully enforceable as an arbitration award in any court having jurisdiction and venue over the Parties.  The arbitrator shall also award the prevailing Party any reasonable attorneys’ fees and reasonable expenses the prevailing Party incurs in connection with the arbitration, and the non-prevailing Party shall pay the arbitrator’s fees and expenses.  The arbitrator shall determine who is the prevailing Party.  Each Party also agrees to accept service of process for all arbitration proceedings in accordance with AAA’s rules.

 

 

(b)             The obligation to arbitrate shall not be binding upon either party with respect to requests for temporary restraining orders, preliminary injunctions or other procedures in a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution by arbitration of the actual dispute between the Parties.

 

(c)             The provisions of this Section shall be construed as independent of any other covenant or provision of this Agreement; provided that, if a court of competent jurisdiction determines that any such provisions are unlawful in any way, such court shall modify or interpret such provisions to the minimum extent necessary to have them comply with the law.

 

(d)             This arbitration provision shall be deemed to be self-executing and shall remain in full force and effect after expiration or termination of this Agreement.  In the event either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against such party by default or otherwise notwithstanding said failure to appear.

 

14.4           Severability .  Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable in any relevant jurisdiction, then such illegal or unenforceable provision shall be modified by the proper court, if possible, but only to the extent necessary to make such provision enforceable, and such modified provision and all other provisions of this Agreement shall be given effect separately from the provision or portion thereof determined to be illegal or unenforceable and shall not be affected thereby; provided that, any such modification shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such determination of illegality or unenforceability is made.

 

14.5           Waiver .  The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.  The rights granted both parties herein are cumulative and the election of one shall not constitute a waiver of such party’s right to assert all other legal remedies available under the circumstances.

 

14.6           Parties in Interest .  Nothing in this Agreement, except as expressly set forth herein, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties to this Agreement and the successors, assigns and affiliates of the Company, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of action over or against any party to this Agreement.

 

14.7           Assignment .  The rights and obligations under this Agreement shall be binding upon, and inure to the benefit of, the heirs, executors, successors and assigns of Executive and the Company.  Except as specifically provided in this Section 14, neither the Company nor Executive may assign this Agreement or delegate their respective responsibilities under this Agreement without the consent of the other party hereto. Upon the sale, exchange or other transfer of substantially all of the assets of the Company, the Company shall assign this Agreement to the transferee of such assets.  No assignment of this Agreement by the Company shall relieve the Company of, and the Company shall remain obligated to perform, its duties and obligations under this Agreement, including, without limitation, payment of the Base Compensation set forth in Section 5, above.

 

 

14.8           Attorneys’ Fees .  In the event of any Controversy, suit, action or arbitration to enforce any of the terms or provisions of this Agreement, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs.  The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing party on any appeal of a judgment and for any action to enforce a judgment.

 

14.9           Modification .  This Agreement may be modified only by a contract in writing executed by the party(ies) to this Agreement against whom enforcement of such modification is sought.

 

14.10         Prior Understandings .  This Agreement contains the entire agreement between the parties to this Agreement with respect to the subject matter of this Agreement, is intended as a final expression of such parties’ agreement with respect to such terms as are included in this Agreement, is intended as a complete and exclusive statement of the terms of such agreement, and supersedes all negotiations, stipulations, understandings, agreements, representations and warranties, if any, with respect to such subject matter, which precede or accompany the execution of this Agreement.

 

14.11         Interpretation .  Whenever the context so requires in this Agreement, all words used in the singular shall be construed to have been used in the plural (and vice versa), each gender shall be construed to include any other genders, and the word “person” shall be construed to include a natural person, a corporation, a firm, a partnership, a joint venture, a trust, an estate or any other entity.

 

14.12         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.

 

14.13         Applicable Law .  This Agreement and the rights and obligations of the parties hereunder shall be construed under, and governed by, the laws of the State of Delaware without giving effect to conflict of laws provisions.

 

14.14         Drafting Ambiguities .  Each party to this Agreement has reviewed and revised this Agreement.  Each party to this Agreement has had the opportunity to have such party’s legal counsel review and revise this Agreement.  The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or of any amendments or exhibits to this Agreement.

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.

 

 

 

EXHIBIT 10.4

 

EMPLOYMENT AGREEMENT

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made as of February 6, 2013 (the “ Agreement Date ”) by and between EASTBRIDGE INVESTMENT GROUP CORPORATION (OTCQB: EBIG) (the “ Company ”), and the undersigned individual (“ Executive ”), with reference to the following facts:

A.          Cellular Biomedicine Group Ltd. (“ CBMG ”) is a developer of cell therapies for the treatment of certain cancers and degenerative diseases.

B.          Executive has extensive experience in the field of finance.

C.           The Company expects to complete a merger with CBMG (“ Merger ”) whereby CBMG will become its wholly-owned subsidiary, which the Company anticipates will be consummated in February 2013 (the date of closing of the Merger shall be referred to as the “ Effective Date ”).

D.           The Company desires to employ Executive to perform the duties and responsibilities described herein on the terms and conditions hereinafter set forth.

NOW, THEREFORE, the parties agree as follows:

1.            Employment .  The Company hereby employs Executive and Executive hereby accepts such employment upon the terms and conditions hereinafter set forth.

 

2.            Duties .  Subject to the terms and provisions of this Agreement, Executive is hereby employed by the Company as Chief Financial Officer and Secretary of the Company.  Executive shall have full responsibility and authority for such duties as customarily are associated with service as the Chief Financial Officer and Secretary of the Company at the direction of the Board of Directors of the Company (the “ Board ”).  Executive shall faithfully and diligently perform, on a full time basis, such duties assigned to Executive and shall report directly to the Board.

 

3.            Scope of Services .  Executive shall devote substantially all of his business time, attention, energies, skills, learning and efforts to the Company’s business.

 

4.            Term .  Subject to prior termination of this Agreement as hereinafter provided, the term of this Agreement shall commence on the Effective Date and shall continue for three (3) years thereafter unless earlier terminated as provided in this Agreement.  After the foregoing three (3) year term, the Executive shall continue to be employed on an at-will basis and this Agreement shall automatically renew for successive one year terms, until and unless this Agreement is terminated.

 

 

5.            Compensation .

 

5.1            Salary .  Executive’s annual compensation (“ Base Compensation ”) under this Agreement shall be USD $150,000 per year, prorated for any partial year, commencing upon the Effective Date; provided however that the Executive’s Base Compensation shall be reviewed annually by the Board of Directors and/or its Compensation Committee (as applicable).  The Base Compensation shall be payable semi-monthly in arrears from the Effective Date in accordance with the ordinary payroll procedures of the Company.  Executive agrees that the Base Compensation may be paid by the Company, any of the Company’s subsidiaries or any combination thereof.  Any changes in Base Compensation shall be in the sole and absolute discretion of the Board and/or its Compensation Committee (as applicable).

 

5.2            Participation in Plan .  Executive shall be eligible to participate in any executive incentive plans established by Company for all of its executive employees.

 

5.3            Expenses .  The Company shall reimburse Executive for:

 

(a)            all reasonable business, entertainment and travel expenses actually incurred or paid by Executive in the performance of his services on behalf of the Company, in accordance with the Company’s expense reimbursement policy as from time to time in effect;

 

(b)            the cost of continuing education courses in furtherance of Executive’s performance of his duties of up to USD $5,000 per annum;

 

(c)            reasonable moving expenses if the Company requires the Executive to relocate, and as a result Executive must change his place of residence to a place more than 50 miles away from his current place of residence (which expenses shall be appropriately documented by Executive); and

 

(d)            if the Company requires the Executive to relocate (in excess of 50 miles), and after relocation the Executive is terminated without Cause pursuant to Section 7.1(b) and chooses to return to his original place of residence immediately prior to the Effective Date, reasonable moving expenses incurred by Executive (which expenses shall be appropriately documented by Executive).

 

5.4            Options .  The Executive shall be eligible to participate in the Company’s 2011 Equity Incentive Plan, and receive option grant(s) thereunder for the purchase common stock of the Company (“ Options ” or “ Option ”) at the discretion of the Board of Directors.  Options granted to the Executive shall be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the Board of Directors (“ Option Agreement ”).

 

6.            Other Rights and Benefits .  Executive shall receive other rights and benefits, life insurance, vacation time, sick pay and retirement plan participation, as determined by the Board of Directors.

 

7.            Termination .  Executive’s employment may be terminated as follows:

 

7.1            Termination by the Company or Executive .

 

(a)            During the one (1) year period after the Effective Date, this Agreement may not be voluntarily terminated by either party except pursuant to Section 7.2, 7.3 or 7.4 below.

 

 

 

(b)            After the one (1) year period in Section 7.1(a), for two (2) years thereafter, Executive may not be voluntarily terminated by the Company except pursuant to Section 7.2, 7.3 or 7.4 below, provided, however that during said two year period the board of directors of the Company may alter the responsibilities of the Executive to other senior-level functions, and change the Executive’s title to a mutually agreeable alternative title.

 

(c)            If during the initial three (3) year period following the Agreement Date, the employment of the Executive is terminated for any reason other than pursuant to Section 7.2, 7.3, or 7.4, or for no good reason, the Company shall be obligated to:

 

(i)          Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to one (1) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination;

 

(ii)         Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of such termination;

 

(iii)         Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month; and

 

(iv)        Pay any bonus amounts that have been earned by the Executive but have not yet been paid as of the date of termination.

 

7.2            Termination for Death . Executive’s employment shall terminate immediately upon Executive’s death.

 

7.3            Termination Upon Disability .  Executive’s employment shall terminate if Executive should become totally and permanently disabled.  For purposes of this Agreement, Executive shall be considered “totally and permanently disabled” if Executive is treated as permanently “disabled” under any permanent disability insurance policy maintained by the Company and is entitled to full benefits payable under such policy upon a total and permanent disability.  In the event any such policy is either not in force or the benefits are not available under such policy, then “total and permanent disability” shall mean the inability of Executive, as a result of substance abuse, any mental, nervous or psychiatric disorder, or physical condition, injury or illness to perform substantially all of his current duties on a full-time basis for a period of six (6) consecutive months, as determined by a licensed physician selected by the Board.

 

 

7.4               Termination by Company for “Cause ”.  The Company may terminate this Agreement for “Cause” upon three days written notice so long as the Company has given Executive written notice describing the Cause pursuant to subsections (c) and/or (e) Executive has not cured such Cause within a reasonable time, but no less than 14 days.  For purposes of this Agreement, “Cause” shall mean the existence or occurrence of any of the following:

 

(a)            Executive’s conviction for or pleading of nolo contendre to any felony involving the Company or moral turpitude.

 

(b)              Executive’s misappropriation of Company assets.

 

(c)            Executive’s willful violation of a Company policy or a directive of the Board previously delivered to him in writing.

 

(d)            Executive’s breach of his obligations set forth in Sections 11, 12, or 13 below.

 

(e)            Any willful neglect or material breach of duty by Executive under this Agreement, or any failure by Executive to perform duties under this Agreement, including the duties set forth in Section 2.

 

(f)            A failure, upon request of the Company, to relocate to a corporate office of the Company designated by the Board of Directors.

 

8.            Change in Control .  If Executive’s employment with the Company is not assumed and the Executive’s employment relationship is terminated by the Company, upon or within two (2) years following the date of a Change in Control, the Company shall:

 

(a)            Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination.

 

(b)            Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of termination within the two (2) year period following the occurrence of a Change in Control.

 

(c)            Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month.

 

 

If the Executive’s employment is terminated by Executive without Cause or terminated for Cause, death or disability of Executive, Executive shall not be entitled to the benefits or payments in Section 8(a) or (b), except as mandated by law.

 

For purposes of this Agreement, a “ Change in Control ”   means (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of the Company after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the directors on the board of directors who are not affiliates of the offeror do not recommend such stockholders accept; (iii) the sale, transfer, or other disposition of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.  A transfer or distribution by the majority shareholder Global Health Investment Holdings Ltd. (“ Global Health ”), of 50% or more of the total shares of the Company held by Global Health to its shareholders shall not constitute a Change in Control.

 

9.            Representations and Warranties .  Executive hereby represents and warrants to Company that as of the date of execution of this Agreement: (i) this Agreement will not cause or require Executive to breach any obligation to, or agreement or confidence with, any other person; (ii) Executive is not representing, or otherwise affiliated in any capacity with, any other research organizations, lines of products, manufacturers, vendors or customers of the Company; and (iii) Executive has not been induced to enter into this Agreement by any promise or representation other than as expressly set forth in this Agreement.

 

10.          Non-Solicitation .

 

10.1           Non-Solicitation of Employees . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment:

 

(a)            directly solicit, encourage, or take any other action which is intended to induce any other employee of the Company to terminate his or her employment with the Company; or

 

(b)            directly interfere in any manner with the contractual or employment relationship between the Company and any such employee of the Company.

 

 

The foregoing shall not prohibit Executive or any entity with which Executive may later be affiliated from hiring a former or existing employee of the Company or any of its subsidiaries, provided that such hiring does not result from the direct actions of Executive.  For purposes of this Article 10, Article 11, Article 12 and Article 13, any reference to the Company shall include all of the Company’s Affiliates.  As used herein, “Affiliate” means any person or entity controlling, controlled by or under common control with another person or entity.

 

10.2           Non-Solicit of Customers with respect to Competitive Business Activity . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment, directly or indirectly, whether for his own account or for the account of any other individual or entity, solicit the business or patronage of any customers of the Company with respect to products and/or services directly related to a Competitive Business Activity.  “ Competitive Business Activity ” shall mean engaging in, whether independently or as an employee, agent, consultant, advisor, independent contractor, partner, stockholder, officer, director or otherwise, any business which is materially competitive with the business of the Company as conducted or actively planned to be conducted by the Company during his employment by it, provided that Executive shall not be deemed to engage in a Competitive Business Activity solely by reason of (i) owning 1% or less of the outstanding common stock of any corporation if such class of common stock is registered under Section 12 of the Securities Exchange Act of 1934, or (ii) after the termination of his employment by the Company, being employed by or otherwise providing services to a corporation having total revenue of at least $500 million (or such lower number as may be agreed by the Board) so long as such services are provided solely to a division or other business unit of such corporation which does not engage in a business which is then competitive with the business of the Company.

 

11.          Confidentiality .  Executive hereby acknowledges that the Company has made and will make available to Executive certain customer lists, product design information, performance standards and other confidential and/or proprietary information of the Company or licensed to the Company, including without limitation trade secrets, copyrighted materials and/or financial information of the Company (or any of its Affiliates), including without limitation, financial statements, reports and data (collectively, the “ Confidential Material ”); however, Confidential Material does not include any of the foregoing items which has become publicly known or made generally available through no wrongful act of Executive or of others who were under confidentiality obligations as to the item or items involved.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any disclosure of this Agreement, the terms of this Agreement, or any of the Confidential Material.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any duplication or other copy of any of the Confidential Material.  Immediately upon request from the Company, Executive shall return to the Company all Confidential Material.  Executive shall notify each person to whom any disclosure is made that such disclosure is made in confidence, that the Confidential Material shall be kept in confidence by such person.  Nothing contained in this Section 11 shall be construed as preventing Executive from providing Confidential Material in compliance with a valid court order issued by a court of competent jurisdiction, providing Executive takes reasonable steps to prevent dissemination of such Confidential Material.

 

 

12.          Proprietary Information .  For purposes of this Agreement, “ Proprietary Information ” shall mean any information, observation, data, written material, record, document, software, firmware, invention, discovery, improvement, development, tool, machine, apparatus, appliance, design, promotional idea, customer list, practice, process, formula, method, technique, trade secret, product and/or research related to the actual or anticipated research, marketing strategies, pricing information, business records, development, products, organization, business or finances of the Company.  Proprietary Information shall not include information in the public domain as of execution of this Agreement except through any act or omission of Executive.  All right, title and interest of every kind and nature whatsoever in and to the Proprietary Information made, discussed, developed, secured, obtained or learned by Executive during the term of this Agreement shall be the sole and exclusive property of  the Company for any purposes or uses whatsoever, and shall be disclosed promptly by Executive to the Company.  The covenants set forth in the preceding sentence shall apply regardless of whether any Proprietary Information is made, discovered, developed, secured, obtained or learned (a) solely or jointly with others, (b) during the usual hours of work or otherwise, (c) at the request and upon the suggestion of the Company or otherwise, or (d) with the Company’s materials, tools, instruments or on the Company’s premises or otherwise.  All Proprietary Information developed, created, invented, devised, conceived or discovered by Executive that is subject to copyright protection is explicitly considered by Executive and the Company to be works made for hire to the extent permitted by law.  Executive hereby forever fully releases and discharges the Company, and the Company and their respective officers, directors and employees, from and against any and all claims, demands, damages, liabilities, costs and expenses of Executive arising out of, or relating to, any Proprietary Information.  Executive shall execute any documents and take any action the Company may deem necessary or appropriate to effectuate the provisions of this Agreement, including without limitation assisting the Company in obtaining and/or maintaining patents, copyrights or similar rights to any Proprietary Information assigned to the Company, if the Company, in their sole discretion, requests such assistance.  Executive shall comply with any reasonable rules established from time to time by the Company for the protection of the confidentiality of any Proprietary Information.  Executive irrevocably appoints the President of the Company to act as Executive’s agent and attorney-in-fact to perform all acts necessary to obtain and/or maintain patents, copyrights and similar rights to any Proprietary Information assigned by Executive to the Company under this Agreement if (a) Executive refuses to perform those acts, or (b) is unavailable, within the meaning of any applicable laws.  Executive acknowledges that the grant of the foregoing power of attorney is coupled with an interest and shall survive the death or disability of Executive.  Executive shall promptly disclose to the Company, in confidence (a) all Proprietary Information that Executive creates during the term of this Agreement, and (b) all patent applications, copyright registrations or similar rights filed or applied for by Executive within six months after termination of this Agreement.  Any application for a patent, copyright registration or similar right filed by Executive within six months after termination of this Agreement shall be presumed to relate to Proprietary Information created by Executive during the term of this Agreement, unless Executive can prove otherwise.  Nothing contained in this Agreement shall be construed to preclude the Company from exercising all of its rights and privileges as sole and exclusive owner of all of the Proprietary Information owned by or assigned to the Company under this Agreement.  The Company, in exercising such rights and privileges with respect to any particular item of Proprietary Information, may decide not to file any patent application or any copyright registration on such Proprietary Information, may decide to maintain such Proprietary Information as secret and confidential, or may decide to abandon such Proprietary Information or dedicate it to the public.  Executive shall have no authority to exercise any rights or privileges with respect to the Proprietary Information owned by or assigned to the Company under this Agreement.  This Agreement does not apply to any Proprietary Information that qualifies fully under the provisions of California Labor Code Section 2870 or any similar or successor statute.

 

 

13.          Business Opportunities .  During the term of this Agreement, if Executive (or any agent, employee, officer or independent contractor of or retained by Executive) becomes aware of, or develops, creates, invests, devises, conceives or discovers, any project, investment, venture, business or other opportunity (any of the preceding, an “ Opportunity ”) that is similar to, competitive with, related to or in the same field as the Company, or any project, investment, venture, or business of the Company, th0en Executive shall so notify the Company immediately in writing of such Opportunity and shall use Executive’s good-faith efforts to cause the Company to have the opportunity to invest in, participate in or otherwise become affiliated with such Opportunity.

 

14.          Miscellaneous .

 

14.1           Section Headings .  The section headings or captions in this Agreement are for convenience of reference only and do not form a part hereof, and do not in any way modify, interpret or construe the intent of the parties or affect any of the provisions of this Agreement.

 

14.2           Survival .  The obligations and rights imposed upon the parties hereto by the provisions of this Agreement which relate to acts or events subsequent to the termination of this Agreement shall survive the termination of this Agreement and shall remain fully effective thereafter, including without limitation the obligations of Executive with to any Confidential Material under Section 11.

 

14.3           Arbitration .

 

(a)            Any claim, dispute or other controversy (a “ Controversy ”) relating to this Agreement shall be settled and resolved by binding arbitration in Los Angeles County, California before a single arbitrator under the Employment Rules of the American Arbitration Association (“ AAA ”) in effect at the time a demand for arbitration is made.  If there is any conflict between the AAA rules and this arbitration clause, this arbitration clause will govern and determine the rights of the parties.  The Parties to this Agreement (the “ Parties ”) shall be entitled to full discovery regarding the Controversy as permitted by the California Code of Civil Procedure.  The arbitrator’s decision on the Controversy shall be a final and binding determination of the Controversy and shall be fully enforceable as an arbitration award in any court having jurisdiction and venue over the Parties.  The arbitrator shall also award the prevailing Party any reasonable attorneys’ fees and reasonable expenses the prevailing Party incurs in connection with the arbitration, and the non-prevailing Party shall pay the arbitrator’s fees and expenses.  The arbitrator shall determine who is the prevailing Party.  Each Party also agrees to accept service of process for all arbitration proceedings in accordance with AAA’s rules.

 

 

(b)            The obligation to arbitrate shall not be binding upon either party with respect to requests for temporary restraining orders, preliminary injunctions or other procedures in a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution by arbitration of the actual dispute between the Parties.

 

(c)            The provisions of this Section shall be construed as independent of any other covenant or provision of this Agreement; provided that, if a court of competent jurisdiction determines that any such provisions are unlawful in any way, such court shall modify or interpret such provisions to the minimum extent necessary to have them comply with the law.

 

(d)            This arbitration provision shall be deemed to be self-executing and shall remain in full force and effect after expiration or termination of this Agreement.  In the event either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against such party by default or otherwise notwithstanding said failure to appear.

 

14.4           Severability .  Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable in any relevant jurisdiction, then such illegal or unenforceable provision shall be modified by the proper court, if possible, but only to the extent necessary to make such provision enforceable, and such modified provision and all other provisions of this Agreement shall be given effect separately from the provision or portion thereof determined to be illegal or unenforceable and shall not be affected thereby; provided that, any such modification shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such determination of illegality or unenforceability is made.

 

14.5           Waiver .  The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.  The rights granted both parties herein are cumulative and the election of one shall not constitute a waiver of such party’s right to assert all other legal remedies available under the circumstances.

 

14.6           Parties in Interest .  Nothing in this Agreement, except as expressly set forth herein, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties to this Agreement and the successors, assigns and affiliates of the Company, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of action over or against any party to this Agreement.

 

14.7           Assignment .  The rights and obligations under this Agreement shall be binding upon, and inure to the benefit of, the heirs, executors, successors and assigns of Executive and the Company.  Except as specifically provided in this Section 14, neither the Company nor Executive may assign this Agreement or delegate their respective responsibilities under this Agreement without the consent of the other party hereto. Upon the sale, exchange or other transfer of substantially all of the assets of the Company, the Company shall assign this Agreement to the transferee of such assets.  No assignment of this Agreement by the Company shall relieve the Company of, and the Company shall remain obligated to perform, its duties and obligations under this Agreement, including, without limitation, payment of the Base Compensation set forth in Section 5, above.

 

 

14.8           Attorneys’ Fees .  In the event of any Controversy, suit, action or arbitration to enforce any of the terms or provisions of this Agreement, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs.  The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing party on any appeal of a judgment and for any action to enforce a judgment.

 

14.9           Modification .  This Agreement may be modified only by a contract in writing executed by the party(ies) to this Agreement against whom enforcement of such modification is sought.

 

14.10        Prior Understandings .  This Agreement contains the entire agreement between the parties to this Agreement with respect to the subject matter of this Agreement, is intended as a final expression of such parties’ agreement with respect to such terms as are included in this Agreement, is intended as a complete and exclusive statement of the terms of such agreement, and supersedes all negotiations, stipulations, understandings, agreements, representations and warranties, if any, with respect to such subject matter, which precede or accompany the execution of this Agreement.

 

14.11         Interpretation .  Whenever the context so requires in this Agreement, all words used in the singular shall be construed to have been used in the plural (and vice versa), each gender shall be construed to include any other genders, and the word “person” shall be construed to include a natural person, a corporation, a firm, a partnership, a joint venture, a trust, an estate or any other entity.

 

14.12         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.

 

14.13         Applicable Law .  This Agreement and the rights and obligations of the parties hereunder shall be construed under, and governed by, the laws of the State of California without giving effect to conflict of laws provisions.

 

14.14        Drafting Ambiguities .  Each party to this Agreement has reviewed and revised this Agreement.  Each party to this Agreement has had the opportunity to have such party’s legal counsel review and revise this Agreement.  The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or of any amendments or exhibits to this Agreement.

 

[ Signature Page Follows ]

 

 

 

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.

 

EXHIBIT 10.5

 

Cellular Biomedicine Group

 

[_____________]

 

To:   [ __________]

Dear [___________]:

We are pleased to offer you a director position on our Board of Directors.  As discussed, Cellular Biomedicine Group Ltd., a British Virgin Islands corporation (“ CBMG ”) is merging with EastBridge Investment Group Corp. (OTCQB: EBIG) (“ EastBridge ”) to form a combined company in Delaware to be named “Cellular Biomedicine Group, Inc.” (the “ Company ”).  The merger is expected to be consummated on or around January 22, 2013.

The purpose of the board of directors of the Company (the “ Board ”) is to manage and direct the property, affairs and business of the Company.  The Board plans to meet approximately once per calendar quarter, or as circumstances may require.

Should you chose to accept this position as a member of the Board, this letter shall constitute an agreement between you and the Company, effective on the date of closing of the merger (“ Effective Date ”), and this letter agreement contains all the terms and conditions of your service as a director.

1 .             Term .   The Company's Board of Directors shall consist of three classes (Class I, Class II, and Class III), each with staggered terms.  You agree to be appointed as a Class [I][II][III] director, which class shall have an initial [_____] (_) year term ending on the date of the annual stockholders meeting of the Company occurring in 2016, and when your successor Class [___] director is duly elected and qualified.  The position shall be open for election once every three years at the Company’s annual meeting of stockholders occurring at such three-year interval.  If you are re-elected to any additional term as director, the terms and provisions of this agreement shall remain in effect.

 

2.             Services and Compensation .   You agree to render services required as a director on the Company’s Board of Directors, the responsibility and function of which is to manage and direct the Company’s business, property and affairs (hereinafter your “ Duties ”).  You further agree to consult with other members of the Board at meetings held no less frequently than once per calendar quarter in locations and times designated by the Chairman of the Board of Directors.  The Board is also pleased to designate you as a member of the Audit Committee, and you agree to serve on such committee as Audit Committee Chairman, subject to the Board’s routine qualification procedure.  You may be appointed by the Board or Chairman to serve on other committees (such as Compensation and/or Nominating), and you agree to serve on those committees if appointed.  In consideration for your services as a member of the Board and Chairman of the Audit Committee, the Company agrees to pay you USD $30,000 per year (pro rated daily based on a 360 day year for any portion of the year should you serve for less than a full term).  In addition as a non-employee director you will be eligible to receive an option grant under the Company’s 2011 Equity Incentive Plan, and receive an award which shall vest monthly or quarterly (as the case may be in the definitive option agreement), over a three year period of continuous service (the cash compensation plus any option grant is referred to as the “ Annual Compensation ”).  The number of shares of common stock under your incentive stock option award is subject to review and confirmation by the Chairman of the Board of Directors and/or Compensation Committee, however at this time we anticipate that the number of shares under your initial option grant shall constitute up to 0.1% of the total outstanding number of shares of the combined Company post-merger.  The Annual Compensation shall be paid in accordance with the Company’s general practices as determined by the Board of Directors.   In the event of a subdivision of the outstanding common stock or a combination or consolidation of the outstanding common stock into a lesser number of shares, the incentive stock option portion of the Annual Compensation referenced above shall automatically be adjusted proportionately. Your compensation as a director in any future periods is subject to the determination of the Board of Directors and/or Compensation Committee, and may differ from year to year, and may differ in subsequent terms should you be re-elected to serve additional terms on the Board.

 

2 .             Expenses .   The Company agrees to reimburse you for all reasonable documented out-of-pocket expenses that you incur in order to attend meetings of the board of directors, and any other expenses approved in advance in writing by the Company.

4.             Services for Others .   You shall be free to represent or perform services for other persons during the term of this agreement.  However, you agree that you do not presently perform and do not intend to perform, during the term of this agreement, similar Duties, consulting or other services for companies whose businesses are or would be, in any way, competitive with the Company (except for companies previously disclosed by you to the Company in writing).  Should you propose to perform similar Duties, consulting or other services for any such company, you agree to notify the Company in writing in advance (specifying the name of the organization for whom you propose to perform such services) and to provide information to the Company sufficient to allow it to determine if the performance of such services would conflict with areas of interest to the Company.

5.             No Assignment .   Because of the personal nature of the services to be rendered by you, this agreement may not be assigned without the prior written consent of the Company.

6.             Confidential Information; Non-Disclosure .   In consideration of your access to the premises and/or certain Confidential Information of the Company, in connection with your business relationship with us, you hereby represent and agree as follows:

 

 

a .             Definition .   For purposes of this agreement the term “ Confidential Information ” means:

i .             Any information which the Company possesses that has been created, discovered or developed by or for the Company, and which has or could have commercial value or utility in the business in which the Company is engaged; or

ii .            Any information which is related to the business of the Company and is generally not known by non-Company personnel.

iii .           By way of illustration, but not limitation, Confidential Information includes trade secrets and any information concerning products, protocols, methods, processes, formulas, designs, inventions (whether or not patentable or registrable under copyright or similar laws, and whether or not reduced to practice), discoveries, concepts, ideas, improvements, techniques, methods, research, development and test results, specifications, data, know-how, software, formats, marketing plans, and analyses, business plans and analyses, strategies, forecasts, customer and supplier identities, characteristics and agreements.

b .             Exclusions .   Notwithstanding the foregoing, the term Confidential Information shall not include:

i .             Any information which becomes generally available to the public other than as a result of a breach of the confidentiality portions of this agreement, or any other agreement requiring confidentiality between the Company and you;

ii .            Information received from a third party in rightful possession of such information who is not restricted from disclosing such information; and

iii .           Information known by you prior to receipt of such information from the Company, which prior knowledge can be documented.

c .             Documents . You agree that, without the express written consent of the Company, you will not remove from the Company’s premises, any notes, formulas, programs, data, records, machines or any other documents or items which in any manner contain or constitute Confidential Information, nor will you make reproductions or copies of same, nor will you use any of the same except as necessary in connection with executing your Duties as a member of the Board.  In the event you receive any such documents or items by personal delivery from any duly designated or authorized personnel of the Company, you shall be deemed to have received the express written consent of the Company to possess such material.  In the event that you receive any such documents or items, other than through personal delivery as described in the preceding sentence, you agree to inform the Company promptly of your possession of such documents or items.  You shall promptly return any such documents or items, along with any reproductions or copies to the Company upon the Company’s demand or upon termination of this agreement.

 

d .             No Disclosure .   You agree that you will hold in strict trust and confidence all Confidential Information and will not disclose to others, directly or indirectly, any Confidential Information or anything relating to such information without the prior written consent of the Company, except as maybe necessary in the course of his business relationship with the Company.  You further agree that the provisions of this Section 6 shall survive termination of this agreement for three (3) years after the date of termination.

7.             Entire Agreement; Amendment; Waiver .   This agreement expresses the entire understanding with respect to the subject matter hereof and supersedes and terminates any prior oral or written agreements with respect to the subject matter hereof. Any term of this agreement may be amended and observance of any term of this agreement may be waived only with the written consent of the parties hereto.  Waiver of any term or condition of this agreement by any party shall not be construed as a waiver of any subsequent breach or failure of the same term or condition or waiver of any other term or condition of this agreement.  The failure of any party at any time to require performance by any other party of any provision of this agreement shall not affect the right of any such party to require future performance of such provision or any other provision of agreement.

 

 

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The Agreement has been executed and delivered by the undersigned on the date set forth below, and shall be deemed effective as of the Effective Date.

 

 

 

 

5

EXHIBIT 10.6

 

INDEMNIFICATION AGREEMENT

 

THIS AGREEMENT is entered into, effective as of _______, ____ by and between EASTBRIDGE INVESTMENT GROUP CORPORATION, a Delaware corporation (the “ Company ”), and __________ (“ Indemnitee ”).

WHEREAS, it is essential to the Company to retain and attract as directors and officers the most capable persons available;

WHEREAS, Indemnitee is a director 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 a director, 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 ” means (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of the Company after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the directors on the board of directors who are not affiliates of the offeror do not recommend such stockholders accept; (iii) the sale, transfer, or other disposition of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company; or (iv) 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.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.  A transfer or distribution by the majority shareholder Global Health Investment Holdings Ltd. (“ Global Health ”), of 50% or more of the total shares of the Company held by Global Health to its shareholders shall not constitute a Change in Control.

 

 

(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, consultant, advisor, 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.

(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 Certificate 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.

 

(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.

 

(g)   Clawback .  No indemnification pursuant to this Agreement shall be paid by the Company in the event that Indemnitee resigns as an officer of the Company within the one year period following the date of this Agreement. IN the event of such resignation as provided in this subsection (g), Indemnitee agrees to reimburse the Company for all indemnification expenses paid to Indemnitee, and all expenses incurred by the Company, under this Agreement.

 

 

 

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 Certificate 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.

 

(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 Certificate 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).

 

(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 Certificate 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 Certificate 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.

 

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:

 

530 University Avenue, Unit 17

Palo Alto, CA  94301

Attn:  Steve Liu, CEO

 

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.

 

 

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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Indemnification Agreement as of the day specified above.

 

 

COMPANY:	EASTBRIDGE INVESTMENT GROUP CORPORATION
	By:
		Steve Liu
		Chief Executive Officer
INDEMNITEE:

 

 

 

INDEMNIFICATION AGREEMENT – INDEMNITEE

EXHIBIT 10.7

 

FORM OF INDEMNIFICATION AGREEMENT

THIS AGREEMENT is entered into, effective as of _______, ____ by and between EASTBRIDGE INVESTMENT GROUP CORPORATION, a Delaware corporation (the “ Company ”), and __________ (“ Indemnitee ”).

 

WHEREAS, it is essential to the Company to retain and attract as directors and officers the most capable persons available;

 

WHEREAS, Indemnitee is a director 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 a director, 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 ” means (i) the consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not shareholders of the Company immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of the Company after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders which a majority of the directors on the board of directors who are not affiliates of the offeror do not recommend such stockholders accept; (iii) the sale, transfer, or other disposition of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company; or (iv) 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.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.  A transfer or distribution by the majority shareholder Global Health Investment Holdings Ltd. (“ Global Health ”), of 50% or more of the total shares of the Company held by Global Health to its shareholders shall not constitute a Change in Control.

 

 

 

(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, consultant, advisor, 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.

 

(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 Certificate 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.

 

(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 Certificate 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.

 

(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 Certificate 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).

 

(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 Certificate 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 Certificate 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.

 

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:

 

530 University Avenue, Unit 17

Palo Alto, CA  94301

Attn:  Steve Liu, CEO

 

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.

 

 

[ Remainder of Page Left Blank Intentionally ]

 

 

 

 

 

EXHIBIT 10.8

 

January 21, 2013

 

 

2

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EXHIBIT 10.9

 

DEFERRED COMPENSATION AGREEMENT

 

The parties to this Deferred Compensation Agreement (“ Agreement ”) are Keith Wong and Norman Klein (each, an “ Executive ” and collectively, the “ Executives ”), EastBridge Investment Group Corporation, a Delaware corporation (“ Parent ”), and its wholly-owned subsidiary, EastBridge Investment Corp. (“ EastBridge Sub ”).   In connection with that certain Agreement and Plan of Merger by and among Parent, Cellular Biomedicine Group Ltd. (“ Company ”) and CBMG Acquisition Limited (“ Merger Sub ”) dated November 13, 2012, as amended (the “ Merger Agreement ”), Executives  and Parent desire to confirm certain arrangements with respect to certain deferred payments referenced under Section 7.1(d) of the Merger Agreement.  All capitalized terms used herein and not defined shall have the same respective meanings assigned to such terms in the Merger Agreement.

 

R E C I T A L S :

 

A.            Each Executive is entering in to an employment agreement with EastBridge Sub under which such Executive will become officers of EastBridge Sub, effective on the Closing Date.

 

B.            Each Executive will resign from his respective officer positions at the Parent and terminate each of the Executives existing employment agreements each dated June 1, 2005 (“ Prior Employment Agreements ”) between each of the Executives and the Parent, on the Closing Date.

 

C.            The Parent and Executives are entering into this Agreement to provide for the payment of past compensation owed to the Executives under the Prior Employment Agreements.

 

AGREEMEN T :

 

Executives and Parent hereby agree as follows:

 

1.            Deferred Cash Compensation .  Upon closing of the transactions contemplated by the Merger Agreement, Parent agrees to pay the Executives in full satisfaction and settlement of certain accrued unpaid compensation through the date hereof, the amounts as follows:

 

(a)           $676,838.67 payable to Mr. Wong, consisting of deferred salary of $530,000, interest of $146,838.67; 

 

(b)           $459,300.44 payable to Mr. Klein, consisting of deferred salary of $350,000, interest of $109,300.44;

 

which amounts are comprised of accrued unpaid salary plus aggregate accrued interest calculated at the simple rate of 12% per annum (the “ Deferred Cash Compensation ”).

 

 

2.            Bonus .  On August 31, 2013 (“ Release Date ”), Parent agrees to pay Executives a performance bonus in the amounts as follows (the “ Bonus Payments ”):

 

(a)           $204,722.58 payable to Mr. Wong; and

(b)           $152,577.11 payable to Mr. Klein.

3.            Representations and Warranties .  The Executives each hereby represent and warrant to the Parent and Company as follows:

 

(a)           Attached hereto as Exhibit A is a true and correct copy of a letter from Rivers & Moorehead dated January 31, 2013 providing input regarding typical payment arrangements for executives that have deferred their salary;

 

(b)           This Agreement has been duly adopted and approved by the board of directors of Parent, authorizing payment of the Deferred Cash Compensation and Bonus, and such resolutions have not been amended, revoked or modified and are in full force and effect on the date hereof;

 

(c)           To the Executive's knowledge, the amount of such Executive’s accrued unpaid salary component of the Deferred Cash Compensation stated in this Agreement is accurate and correct; and

 

(d)           To the Executive's knowledge, the Parent’s SEC periodic reports on Form 10-K and 10-Q correctly and accurately state the Executive's compensation paid and accrued.

 

4.            Release .  Effective upon payment of the compensation to each Executive in paragraphs 1 and 2 above, each Executive agrees to release and prospectively discharge the Parent and each of its past, present, and future related entities and each of their respective past, present, and future members, managers, partners, shareholders, officers, directors, agents, employees, attorneys, insurers, successors, and assigns from any and all claims, rights, demands, actions, liabilities, and causes of action of every kind and character, whether known or unknown, matured or unmatured, which such Executive may have or has ever had, arising from or in any way related to such Executive’s employment with the Parent under the Prior Employment Agreements, including without limitation the conditions of employment or the termination thereof, whether based on tort, contract (express or implied), or any federal, state, or local statute, regulation, ordinance, or other law. A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR. The parties agree that this Agreement applies to all unknown and unanticipated claims, damages, and expenses existing as of the effective date of this Agreement, and they waive any rights that they might have under Section 1542 of the California Civil Code or any other similar enactment of any jurisdiction.

 

 

5.            Miscellaneous .

 

(a)            Section Headings .  The section headings or captions in this Agreement are for convenience of reference only and do not form a part hereof, and do not in any way modify, interpret or construe the intent of the parties or affect any of the provisions of this Agreement.

 

(b)            Survival .  The obligations and rights imposed upon the parties hereto by the provisions of this Agreement which relate to acts or events subsequent to the termination of this Agreement shall survive the termination of this Agreement and shall remain fully effective thereafter.

 

(c)            Arbitration .

 

(i)           Any claim, dispute or other controversy (a “ Controversy ”) relating to this Agreement shall be settled and resolved by binding arbitration in Wilmington, Delaware before a single arbitrator under the Employment Rules of the American Arbitration Association (“ AAA ”) in effect at the time a demand for arbitration is made.  If there is any conflict between the AAA rules and this arbitration clause, this arbitration clause will govern and determine the rights of the parties.  The parties to this Agreement (the “ Parties ”) shall be entitled to full discovery regarding the Controversy as permitted by the laws of the State of Delaware.  The arbitrator’s decision on the Controversy shall be a final and binding determination of the Controversy and shall be fully enforceable as an arbitration award in any court having jurisdiction and venue over the Parties.  The arbitrator shall also award the prevailing Party any reasonable attorneys’ fees and reasonable expenses the prevailing Party incurs in connection with the arbitration, and the non-prevailing Party shall pay the arbitrator’s fees and expenses.  The arbitrator shall determine who is the prevailing Party.  Each Party also agrees to accept service of process for all arbitration proceedings in accordance with AAA’s rules.

 

(ii)          The obligation to arbitrate shall not be binding upon any party with respect to requests for temporary restraining orders, preliminary injunctions or other procedures in a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution by arbitration of the actual dispute between the Parties.

 

(iii)         The provisions of this Section shall be construed as independent of any other covenant or provision of this Agreement; provided that, if a court of competent jurisdiction determines that any such provisions are unlawful in any way, such court shall modify or interpret such provisions to the minimum extent necessary to have them comply with the law.

 

(iv)         This arbitration provision shall be deemed to be self-executing and shall remain in full force and effect after expiration or termination of this Agreement.  In the event either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against such party by default or otherwise notwithstanding said failure to appear.

 

 

(d)            Severability .  Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable in any relevant jurisdiction, then such illegal or unenforceable provision shall be modified by the proper court, if possible, but only to the extent necessary to make such provision enforceable, and such modified provision and all other provisions of this Agreement shall be given effect separately from the provision or portion thereof determined to be illegal or unenforceable and shall not be affected thereby; provided that, any such modification shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such determination of illegality or unenforceability is made.

 

(e)            Waiver .  The failure of any party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.  The rights granted the parties herein are cumulative and the election of one shall not constitute a waiver of such party’s right to assert all other legal remedies available under the circumstances.

 

(f)             Parties in Interest .  Nothing in this Agreement, except as expressly set forth herein, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the Parties and the successors, assigns and affiliates of the Company, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third person to any Party, nor shall any provision give any third person any right of action over or against any Party.

 

(g)            Assignment .  The rights and obligations under this Agreement shall be binding upon, and inure to the benefit of, the heirs, executors, successors and assigns of the Parties  Except as specifically provided in this paragraph (g), no Party may assign this Agreement or delegate their respective responsibilities under this Agreement without the consent of the other Parties hereto.

 

(h)            Attorneys’ Fees .  In the event of any Controversy, suit, action or arbitration to enforce any of the terms or provisions of this Agreement, the prevailing Party shall be entitled to its reasonable attorneys’ fees and costs.  The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing Party on any appeal of a judgment and for any action to enforce a judgment.

 

(i)            Modification .  This Agreement may be modified only by a contract in writing executed by the Party(ies) to this Agreement against whom enforcement of such modification is sought.

 

(j)             Prior Understandings .  This Agreement contains the entire agreement between the Parties with respect to the subject matter of this Agreement, is intended as a final expression of such Parties’ agreement with respect to such terms as are included in this Agreement, is intended as a complete and exclusive statement of the terms of such agreement, and supersedes all negotiations, stipulations, understandings, agreements, representations and warranties, if any, with respect to such subject matter, which precede or accompany the execution of this Agreement.

 

(k)            Interpretation .  Whenever the context so requires in this Agreement, all words used in the singular shall be construed to have been used in the plural (and vice versa), each gender shall be construed to include any other genders, and the word “person” shall be construed to include a natural person, a corporation, a firm, a partnership, a joint venture, a trust, an estate or any other entity.

 

 

(l)             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.

 

(m)           Applicable Law .  This Agreement and the rights and obligations of the Parties hereunder shall be construed under, and governed by, the laws of the State of Delaware without giving effect to conflict of laws provisions.

 

 

[ Signature Page Follows ]

 

 

 

 

 

 

IN WITNESS WHEREOF, this Deferred Compensation Agreement has been executed and delivered by the parties hereto on this 5 th day of February, 2013.

 

 

EXHIBIT A

ACCOUNTANT'S LETTER

 

 

7

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EXHIBIT 10.10

 

EMPLOYMENT AGREEMENT

 
 

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made as of February 6, 2013 (the “ Agreement Date ”) by and between EASTBRIDGE INVESTMENT CORP. (the “ Company ”), and the undersigned individual (“ Executive ”), with reference to the following facts:

WHEREAS, the Company desires to employ Executive to perform the duties and responsibilities described herein on the terms and conditions hereinafter set forth.

NOW, THEREFORE, the parties agree as follows:

1.             Employment .  The Company hereby employs Executive and Executive hereby accepts such employment upon the terms and conditions hereinafter set forth.

 

2.             Duties .  Subject to the terms and provisions of this Agreement, Executive is hereby employed by the Company as the President and Chief Executive Officer (“ CEO ”) of the Company.  Executive shall have full responsibility and authority for such duties as customarily are associated with service as a President and CEO at the direction of the Board of Directors of the Company (the “ Board ”).  Executive shall faithfully and diligently perform, on a full time basis, such duties assigned to Executive and shall report directly to the Board.

 

3.             Scope of Services .  Executive shall devote substantially all of his business time, attention, energies, skills, learning and efforts to the Company’s business.

 

4.             Term .  Subject to prior termination of this Agreement as hereinafter provided, the term of this Agreement shall commence on the date hereof (the “ Effective Date ”) and shall continue for three (3) years thereafter unless earlier terminated as provided in this Agreement.  After the foregoing three (3) year term, the Executive shall continue to be employed on an at-will basis and this Agreement shall automatically renew for successive one year terms, until and unless this Agreement is terminated.

 

5.             Compensation .

 

5.1             Salary .  Executive’s annual compensation (“ Base Compensation ”) under this Agreement shall be USD $240,000 per year, prorated for any partial year, commencing on the Effective Date; provided however that the Executive’s Base Compensation shall be reviewed annually by the Board of Directors and/or its Compensation Committee (as applicable).  The Base Compensation shall be payable semi-monthly in arrears from the Effective Date in accordance with the ordinary payroll procedures of the Company.  Any changes in Base Compensation shall be in the sole and absolute discretion of the Board and/or its Compensation Committee (as applicable).

 

 

5.2             Participation in Option Plan .  The Executive shall be eligible to participate in the Amended and Restated 2011 Equity Incentive Plan (the “ Plan ”) of EastBridge Investment Group Corporation, the parent company and sole stockholder of the Company (“ EastBridge ” or “ Parent ”).  Parent agrees to grant Executive an option to purchase 30,000 shares of Parent’s common stock pursuant to the Plan, at an exercise price equal to the volume weighted average of the price per share of Parent common stock as quoted on the OTCQB for the three trading days preceding the date hereof.  The foregoing option shall vest over a two year period at a rate of 1,250 shares per month, and shall be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the board of directors of Parent or the compensation committee thereof (" Option Grant "), within 30 days following the date hereof.

 

5.3             Expenses .  The Company shall reimburse Executive for:

 

(a)             all reasonable business, entertainment and travel expenses actually incurred or paid by Executive in the performance of his services on behalf of the Company, in accordance with the Company’s expense reimbursement policy as from time to time in effect;

 

(b)             the cost of continuing education courses in furtherance of Executive’s performance of his duties of up to USD $5,000 per annum;

 

(c)             reasonable moving expenses if the Company requires the Executive to relocate, and as a result Executive must change his place of residence to a place more than 50 miles away from his current place of residence (which expenses shall be appropriately documented by Executive); and

 

(d)             if the Company requires the Executive to relocate (in excess of 50 miles), and after relocation the Executive is terminated without Cause pursuant to Section 7.1(b) and chooses to return to his original place of residence immediately prior to the Effective Date, reasonable moving expenses incurred by Executive (which expenses shall be appropriately documented by Executive).

 

6.             Other Rights and Benefits .  Executive shall receive other rights and benefits, life insurance, vacation time, sick pay and retirement plan participation, as determined by the Board.

 

7.             Termination .  Executive’s employment may be terminated as follows:

 

7.1             Termination by the Company or Executive .

 

(a)             During the one (1) year period after the Effective Date, this Agreement may not be terminated by either party except pursuant to Section 7.2, 7.3 or 7.4 below.

 

(b)             After the one (1) year period in Section 7.1(a), for two (2) years thereafter, Executive may not be terminated by the Company except pursuant to Section 7.2, 7.3 or 7.4 below, provided, however that during said two year period the Board may alter the responsibilities of the Executive to other senior-level functions, and change the Executive’s title to a mutually agreeable alternative title.

 

(c)            If during the initial three (3) year period following the Agreement Date, the employment of the Executive is terminated for any reason other than pursuant to Section 7.2, 7.3, or 7.4, or for no good reason, the Company shall be obligated to:

 

 

(i)             Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination;

 

(ii)            Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective upon the date of termination;

 

(iii)           Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month; and

 

(iv)           Pay any bonus amounts that have been earned by the Executive but have not yet been paid as of the date of termination.

 

7.2             Termination for Death . Executive’s employment shall terminate immediately upon Executive’s death.

 

7.3             Termination Upon Disability .  Executive’s employment shall terminate if Executive should become totally and permanently disabled.  For purposes of this Agreement, Executive shall be considered “totally and permanently disabled” if Executive is treated as permanently “disabled” under any permanent disability insurance policy maintained by the Company and is entitled to full benefits payable under such policy upon a total and permanent disability.  In the event any such policy is either not in force or the benefits are not available under such policy, then “total and permanent disability” shall mean the inability of Executive, as a result of substance abuse, any mental, nervous or psychiatric disorder, or physical condition, injury or illness to perform substantially all of his current duties on a full-time basis for a period of six (6) consecutive months, as determined by a licensed physician selected by the Board.

 

7.4               Termination by Company for “Cause ”.  The Company may terminate this Agreement for “Cause” upon three days written notice so long as the Company has given Executive written notice describing the Cause pursuant to subsections (c) and/or (e) and Executive has not cured such Cause within a reasonable time, but no less than 14 days.  For purposes of this Agreement, “Cause” shall mean the existence or occurrence of any of the following:

 

 

(a)             Executive’s conviction for or pleading of nolo contendre to any felony involving the Company or moral turpitude.

 

(b)              Executive’s misappropriation of Company assets.

 

(c)             Executive’s willful violation of a Company policy or a directive of the Board previously delivered to him in writing.

 

(d)             Executive’s breach of his obligations set forth in Sections 11, 12, or 13 below.

 

(e)             Any willful neglect or material breach of duty by Executive under this Agreement, or any failure by Executive to perform duties under this Agreement, including the duties set forth in Section 2.

 

(f)             A failure, upon request of the Company, to relocate to a corporate office of the Company designated by the Board of Directors.

 

8.             Change in Control .  If Executive’s employment with the Company is not assumed and the Executive’s employment relationship is terminated by the Company, upon or within two (2) years following the date of a Change in Control, the Company shall:

 

(a)             Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination.

 

(b)             Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective as of immediately upon the date of termination within the two (2) year period following the occurrence of a Change in Control.

 

(c)             Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month.

 

If the Executive’s employment is terminated by Executive without Cause or terminated for Cause, death or disability of Executive, Executive shall not be entitled to the benefits or payments in Section 8(a) or (b), except as mandated by law.

 

 

For purposes of this Agreement, a “ Change in Control ”   means (i) the consummation of a merger or consolidation of the Parent with or into another entity or any other corporate reorganization, if fifty percent (50%) or more of the combined voting power of the continuing or surviving entity’s securities outstanding immediately after such merger, consolidation, or other reorganization is owned by persons who were not stockholders of Parent immediately prior to such merger, consolidation, or other reorganization; (ii) a change in ownership or control of Parent after the date hereof, effected through the direct or indirect acquisition by any person or related group of persons of securities possessing more than fifty percent (50%) of the total combined voting power of Parent’s outstanding securities; (iii) the sale, transfer, or other disposition of all or substantially all of Parent’s assets or the complete liquidation or dissolution of Parent.  A transaction shall not constitute a Change in Control if its sole purpose is to change the state of Parent’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Parent’s securities immediately before such transactions.

 

9.             Representations and Warranties .  Executive hereby represents and warrants to Company that as of the date of execution of this Agreement: (i) this Agreement will not cause or require Executive to breach any obligation to, or agreement or confidence with, any other person; (ii) Executive is not representing, or otherwise affiliated in any capacity with, any other company which is engaged in a Competitive Business Activity; and (iii) Executive has not been induced to enter into this Agreement by any promise or representation other than as expressly set forth in this Agreement.

 

10.           Non-Solicitation .

 

10.1             Non-Solicitation of Employees . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment:

 

(a)             directly solicit, encourage, or take any other action which is intended to induce any other employee of the Company or EastBridge to terminate his or her employment with the Company; or

 

(b)             directly interfere in any manner with the contractual or employment relationship between the Company or EastBridge and any such employee of the Company or EastBridge.

 

The foregoing shall not prohibit Executive or any entity with which Executive may later be affiliated from hiring a former or existing employee of the Company or EastBridge or any of their subsidiaries, provided that such hiring does not result from the direct actions of Executive.  For purposes of this Article 10, Article 11, Article 12 and Article 13, any reference to the Company shall include all of the Company’s Affiliates.  As used herein, “Affiliate” means any person or entity controlling, controlled by or under common control with another person or entity.

 

10.2             Non-Solicit of Customers with respect to Competitive Business Activity . Executive agrees that he will not, while employed by the Company and for a period of two (2) years following termination of such employment, directly or indirectly, whether for his own account or for the account of any other individual or entity, solicit the business or patronage of any customers of the Company with respect to products and/or services directly related to a Competitive Business Activity.  “ Competitive Business Activity ” shall mean engaging in, whether independently or as an employee, agent, consultant, advisor, independent contractor, partner, stockholder, officer, director or otherwise, any business which is materially competitive with the business of the Company as conducted or actively planned to be conducted by the Company during his employment by it, provided that Executive shall not be deemed to engage in a Competitive Business Activity solely by reason of (i) owning 1% or less of the outstanding common stock of any corporation if such class of common stock is registered under Section 12 of the Securities Exchange Act of 1934, or (ii) after the termination of his employment by the Company, being employed by or otherwise providing services to a corporation having total revenue of at least $500 million (or such lower number as may be agreed by the Board) so long as such services are provided solely to a division or other business unit of such corporation which does not engage in a business which is then competitive with the business of the Company.

 

 

11.             Confidentiality .  Executive hereby acknowledges that the Company has made and will make available to Executive certain customer lists, product design information, performance standards and other confidential and/or proprietary information of the Company or licensed to the Company, including without limitation trade secrets, copyrighted materials and/or financial information of the Company (or any of its Affiliates), including without limitation, financial statements, reports and data (collectively, the “ Confidential Material ”); however, Confidential Material does not include any of the foregoing items which has become publicly known or made generally available through no wrongful act of Executive or of others who were under confidentiality obligations as to the item or items involved.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any disclosure of this Agreement, the terms of this Agreement, or any of the Confidential Material.  Except as essential to Executive’s obligations under this Agreement, neither Executive nor any agent, employee, officer, or independent contractor of or retained by Executive shall make any duplication or other copy of any of the Confidential Material.  Immediately upon request from the Company, Executive shall return to the Company all Confidential Material.  Executive shall notify each person to whom any disclosure is made that such disclosure is made in confidence, that the Confidential Material shall be kept in confidence by such person.  Nothing contained in this Section 11 shall be construed as preventing Executive from providing Confidential Material in compliance with a valid court order issued by a court of competent jurisdiction, providing Executive takes reasonable steps to prevent dissemination of such Confidential Material.

 

12.             Proprietary Information .  For purposes of this Agreement, “ Proprietary Information ” shall mean any information, observation, data, written material, record, document, software, firmware, invention, discovery, improvement, development, tool, machine, apparatus, appliance, design, promotional idea, customer list, practice, process, formula, method, technique, trade secret, product and/or research related to the actual or anticipated research, marketing strategies, pricing information, business records, development, products, organization, business or finances of the Company.  Proprietary Information shall not include information in the public domain as of execution of this Agreement except through any act or omission of Executive.  All right, title and interest of every kind and nature whatsoever in and to the Proprietary Information made, discussed, developed, secured, obtained or learned by Executive during the term of this Agreement shall be the sole and exclusive property of  the Company for any purposes or uses whatsoever, and shall be disclosed promptly by Executive to the Company.  The covenants set forth in the preceding sentence shall apply regardless of whether any Proprietary Information is made, discovered, developed, secured, obtained or learned (a) solely or jointly with others, (b) during the usual hours of work or otherwise, (c) at the request and upon the suggestion of the Company or otherwise, or (d) with the Company’s materials, tools, instruments or on the Company’s premises or otherwise.  All Proprietary Information developed, created, invented, devised, conceived or discovered by Executive that is subject to copyright protection is explicitly considered by Executive and the Company to be works made for hire to the extent permitted by law.  Executive hereby forever fully releases and discharges the Company, and the Company and their respective officers, directors and employees, from and against any and all claims, demands, damages, liabilities, costs and expenses of Executive arising out of, or relating to, any Proprietary Information.  Executive shall execute any documents and take any action the Company may deem necessary or appropriate to effectuate the provisions of this Agreement, including without limitation assisting the Company in obtaining and/or maintaining patents, copyrights or similar rights to any Proprietary Information assigned to the Company, if the Company, in their sole discretion, requests such assistance.  Executive shall comply with any reasonable rules established from time to time by the Company for the protection of the confidentiality of any Proprietary Information.  Executive irrevocably appoints the President of the Company to act as Executive’s agent and attorney-in-fact to perform all acts necessary to obtain and/or maintain patents, copyrights and similar rights to any Proprietary Information assigned by Executive to the Company under this Agreement if (a) Executive refuses to perform those acts, or (b) is unavailable, within the meaning of any applicable laws.  Executive acknowledges that the grant of the foregoing power of attorney is coupled with an interest and shall survive the death or disability of Executive.  Executive shall promptly disclose to the Company, in confidence (a) all Proprietary Information that Executive creates during the term of this Agreement, and (b) all patent applications, copyright registrations or similar rights filed or applied for by Executive within six months after termination of this Agreement.  Any application for a patent, copyright registration or similar right filed by Executive within six months after termination of this Agreement shall be presumed to relate to Proprietary Information created by Executive during the term of this Agreement, unless Executive can prove otherwise.  Nothing contained in this Agreement shall be construed to preclude the Company from exercising all of its rights and privileges as sole and exclusive owner of all of the Proprietary Information owned by or assigned to the Company under this Agreement.  The Company, in exercising such rights and privileges with respect to any particular item of Proprietary Information, may decide not to file any patent application or any copyright registration on such Proprietary Information, may decide to maintain such Proprietary Information as secret and confidential, or may decide to abandon such Proprietary Information or dedicate it to the public.  Executive shall have no authority to exercise any rights or privileges with respect to the Proprietary Information owned by or assigned to the Company under this Agreement.

 

 

13.             Business Opportunities .  During the term of this Agreement, if Executive (or any agent, employee, officer or independent contractor of or retained by Executive) becomes aware of, or develops, creates, invests, devises, conceives or discovers, any project, investment, venture, business or other opportunity (any of the preceding, an “ Opportunity ”) that is similar to, competitive with, related to or in the same field as the Company, or any project, investment, venture, or business of the Company, then Executive shall so notify the Company immediately in writing of such Opportunity and shall use Executive’s good-faith efforts to cause the Company to have the opportunity to invest in, participate in or otherwise become affiliated with such Opportunity.

 

14.             Miscellaneous .

 

14.1             Section Headings .  The section headings or captions in this Agreement are for convenience of reference only and do not form a part hereof, and do not in any way modify, interpret or construe the intent of the parties or affect any of the provisions of this Agreement.

 

14.2             Survival .  The obligations and rights imposed upon the parties hereto by the provisions of this Agreement which relate to acts or events subsequent to the termination of this Agreement shall survive the termination of this Agreement and shall remain fully effective thereafter, including without limitation the obligations of Executive with to any Confidential Material under Section 11.

 

14.3             Arbitration .

 

(a)             Any claim, dispute or other controversy (a “ Controversy ”) relating to this Agreement shall be settled and resolved by binding arbitration in Wilmington, Delaware before a single arbitrator under the Employment Rules of the American Arbitration Association (“ AAA ”) in effect at the time a demand for arbitration is made.  If there is any conflict between the AAA rules and this arbitration clause, this arbitration clause will govern and determine the rights of the parties.  The Parties to this Agreement (the “ Parties ”) shall be entitled to full discovery regarding the Controversy as permitted by the laws of the State of Delaware.  The arbitrator’s decision on the Controversy shall be a final and binding determination of the Controversy and shall be fully enforceable as an arbitration award in any court having jurisdiction and venue over the Parties.  The arbitrator shall also award the prevailing Party any reasonable attorneys’ fees and reasonable expenses the prevailing Party incurs in connection with the arbitration, and the non-prevailing Party shall pay the arbitrator’s fees and expenses.  The arbitrator shall determine who is the prevailing Party.  Each Party also agrees to accept service of process for all arbitration proceedings in accordance with AAA’s rules.

 

(b)             The obligation to arbitrate shall not be binding upon either party with respect to requests for temporary restraining orders, preliminary injunctions or other procedures in a court of competent jurisdiction to obtain interim relief when deemed necessary by such court to preserve the status quo or prevent irreparable injury pending resolution by arbitration of the actual dispute between the Parties.

 

(c)             The provisions of this Section shall be construed as independent of any other covenant or provision of this Agreement; provided that, if a court of competent jurisdiction determines that any such provisions are unlawful in any way, such court shall modify or interpret such provisions to the minimum extent necessary to have them comply with the law.

 

(d)             This arbitration provision shall be deemed to be self-executing and shall remain in full force and effect after expiration or termination of this Agreement.  In the event either party fails to appear at any properly noticed arbitration proceeding, an award may be entered against such party by default or otherwise notwithstanding said failure to appear.

 

 

14.4             Severability .  Should any one or more of the provisions of this Agreement be determined to be illegal or unenforceable in any relevant jurisdiction, then such illegal or unenforceable provision shall be modified by the proper court, if possible, but only to the extent necessary to make such provision enforceable, and such modified provision and all other provisions of this Agreement shall be given effect separately from the provision or portion thereof determined to be illegal or unenforceable and shall not be affected thereby; provided that, any such modification shall apply only with respect to the operation of this Agreement in the particular jurisdiction in which such determination of illegality or unenforceability is made.

 

14.5             Waiver .  The failure of either party to enforce any provision of this Agreement shall not be construed as a waiver of any such provision, nor prevent such party thereafter from enforcing such provision or any other provision of this Agreement.  The rights granted both parties herein are cumulative and the election of one shall not constitute a waiver of such party’s right to assert all other legal remedies available under the circumstances.

 

14.6             Parties in Interest .  Nothing in this Agreement, except as expressly set forth herein, is intended to confer any rights or remedies under or by reason of this Agreement on any persons other than the parties to this Agreement and the successors, assigns and affiliates of the Company, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third person to any party to this Agreement, nor shall any provision give any third person any right of action over or against any party to this Agreement.

 

14.7             Assignment .  The rights and obligations under this Agreement shall be binding upon, and inure to the benefit of, the heirs, executors, successors and assigns of Executive and the Company.  Except as specifically provided in this Section 14, neither the Company nor Executive may assign this Agreement or delegate their respective responsibilities under this Agreement without the consent of the other party hereto. Upon the sale, exchange or other transfer of substantially all of the assets of the Company, the Company shall assign this Agreement to the transferee of such assets.  No assignment of this Agreement by the Company shall relieve the Company of, and the Company shall remain obligated to perform, its duties and obligations under this Agreement, including, without limitation, payment of the Base Compensation set forth in Section 5, above.

 

14.8             Attorneys’ Fees .  In the event of any Controversy, suit, action or arbitration to enforce any of the terms or provisions of this Agreement, the prevailing party shall be entitled to its reasonable attorneys’ fees and costs.  The foregoing entitlement shall also include attorneys’ fees and costs of the prevailing party on any appeal of a judgment and for any action to enforce a judgment.

 

14.9             Modification .  This Agreement may be modified only by a contract in writing executed by the party(ies) to this Agreement against whom enforcement of such modification is sought.

 

14.10           Prior Understandings .  This Agreement contains the entire agreement between the parties to this Agreement with respect to the subject matter of this Agreement, is intended as a final expression of such parties’ agreement with respect to such terms as are included in this Agreement, is intended as a complete and exclusive statement of the terms of such agreement, and supersedes all negotiations, stipulations, understandings, agreements, representations and warranties, if any, with respect to such subject matter, which precede or accompany the execution of this Agreement.

 

 

14.11           Interpretation .  Whenever the context so requires in this Agreement, all words used in the singular shall be construed to have been used in the plural (and vice versa), each gender shall be construed to include any other genders, and the word “person” shall be construed to include a natural person, a corporation, a firm, a partnership, a joint venture, a trust, an estate or any other entity.

 

14.12           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.

 

14.13           Applicable Law .  This Agreement and the rights and obligations of the parties hereunder shall be construed under, and governed by, the laws of the State of Delaware without giving effect to conflict of laws provisions.

 

14.14           Drafting Ambiguities .  Each party to this Agreement has reviewed and revised this Agreement.  Each party to this Agreement has had the opportunity to have such party’s legal counsel review and revise this Agreement.  The rule of construction that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or of any amendments or exhibits to this Agreement.

 

 

[ Signature Page Follows ]

 

 

 

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first above written.

EXHIBIT 10.11

 

EMPLOYMENT AGREEMENT

 
 

This EMPLOYMENT AGREEMENT (this “ Agreement ”) is made as of February 6, 2013 (the “ Agreement Date ”) by and between EASTBRIDGE INVESTMENT CORP. (the “ Company ”), and the undersigned individual (“ Executive ”), with reference to the following facts:

WHEREAS, the Company desires to employ Executive to perform the duties and responsibilities described herein on the terms and conditions hereinafter set forth.

NOW, THEREFORE, the parties agree as follows:

1.             Employment .  The Company hereby employs Executive and Executive hereby accepts such employment upon the terms and conditions hereinafter set forth.

 

2.             Duties .  Subject to the terms and provisions of this Agreement, Executive is hereby employed by the Company as the Chief Financial Officer, Chief Operating Officer and Investor Relations Officer of the Company.  Executive shall have full responsibility and authority for such duties as customarily are associated with service in such positions at the direction of the Board of Directors of the Company (the “ Board ”).  Executive shall faithfully and diligently perform, on a full time basis, such duties assigned to Executive and shall report directly to the Board.

 

3.             Scope of Services .  Executive shall devote substantially all of his business time, attention, energies, skills, learning and efforts to the Company’s business.

 

4.             Term .  Subject to prior termination of this Agreement as hereinafter provided, the term of this Agreement shall commence on the date hereof (the “ Effective Date ”) and shall continue for three (3) years thereafter unless earlier terminated as provided in this Agreement.  After the foregoing three (3) year term, the Executive shall continue to be employed on an at-will basis and this Agreement shall automatically renew for successive one year terms, until and unless this Agreement is terminated.

 

5.             Compensation .

 

5.1             Salary .  Executive’s annual compensation (“ Base Compensation ”) under this Agreement shall be USD $180,000 per year, prorated for any partial year, commencing on the Effective Date; provided however that the Executive’s Base Compensation shall be reviewed annually by the Board of Directors and/or its Compensation Committee (as applicable).  The Base Compensation shall be payable semi-monthly in arrears from the Effective Date in accordance with the ordinary payroll procedures of the Company.  Any changes in Base Compensation shall be in the sole and absolute discretion of the Board and/or its Compensation Committee (as applicable).

 

 

5.2             Participation in Option Plan .  The Executive shall be eligible to participate in the Amended and Restated 2011 Equity Incentive Plan (the “ Plan ”) of EastBridge Investment Group Corporation, the parent company and sole stockholder of the Company (“ EastBridge ” or “ Parent ”).  Parent agrees to grant Executive an option to purchase 30,000 shares of Parent’s common stock pursuant to the Plan, at an exercise price equal to the volume weighted average of the price per share of Parent common stock as quoted on the OTCQB for the three trading days preceding the date hereof.  The foregoing option shall vest over a two year period at a rate of 1,250 shares per month, and shall be controlled by the terms and conditions set forth in a Notice of Grant and Stock Option Agreement approved by the board of directors of Parent or the compensation committee thereof (" Option Grant "), within 30 days following the date hereof.

 

5.3             Expenses .  The Company shall reimburse Executive for:

 

(a)             all reasonable business, entertainment and travel expenses actually incurred or paid by Executive in the performance of his services on behalf of the Company, in accordance with the Company’s expense reimbursement policy as from time to time in effect;

 

(b)             the cost of continuing education courses in furtherance of Executive’s performance of his duties of up to USD $5,000 per annum;

 

(c)             reasonable moving expenses if the Company requires the Executive to relocate, and as a result Executive must change his place of residence to a place more than 50 miles away from his current place of residence (which expenses shall be appropriately documented by Executive); and

 

(d)             if the Company requires the Executive to relocate (in excess of 50 miles), and after relocation the Executive is terminated without Cause pursuant to Section 7.1(b) and chooses to return to his original place of residence immediately prior to the Effective Date, reasonable moving expenses incurred by Executive (which expenses shall be appropriately documented by Executive).

 

6.             Other Rights and Benefits .  Executive shall receive other rights and benefits, life insurance, vacation time, sick pay and retirement plan participation, as determined by the Board.

 

7.             Termination .  Executive’s employment may be terminated as follows:

 

7.1             Termination by the Company or Executive .

 

(a)             During the one (1) year period after the Effective Date, this Agreement may not be terminated by either party except pursuant to Section 7.2, 7.3 or 7.4 below.

 

(b)             After the one (1) year period in Section 7.1(a), for two (2) years thereafter, Executive may not be terminated by the Company except pursuant to Section 7.2, 7.3 or 7.4 below, provided, however that during said two year period the Board may alter the responsibilities of the Executive to other senior-level functions, and change the Executive’s title to a mutually agreeable alternative title.

 

(c)            If during the initial three (3) year period following the Agreement Date, the employment of the Executive is terminated for any reason other than pursuant to Section 7.2, 7.3, or 7.4, or for no good reason, the Company shall be obligated to:

 

 

(i)            Pay Executive as soon as practicable following termination of employment, a lump sum severance amount equal to two (2) times Executive’s Base Compensation, subject to legally required withholding requirements.  Said severance will be due and payable within thirty (30) days following the date of termination;

 

(ii)           Accelerate and vest in full Executive’s stock options, pursuant to such Executive’s option agreement, effective upon the date of termination;

 

(iii)          Subject to Executive’s election to receive COBRA, pay for the Executive’s premiums charged to continue medical and dental coverage pursuant to COBRA for the Executive during the 12 month period commencing with continuation coverage for the month following the month in which the date of termination occurs, provided, that if Executive is not eligible to receive, or if the Company is not able to provide, continuation coverage under COBRA for any month during the continuation period, the Company shall pay the Executive a cash payment equal to its portion of the applicable COBRA premiums on an after-tax basis (with such payment to be made in the same month for which the continuation coverage was otherwise to be provided).  Notwithstanding the forgoing provisions of this paragraph, in the event the Executive becomes reemployed with another employer and becomes eligible to receive medical and dental benefits from such employer during any month in the 12 month continuation period provided for by this paragraph, the Company shall have no obligation to pay, reimburse or otherwise provide the Executive with continuation coverage for any such month; and

 

(iv)          Pay any bonus amounts that have been earned by the Executive but have not yet been paid as of the date of termination.

 

7.2             Termination for Death . Executive’s employment shall terminate immediately upon Executive’s death.

 

7.3             Termination Upon Disability .  Executive’s employment shall terminate if Executive should become totally and permanently disabled.  For purposes of this Agreement, Executive shall be considered “totally and permanently disabled” if Executive is treated as permanently “disabled” under any permanent disability insurance policy maintained by the Company and is entitled to full benefits payable under such policy upon a total and permanent disability.  In the event any such policy is either not in force or the benefits are not available under such policy, then “total and permanent disability” shall mean the inability of Executive, as a result of substance abuse, any mental, nervous or psychiatric disorder, or physical condition, injury or illness to perform substantially all of his current duties on a full-time basis for a period of six (6) consecutive months, as determined by a licensed physician selected by the Board.