EMPLOYMENT
AGREEMENT
This Employment Agreement (the “
Agreement ”), effective as of the first (1
st ) day of January 2009, by and between WLG, Inc,
a Delaware corporation (the “ Company
”), and Christopher Wood (the “ Executive
”).
WITNESSETH
WHEREAS , the Executive is the Chief Executive Officer
of the Company; and
WHEREAS , the Company and the Executive have determined
that it is in their respective best interest to set forth the terms
of the Executive’s employment by the Company in writing and
enter into this Agreement on the terms and conditions as set forth
herein.
NOW ,
THEREFORE , in consideration of the premises and the mutual
covenants and promises contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as
follows:
1.
Employment . The Company
hereby agrees to employ the Executive, and the Executive hereby
agrees to serve the Company, upon the terms and conditions set
forth herein.
2.
Term . The employment of the
Executive by the Company pursuant to this Agreement as provided in
Section 1 will commence on 1 st January 2009 (the “ Effective Date
”), and terminate on 31 st December, 2013 (the “ Initial Term
”); provided, however, notwithstanding anything to the
contrary provided herein or elsewhere, this Agreement shall be
automatically extended for successive one (1) year periods (each a
“ Extension Period ”) ending on each successive
anniversary of 31 st December, 2013, subject to earlier termination
in accordance with the provisions of Section 6 of this
Agreement. The Initial Term and any Extension Period is
hereby collectively referred to as the “ Term
.”
3.
Position and Duties . The
Executive shall serve as the Chief Executive Officer (“
CEO ”), and shall have such responsibilities, duties
and authority as are generally associated with such office and as
may from time to time be assigned on a reasonable basis to the
Executive by the Company’s Board of Directors (the “
Board ”), that are consistent with such
responsibilities, duties and authority, including, but not limited
to, responsibility for the overall and day-to-day management of the
Company on a worldwide basis. The Executive shall
perform his duties diligently and faithfully and shall devote
substantially all his weekday working time to the business and
affairs of the Company and to the oversight of its subsidiaries and
affiliates. The Executive shall, at all times during the
Term, report directly to the Board. Notwithstanding
anything in this Section 3 to the contrary, the Executive
shall not be required to perform any duties or responsibilities
that would result in a violation of, or noncompliance with, any
law, regulation, regulatory pronouncement or any other regulatory
requirement applicable to the Company and the conduct of the
Company’s business or to the Executive in his capacity as CEO
of the Company nor shall the Executive be required to
relocate his residence.
4.
Compensation and Related Matters
.
4.1
Base Salary
. In consideration of the services rendered to the
Company hereunder by the Executive, the Company shall, during the
Term, pay to the Executive an annual base salary at a rate of HKD
1,920,000 (one million nine hundred thousand Hong Kong Dollars)
(the “ Base Salary ”) payable to the
Executive’s bank account by wire transfer or otherwise as
instructed by Executive, less mandatory statutory deductions and
withholdings, if any, payable in accordance with the
Company’s normal payroll practices. At least
annually, the Board will review the Base Salary for, among other
items the Board deems relevant, competitiveness, the business of
the Company in the then business environment, the stage of
development of the Company and appropriateness in the
industry. The Base Salary shall be payable monthly in
accordance with the Company’s normal payroll
practices.
4.2
Housing Allowance. The Executive shall
receive a monthly housing allowance of HKD70,000, which may be
adjusted from time to time, as agreed between the Company and
Executive.
4.3
Annual Bonus . For each
calendar year during the Term, the Executive shall be eligible to
receive a cash bonus of up to 100% of the Base Salary (the “
Bonus ”). Such Bonus shall be determined
and payable at the sole discretion of the Board.
4.4
Stock Options . From time to time,
the Company shall grant to Executive stock options (the “
Options ”) to purchase shares of common stock of the
Company in amounts that shall be determined by the Board. The
Options shall be issued pursuant to the Company’s 2005 Stock
Incentive Plan (as may be amended from time to time or another plan
if so adopted) and will be evidenced by a Stock Option Grant
Agreement (a “ Grant Agreement
”). The terms of the Options shall be determined
by the Board and set forth in each Grant Agreement, which shall
include anti-dilution protection and provide that the Options shall
be exercisable for a period of not less then five (5) years from
the date of grant.
Notwithstanding
the foregoing, all Options granted to Executive shall vest 100%
immediately upon a “Change in Control” as defined
below. For purposes of this Section , a “
Change in Control ” shall be deemed to occur in the
event of a change in ownership or control of the Company affected
through any of the following transactions: (i) the acquisition,
directly or indirectly, by any person or related group of persons
(other than the Company) of beneficial ownership (within the
meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as
amended) of outstanding securities possessing more than thirty-five
percent (35%) of the total combined voting power and/or issued and
outstanding common stock of the Company’s outstanding
securities; or (ii) the sale, transfer or other disposition of all
or substantially all of the Company’s assets; (iii)
during any period of
two consecutive years, individuals who at the
beginning of such period constituted the Board (together
with any new directors whose election to the
Board, or whose nomination for
election by the stockholders of the
Company, was approved by a vote of 75% of the directors
then still in office who were either directors at the beginning of
such period or whose election
or nomination for election
was previously so approved) cease to
constitute a majority of the Board then in office; or (iv) the
consummation of a merger or consolidation of the Company with or
into another entity or any other corporate reorganization, if more
than thirty-five percent (35%) 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 ten (10%) percent
or greater beneficial stockholders of the Company immediately prior
to such merger, consolidation or other reorganization.
4.5
Expenses
. The Executive shall be entitled to receive prompt
reimbursement for all reasonable and customary expenses incurred by
the Executive in performing services hereunder, provided that such
expenses are incurred and accounted for in accordance with the
policies and procedures established by the Company. For
the sake of clarity, reimbursable expenses shall include payment of
cell phone billings, business travel, meals and lodging as well as
high speed access computer lines.
4.6
Benefits .
(a) The
Executive shall be entitled to health insurance for himself and his
immediate family members and shall receive full reimbursement for
the premium costs of any medical and dental plans under which
Executive and his immediate family are covered during the
Term.
(b) The
Executive shall be entitled to the use of a company car during the
Term. The Company shall reimburse all reasonable costs
of operating such Company car, including gasoline, parking, tolls,
insurance and repairs.
(c) The
Executive shall be provided with a laptop computer with appropriate
software, as well as a cell phone/Blackberry capable of making
international calls.
(d) The
Executive shall be entitled to reasonable vacation time to be
determined in consultation with the Board, provided that such
vacation time shall not be less than four (4) weeks per
year.
(e) The
Executive shall be entitled to business class air travel when
traveling on company business.
5.
Director and Officer of the Company; D&O
Insurance .
(a) As
an officer and a director of the Company, the Executive will be
covered under all of the Company’s Director’s and
Officer’s liability insurance policies (the “
Insurance ”), which are in place and updated from time
to time. The Company, however, agrees that during the
Term and for a period of five (5) years following the Term, the
Company shall maintain such amounts and on such terms that covers
the Executive following termination of the Term for acts and/or
alleged acts occurring during the Term, and shall be on such terms
no less beneficial to the Executive that that held by other
entities, private or public, of similar size and financial status
as that of the Company. In addition, the Company shall
indemnify and hold harmless the Executive as and to the extent
provided in Exhibit A annexed hereto.
(b) Reserved.
6.
Termination . The
Executive’s employment hereunder may be terminated only under
the following circumstances:
6.1
Death or Disability . In the event of the
Executive’s death or Disability (as defined below) during the
Term, the Executive’s employment hereunder shall terminate,
and the Company shall have no further obligation or duty to the
Executive or his estate or beneficiaries other than for the Base
Salary earned under this Agreement to the date of termination,
reimbursement of corporate expenses incurred through the date of
termination, and any payments or benefits due under Company
policies or benefit plans which shall be paid within a reasonable
time following death or Disability. For purposes of this
Agreement, " Disability " shall mean a physical or mental
infirmity which causes the Executive to be unable to perform his
duties hereunder for any period of one-hundred and
eighty (180) consecutive days; provided ,
however, that notwithstanding anything to the contrary herein and
despite any termination of Executive’s employment under this
Section 6 , Executive shall be entitled in the event of a
termination on account of Disability: (i) to retain his disability
benefits, which amounts shall not be offset by any disability
benefits received by Executive from any other source, (ii) to
receive his Base Salary until such time as he has commenced
receiving disability payments under the Company's policies, (iii)
to receive a prorated portion of the Bonus to which Executive would
otherwise have been entitled for the calendar year through the date
of termination (as determined by the Board), and (iv) accrued
but unused vacation. In addition, notwithstanding
anything to the contrary herein and despite any termination of
Executive’s employment under this Section 6 ,
Executive shall be entitled in the event of a termination on
account of his death: (i) to receive a prorated portion of the
Bonus to which Executive would otherwise have been entitled for the
calendar year through the date of termination (as determined by the
Board), and (ii) accrued but unused
vacation. Nothing to the contrary provided herein or
elsewhere, all Options granted to the Executive shall vest
immediately upon his death or termination due to Disability and
Executive, or his legal representative, as the case may be, shall
have a period of six (6) months following the termination of his
employment pursuant to this Section 6.1 to exercise any
vested Options.
6.2
Cause, Without Cause Termination by the Executive; Mutual
Termination . Notwithstanding the provisions of
Section 2 of this Agreement, the Executive’s
employment hereunder may terminate prior to the expiration of the
Initial Term, or any Extension Period thereafter, under the
following circumstances:
(a)
Termination by the Company for Cause . The
Board by unanimous vote may terminate this Agreement for Cause at
any time, upon written notice to the Executive setting forth in
reasonable detail the nature of such Cause. For purposes
of this Agreement, “ Cause ” is defined as (i)
the Executive’s material breach of Section 3 of this
Agreement; (ii) the Executive’s conviction (after the
exhaustion of all available appeals) of any felony or any crime
involving moral turpitude; or (iii) the Executive’s material
breach of Section 7 of this Agreement; (iv) gross negligence
or willful misconduct by the Executive in connection with the
performance of his material duties hereunder, or (v) his refusal to
perform such material duties reasonably requested in the ordinary
course by the Board; provided, however, that the Company shall give
Executive thirty (30) days’ after receipt by the Executive of
written notice of “Cause” for his termination to cure
prior to any termination for Cause based on the grounds specified
herein, except in item (ii) above. Upon the termination
for Cause of Executive’s employment, the Company shall have
no further obligation or liability to the Executive other than for
Base Salary accrued but unpaid under this Agreement prior to the
date of termination, and reimbursement for corporate expenses
incurred through the date of termination. Executive’s vested
but unexercised Options shall expire immediately upon his
termination for Cause pursuant to this Section 6.2(a)
.
(b)
Termination by the Executive . The
Executive may terminate his employment hereunder for any reason or
no reason upon one (1) month’s written notice to the Company
(the “ Notice Period ”). In the event
Executive provides notice of termination pursuant to this
Section 6.2(b) , the Company may elect to terminate
Ex
