Employment Agreement
This EMPLOYMENT
AGREEMENT (“Agreement”) is dated on January 1,
2009 between Qinan Ji (the “Executive”) , a
citizen of China , ID number 612125195706230432, and
China Natural Gas, Inc. (the “Company”), a
Delaware Corporation, with primary business address of No. 35
Tangyan Road, High-Tech Zone, Xi’an 710065, Shaanxi Province,
China.
WHEREAS, the
Company believes that Executive provides excellent management
services for the Company and wishes to retain Executive as its
Chief Executive Officer; and
WHEREAS, the
Company and Executive have reached the following understanding with
respect to the Executive's employment by the Company for a period
of 1 commencing January 1, 2009;
and
WHEREAS, the
Company and Executive desire to evidence their agreement in writing
and to retain the Executive by the Company on terms set forth
herein.
1. Employment,
Duties and Acceptance.
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Effective January 1, 2009 , the Company
hereby agrees to the continued employment of Executive as the Chief
Executive Officer ("CEO") and both parties hereby accept such
employment on the terms and conditions contained in this Agreement.
During the term of this Agreement, the Executive shall make him /
her available to the Company to pursue the business of the Company
subject to the supervision and direction of the Board of Directors
of the Company ("Board" or "Board of Directors").
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The Company shall retain the Executive to serve
as the Company’s full time CEO. The scope and
responsibilities of the CEO position include the
following:
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(a)
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To contact and market the company to the
investment community; set up good relationship and communicate
effectively with current and potential investors
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To formulate and implement relevant policies,
procedures and strategies to ensure the realization of the
Company’s strategy;
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(c)
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To establish a
strong management system and strict internal control
procedure;
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To supervise
all business activities to ensure their compliance with law and the
Company’s policy;
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(e)
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To establish
good management mode to improve the company’s outstanding
achievement;
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(f)
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To establish
and direct a mechanism for reducing costs and increasing
efficiency;
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To be
responsible for the Company’s long-term strategy
planning;
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To participate
in business development and strategic planning;
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(i)
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To carry out strategic acquisition, capital
management, financing etc. pursuant to the requirements of the
Board of Directors;
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(j)
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To provide
comments to the Management Team and the Board of Directors on
management issues of the Company;
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To actively
aware of the changing rules and regulations in the US and
China;
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(l)
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Other
responsibilities stipulated by the Board of Directors.
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Meanwhile, the
CEO is the primary consultant of the department directors with
respect to strategies and operations, and will be responsible for
the Company’s comprehensive management, including the
following: (1) Company strategy; (2) Development strategy; (3)
business spread; and (4) direct of business.
The CEO shall
play a major role in coordinating a comprehensive strategy to
maximize Company value:
(1) Ensure the existing plans are
well based on the Company’s current business to maximize the
value to the Company;
1. Continuously assess the
plan’s value creation potential;
2. Ensure the plans are targeted
towards major problems faced by the Company. In doing so, the
Executive should repeatedly research reasons and possibilities
related to changes in the Company’s operations and provide
external references for value creation (e.g., the value of certain
business to other possible owners) and make decisions;
3. Formulate criteria for business
achievements and establish mechanism for progress
assessment
(2) Assist in
developing the Company’s expansion strategy and creating
shareholder value.
1. Comment on
the current market opportunities closely related to the
Company’s business;
2. Evaluate the
Company’s capacity and assets to capitalize the market
opportunity; propose proper remedies for capacities
lacking;
3. Provide
business evaluations regarding specific proposals.
At the same
time, the CEO should perform other responsibility which belongs to
him. The CEO shall be responsible for the formulation and
implementation of comprehensive business plans and strategies to
provide support for the company's business and create greatest
value for shareholders.
(1) Propose capital and dividend policies for
value creation;
(2) Design and manage Company presentation of
the Company’s operations and plan to the financial
community;
CEO shall
ensure effective management of the Company’s financial
issues:
(1) Make
decisions on all the important business events, including the
financial affairs, business direction and business
scope;
(2) Establish
internal control system to ensure the safety of the company's
assets;
(3) Ensure
effective and efficient management of general events/ business /
operation;
(4) Maintain
close relationship with the Company’s business partners and
investors;
(5) Manage
the Risk Management Plan of the Company.
1.3. The
Executive shall perform his duties diligently and competently
pursuant to the requirements for the position.
1.4 Work time.
According to the Labor Law and policies of company, Executive works
8 hours per day, if there is any important issue or event to be
solved, Executive shall ensure the issue to be effectively
completed in time.
1.5 The Board
may assign the Executive such general management and supervisory
responsibilities and executive duties for the Company as are
appropriate and commensurate with Executive's position as CEO of
the Company.
2. Compensation
and Benefits.
2.1. The
Company shall pay to Executive a salary of USD 120,000 pre-tax
annually and receive 12 pays each year, equal to a monthly salary
of USD10, 000, PLUS USD60, 000 when Executive works for the entire
12 months. In accordance with the relevant provisions of the
company executives salary according to 80% of the month paid
performer for(i.e. $8,000 ）
, remaining 20% ($2,000 per month,
and a year, total $ 24,000) will payoff expire depending on the
executor of the ability to work and achievement one year. Salary by
basic wage, salary job housing and transportation three parts.
Monthly salary payoff form: basic wage $5,000, rental apartments
housing and transport, the total amount is $3,000 per month,
monthly reimbursed.
The Executive
is entitled to options to purchase 292,000 shares of common stock
of the Company vested in four years (73,000 shares each year),
representing approximately 1% of total shares outstanding of the
Company. The Executive could exercises the option at $2.45 per
share on a cash basis after one year of service and the option will
be subject to specific terms of the Employee Stock Option
Plan.
2.2. The
Executive shall pay personal income taxes pursuant to regulations
of the government tax agency, and the Company shall deduct a
corresponding amount from the monthly salary of the Executive and
pay that amount on behalf of the Executive to the relevant tax
agency.
2.3. In
addition to what is provided for under the foregoing Article 2.2,
the Company shall have the right to deduct from the
Executives’ salaries for other purposes in accordance with
laws and regulations of the State.
3.1. The term
of this Agreement is for a period of 1 years beginning on January
1 st
, 2009 and terminating on December
31, 2009. If both Parties desire to renew this Agreement, each
Party shall notify the other Party of its intent to renew this
Agreement thirty days prior to the expiration of this Agreement.
The Agreement will then be extended for 1 year.
The Company, by
notice to Executive, may terminate this Agreement for cause. As
used herein, "cause" shall include (a) the refusal in bad faith by
Executive to carry out specific written directions of the Board,
(b) intentional fraud or dishonest action by Exe
