Service Agreement with Huiyi Chen
This Service Agreement (“Agreement”) is entered into as of the 1st day of January, 2020 (“Effective Date”) between China XD Plastics Company Limited (hereinafter referred to as the “Company”) and Huiyi Chen, (hereinafter referred to as the “Director”), to provide the terms under which the Director shall perform his functions as an elected independent member and audit committee Chairman of the Board of Directors of the Company during his respective terms.
WHEREAS, the Company’s business consists of the development, manufacture and sale of polymer composite materials, primarily for use in automotive applications thereto (the “Business”) and the Company is a public company subject to the securities laws and rules and other applicable laws and rules of the United States.
WHEREAS, the Company recognizes the unique qualifications and contributions of the Director and desires to secure the services of the Director on the terms and conditions set forth herein; and
WHEREAS, the Independent Director is prepared to commit to such services in return for specific arrangements, compensation and other benefits on the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the foregoing premises and the mutual covenants and agreements herein contained, the Company and the Director do hereby agree as follows:
1. DUTIES OF THE INDEPENDENT DIRECTOR:
1.1 The Director shall care out his duty as an independent director to the Company and shall make himself available to perform such functions in keeping with all the applicable laws, rules, and regulations of the United States of America, including, not limited to, the applicable securities laws and the laws of the State of Nevada.
1.2 The Director hereby agrees faithfully to render the service expected of an independent director and to promote the interests of the Company to the best of his ability and keep his duty of care, confidentiality and loyalty, among other duties. The Director further agrees to devote the necessary time, attention, skill, and best effort to the performance of his duties under this agreement. The Director shall not self-deal or do anything harmful to the interest of the Company or its shareholders and shall not engage in any insider trading or similar activities.
1.3 The Director shall maintain his standing and capacity as an “independent director” under the rules of the Securities and Exchange Commission and the rules and regulations of relevant stock exchanges, and shall not engage in any employment or service with the Company or otherwise that may impair such standing.
1.4 The Director shall serve on the audit committee and the nominating committee in his capacity as an independent director.
2. COMPENSATION AND EXPENSES
During his term as a Director until the end of his function as a Director:
2.1 The Company agrees to pay $5,000 per month ($60,000 annual) for services as such and for services as the chairperson of the Audit Committee.
2.2 The Company shall promptly pay or reimburse the Director for all reasonable expenses actually and properly (in accordance with the Company’s policy) incurred or paid by him in connection with the performance of his services under the Agreement (including, without limitation, travel expenses) upon presentation of expense statements or vouchers or such other supporting documentation in such form and containing such information as the Company may from time to time require. Any expense above $500 shall be pre-approved by the Company.
2.3 The Company shall have appropriate Director and Officer Insurance coverage in place prior to the signing of this Agreement.
The Company shall indemnify the Director to the full extent permitted by the General Corporation Law of the State of Nevada.
4.1 This Agreement expresses the entire understanding and agreement of the parties and supersedes any and all prior agreements and understandings, whether written or oral, relating in any way to the subject manner of this Agreement. This Agreement cannot be modified, amended, or supplemented except by a written instrument or instruments executed by each of the parties hereto.
4.2 This Agreement shall have a term during the period director serves as an director of the Company until such time that he is removed by the board of directors by a majority vote or not elected by the next shareholder meeting, whichever comes earlier.
4.3 This Agreement shall be governed by and construed under the laws of the State of Nevada. If any provision of this Agreement shall be invalid or unenforceable, this Agreement shall be deemed amended but only to the extent required to make it valid and enforceable, and this Agreement as thereby amended shall remain in full force and effect.
4.4 Arbitration is the only and exclusive remedy to the parties for any dispute arising from this agreement. The Parties hereby expressly waive the right to any jury or non-jury trial and hereby expressly submit to the exclusive jurisdiction of an arbitration tribunal under the auspices of the American Association in the City of New York with such tribunal composed of three arbitrators of which one is selected by each party and the third one selected by the two arbitrators already selected respectively by the parties.
4.5 The award of the tribunal shall be exclusive, binding, final and enforceable against the parties. In any arbitration arising out of this Agreement, the prevailing party shall be entitled to request, and receive an amount as and for the reasonable counsel fees and expenses incurred by the prevailing party in connection with such action, proceeding, or arbitration.
IN WITNESS WHEREOF, the Company and the Director have executed this Agreement as of the day and year first above written.
Signed: /s/ Huiyi Chen
Name in Print: Huiyi Chen
Title: Independent Director & Chairman of
the Audit Committee
Date: January 1, 2020
Signed: /s/ Jie Han
Name in Print: Jie Han
Title: Chairman, CEO
Date: January 1, 2020