EMPLOYMENT AGREEMENT
This Employment Agreement is made and entered into between Yifan
Communications, Inc., a Delaware corporation, having a place of business at
41-60 Main Street, Flushing, Queens, New York (the "Company") and Sally A.
Fonner an individual resident of Clearwater, Florida (the "Employee").
WHEREAS, the Employee has been the sole member of the Company's Board of
Directors and the sole manager of its business affairs since April 2, 2000; and
WHEREAS, the Company has recently entered into a business combination
agreement with Yifan.com, Inc., a New York corporation, that has resulted in
substantial changes in the ownership, management and business of the Company;
and
WHEREAS, the Company is desirous of making appropriate long-term
arrangements for the management of its business affairs; and
WHEREAS, the Company is desirous of retaining the Employee to serve as its
Director of Regulatory Affairs on the conditions set forth herein for the entire
term of this Agreement, and
WHEREAS, in such capacity, the Employee will develop or have access to all
of the business methods and confidential information relating to the Company and
its business activities, its operational and financial matters, its contemplated
property acquisition plans, its personnel training and development programs and
its industry relationships.
NOW THEREFORE, in consideration of the promises and of the mutual
covenants and agreements herein contained, the parties hereto agree as follows:
1. Employee Representations and Warranties. The Employee represents and
warrants to the Company that she is free to accept employment hereunder and that
she has no prior or other obligations or commitments of any kind to anyone that
would in any way hinder or interfere with her acceptance of, or the full,
uninhibited and faithful performance of this Agreement, or the exercise of her
best efforts as an executive officer of the Company.
2. Employment and Duties. The Company shall employ the Employee as its
Director of Regulatory Affairs, or in such other comparable executive capacity
as the Board of Directors of the Company shall specify from time to time. The
Employee's initial responsibilities shall include the following:
(a)The Employee shall continue to serve as a member of the Company's Board of
Directors until the next annual meeting of the Company's stockholders, or
until her successor is elected and qualified;
(b)The Employee shall manage, operate and maintain all required internal
accounting and external financial reporting systems on behalf of the Company
until such operations have expanded to a point where it is economically
feasible for the Company to retain its own in-house accounting and financial
reporting staff;
(c)The Employee shall manage all of the Company's relationships with its
transfer agents, financial printers, public relations firms and investor
communications firms, but shall not have the power to bind the Company to any
agreements with any such firms without the express authorization of the Board
of Directors; and
(d)The Employee shall manage the preparation and filing of all required reports
and registration statements with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc. and other regulatory
authorities and self-regulatory associations;
In addition, the Employee shall, from time to time, perform such other functions
and duties in connection with the business of the Company as the Board of
Directors may entrust or delegate to her.
3. Conduct of Employee. During the entire Term of this Agreement, the
Employee shall devote as much time, effort, skill and attention to the affairs
of the Company and its subsidiaries as may be reasonably required under the
circumstances. The Employee will use her best efforts to promote the interests
of the Company, and will discharge her responsibilities in a diligent and
faithful manner, consistent with sound business practices. In furtherance of the
foregoing:
(a) The Employee represents that her employment by the Company will not
conflict with any obligations which she has to any other person, firm
or entity. The Employee specifically represents that she has not
brought to the Company (during the period before the signing of this
Agreement) and she will not bring to the Company any materials or
documents of a former or present employer, or any confidential
information or property of any other person, firm or entity.
(b) The Employee shall not, without disclosure to and approval of the Board
of Directors of the Company, directly or indirectly, assist or have an
active interest in (whether as a principal, stockholder, lender,
employee, officer, director, partner, consultant or otherwise) in any
person, firm, partnership, association, corporation or business
organization, entity or enterprise that competes with or is engaged in
a business which is substantially similar to the business of the
Company except that ownership of not more than 5% of the outstanding
securities of any class of any publicly-held corporation shall not be
deemed a violation of this sub-paragraph 3(b).
(c) The Employee shall promptly disclose to the directors of the Company,
in accordance with the Company's policies, full information concerning
any interests, direct or indirect, she holds (whether as a principal,
stockholder, lender, Employee, director, officer, partner, consultant
or otherwise) in any business which, as reasonably known to the
Employee purchases or provides services or products to, the Company or
any of its subsidiaries, provided that the Employee need not disclose
any such interest resulting from ownership of not more than 5% of the
outstanding securities of any class of any publicly-held corporation.
(d) The Employee shall not disclose to any person or entity (other than to
the Company's Board of Directors or to others as required, in her
judgment, in the due performance of her duties under this Agreement)
any confidential or secret information with respect to the business or
affairs of the Company, or any of its subsidiaries or affiliates.
Nothing in this Agreement shall be deemed to preclude the Employee from
participating in other business opportunities if and to the extent that (i) such
business opportunities are not directly competitive with or similar to the
business of the Company, and (ii) the Employee's activities with respect to such
opportunities do not have a material adverse effect on the performance of the
Employee's duties hereunder.
4. Conditions of Employment.
(a) Term of Employment. Unless terminated earlier in accordance with the
provisions of this Agreement, the Employee will be employed by the
Company for a period commencing on August 1, 2000 and terminating on
July 31, 2001 (the "Term"). Thereafter, this Agreement shall be
renewable on such reasonable terms and for such periods as may be
negotiated between the Employee and the Company.
(b) Place of Employment. The Employee shall work for the Company from her
office in Clearwater, Florida. All expenses associated with the
operation and maintenance of the Employee's office, including the cost
of any required support staff, shall be paid by the Employee from her
own funds and the Company shall have no obligation to make any
contribution to such costs The Employee shall not be required during
the Term of this Agreement to relocate from Clearwater, Florida to any
other business location maintained by the Company although the Employee
expressly agrees that regular travel shall be necessary as part of her
duties.
(c) Ownership of Company Records and Reports. The Employee shall not,
except in the performance of her duties hereunder, at any time or in
any manner make or cause to be made any copies, pictures, duplicates,
facsimiles, or other reproductions or recordings or any abstracts or
summaries of any reports, studies, memoranda, correspondence, manuals,
records, plans or other written or otherwise recorded materials of any
kind whatever belonging to or in the possession of the Company, or of
any subsidiary or affiliate of the Company, including but not limited
to materials describing or in any way relating to the Company's
business activities including, but not limited to, its proprietary
radioactive logging techniques and technologies, its proprietary water
handling and disposal technologies, its proprietary reservoir analysis
and modeling techniques, its property selection methods and criteria,
its proprietary oil and gas production techniques, its operational and
financial matters, its contemplated property acquisition and
development plans, its personnel training and development programs and
its industry relationships. The Employee shall have no right, title or
interest in any such material, and the Employee agrees that, except in
the performance of her duties hereunder, she will not, without the
prior written consent of the Company remove any such material from any
premises of the Company, or any subsidiary or affiliate of the Company,
and immediately upon the termination of her employment for any reason
whatsoever Employee shall return to the Company all such material in
her possession.
(d) Company's Trade Secrets. Without the prior written consent of the
Company, the Employee shall not at any time (whether during or after
her employment with the Company) use for her own benefit or purposes or
for the benefit or purposes of any other person, firm, partnership,
association, corporation or business organization, entity or
enterprise, or disclose in any manner to any person, firm, partnership
association, corporation or business organization, entity or
enterprise, except in the performance of her duties hereunder, any
trade secrets, or any information data, know-how or knowledge
constituting trade secrets belonging to, or relating to the affairs of
the Company, or any subsidiary, former subsidiary, or affiliate of the
Company.
5. Compensation. The Company shall compensate the Employee for all
services to be rendered by her during the Term as follows:
(a)As her sole compensation for services to be rendered during the initial term
of this agreement, the Employee shall receive 180,000 shares of the Company's
$0.008 par value common stock. Such shares will be fully earned upon the
execution of this agreement and shall have an agreed value of $0.89 per
share, an amount which is equal to the price paid by the last person to
purchase shares of Yifan.com, Inc. for cash. These shares will be issuable to
the Employee upon the effectiveness of an amendment to the Company's
Certificate of Incorporation that authorizes the issuance of such $0.008 par
value common stock.
(b)The Employee expressly acknowledges and agrees that (a) the shares provided
for herein will be issued to her compensation for services rendered to the
Company, (b) this agreement relates solely to day-to-day services as an
employee of the Company and the Employee's compensation for any future
"capital raising transactions" will be established by a separate
transaction-specific agreement (c) the Employee has paid no cash
consideration to the Company for the shares that will be issued to her
pursuant to the terms of this agreement and no portion of the proceeds from
any resale of such shares will be remitted to the Company or used directly or
indirectly for the payment of any expenses of the Company or any of its
affiliates, (d) Employee will not be directly involved in any activity that
promotes or otherwise maintains a market for the securities of the Company,
(e) as long as the Employee is the beneficial owner of any securities of the
Company, she will not engage in "buy-side" trading activities, hedging
transactions or other activities that could reasonably be expected to
influence the market price of such securities, (f) she will not sell any
shares in a transaction that is effected at a price lower than the quoted bid
price of the securities at the time of sale, (g) if she engages in multiple
sales in any five consecutive business days, she will not sell any shares in
a transaction that is effected at a price lower than the last price received
by us for the same securities, and (h) she will not sell more than 15,000
shares in any calendar month.
(c) The Employee shall not participate in any compensation plans adopted by
the shareholders of the Company.
(d)The Employee shall not participate in the Company's standard
medial/hospitalization insurance and group life insurance, however, she will
be entitled to participate in any retirement plans that are subsequently
adopted by the Company from time to time.
(e)During the Term of this Agreement, the Company will reimburse the Employee
for all reasonable out-of-pocket business expenses incurred by her on behalf
of the Company in the performance of her duties hereunder upon presentation
of vouchers, receipts or other evidence of such expenses in accordance with
the policies of the Company, and provided that the Employee shall incur no
costs or expenses that exceed five hundred dollars without prior
authorization of the Company.
(f)Notwithstanding any other provision of this Agreement, it is agreed that the
Employee shall be entitled to receive such incentive bonuses, stock options
and other benefits as may be granted by the board of directors from time to
time.
8. Termination of Employment.
(a)This Agreement and the compensation payable to Employee hereunder shall
terminate and cease to accrue forthwith upon Employee's death.
(b)The Employee's employment under the terms of this Agreement may be
terminated by the Company at any time, with or without cause, upon written
notice to the Employee;
(c)If this Agreement is terminated by the Company without cause, the Employee
shall not be obligated to surrender any portion of the compensation
previously paid to her pursuant to the terms of this Agreement.
(d)If this Agreement is terminated by the Company for cause, however, the
Employee shall be obligated to surrender to the Company 15,000 shares of
Common Stock for each full month remaining in the original term of this
Agreement.
(e)As used herein, "cause" shall mean (i) any material failure by Employee to
observe or perform her Agreements herein contained, (ii) any fraudulent or
dishonest conduct in the performance of the Employee's duties and functions,
(iii) any gross negligence or willful breach of the Employee's obligations
under this Agreement, (iv) any intentional disregard of the policies and
instructions established by the Board of Directors of the Company, or (v) any
use of illegal or controlled substances.
(f)The Employee's employment under the terms of this Agreement may be
terminated by the Employee at any time, with or without cause, upon written
notice to the Company. If this Agreement is terminated by the Employee
without cause, however, the Employee shall be obligated to surrender to the
Company 15,000 shares of Common Stock for each full month remaining in the
original term of this Agreement.
9. Specific Performance. If any portion of this Agreement is found by a
court of competent jurisdiction to be too broad to permit enforcement of such
restriction to its full extent, then such restriction shall be enforced to the
maximum extent permitted by law, and the Employee hereby consents and agrees
that such scope may be judicially modified accordingly in any proceeding brought
to enforce such restriction. All provisions of this Agreement are severable, and
the unenforceability or invalidity of any single provision hereof shall not
affect any remaining provision. The Employee acknowledges and agrees that the
Company's remedy at law for any breach of any of her obligations hereunder would
be inadequate, and agrees and consents that temporary and permanent injunctive
relief may be granted in any proceeding that may be brought to enforce any
provision of this Agreement without the necessity of proof of actual damage and
without any bond or other security being required. Such remedies shall not be
exclusive and shall be in addition to any other remedy which the Company may
have.
10. Miscellaneous.
(a) The failure of a party to insist on any occasion upon strict adherence
to any Term of this Agreement shall not be considered to be a waiver or
deprive that party of the right thereafter to insist upon strict
adherence to that Term or any other Term of this Agreement. Any waiver
must be in writing.
(b) All notices and other communications under this Agreement shall be in
writing and shall be delivered personally or mailed by registered mail,
return receipt requested, and shall be deemed given when so delivered
or mailed, to a party at such address as a party may, from time to
time, designate in writing to the other party.
(c) This Agreement shall be assigned to and inure to the benefit of, and be
binding upon, any successor to substantially all of the assets and
business of the Company as a going concern, whether by merger,
consolidation, liquidation or sale of substantially all of the assets
of the Company or otherwise.
(d) This Agreement constitutes the entire Agreement between the parties
regarding the above matters, and each party acknowledges that there are
no other written or verbal Agreements or understandings relating to
such subject matter between the Employee and the Company or between the
Employee and any other individuals or entities other than those set
forth herein. No amendment to this Agreement shall be effective unless
it is in writing and signed by both the parties hereto.
(e) This Agreement shall be construed according to the laws of the State of
Florida pertaining to Agreements formed and to be performed wholly
within the State of Florida. In the event action be brought to enforce
any provisions of this Agreement, the prevailing party shall be
entitled to reasonable attorney's fees as fixed by the court. The
Employee represents and warrants that she has reviewed this Agreement
in detail with her legal and other advisors, as she considers
appropriate, and that she fully understands the consequences to her of
its provisions. The Employee is relying on her own judgment and the
judgment of her advisors with respect to this Agreement and she
understands that the Company is making no representations to her
concerning taxes or any other matters respecting this Agreement.
(f) Any dispute between the parties to this Agreement shall be determined
and settled by binding arbitration in Clearwater, Florida under the
rules of the American Arbitration Association. Judgment on any award
rendered by the arbitrators may be entered in any court having
jurisdiction over the party adversely by such award.
(g) This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original for all purposes hereof.
IN WITNESS WHEREOF, the parties hereto have set their hands on this 30th
day of July, 2000.
YIFAN COMMUNICATIONS, INC. SALLY A. FONNER
By: /s/ /s/
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Yifan He, Chief Executive Officer