MARWYNN HOLDINGS, INC. INDEPENDENT DIRECTOR AGREEMENT
Exhibit 10.1
INDEPENDENT DIRECTOR AGREEMENT
This Independent Director Agreement (the “Agreement”) is made and entered into as of ____, 2024, by and between Marwynn Holdings, Inc., a Nevada corporation (the “Company”), and ________, an individual (“Director”).
RECITALS
A. The Company has proposed to raise additional capital through an initial public offering (“IPO”) of the Company’s common stock and, in connection with the IPO, the Company proposes to file with the United States Securities and Exchange Commission (the “SEC”) a registration statement on Form S-1 (the “Form S-1 Registration Statement”) relating to the registration of its common stock under Section 5 of the Securities Act of 1933, as amended; and
B. The Company desires to appoint the Director to serve on the Company’s board of directors (the “Board”) and the Director desires to accept such appointment to serve on the Board; and
C. The Director may be appointed as a member of one or more committees of the Board; and
D. The Director may also be appointed to serve as Chairman of one or more committees of the Board.
I. SERVICES
1.1 Board of Directors. Director agrees to perform such tasks as may be necessary to fulfill Director’s obligations as a member of the Board and its committees and serve as a director so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the Company’s Articles of Incorporation and Bylaws (collectively, the “Charter”) and any necessary approval by the Company’s stockholders and/or Board, and until such time as he resigns, fails to stand for election, fails to be elected by the stockholders of the Company or is removed from his position. Director may at any time and for any reason resign or be removed from such position consistent with the Charter (subject to any other contractual obligation or other obligation imposed by operation of law), in which event the Company shall have no obligation under this Agreement with respect to the Director.
1.2 Director Services. The Director shall provide the following Services (“Director Services”):
(a) During the term of services as a director of the Company (“Directorship Term”), the Director shall make reasonable business efforts to attend all Board meetings, serve on appropriate subcommittees as reasonably requested by the Board, make himself available to the Company at mutually convenient times and places, attend external meetings and presentations, as appropriate and convenient, and perform such duties, services and responsibilities, and have the authority commensurate to such position.
(b) The Director will use his best efforts to promote the interests of the Company. The Company recognizes that the Director (i) is or may become a full-time employee of another entity and that his responsibilities to such entity must have priority and (ii) sits or may sit on the board of directors of other entities, subject to any limitations set forth by the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and limitations provided by any exchange or quotation service on which the Company’s common stock is listed or traded. Notwithstanding the same, the Director will provide the Company with prior written notice of any future commitments to such entities and use reasonable business efforts to coordinate his respective commitments so as to fulfill his obligations to the Company and, in any event, will fulfill his legal obligations as a Director. Other than as set forth above, the Director will not, without the prior notification to the Board, engage in any other business activity which could materially interfere with the performance of his duties, services and responsibilities hereunder or which is in violation of the reasonable policies established from time to time by the Company, provided that the foregoing shall in no way limit his activities on behalf of (i) any current employer and its affiliates or (ii) the board of directors of any entities on which he currently sits. At such time as the Board receives such notification, the Board may require the resignation of the Director if it determines that such business activity does in fact materially interfere with the performance of the Director’s duties, services and responsibilities hereunder.
1.3 Independence. Director acknowledges that his/her appointment hereunder is contingent upon the Board’s determination that he/she is “independent” with respect to the Company, in accordance with the listing requirements of the Nasdaq and NYSE American, and that his/her appointment may be terminated by the Company in the event that the Director does not maintain such independence standard.
1.3 Term. This Agreement shall terminate upon the “Expiration Date” which shall be the earlier of the date on which Director ceases to be a member of the Board for any reason, including death, resignation, removal, or failure to be elected by the stockholders of the Company, or the date of termination of this Agreement in accordance with Section 5.2 hereof.
II. COMPENSATION
2.1 Expense Reimbursement. The Company shall reimburse the Director for pre-approved reasonable business-related expenses incurred in good faith in connection with the performance of the Director’s duties for the Company. Such reimbursement shall be made by the Company upon submission by the Director of a signed statement itemizing the expenses incurred, which shall be accompanied by sufficient documentation to support the expenditures.
2.2 Fees to Director. During the Directorship Term, the Company agrees to pay Director a fee of US$10,000 per year (“Annual Fee”), which Annual Fee shall be paid to the Director in four (4) equal installments no later than the fifth business day of each calendar quarter commencing in the first quarter following the effective date of the Form S-1 Registration Statement. In the event that the Director ceases to be a director of the Company, for whatever reason, no further fees shall be payable. The Director shall be responsible for his or her own individual income tax payment on the Annual Fee in jurisdictions where the Director resides.
2.3 Equity Compensation. As soon as practical on or after the date of this Agreement, the Director shall be entitled to receive an initial stock option (the “Initial Award”) to purchase 20,000 shares of the Company’s common stock. The per share exercise price of each option granted to the Director shall equal 100% of the fair market value (as defined by the Board) of a share of common stock on the date the option is granted. The Initial Award shall vest over three (3) years of which 1/3 of the options shall vest on the first anniversary of the grant date, and the remaining 2/3 of the options shall vest over two years on an annual basis, subject to the Director continuing in service on the Board through each such vesting date. The term of each stock option granted to the Director shall be ten (10) years from the date of grant.
2.4 Director and Officer Liability Insurance. The Company will use its best efforts to maintain a customary director and officer liability insurance policy for all Board members and such policy will cover Director to the same extent as other directors and officers covered under the policy.
2.4 Independent Contractor. The Director’s status during the Directorship Term shall be that of an independent contractor and not, for any purpose, that of an employee or agent with authority to bind the Company in any respect. All payments and other consideration made or provided to the Director under this Section 2 shall be made or provided without withholding or deduction of any kind, and the Director shall assume sole responsibility for discharging all tax or other obligations associated therewith.
2
III. CONFIDENTIALITY AND NONDISCLOSURE
3.1 Confidentiality. During the term of this Agreement, and for a period of three (3) years after the Expiration Date, Director shall maintain in strict confidence all information he has obtained or shall obtain from the Company, which the Company has designated as “confidential” or which is by its nature confidential, relating to the Company’s business, operations, properties, assets, services, condition (financial or otherwise), liabilities, employee relations, customers, suppliers, prospects, technology, or trade secrets, except to the extent such information (i) is in the public domain through no act or omission of the Company, (ii) is required to be disclosed by law or a valid order by a court or other governmental body, or (iii) is independently learned by Director outside of this relationship (the “Confidential Information”).
3.2 Nondisclosure and Nonuse Obligations. Director will use the Confidential Information solely to perform his obligations for the benefit of the Company hereunder. Director will treat all Confidential Information of the Company with the same degree of care as Director treats his own Confidential Information, and Director will use his best efforts to protect the Confidential Information. Director will not use the Confidential Information for his own benefit or the benefit of any other person or entity, except as may be specifically permitted in this Agreement. Director will immediately give notice to the Company of any unauthorized use or disclosure by or through him, or of which he becomes aware, of the Confidential Information.
3.3 Return of Company Property. All materials furnished to Director by the Company, whether delivered to Director by the Company or made by Director in the performance of Director Services under this Agreement (the “Company Property”), are the sole and exclusive property of the Company. Director agrees to promptly deliver the original and any copies of the Company Property to the Company at any time upon the Company’s request. Upon termination of this Agreement by either party for any reason, Director agrees to promptly deliver to the Company or destroy, at the Company’s option, the original and any copies of the Company Property. Director agrees to certify in writing that Director has so returned or destroyed all such Company Property.
3.4 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Guidelines. Director acknowledges and agrees that the Director may have access to “material non-public information” for purposes of the federal securities laws (“Insider Information”) and that the Director will abide by all securities laws relating to the handling of and acting upon such Insider Information. Upon request by the Company, Director will be asked to executed the Company’s ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Section 16 Compliance Policy upon adoption by the Company.
IV. COVENANTS OF DIRECTOR
4.1 No Conflict of Interest. During the term of this Agreement, Director shall not be employed by, own, manage, control or participate in the ownership, management, operation or control of any person, firm, partnership, corporation or unincorporated association or entity of any kind that is competitive with the Company or otherwise undertake any obligation inconsistent with the terms hereof, provided that Director may continue Director’s current affiliation or other current relationships with the entity or entities described on Exhibit A (all of which entities are referred to collectively as “Current Affiliations”). This Agreement is subject to the current terms and agreements governing Director’s relationship with Current Affiliations, and nothing in this Agreement is intended to be or will be construed to inhibit or limit any of Director’s obligations to Current Affiliations. Director represents that nothing in this Agreement conflicts with Director’s obligations to Current Affiliations. A business shall be deemed to be “competitive with the Company” for purpose of this Article IV only if and to the extent it engages in a business substantially similar to the Company’s business.
3
4.2 Disparaging Statements. At all times during and after the period in which the Director is a member of the Board and at all times thereafter, the Company, its employees, affiliates, or assignees, and the Director, one and for the other, shall not either verbally, in writing, electronically or otherwise: (i) make any derogatory or disparaging statements about the Company, any of its affiliates, any of their respective officers, directors, shareholders, employees and agents, or any of the Company’s current or past customers or employees, or (ii) make any public statement or perform or do any other act prejudicial or injurious to the reputation or goodwill of the Company or any of its affiliates or otherwise interfere with the business of the Company or any of its affiliates; provided, however, that nothing in this paragraph shall preclude the Director from complying with all obligations imposed by law or legal compulsion, and provided, further, however, that nothing in this paragraph shall be deemed applicable to any testimony given by the Director, or the Company, its employees, affiliates, or assignees, in any legal or administrative proceedings.
4.3 Market Stand-Off Agreement. In the event of a public or private offering of the Company’s securities, including in connection with the IPO, and upon request of the Company, the underwriters or placement agents placing the offering of the Company’s securities, the Director agrees not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Company that the Director may own, other than those included in the registration, without the prior written consent of the Company or such underwriters, as the case may be, for such period of time from the effective date of such registration as may be requested by the Company or such placement agent or underwriter.
V. TERM AND TERMINATION
5.1 Term. This Agreement is effective as of the date of this Agreement and will continue until the Expiration Date.
5.2 Survival. The rights and obligations contained in Articles III and IV will survive any termination or expiration of this Agreement.
VI. MISCELLANEOUS
6.1 Assignment. Except as expressly permitted by this Agreement, neither party shall assign, delegate, or otherwise transfer any of its rights or obligations under this Agreement without the prior written consent of the other party. Subject to the foregoing, this Agreement will be binding upon and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.
6.2 Remedies. The Director agrees that any breach of the terms of this Articles III and IV would result in irreparable injury and damage to the Company for which the Company would have no adequate remedy at law; the Director therefore also agrees that in the event of said breach or any threat of breach, the Company shall be entitled to an immediate injunction and restraining order to prevent such breach and/or threatened breach and/or continued breach by the Director and/or any and all entities acting for and/or with the Director, without having to prove damages or paying a bond, in addition to any other remedies to which the Company may be entitled at law or in equity. The terms of this Section shall not prevent the Company from pursuing any other available remedies for any breach or threatened breach hereof, including, but not limited to, the recovery of damages from the Director. The Director acknowledges that the Company would not have entered into this Agreement had the Director not agreed to the provisions of this Section 6.2.
4
6.3 No Waiver. The failure of any party to insist upon the strict observance and performance of the terms of this Agreement shall not be deemed a waiver of other obligations hereunder, nor shall it be considered a future or continuing waiver of the same terms.
6.4 Notices. Any notice required or permitted by this Agreement shall be in writing and shall be delivered as follows with notice deemed given as indicated: (i) by personal delivery when delivered personally; (ii) by overnight courier upon written verification of receipt; (iii) by facsimile transmission upon acknowledgment of receipt of electronic transmission; or (iv) by certified or registered mail, return receipt requested, upon verification of receipt. Notice shall be sent to the addresses set forth on the signature page of this Agreement or such other address as either party may specify in writing.
6.5 Governing Law. This Agreement shall be governed in all respects by the laws of the State of California, without regard to conflicts of law principles thereof.
6.6 Severability. Should any provisions of this Agreement be held by a court to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Agreement shall not be affected or impaired thereby.
6.7 Entire Agreement. This Agreement constitutes the entire agreement between the parties relating to this subject matter and supersedes all prior or contemporaneous oral or written agreements concerning such subject matter. The terms of this Agreement will govern all Director Services undertaken by Director for the Company.
6.8 Amendments. This Agreement may only be amended, modified or changed by an agreement signed by the Company and Director. The terms contained herein may not be altered, supplemented or interpreted by any course of dealing or practices.
6.9 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
[Rest of page intentionally left blank; signature page follows]
5
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
| Company: | Marwynn Holdings, Inc. | |
| By: | ||
| Name: | ▇▇▇ ▇▇▇ | |
| Title: | Chief Executive Officer | |
| Address: |
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | |
|
Director: |
||
| By: | ||
| Name: | [NAME] | |
| Address: | [ADDRESS] | |
6
Exhibit A
Director’s Current Affiliations
7