EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”), is dated as of January 13, 2010, by and
between Renhuang Pharmaceuticals, Inc., a Nevada corporation (the “Company”),
and Yan Yi Chen (the “Executive”).

WHEREAS, the Company desires to employ the Executive, and the Executive desires
to accept such employment, on the terms and conditions set forth herein,
effective as of   January 13, 2010  .

1.            Employment.  The Company hereby agrees to employ the Executive,
and the Executive hereby accepts such employment, upon the terms and conditions
set forth herein.  The Company agrees to fully cooperate with Executive in
connection with obtaining work visas or other work permits as may be necessary
for Executive to fulfill her responsibilities.  The Executive’s primary office
location shall be Beijing, but the Executive shall be expected to perform many
work-related duties in other locations in China, in the United States and in
Hong Kong.

2.           Term.  This Agreement shall commence on the date hereof (the
“Commencement Date”) and terminate on the third anniversary thereof, unless
sooner terminated as provided in Section 10 of this Agreement (the “Employment
Period”).

3.            Position and Duties.

(a)           During the Employment Period, the Executive shall serve as the
Chief Financial Officer of the Company and shall have such duties and
responsibilities as consistent with such office, and as otherwise may be
prescribed by the Board of Directors of the Company (the “Board”) from time to
time.

(b)           During the Employment Period, the Executive shall perform and
discharge her duties and responsibilities well and faithfully and in accordance
with the terms and conditions of this Agreement, and shall devote her best
talents, efforts and abilities to the performance of her duties hereunder.

(c)           During the Employment Period, the Executive shall devote
substantially all of her business time, attention and energy to performing her
duties and responsibilities hereunder and shall have no other employment and no
other outside business activities whatsoever; provided, however, that the
Executive shall not be precluded from making passive investments which do not
require the devotion of any significant time or effort.

4.            Compensation.

(a)           Base Salary.  In consideration for the Executive’s services
hereunder, the Company shall pay the Executive a minimum annual salary (the
amount shall be increased from time to time at the discretion of the Board, the
“Base Salary”) of Four Hundred Thousand Renminbi (RMB 400,000), payable in
accordance with the customary payroll practices of the Company.

(b)           Discretionary Bonus.  In addition to the Base Salary, the
Executive shall be eligible to receive discretionary bonuses at times and in
amounts to be determined by the Board, or if the Board organizes a compensation
committee, such committee (the “Committee”) (excluding the Executive if she is
then a member of the Committee), in its sole discretion.  This bonus, if any,
shall be subject to all applicable tax and payroll withholdings.

 
 

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(c)           Stock Option Grants.  The Executive shall be entitled to receive
options to purchase an aggregate of 150,000 shares of Common Stock of the
Company (the “Options”) in accordance with schedule set forth on Schedule
A.  The Options shall have a term of three years.  Any such grant of Options, or
any stock option plan pursuant to which any such Options are granted, shall have
been approved by the Company’s shareholders in accordance with applicable Stock
Exchange rules and regulations.

5.            Benefits.           During the Employment Period, the Company
shall provide the Executive with the following benefits:

(a)           Insurance Benefits.  The Company shall provide the Executive with
medical, health, dental, disability and accident insurance coverage at the
Executive’s option in an annual amount not to exceed Five Thousand Renminbi (RMB
5,000).

(b)           Liability Insurance.  The Executive shall be provided with the
liability insurance coverage generally provided to offices and managers of the
Company.  However the Company shall not be required to obtain such
coverage.  Notwithstanding the foregoing, the Company agrees to indemnify the
Executive against all costs, damages and expenses, including attorneys’ fees,
incurred by the Executive as a result of claims by third parties arising out of
or from the Executive’s lawful acts as an Executive of the Company, provided
such acts are not grossly negligent and are performed in good faith and in a
manner reasonably believed by the Executive to be in the Company’s best
interests.  Any counsel employed to defend the Executive in any such action
shall be reasonably acceptable to the Executive and the Company.  Any counsel
appointed by any insurance carrier for the Company shall be deemed
acceptable.  It is the intent of the parties that the obligation imposed by this
paragraph will survive the termination of this Agreement.

(c)           Other Benefits.  The Company shall make available to the Executive
any and all other Executive or fringe benefits (in accordance with their terms
and conditions) which the Company may make available to its other Executives.

6.            Reimbursement of Expenses.  During the Employment Period, the
Company shall pay or reimburse the Executive for the following expenses:

(a)           Membership/Professional Dues.  The Company shall pay or reimburse
the Executive for any membership fee payable or paid as required to maintain her
professional qualifications.

(b)           Training.  Based on approval of the Board, the Company shall pay
or reimburse for all training and examination related costs relevant to the
Executive’s role (for example, US CPA), and provide reasonable time and paid
leave for course and examination preparation and attendance.

(c)           Professional manuals.  The Company shall reimburse the Executive
for any professional manuals purchased as required in carrying out her duties.

 
 

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(d)          Other business expenses.  The Company shall pay or reimburse the
Executive for all reasonable entertainment and other business expenses actually
incurred or paid by the Executive in the performance of her duties hereunder
upon presentation of expense statements and /or such other supporting
information as the Company may reasonably require of the Executive.  The Company
shall pay the Executive an annual amount of Three Hundred and Fifty Thousand
Renminbi (RMB 350,000) for such expenses, any over or under payment between this
amount and actual amount incurred shall be reimbursed by the Executive or the
Company at the end of each of the 12 month anniversary of employment.

7.            Vacation.  The Executive shall be entitled to paid vacation during
each full calendar year of the Employment Period of 20 working days (and a pro
rata portion thereof for any portion of the Employment Period that is less than
a full calendar year).

8.            Statutory and Other Leaves.  The Executive shall be entitled to
all statutory and other leave entitlements in accordance to relevant laws and
regulations of the P.R.C and relevant regulations applied in Beijing.

9.            Initial Public Stock Offering.  Shall the Company participate in
Initial Public Stock Offering (the “IPO”), (a) the Base Salary and reimbursement
of Expenses detailed in Section 4 and 6 shall be reviewed and amended as
mutually agreed between the Board and the Executive and (b) additional share
options in the amount and terms mutually agreed between the Board and the
Executive shall be granted.

10.         Termination.  The employment of the Executive hereunder may be
terminated prior to the expiration of the Employment Period in the manner
described in this Section.

(a)           Termination upon Death.  The employment of the Executive hereunder
shall terminate immediately upon her death.

(b)           Termination upon Disability.  The Company shall have the right to
terminate this Agreement during the continuance of any Disability of the
Executive upon fifteen days’ prior notice to the Executive during the
continuance of the Disability.

(c)           Termination by the Company Without Good Cause.  The Company shall
have the right to terminate the Executive’s employment hereunder without Good
Cause (as such term is defined herein) by written notice to the Executive.

(d)           Termination by the Company for Good Cause.  The Company shall have
the right to terminate the employment of the Executive for Good Cause by written
notice to the Executive specifying the particulars of the circumstances forming
the basis for such Good Cause.

(e)           Voluntary Resignation by the Executive.  The Executive shall have
the right to voluntarily resign her employment hereunder for other than Good
Reason (as such term is defined herein) by written notice to the Company.

(f)           Resignation by the Executive for Good Reason.  The Executive shall
have the right to terminate her employment for Good Reason by written notice to
the Company specifying the particulars of the circumstances forming the basis
for such Good Reason.

 
 

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(g)          Termination Date.  The “Termination Date” is the date as of which
the Executive’s employment with the Company terminates.  Any notice of
termination given pursuant to the provisions of this Agreement shall specify the
Termination Date.
 
(h)          Certain Definitions.  For purposes of this Agreement, the following
terms shall have the following meanings:
 
(i)           “Disability” shall mean an inability by the Executive to perform a
substantial portion of the Executive’s duties hereunder by reason of physical or
mental incapacity or disability for a total of one hundred twenty days or more
in any consecutive period of three hundred and sixty five days, as determined by
the Board in its good faith judgment.
 
(ii)          “Good Cause” as used herein, shall mean:
 
(A) the commission of a felony, or a crime involving moral turpitude, or the
commission of any other act or omission involving dishonesty, disloyalty, or
fraud with respect to the Company;
 
(B) conduct tending to bring the Company or any of its affiliates into
substantial public disgrace or disrepute;
 
(C) substantial and repeated failure to perform duties as reasonably directed by
the Board;
 
(D) gross negligence or willful misconduct with respect to the Company or any of
its affiliates; or
 
(E) any material misrepresentation by the Executive under this Agreement;
provide, however, that such Good Cause shall not exist unless the Company shall
first have provided the Executive with written notice specifying in reasonable
detail the factors constituting such Good Cause, as applicable, and such factors
shall not have been cured by the Executive within thirty days after such notice
or such longer period as may reasonably be necessary to accomplish the cure.
 
(iii)         “Good Reason” means the occurrence of any of the following events:
 
(A) the assignment to the Executive of any duties inconsistent in any material
respect with the Executive’s then position (including status, offices, titles
and reporting relationships), authority, duties or responsibilities, or any
other action or actions by the Company which when taken as a whole results in a
significant diminution in the Executive’s position, authority, duties or
responsibilities, excluding for this purpose any isolated, immaterial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive;
 
(B) a material breach by the Company of one or more provisions of this
Agreement, provided that such Good Reason shall not exist unless the Executive
shall first have provided the Company with written notice specifying in
reasonable detail the factors constituting such material breach and such
material breach shall not have been cured by the Company within thirty days
after such notice or such longer period as may reasonably be necessary to
accomplish the cure;

 
 

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(C) the Company requiring the Executive to be primarily based at any location
other than a location other than Beijing, except for the requirements of
temporary travel on the Company’s business; and
 
(D) any purported termination by the Company of the Executive’s employment
otherwise than as expressly permitted by the Agreement.
 
(E) A Change in Control whereby:
 
     (i)  A person (other than a person who is an officer or director of the
Company on the Effective Date), including a group as defined in the Securities
Exchange Act of 1934, as amended, becomes, or obtains the right to become, the
beneficial owner of the Company’s securities having fifty one percent or more of
the combined voting power of then outstanding securities of the Company;
 
(ii)  The Company consummates a merger in which it is not the surviving entity;
 
(iii) All or substantially all of the Company’s assets are sold;
 
(iv) The Company’s shareholders approve the dissolution or liquidation of the
Company.
 
11.          Obligation of Company on Termination or Resignation.  If terminated
by the Company without Good Cause, if resigned from the Company for Good Reason,
the Executive is entitled to receive as severance (a) the Base Salary and
reimbursement of Expenses contemplated hereunder for a period of twelve months,
and (b) all Options granted but not yet vested shall immediately vest and shall
be exercisable.
 
12.          Covenants of Executive.
 
(a)           Confidentiality.
 
(i)  The Executive recognizes that the Executive’s position with the Company is
one of trust and confidence.  The Executive acknowledges that, the Company has
devoted substantial time and effort and resources to developing the Company’s
business and clients, and that during the course of the Executive’s employment
with the Company, the Executive will necessarily become acquainted with
confidential information relating to the clients or potential clients (including
names, addresses and telephone numbers) of the Company, and the Company’s
investments or potential investments in and/or financings and/or potential
financings to be provided to these clients or potential client, and trade
secrets, processes, methods of operation and other information, which the
Company regards as confidential and in the nature of trade secrets
(collectively, “Confidential Information”).  The Executive acknowledges and
agrees that the Confidential Information is of incalculable value to the Company
and that the Company would suffer damage if any of the Confidential Information
was improperly disclosed.

 
 

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(ii)  The Executive recognizes that because of the opportunities and support so
provided to the Executive and because of the Executive’s access to the Company’s
Confidential Information, Executive would be in a unique position to divert
business from the Company and to commit irreparable damage to the Company were
the Executive be allowed to divulge any of the Confidential Information.
 
(iii)  The Executive agrees that the Executive will not, at any time during or
after the termination of the Executive’s relationship with the Company
regardless of whether termination is initiated by either Executive or the
Company, reveal, divulge, or make known to any person, firm or corporation, any
Confidential Information made known to the Executive or of which the Executive
has become aware, regardless of whether developed, prepared, devised or
otherwise created in whole or in part by the efforts of the Executive, except
and to the extent that such disclosures is necessary to carry out the
Executive’s duties of the Company.  The Executive further agrees that the
Executive shall retain all Confidential Information in trust for the sole
benefit of the Company, and will not divulge or deliver or show any Confidential
Information to any unauthorized person including, without limitation, any other
employer of the Executive, and the Executive will not make use thereof in an
independent business related to the business of the Company; provided, however,
that the Executive has no obligation, express or implied, to refrain from using
or disclosing to others any such knowledge or information which is or hereafter
shall become available to the public other than through disclosure by the
Executive.
 
(iv)  The Executive agrees that, upon termination of the Executive’s employment
with the Company, for any reason whatsoever, or for no reason, and at any time,
the Executive shall return to the Company all papers, documents and other
property of the Company placed in the Executive’s custody or obtained by the
Executive during the course of the Executive’s employment which relate to
Confidential Information, and the Executive will not retain copies of any such
papers, documents or other property for any purpose whatsoever.
 
(b)  Non-Competition.  The Company is in the business of processing,
distributing, and selling pharmaceutical products (the “Business”). The
Executive acknowledges that during her employment with the Company she will
become familiar with trade secrets and other information relating to the
Company, and that her services have been and will be of special, unique and
extraordinary value to the Company.  Therefore, Executive agrees that during the
Employment Period, and for one year thereafter (collectively, the “Non-Compete
Period”), she will not  directly or indirectly own, manage, control, participate
in, consult with, render services for, or in any other manner engage in any
business, or as an investor in or lender to any business (in each case
including, with limitation, on her own behalf or on behalf of another entity)
which competes either directly or indirectly with the Company in the Business,
in any market in which the Company is operating, or is considering operating at
any given point in time during the Employment Period, or as of the end of the
Employment Period if the Employment Period has ended.  Nothing in this section
will deemed to prohibit the Executive from being a passive owner of less than 5%
of the outstanding stock of a corporation engaged in a competing business as
described above of any class which is publicly trade, so long as the Executive
has no direct or indirect participation in the business of such corporation.

 
 

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(c)           Non-Solicitation of Business.  The Executive will not, during the
Employment Period, or at any time within the one year period immediately
following her termination from employment, regardless of whether termination is
initiated by the Executive or by the Company, for any reason, solicit or assist
any other person to solicit, whether directly or indirectly, any business (other
than for the Company) from any entity: (i) into which the Company has invested;
(ii) for which the Company has provided financing; (iii) for which the Company
has been engaged to provide any kind of services, including but not limited to,
advisory services and providing financial analyses; (iv) that has either
invested in, or participated in a financing for, a client of the Company; or (v)
that has either been solicited by the Company to invest in, or participate in a
financing for, a client of the Company.
 
(d)           Non-Solicitation of Employees and Independent Contractors.  The
Executive will not, during the Employment Period, or at any time following her
termination from employment, regardless of whether termination is initiated by
Executive or by the Company, for any reason, directly or indirectly (i) induce
or attempt to induce any employee or full-time independent contractor of the
Company to leave the employment or contracting relationship with the Company, or
in any way interfere with the relationship between the Company and any employee
or full-time independent contractor thereof, (ii) solicit for employment or as
an independent contractor any person who was an employee or full-time
independent contractor of the Company at any time during the Employment Period,
or (iii) induce or attempt to induce any customer, supplier or other business
relation of the Company to cease doing business with the Company or in any way
interfere with the relationship between any such customer, supplier or other
business relation and the Company.
 
(e)           Work Product.  The Executive agrees that all innovations,
inventions, improvements, developments, methods, designs, analyses, drawing,
reports, and all similar or related information which relate to the Company’s
Business, or any business which the Company has taken significant action to
pursue, and which are conceived, developed or made by the Executive during the
Employment Period (any of the foregoing, hereinafter “Work Product”), belong to
the Company.  The Executive will promptly disclose all such Work Product to the
Board and perform all actions reasonably requested by the Board (whether during
or after the Employment Period) to establish and confirm such ownership
(including, without limitation, assignments, consents, powers of attorney and
other instruments).
 
(f)           No Conflict.  The Executive represents and warrants to the Company
that the Executive is not a party or bound by any employment agreement,
non-compete agreement or confidentiality agreement with any other person or
entity or any other agreement which would prevent or limit her ability to enter
into this Agreement or perform her obligations hereunder.
 
13.          Indemnification.  To the fullest extent permitted by law and other
relevant statutes, the Company will indemnify and hold harmless the Executive
against any actual action, suit or proceeding, whether civil, criminal, or
administrative, arising by reason of Executive’s status as a director, officer,
employee and/or agent of the Company or any of its affiliates during the
Executive’s employment or the Executive’s status, if any, as a trustee or other
fiduciary of any employee benefit plan sponsored by the Company or its
affiliates.  In addition, to the fullest extent permitted by law, the Company
will pay or reimburse the Executive for any costs and expenses, including
reasonably attorney’s fees, the Executive incurs arising from any claim as to
which the Company is providing indemnification hereunder.
 
14.          Severability.  Should any provision of this Agreement be held, by a
court of competent jurisdiction, to be invalid or unenforceable, such invalidity
or unenforceability shall not render the entire Agreement invalid or
unenforceable, and this Agreement and each other provision hereof shall be
enforceable and valid to the fullest extent permitted by law.

 
 

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15.          Successors and Assigns.
 
(a)  This Agreement and all rights under this Agreement are personal to the
Executive and shall not be assignable other than by will or the laws of
descent.  All of the Executive’s rights under the Agreement shall inure to the
benefit of her personal representatives or other legal representatives, as the
case may be.
 
(b)  This Agreement shall inure to the benefit of and be binding upon the
Company and its successors and assigns.  Any entity succeeding to the business
of the Company by merger, purchase, consolidation or otherwise shall assume by
contract or operation of law the obligations of the Company under this
Agreement.
 
16.          Arbitration.  [Arbitration terms applicable to Company Executives]
 
17.          Complete Understanding.  Except as expressly provided below, this
Agreement supersedes any prior contracts, understandings, discussions and
agreements relating to employment between the Executive and the Company and
constitutes the complete understanding between the parties with respect to the
subject matter hereof.  No statement, representation, warranty or covenant has
been made by either party with respect to the subject matter hereof except as
expressly set forth herein.
 
18.          Modification and Waiver.
 
(a)  This Agreement may be amended or waived if, and only if, such amendment or
waiver is in writing and signed, in the case of an amendment, by the Company and
the Executive or in the case of a waiver, by the party against whom the waiver
is to be effective.  Any such waiver shall be effective only to the extent
specifically set forth in such writing.
 
(b)  No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.
 
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed in
its corporate name by one of its officers duly authorized to enter into and
execute this Agreement, and the Executive has manually signed her name.
 

     
RENHUANG PHARMACEUTICALS, INC.
       
 
 
By:
/s/ Li Shaoming
Witness -
   
Name:Li Shaoming
     
Title:CEO and President of Renhuang
             
/s/ Yan Yi Chen
Witness -
   
Name: Yan Yi Chen

 
 
 

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SCHEDULE A
 
SHARE OPTIONS

Grant Date*
 
Number of Shares Issuable
Upon Exercise
   
Exercise Price
 
Commencement Date
    50,000     $ 1.00  
12 month anniversary of the Commencement Date
    50,000     $ 1.00  
24 month anniversary of the Commencement Date
    50,000     $ 1.00  

 
* The options shall vest on the 12 month anniversary of their respective Grant
Dates, conditional upon the Executive’s continued employment with the Company as
of each such Vesting Date

 
 

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