EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into as of
September 6, 2013 by and between Rich Pharmaceuticals, Inc., a Nevada
corporation (the “Company”) and Ben Chang (the “Employee”).

 

A.                  Employee has served as the Chief Executive Officer, Chief
Financial Officer, Secretary and President of the Company since July 18, 2013,
and the Company desires to enter into this Agreement to retain the services of
the Employee in such capacities, and the Employee desires to continue to provide
services to the Company in such capacities.

 

B.                  The Employee is willing to be employed by the Company on the
terms and subject to the conditions set forth in this Agreement.

THE PARTIES AGREE AS FOLLOWS:

 

1.                   Positions and Duties.

1.1                Title. The Employee shall be employed by the Company as its
Chief Executive Officer, Chief Financial Officer and President, and the Company
agrees to employ and retain the Employee in such capacity. The Employee shall
report to, and serve at the pleasure of, the Company’s Board of Directors (the
“Board”).

1.2                Duties. Employee shall devote the majority of his business
time, energy, and skill to the affairs of the Company to perform the duties
required and necessary for a chief executive officer, chief financial officer
and president of a public company in the Company’s industry, and shall ensure
that Employee’s other business, charitable or professional activities do not
materially interfere with the Employee’s performance of services under this
Agreement. Employee’s duties as Secretary shall cease upon the Company’s
appointment of a Secretary.

1.3 Term of Employment. The term of Employee's employment pursuant to this
Agreement commenced on September 6, 2013 (the “Effective Date”), and shall
expire on September 6, 2015, unless renewed or extended by the agreement of the
parties hereto, or terminated earlier as provided herein.

1.4 Employee Indemnification. The Employee shall be entitled to all rights to
indemnification as a Company officer as provided under the laws of the State of
Nevada, the Company’s Certificate of Incorporation, the Company’s Bylaws, and
the Company’s insurance policies.

2.                   Terms of Employment.

2.1                Definitions. For purposes of this Agreement, the following
terms shall have the following meanings:

 

 

(a)                 “Accrued Compensation” shall mean any accrued Total
Compensation, any benefits under any plan of the Company in which the Employee
is a participant to the full extent of Employee’s rights under such plans, any
accrued vacation pay, and any appropriate business expenses incurred by the
Employee in connection with the performance of Employee’s duties hereunder, all
to the extent unpaid on the date of termination.

(b)                 “Base Compensation” shall have the meaning set forth in
Sections 3.1 and 3.2 hereof.

(c)                 “Change of Control” shall mean the consummation of an
acquisition, a merger or consolidation of the Company with or into another
entity or any other corporate reorganization, if more than 50% of the combined
voting power of the continuing or surviving entity's securities outstanding
immediately after such acquisition, merger, consolidation or other
reorganization is owned by persons who in the aggregate owned less than 20% of
the Company's combined voting power represented by the Company's outstanding
securities immediately prior to such acquisition, merger, consolidation or other
reorganization.

(d)                 “Death Termination” shall mean termination of the Employee’s
employment because of the death of the Employee.

(e)                 “Disability Termination” means termination by the Company of
the Employee’s employment by reason of the Employee’s incapacitation due to
disability. The Employee shall be deemed to be incapacitated due to disability
if at the end of any month the Employee is unable to perform substantially all
of his or her duties under this Agreement in the normal and regular manner due
to illness, injury or mental or physical incapacity, and has been unable so to
perform for either (i) three consecutive full calendar months then ending, or
(ii) 90 or more of the normal working days during the 12 consecutive full
calendar months then ending. Nothing in this paragraph shall alter the Company’s
obligations under applicable law, which may, in certain circumstances, result in
the suspension or alteration of the foregoing time periods.

(f)                  “Termination For Cause” means termination by the Company of
the Employee’s employment by reason of the Employee’s (i) dishonesty or fraud,
(ii) gross negligence in the performance of his or her duties hereunder, (iii)
material breach of this Agreement, (iv) intentional engagement in acts seriously
detrimental to the Company’s operations, (v) conviction of a felony involving
moral turpitude, or (vi) failure to comply with any lawful orders or directions
of the Board that are not incompatible with his position with the Company or
manifestly unreasonable or unethical, provided that the Board delivers to
Employee a written notification specifying in sufficient detail such order or
direction and the Employee has thirty (30) days within which to comply with such
order or direction (or such reasonably shorter period of time if such ordered or
directed task by its nature requires completion in less than thirty (30) days)).

(g)                 “Termination Other Than For Cause” means termination by the
Company of the Employee’s employment for any reason other than as specified in
Sections 2.1(c), (d), (e) or (i) hereof.

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(h)                 “Total Compensation” shall mean the Employee’s Base Salary
(as defined in Section 3.1).

(i)                   “Voluntary Termination” means termination of the
Employee’s employment by the voluntary action of the Employee other than by
reason of a Disability Termination or a Death Termination.

2.2                Termination For Cause. The Company shall have the right to
effect a Termination For Cause as provide in Section 2.1(f). Upon Termination
For Cause, the Company shall pay the Employee Accrued Compensation, if any.

2.3                Termination Other Than For Cause. The Company shall have the
right to effect a Termination Other Than For Cause upon thirty (30) days prior
notice to the Employee. In the event of a Termination Other Than For Cause
before the expiration of the Employment Agreement, the Company shall pay the
Employee all Accrued Compensation, if any, and all Severance Compensation as
provided in Section 2.6.

2.4                Disability Termination. The Company shall have the right to
effect a Disability Termination by giving written notice thereof to the
Employee. Upon Disability Termination, the Company shall pay the Employee all
Accrued Compensation, if any.

2.5                Death Termination. In the event of the Employee’s death
during the term of this Agreement, the Employee’s employment shall be deemed to
have terminated as of the last day of the month during which his or her death
occurs, and the Company shall promptly pay to the Employee’s estate Accrued
Compensation, if any.

2.6                Severance Payments. In the event of the termination of
Employee resulting from (i) a Change of Control; or (ii) Termination Other Than
For Cause at any time during the first twelve (12) months of employment,
Employee shall be paid severance payments equal to three (3) months of Base
Salary. In the event of the termination of Employee resulting from (i) a Change
of Control; or (ii) Termination Other Than For Cause at any time during the
second twelve (12) months of employment, Employee shall be paid severance
payments equal to six (6) months of Base Salary. The severance payment shall be
paid pursuant to the Company’s normal payroll schedule for the applicable
monthly period following the termination date.

3.                   Compensation and Benefits.

3.1                Base Salary. As payment for the services to be rendered by
the Employee as provided in Section 1 and subject to the provisions of Section 2
of this Agreement, the Company shall pay the Employee a “Base Salary” at the
rate of $22,916.66 per month (equivalent to $275,000 per year), payable on the
Company’s normal payroll schedule. Employee and Company agree that the amount of
$68,749.98 is due and payable by the Company to Employee as of the date of this
Agreement as a bonus for services performed on behalf of the Company.

3.2 Option Compensation. As payment for the services to be rendered by the
Employee as provided in Section 1 and subject to the provisions of this
Agreement, the Company shall issue to Employee options to purchase up to 7,200
shares of Company common stock pursuant to the terms of the Company’s 2013 Stock
Option Plan and the Plan award documents. The material terms of the options
shall be as follows: (i) $8.00 exercise price; (ii) vesting 50% on grant/50%
monthly for 24 months; and (iii) rights of cashless exercise. The number of
options and exercise price shall be adjusted upon the effective date of the
Company’s planned 416.7 to one forward stock split such that the number of
options shall be 5,000,000 and the exercise price shall be $.0191984.

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3.2                Fringe Benefits.

(a)                 Fringe Benefits. The Employee shall not be eligible to
participate in any of the Company’s benefit plans as are now generally available
or later made generally available to senior officers of the Company, including,
without limitation, medical, dental, life, and disability insurance plans, if
any.

(b)                 Expense Reimbursement. The Company agrees to reimburse the
Employee for all reasonable, ordinary and necessary travel and entertainment
expenses incurred by the Employee in conjunction with Employee’s services to the
Company consistent with the Company’s standard reimbursement policies. The
Company shall pay travel costs incurred by the Employee in conjunction with his
or her services to the Company consistent with the Company’s standard travel
policy.

(c)                 Vacation. The Employee shall be entitled, without loss of
compensation, to two (2) weeks of vacation per year. Unused vacation may be
accrued by the Employee up to a maximum of four (4) weeks, when it will cease
accruing until the Employee reduces the accrued, unused amount through use of
vacation time.

3.3 Code Section 409A; Employee Taxes.

 

(a)                To the extent applicable, this Agreement shall be interpreted
in accordance with Section 409A of the Code (together with Department of
Treasury regulations and other official guidance issued thereunder, “Section
409A”). Notwithstanding any provision of this Agreement to the contrary, in the
event that the Company determines in good faith that any compensation or
benefits payable under this Agreement may not be either exempt from or compliant
with Section 409A, the Company shall consult with Employee and, subject to the
written consent of Employee, adopt such amendments to this Agreement or adopt
other policies or procedures (including amendments, policies and procedures with
retroactive effect), or take any other commercially reasonable actions necessary
or appropriate to (i) preserve the intended tax treatment of the compensation
and benefits payable hereunder, to preserve the economic benefits of such
compensation and benefits, and/or to avoid less favorable accounting or tax
consequences for the Company and/or (ii) to exempt the compensation and benefits
payable hereunder from Section 409A or to comply with the requirements of
Section 409A and thereby avoid the application of penalty taxes thereunder;
provided, however, that this Section 3.3(a) does not, and shall not be construed
so as to, create any obligation on the part of the Company to adopt any such
amendments, policies or procedures or to take any other such actions or to
indemnify Employee for any failure to do so.

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(b)               Notwithstanding anything herein to the contrary, Employee
acknowledges and agrees that in the event that any tax is imposed under Section
409A in respect to any compensation or benefits payable to Employee, whether
under this Agreement or otherwise, then (i) the payment of such tax shall be
solely Employee’s responsibility, and (ii) neither the Company, or their
subsidiaries or affiliates, nor any of their respective past or present
directors, officers, employees or agents shall have any liability for any such
tax.

(c) Employee shall be solely responsible for the payment of all state and
federal income tax related to his compensation under this Agreement and the
Option Agreement.

4.                   Proprietary Information. The Employee shall as of the
Effective Date or promptly thereafter execute and deliver to the Company the
Company Employee Confidential Information and Inventions Agreement.

5.                   Miscellaneous.

5.1                Waiver. The waiver of the breach of any provision of this
Agreement shall not operate or be construed as a waiver of any subsequent breach
of the same or other provision hereof.

5.2                Notices. All notices and other communications under this
Agreement shall be in writing and shall be given by personal or courier
delivery, facsimile or first class mail, certified or registered with return
receipt requested, and shall be deemed to have been duly given upon receipt if
personally delivered or delivered by courier, on the date of transmission if
transmitted by facsimile, or three days after mailing if mailed, to the
addresses of the Company and the Employee contained in the records of the
Company at the time of such notice. Any party may Change such party’s address
for notices by notice duly given pursuant to this Section 5.2.

5.3                Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to
contracts entered into and wholly to be performed within the State of California
by California residents.

5.4                Survival of Obligations. This Agreement shall be binding upon
and inure to the benefit of the executors, administrators, heirs, successors,
and assigns of the parties; provided, however, that except as herein expressly
provided, this Agreement shall not be assignable either by the Company (except
to an affiliate or successor of the Company) or by the Employee without the
prior written consent of the other party.

5.5                Counterparts. This Agreement may be executed in one or more
counterparts and delivered by facsimile or PDF/electronic transmission, all of
which taken together shall constitute one and the same Agreement.

5.6                Withholding. All sums payable to the Employee hereunder shall
be reduced by all federal, state, local, and other withholdings and similar
taxes and payments required by applicable law.

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5.7                Enforcement. If any portion of this Agreement is determined
to be invalid or unenforceable, such portion shall be adjusted, rather than
voided, to achieve the intent of the parties to the extent possible, and the
remainder shall be enforced to the maximum extent possible.

5.8                Entire Agreement; Modifications. Except as otherwise provided
herein or in the exhibits hereto, this Agreement represents the entire
understanding among the parties with respect to the subject matter of this
Agreement, and this Agreement supersedes any and all prior and contemporaneous
understandings, agreements, plans, and negotiations, whether written or oral,
with respect to the subject matter hereof. All modifications to the Agreement
must be in writing and signed by each of the parties hereto.

IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement
as of the date set forth in the first paragraph.

 

RICH PHARMACUETICALS, INC.

 

By: /s/ David Chou

David Chou, a Director

 

EMPLOYEE

 

/s/ Ben Chang

Ben Chang

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