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Exhibit 10.1
EMPLOYMENT AGREEMENT
 
This employment agreement (this "Agreement"), dated as of July 31, 2003 (the
"Effective Date"), is made by and between Local Area Yellow Pages, Inc./Telava,
a Nevada corporation (the "Company"), and Baldwin Yung (the "Executive") (each,
a "Party" and together, the "Parties").
 
WHEREAS, the Executive is currently employed as a Chief Executive Officer of the
Company; and Acting Chief Financial Officer
 
WHEREAS, the Parties wish to establish the terms of the Executive's continued
employment by the Company;
 
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
contained herein and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound, hereby agree as follows:
 
 1.         POSITION/DUTIES.
 
(a)              During the Employment Term (as defined in Section 2 below), the
Executive shall serve as a Chief Financial Officer of the Company. In this
capacity the Executive shall have such duties, authorities and responsibilities
commensurate with the duties, authorities and responsibilities of persons in
similar capacities in similarly sized companies and such other reasonable duties
and responsibilities as the Board of Directors of the Company (the "Board")
shall designate. The Executive shall report directly to the Board. The Executive
shall obey the lawful directions of the Board and shall use his diligent efforts
to promote the interests of the Company and to maintain and promote the
reputation thereof.
 
(b)              During the Employment Term, the Executive shall use his best
efforts to perform his duties under this Agreement and shall devote all of his
business time, energy and skill in the performance of his duties with the
Company. The Executive shall not during the Employment Term (except as a
representative of the Company or with consent in writing of the Board) be
directly or indirectly engaged or concerned in any other business activity.
Notwithstanding the foregoing provisions, the Executive is not prohibited from
(1) participating in charitable, civic, educational, professional or community
affairs or serving on the board of directors or advisory committees of
non-profit entities, and (2) subject to Section 9(b) hereof, managing his and
his family's personal investments, in each case, provided that such activities
in the aggregate do not materially interfere with his duties hereunder.
 
(c)              Effective as of the Effective Date, the Company agrees to
defend, protect, indemnify and hold the Executive harmless from any and all
losses, liabilities, obligations, claims, contingencies, damages, costs and
expenses, including all judgments, amounts paid in settlements, court costs and
reasonable attorneys' fees and costs of investigation (collectively, "Losses")
that the Executive may suffer or incur as a result of or relating to (1) any
action that the Executive takes at the direction of the Company's board of
directors, on behalf of the Company as the Chief Financial Officer of the
Company during the Employment Term, or (2) any cause of action, suit or claim
brought or made against the Executive by a third party, including a governmental
authority and arising solely by virtue of the Executive's position as the Chief
Financial Officer of the Company during the Employment Term.
 
 2.           EMPLOYMENT TERM AND PROBATIONARY PERIOD. Except for earlier
termination as provided in Section 6, the Executive's employment under this
Agreement shall be for a two-year term commencing on the Effective Date and
ending on July 31, 2003 (the "Initial Term"). Subject to Section 6, the Company
shall have the option, at its sole discretion, of extending the Initial Term for
additional terms of successive two-year periods (the "Additional Terms") subject
to the Company's delivery of a 30-day written notice to the Executive prior to
the expiration of the Initial Term or each such Additional Term. The Initial
Term and any Additional Term shall be referred to herein as the "Employment
Term." The probationary period of this employment agreement is 3 months,
commencing on July 31, 2003 and ending on July 31, 2005.

 
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3.            BASE SALARY. The Company agrees to pay to the Executive a monthly
base salary of $7,000, payable in accordance with the regular payroll practices
of the Company.
 
4.            BONUS PLAN: STOCK OPTION AWARDS. During the Initial Term, the
Executive shall be eligible to receive a bonus or an option to purchase shares
of the Company's common stock, par value $0.001 per share, having an aggregate
value to be determined by the Board, commencing after completion of the
probationary period. Such option shall vest in quarterly portions over the
Initial Term, with the first portion vesting at the end of the probationary
period and the final portion vesting on the last day of the Initial Term. If the
employment term is terminated by the Company for Cause, or by the Executive with
Good Reason, then, the Company shall issue the stock option to Executive vested
when employed pro-rated of the actual employment term.
 
5.             TERMINATION. The Executive's employment and the Employment Term
shall terminate on
 
the first of the following to occur:
 
(a)              Disability. The thirtieth (30th) day following written notice
by the Company to the Executive of termination due to Disability. For purposes
of this Agreement, "Disability" shall mean a determination by the Company in
accordance with applicable law that due to a physical or mental injury,
infirmity or incapacity, the Executive is unable to perform the essential
functions of his job with or without accommodation for 180 days (whether or not
consecutive) during any 12-month period.
 
(b)              Death. Automatically on the date of death of the Executive.
 
(c)              Cause. Immediately upon written notice by the Company to the
Executive of a termination for Cause. "Cause" shall mean, as determined by the
Chief Executive Officer (or its designee) (1) conduct by the Executive in
connection with his employment duties or responsibilities that is fraudulent,
unlawful or grossly negligent; (2) the wilful misconduct of the Executive; (3)
the wilful and continued failure of the Executive to perform the Executive's
duties with the Company (other than any such failure resulting from incapacity
due to physical or mental illness); (4) the commission by the Executive of any
felony (or the equivalent under the law of the People's Republic of China)
(other than traffic-related offenses) or any crime involving moral turpitude;
(5) violation of any material policy of the Company or any material provision of
the Company's code of conduct, employee handbook or similar documents; or (6)
any material breach by the Executive of any provision of this Agreement or any
other written agreement entered into by the Executive with the Company.
 
(d)              Without Cause. On the thirtieth (30th) day following written
notice by the Company to the Executive of an involuntary termination without
Cause, other than for death or Disability.
 
(e) Good Reason. On the sixtieth (60th) day following written notice by the
Executive to the Company of a termination for Good Reason. "Good Reason" shall
mean, without the express written consent of the Executive, the occurrence of
any the following events unless such events are cured (if curable) by the
Company within fifteen days following receipt of written notification by the
Executive to the Company that he intends to terminate his employment hereunder
for one of the reasons set forth below: any material reduction or diminution
(except temporarily during any period of incapacity due to physical or mental
illness) in the Executive's title, authorities, duties or responsibilities or
reporting requirements with the Company.
 
 
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6.            CONSEQUENCES OF TERMINATION.
 
(a)             Disability. Upon termination of the Employment Term because of
the Executive's Disability, the Company shall pay or provide to the Executive
(1) any unpaid Base Salary and any accrued vacation through the date of
termination; (2) any unpaid Annual Bonus accrued with respect to the fiscal year
ending on or preceding the date of termination; (3) reimbursement for any
unreimbursed expenses properly incurred through the date of termination; and (4)
all other payments or benefits to which the Executive may be entitled under the
terms of any applicable employee benefit plan, program or arrangement
(collectively, "Accrued Benefits").
 
(b)              Death. Upon the termination of the Employment Term because of
the Executive's death, the Executive's estate shall be entitled to any Accrued
Benefits.
 
(c)              Termination for Cause. Upon the termination of the Employment
Term by the Company for Cause or by either party in connection with a failure to
renew this Agreement, the Company shall pay to the Executive any Accrued
Benefits.
 
(d)              Termination without Cause or for Good Reason. Upon the
termination of the Employment Term by the Company without Cause or by the
Executive with Good Reason, the Company shall pay or provide to the Executive
(1) the Accrued Benefits, and (2) subject to the Executive's execution (and
non-revocation) of a general release of claims against the Company and its
affiliates in a form reasonably requested by the Company, (A) continued payment
of his Base Salary for two (2) months after termination, payable in accordance
with the regular payroll practices of the Company, but off the payroll; and (B)
payment of the Executive's cost of continued medical coverage for two (2) months
after termination (subject to the Executive's co-payment of the costs in the
same proportion as such costs were shared immediately prior to the date of
termination).1 Payments provided under this Section 7(d) shall be in lieu of any
termination or severance payments or benefits for which the Executive may be
eligible under any of the plans, policies or programs of the Company.
 
7.            NO ASSIGNMENT. This Agreement is personal to each of the Parties.
Except as provided below, no Party may assign or delegate any rights or
obligations hereunder without first obtaining the written consent of the other
Party hereto; provided, however, that the Company may assign this Agreement to
any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business or assets of the Company.
 
8.            NOTICES. For the purpose of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given (1) on the date of delivery if delivered by hand,
(2) on the date of transmission, if delivered by confirmed facsimile, (3) on the
first business day following the date of deposit if delivered by guaranteed
overnight delivery service, or (4) on the fourth business day following the date
delivered or mailed by United States registered or certified mail, return
receipt requested, postage prepaid, addressed as follows:
 
If to the Executive:
 
At the address (or to the facsimile number) shown on the records of the Company
 
If to the Company:
 
Local Area Yellow Pages, Inc./Telava c/o Management.
353 Sacramento Street, Suite 1500 San Francisco, California, 94111
 
or to such other address as either Party may have furnished to the other in
writing in accordance herewith, except that notices of change of address shall
be effective only upon receipt.

 
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9.            PROTECTION OF THE COMPANY'S BUSINESS.
 
(a)             Confidentiality. The Executive acknowledges that during the
course of his employment by the Company (prior to and during the Employment
Term) he has and will occupy a position of trust and confidence. The Executive
shall hold in a fiduciary capacity for the benefit of the Company and shall not
disclose to others or use, whether directly or indirectly, any Confidential
Information regarding the Company, except (i) as in good faith deemed necessary
by the Executive to perform his duties hereunder, (ii) to enforce any rights or
defend any claims hereunder or under any other agreement to which the Executive
is a party, provided that such disclosure is relevant to the enforcement of such
rights or defense of such claims and is only disclosed in the formal proceedings
related thereto, (iii) when required to do so by a court of law, by any
governmental agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a committee
thereof) with jurisdiction to order him to divulge, disclose or make accessible
such information, provided that the Executive shall give prompt written notice
to the Company of such requirement, disclose no more information than is so
required, and cooperate with any attempts by the Company to obtain a protective
order or similar treatment, (iv) as to such Confidential Information that shall
have become public or known in the Company's industry other than by the
Executive's unauthorized disclosure, or (v) to the Executive's spouse, attorney
and/or his personal tax and financial advisors as reasonably necessary or
appropriate to advance the Executive's tax, financial and other personal
planning (each an "Exempt Person"), provided, however, that any disclosure or
use of Confidential Information by an Exempt Person shall be deemed to be a
breach of this Section 10(a) by the Executive. The Executive shall take all
reasonable steps to safeguard the Confidential Information and to protect it
against disclosure, misuse, espionage, loss and theft. The Executive understands
and agrees that the Executive shall acquire no rights to any such Confidential
Information. "Confidential Information" shall mean information about the
Company, its subsidiaries and affiliates, and their respective clients and
customers that is not disclosed by the Company and that was learned by the
Executive in the course of his employment by the Company, including, but not
limited to, any proprietary knowledge, trade secrets, data and databases,
formulae, sales, financial, marketing, training and technical information,
client, customer, supplier and vendor lists, competitive strategies, computer
programs and all papers, resumes, and records (including computer records) of
the documents containing such Confidential Information.
 
(b)              Non-Competition. During the Employment Term and for the
one-year period following the termination of the Executive's employment for any
reason (the "Restricted Period"), the Executive shall not, directly or
indirectly, without the prior written consent of the Company, provide employment
(including self-employment), directorship, consultative or other services to any
business, individual, partner, firm, corporation, or other entity that competes
with any business conducted by the Company or any of its subsidiaries or
affiliates on the date of the Executive's termination of employment or within
one year of the Executive's termination of employment in the geographic
locations where the Company and its subsidiaries or affiliates engage or propose
to engage in such business (the "Business"). Nothing herein shall prevent the
Executive from having a passive ownership interest of not more than 2% of the
outstanding securities of any entity engaged in the Business whose securities
are traded on a national securities exchange.
 
(c)                    Non-Solicitation of Employees. The Executive recognizes
that he possesses and will possess confidential information about other
employees of the Company and its subsidiaries and affiliates relating to their
education, experience, skills, abilities, compensation and benefits, and
inter-personal relationships with customers of the Company and its subsidiaries
and affiliates. The Executive recognizes that the information he possesses and
will possess about these other employees is not generally known, is of
substantial value to the Company and its subsidiaries and affiliates in
developing their business and in securing and retaining customers, and has been
and will be acquired by him because of his business position with the Company.
The Executive agrees that, during the Restricted Period, he will not, directly
or indirectly, (i) solicit or recruit any employee of the Company or any of its
subsidiaries or affiliates (a "Current Employee") or any person who was an
employee of the Company or any of its subsidiaries or affiliates during the
twelve (12) month period immediately prior to the date the Executive's
employment terminates (a "Former Employee") for the purpose of being employed by
him or any other entity, or (ii) hire any Current Employee or Former Employee.

 
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(d)              Non-Solicitation of Customers. The Executive agrees that,
during the Restricted Period, he will not, directly or indirectly, solicit or
attempt to solicit (i) any party who is a customer or client of the Company or
its subsidiaries, who was a customer or client of the Company or its
subsidiaries at any time during the twelve (12) month period immediately prior
to the date the Executive's employment terminates or who is a prospective
customer or client that has been identified and targeted by the Company or its
subsidiaries for the purpose of marketing, selling or providing to any such
party any services or products offered by or available from the Company or its
subsidiaries, or (ii) any supplier or vendor to the Company or any subsidiary to
terminate, reduce or alter negatively its relationship with the Company or any
subsidiary or in any manner interfere with any agreement or contract between the
Company or any subsidiary and such supplier or vendor.
 
(e)             Property. The Executive acknowledges that all originals and
copies of materials, records and documents generated by him or coming into his
possession during his employment by the Company or its subsidiaries are the sole
property of the Company and its subsidiaries ("Company Property"). During the
Employment Term, and at all times thereafter, the Executive shall not remove, or
cause to be removed, from the premises of the Company or its subsidiaries,
copies of any record, file, memorandum, document, computer related information
or equipment, or any other item relating to the business of the Company or its
subsidiaries, except in furtherance of his duties under this Agreement. When the
Executive's employment with the Company terminates, or upon request of the
Company at any time, the Executive shall promptly deliver to the Company all
copies of Company Property in his possession or control.
 
(f)               Non-Disparagement. Executive shall not, and shall not induce
others to, Disparage the Company or its subsidiaries or affiliates or their past
and present officers, directors, employees or products. "Disparage" shall mean
making comments or statements to the press, the Company's or its subsidiaries'
or affiliates' employees or any individual or entity with whom the Company or
its subsidiaries or affiliates has a business relationship which would adversely
affect in any manner (1) the business of the Company or its subsidiaries or
affiliates (including any products or business plans or prospects), or (2) the
business reputation of the Company or its subsidiaries or affiliates, or any of
their products, or their past or present officers, directors or employees.
 
(g)             Cooperation. Subject to the Executive's other reasonable
business commitments, following the Employment Term, the Executive shall be
available to cooperate with the Company and its outside counsel and provide
information with regard to any past, present, or future legal matters which
relate to or arise out of the business the Executive conducted on behalf of the
Company and its subsidiaries and affiliates, and, upon presentation of
appropriate documentation, the Company shall compensate the Executive for any
out-of-pocket expenses reasonably incurred by the Executive in connection
therewith.
 
(h)              Equitable Relief and Other Remedies. The Executive acknowledges
and agrees that the Company's remedies at law for a breach or threatened breach
of any of the provisions of this Section 10 would be inadequate and, in
recognition of this fact, the Executive agrees that, in the event of such a
breach or threatened or attempted breach, in addition to any remedies at law,
the Company, without posting any bond, shall be entitled to obtain equitable
relief in the form of specific performance, a temporary restraining order, a
temporary or permanent injunction or any other equitable remedy which may then
be available. In addition, without limiting the Company's remedies for any
breach of any restriction on the Executive set forth in this Section 10, except
as required by law, the Executive shall not be entitled to any payments set
forth in Section 7(d) hereof if the Executive has breached the covenants
applicable to the Executive contained in this Section 10, the Executive will
immediately return to the Company any such payments previously received under
Section 7(d) upon such a breach, and, in the event of such breach, the Company
will have no obligation to pay any of the amounts that remain payable by the
Company under Section 7(d).

 
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(i)            Reformation. If it is determined by a court of competent
jurisdiction in any state that any restriction in this Section 10 is excessive
in duration or scope or is unreasonable or unenforceable under the laws of that
state, it is the intention of the parties that such restriction may be modified
or amended by the court to render it enforceable to the maximum extent permitted
by the law of that state. The Executive acknowledges that the restrictive
covenants contained in this Section 10 are a condition of this Agreement and are
reasonable and valid in temporal scope and in all other respects.
 
(j)            Survival of Provisions. The obligations contained in this Section
10 shall survive in accordance with their terms the termination or expiration of
the Executive's employment with the Company and shall be fully enforceable
thereafter.
 
10.             INDEMNIFICATION. The Executive shall be indemnified to the
extent permitted by the
 
Company's organizational documents and to the extent required by law.
 
11.             SECTION HEADINGS AND INTERPRETATION. The section headings used
in this Agreement are included solely for convenience and shall not affect, or
be used in connection with, the interpretation of this Agreement. Expressions of
inclusion used in this agreement are to be understood as being without
limitation.
 
14.             SEVERABILITY. The provisions of this Agreement shall be deemed
severable and the invalidity of unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.
 
15.             COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which
 
shall be deemed to be an original but all of which together will constitute one
and the same Agreement.
 
16.             GOVERNING LAW AND VENUE. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws of
the State of New York without regard to its conflicts of law principles. The
Parties agree irrevocably to submit to the exclusive jurisdiction of the federal
courts or, if no federal jurisdiction exists, the state courts, located in the
City of New York, Borough of Manhattan, for the purposes of any suit, action or
other proceeding brought by any Party arising out of any breach of any of the
provisions of this Agreement and hereby waive, and agree not to assert by way of
motion, as a defence or otherwise, in any such suit, action, or proceeding, any
claim that it is not personally subject to the jurisdiction of the above-named
courts, that the suit, action or proceeding is brought in an inconvenient forum,
that the venue of the suit, action or proceeding is improper, or that the
provisions of this Agreement may not be enforced in or by such courts. IN
ADDITION, THE PARTIES AGREE TO WAIVE A TRIAL BY JURY.
 
17.             ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the Parties with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, with respect thereto. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement.
 
18.            WAIVER AND AMENDMENT. No provision of this Agreement may be
modified, amended, waived or discharged unless such waiver, modification,
amendment or discharge is agreed to in writing and signed by the Executive and
such officer or director as may be designated by the Board. No waiver by either
Party at any time of any breach by the other Party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
Party shall be deemed a waiver or similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time.

 
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19.             WITHHOLDING. The Company may withhold from any and all amounts
payable under this Agreement such federal, state, local and foreign taxes as may
be required to be withheld pursuant to any applicable law or regulation.
 
20.             AUTHORITY AND NON-CONTRAVENTION. The Executive represents and
warrants to the Company that he has the legal right to enter into this Agreement
and to perform all of the obligations on his part to be performed hereunder in
accordance with its terms and that he is not a party to any agreement or
understanding, written or oral, which could prevent him from entering into this
Agreement or performing all of his obligations hereunder.
 
21.             COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.
 
22.             TERMINATION OF EXCHANGE AGREEMENT. In the event that the
consummation of the Acquisition does not occur and the Exchange Agreement
terminates pursuant to its term, the terms of employment contained herein shall
be null and void, or if the Executive's employment with the Company terminates
prior to the consummation of the Acquisition, the terms contained herein shall
be null and void unless the Company agrees otherwise, in its sole discretion.
 
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first written above.
 

 
Local Area Yellow Pages. Inc./ TelavaBoard of Directors:
       
 
By:
/s/ Dr. Dicken Yung       Dr. Dicken Yung      
Title: Chairman of the Board
         

 

  EXECUTIVE          
 
By:
/s/ Baldwin Yung       Baldwin Yung       Title: Chief Executive Officer/ Acting
Chief Financial Officer        

 
 
 
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