Longhai Steel, Inc.: Exhibit 10.12 - Filed by newsfilecorp.com






EXHIBIT 10.12

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the
"Agreement") is made effective as of July 15, 2011, between LONGHAI STEEL, INC.,
a Nevada corporation (the "Company") and Mr. Heyin Lv (the "Executive").

1. EMPLOYMENT

The Company hereby agrees to
employ the Executive, and the Executive hereby agrees to be employed by the
Company, on the terms and conditions set forth herein.

2. TERM

The term ("Term") of this
Agreement shall July 15, 2011 and will terminate July 15, 2016 unless sooner
terminated as hereinafter provided.

3. POSITION AND DUTIES

3.1
Position. The Executive hereby agrees to serve as Chief Financial Officer of the
Company. At the Company's request, the Executive may, at the Executive's
discretion, serve the Company and/or its respective subsidiaries and affiliates
in other offices and capacities in addition to the foregoing, but shall not be
required to do so. In the event that the Executive, during the term of this
Agreement, serves in any one or more of the aforementioned capacities, the
Executive's compensation shall not be increased beyond that specified in Section
4 of this Agreement. In addition, in the event the Company and the Executive
mutually agree that the Executive shall terminate the Executive's service in any
one or more of the aforementioned capacities, or the Executive's service in one
or more of the aforementioned capacities is terminated, the Executive's
compensation, as specified in Section 4 of this Agreement, shall not be
diminished or reduced in any manner.

3.2
Duties. The Company agrees that the duties that may be assigned to the Executive
shall be the usual and customary duties of the Financial Controller.

3.3
Devotion of Time and Effort. Executive shall use Executive's good faith best
efforts and judgment in performing Executive's duties as required hereunder and
to act in the best interests of the Employers. Executive shall devote such time,
attention and energies to the business of the Employers as are reasonably
necessary to satisfy Executive's required responsibilities and duties hereunder.


3.4
Other Activities. The Executive may engage in other activities for the
Executive's own account while employed hereunder, including without limitation
charitable, community and other business activities, provided that such other
activities do not materially interfere with the performance of the Executive's
duties hereunder.

4. COMPENSATION AND RELATED
MATTERS

4.1
Salary. During the Term, the Company shall pay the Executive a salary of Five
Hundred and Forty Two Dollars (US$542.00) per month. The Executive's performance
and salary shall be subject to review at any time, and an increase in salary, if
one is so determined by the Board, shall be made, on a basis consistent with the
standard practices of the Company.

4.2
Business Expenses. The Company shall promptly, in accordance with Company
policy, reimburse the Executive for all reasonable business expenses incurred in
accordance with and subject to the limits set forth in the Company's written policies with respect to
business expenses, upon presentation to the Company of written receipts for such
expenses.

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5. TERMINATION 

5.1
Cause. The Company may terminate the Executive for Cause at any time, upon
written notice to Executive. For purposes of this Agreement, "Cause" shall
mean:

(a) The
Executive's conviction for commission of a felony or a crime involving moral
turpitude; 

(b) The
Executive's willful commission of any act of theft, embezzlement or
misappropriation against the Company; or

(c) The
Executive's material failure to perform his duties hereunder.

5.2
Termination Without Cause. The Company may terminate this Agreement without
Cause at any time, provided that the Company first delivers to the Executive the
Company's written election to terminate this Agreement at least thirty (30) days
prior to the effective date of termination.

6. COMPENSATION UPON TERMINATION

6.1
Termination for Cause. In the event the Executive's employment shall be
terminated for Cause pursuant to Section 5.1 hereof, the Company shall pay the
Executive his salary through the date of termination and all and all stock
options to purchase the Company's stock granted to the Executive as of the date
of termination and which have not vested prior to the date of termination shall
cease vesting.

6.2
Termination without Cause, Termination by Mutual Agreement, Disability or Death.
In the event of a Termination without Cause pursuant to Section 5.2, by mutual
agreement of the parties hereto, or due to disability or death of Executive, the
Company shall pay the Executive through the date of termination, and all stock
options to purchase the Company's stock granted to the Executive as of the Date
of Termination and which have not vested prior to the Date of Termination shall
automatically become immediately exercisable by the Executive on the Date of
Termination and shall remain exercisable for a period of five years from the
date of termination.

7. CONFIDENTIALITY AND
NON-SOLICITATION COVENANTS

7.1
Non-Competition. The Executive agrees that during the Term of this Agreement
prior to any termination of his employment hereunder and for a period of two (2)
years following the date on which the Executive's employment hereunder is
terminated, he will not directly or indirectly, without the prior written
consent of the Company, manage, operate, join, control, participate in, or be
connected as a stockholder (other than as a holder of shares publicly traded on
a stock exchange or the NASDAQ National Market System), partner, or other equity
holder with, or as an officer, director or employee of, any other company whose
business strategy is competitive with that of the Company, as determined by a
majority of the Company's independent directors ("Competing Business").

7.2
Confidentiality. The Executive hereby agrees that the Executive will not, during
the Term or at any time thereafter directly or indirectly disclose or make
available to any person, firm, corporation, association or other entity for any
reason or purpose whatsoever, any Confidential Information (as defined below).
The Executive agrees that, upon termination of his employment with the Company,
all Confidential Information in his possession that is in written or other
tangible form (together with all copies or duplicates thereof, including
computer files) shall be returned to the Company and shall not be retained by
the Executive or furnished to any third party, in any form except as provided herein; provided, however, that the
Executive shall not be obligated to treat as confidential, or return to the
Company copies of any Confidential Information that (i) was publicly known at
the time of disclosure to the Executive, (ii) becomes publicly known or
available thereafter other than by any means in violation of this Agreement or
any other duty owed to the Company by the Executive, or (iii) is lawfully
disclosed to the Executive by a third party. As used in this Agreement the term
"Confidential Information" means information disclosed to the Executive or known
by the Executive as a consequence of or through his relationship with the
Company, about the owners, employees, business methods, public relations
methods, organization, procedures, property acquisition and development, or
finances, including, without limitation, information of or relating to the
Company and its affiliates.

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7.3 Non-Solicitation. For a period of two (2) years following
the date on which the Executive's employment hereunder is terminated, the
Executive shall not solicit or induce any of the Company's employees, agents or
independent contractors to end their relationship with the Company, or recruit,
hire or otherwise induce any such person to perform services for the Executive,
or any other person, firm or company. 

7.4
Return of Property. The Executive hereby acknowledges and agrees that all
Personal Property and equipment furnished to or prepared by the Executive in the
course of or incident to his employment, belongs to the Company and shall be
promptly returned to the Company upon termination of the Employment Period.
"Personal Property" includes, without limitation, all electronic devices of the
Company used by the Executive, including, without limitation, personal
computers, facsimile machines, cellular telephones, pagers and tape recorders
and all books, manuals, records, reports, notes, contracts, lists, blueprints,
maps and other documents, or materials, or copies thereof (including computer
files), and all other proprietary information relating to the business of the
Company. Following termination, the Executive will not retain any written or
other tangible material containing any proprietary information of the
Company.

7.5
Reasonableness of Restrictions. Each of sections 7.1, 7.2, and 7.3 set out above
is acknowledged by Executive to be reasonable in duration, extent and
application and is the minimum protection necessary for the Company in respect
of its goodwill, Confidential Information, trade connections and business. Each
of the covenants and obligations on Executive’s part set out in sections 7.1,
7.2, and 7.3 is deemed to be separate and severable and enforceable by the
Company accordingly. If any of the restrictions set out above are held to be
void but would be valid if part of the wording was deleted such restriction
shall apply with such deletion as may be necessary to make it valid and
effective.

7.6
The restrictions set forth in Sections 7.1, 7.2, and 7.3 hereof shall not apply
if the Executive's employment is terminated pursuant to Section 5.4, 5.5 or 5.7
hereof or in the event that any form of compensation due Executive pursuant to
the provisions of Section 6 is not provided as required when due.

7.7 In
the event of a breach by Executive of this Section 7, any obligations for
payment by the Company otherwise due pursuant to Section 5 hereof shall be
void.

8. GENERAL PROVISIONS

8.1
Injunctive Relief and Enforcement. The Executive acknowledges that the remedies
at law for any breach by him of the provisions of Section 7 hereof may be
inadequate and that, therefore, in the event of breach by the Executive of the
terms of Section 7 hereof, the Company shall be entitled to institute legal
proceedings to enforce the specific performance of this Agreement by the
Executive and to enjoin the Executive from any further violation of Section 7
hereof and to exercise such remedies cumulatively or in conjunction with all
other rights and remedies provided by law and not otherwise limited by this
Agreement. 

8.2
Notice. For the purposes of this Agreement, notices, demands and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when addressed as follows and (i) when personally
delivered, (ii) when transmitted by telecopy, electronic or digital transmission with receipt confirmed, (iii) one day after
delivery to an overnight air courier guaranteeing next day delivery, or (iv)
upon receipt if sent by certified or registered mail. In each case notice shall
be sent to:

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	If to Executive: 	Mr. Heyin Lv 
	  	#1 Jingguang Rd, 
	  	Neiqiu County, Xingtai 
	  	Hebei Province 054200 , PR China 
	  	  
	  	  
	If to the Company: 	Longhai Steel Inc. 
	  	#1 Jingguang Rd. 
	  	Neiqiu County, Xingtai, 
	  	Hebei Province 054200, PR China 
	  	Attn: Mr. Chaojun Wang, CEO




or to such other address as any 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.

8.3
Severability. The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect. In
addition, in the event any provision in this Agreement shall be determined by
any court of competent jurisdiction to be unenforceable by reason of extending
for too great a period of time or over too great a geographical area or by
reason of being too extensive in any other respect, each such agreement shall be
interpreted to extend over the maximum period of time for which it may be
enforceable and to the maximum extent in all other respects as to which it may
be enforceable, and enforced as so interpreted, all as determined by such court
in such action.

8.4
Assignment. This Agreement may not be assigned by the Executive, but may be
assigned by the Company to any successor to its business and will inure to the
benefit and be binding upon any such successor. 

8.5
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 instrument.

8.6
Headings. The headings contained herein are for reference purposes only and
shall not in any way affect the meaning or interpretation of this Agreement.

8.7
Choice of Law; Venue. This Agreement shall be construed, interpreted and
enforced in accordance with the laws of the State of Nevada without giving
effect to the principles of conflict of laws thereof. By execution and delivery
of this Agreement, the parties agree and accept that any legal action or
proceeding brought with respect to this Agreement shall be brought in the court
of appropriate jurisdiction in and for the County of Clark, State of Nevada, and
the parties expressly waive any objection to personal jurisdiction, venue or
forum non conveniens. 

8.12
Entire Agreement. This Agreement contains the entire agreement and understanding
between the Company and the Executive with respect to the employment of the
Executive by the Company as contemplated hereby, and no representations,
promises, agreements or understandings, written or oral, not herein contained
shall be of any force or effect. This Agreement shall not be changed unless in
writing and signed by both the Executive and the Board. 

8.13
Amendments; Waivers. This Agreement may be amended or modified, and any of the
terms and covenants may be waived, only by a written instrument executed by the
parties hereto, or, in the case of a waiver, by the party waiving compliance. Any waiver by any
party in any one or more instances of any term or covenant contained in this
Agreement shall neither be deemed to be nor construed as a further or continuing
waiver of any such term or covenant of this Agreement.

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IN WITNESS WHEREOF, the parties
have executed this Employment Agreement as of the date and year first above
written.

	 	“Company” 
	 	LONGHAI STEEL INC., a Nevade corporation 
	 	  
	 	By: /s/Chaojun Wang                      
	 	     Mr. Chaojun Wang, CEO

	 	“Executive” 
	 	  
	 	/s/ Heyin Lv                                       
	 	Mr. Heyin Lv,CFO 


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