EX-10.5






Exhibit 10.5




Dated the 31st day of August, 2006




MAN SANG INTERNATIONAL LIMITED




AND




YAN SAU MAN AMY



 



SERVICE AGREEMENT


 




 









 








CONTENT




	 	 	 	 	 
	Clause	 	Description	 	Page
	 
	 	 	 	 
	1.
	 	INTERPRETATION	 	1
	 
	 	 	 	 
	2.
	 	APPOINTMENT	 	2
	 
	 	 	 	 
	3.
	 	DURATION	 	2
	 
	 	 	 	 
	4.
	 	EXECUTIVE’S DUTIES	 	2
	 
	 	 	 	 
	5.
	 	REMUNERATION	 	3
	 
	 	 	 	 
	6.
	 	OTHER BENEFITS	 	3
	 
	 	 	 	 
	7.
	 	EXPENSES	 	4
	 
	 	 	 	 
	8.
	 	DEDUCTIONS	 	4
	 
	 	 	 	 
	9.
	 	LEAVE	 	4
	 
	 	 	 	 
	10.
	 	TERMINATION	 	4
	 
	 	 	 	 
	11.
	 	EXECUTIVE’S UNDERTAKINGS	 	6
	 
	 	 	 	 
	12.
	 	INTELLECTUAL PROPERTY RIGHTS	 	8
	 
	 	 	 	 
	13.
	 	MISCELLANEOUS	 	9






 









 






THIS AGREEMENT is made on the 31st day of August, 2006



BETWEEN:





	(1)	 	MAN SANG INTERNATIONAL LIMITED, a company incorporated under the laws of Bermuda and having
its registered office at Clarendon House, 2 Church Street, Hamilton HM11, Bermuda and its
principal place of business in Hong Kong at 21st Floor, Railway Plaza, 39 Chatham Road South,
Tsimshatsui, Kowloon, Hong Kong (the “Company”); and
	 
	(2)	 	YAN SAU MAN AMY of 19B, Sky Garden, 223 Prince Edward Road, Kowloon, Hong Kong (the
“Executive”).





WHEREBY IT IS AGREED as follows:





			
	1.	 	INTERPRETATION






	1.01	 	In this Agreement, unless the context requires otherwise:
	 
	 	 	“Board” means the board of directors for the time being of the Company;
	 
	 	 	“Group” means the Company and its subsidiaries from time to time and “member of the Group”
shall be construed accordingly;
	 
	 	 	“HK$” means Hong Kong dollars;
	 
	 	 	“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of
China;
	 
	 	 	“Listing Rules” means the Rules Governing the Listing of Securities on The Stock Exchange of
Hong Kong Limited (as the same may be amended from time to time); and
	 
	 	 	“month” means calendar month.
	 
	1.02	 	References herein to Clauses are to clauses in the Agreement unless the context requires
otherwise.
	 
	1.03	 	The headings are inserted for convenience only and shall not affect the construction of this
Agreement.
	 
	1.04	 	Unless the context requires otherwise, words importing the singular include the plural and
vice versa and words importing a gender include every gender.




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	2.	 	APPOINTMENT






	 	 	The Company will employ the Executive and the Executive hereby agrees to serve the Company as
an executive director upon the terms and subject to the conditions hereinafter appearing.






			
	3.	 	DURATION






	 	 	Subject to termination as hereinafter provided, the Company will employ the Executive with
effect from 1st September, 2006 for a term of three (3) years until terminated by
either party giving to the other not less than three (3) months’ notice in writing.






			
	4.	 	EXECUTIVE’S DUTIES






	 	 	The Executive shall, during the continuance of her employment hereunder:






	 	(a)	 	serve the Company as an executive director and, in such capacity, perform the
duties and exercise the powers from time to time assigned to or vested in her by the
Board (including (without further remuneration unless otherwise agreed) serving on the
board of directors, or in any other office, of any member(s) of the Group, as the Board
may require) and she will perform those duties at such place or places in Hong Kong or
elsewhere as the Board may from time to time determine;
	 
	 	(b)	 	comply with and conform to any lawful instructions or directions from time to
time given or made by the Board, or with the authority of the Board, and shall comply
with the Company’s rules, regulations, policies and procedures from time to time in
force;
	 
	 	(c)	 	faithfully and diligently serve the Group and use her best endeavours to promote
the business and interests thereof;
	 
	 	(d)	 	devote herself exclusively and diligently to the business and interests of the
Group and personally attend thereto at all times during usual business hours and during
such other times as the Company may reasonably require except in case of incapacity
through illness or accident in which case she shall forthwith notify the Secretary of the
Company of such incapacity and shall furnish to the Board such evidence thereof as it may
require;
	 
	 	(e)	 	keep the Board promptly and fully informed (in writing if so requested) of her
conduct of the business or affairs of the Group and provide such explanations as the
Board may require in connection therewith;
	 
	 	(f)	 	carry out her duties and exercise her powers jointly with any other director or
executive of any member of the Group as shall from time to time be appointed by the Board
to act jointly with the Executive and the Board may at any time




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	 	 	 	require the Executive to cease performing or exercising any of her duties or powers under
this Agreement; and






	 	(g)	 	comply with the relevant requirements of all applicable laws, regulations, codes of
practice and rules (including Securities and Futures Ordinance, the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited and the Model Code for
Securities Transactions by Directors of Listed Companies set out in Appendix 10 therein
and the rules of any other stock exchange, market or dealing system on which the
securities of any member of the Group is traded and the applicable laws, regulations,
codes of practice in that jurisdiction).






			
	5.	 	REMUNERATION






	 	 	The remuneration of the Executive shall be:






	 	(a)	 	an annual salary package of HK$1,650,000.00, such salary to include any sum
receivable as director’s fees or other remuneration from any other member of the Group
(if any). This salary will be reviewed by the Board each year at the time of the annual
salary reviews for senior executives provided that the Executive shall abstain from
voting and shall not be counted in the quorum in respect of any resolution regarding the
amount payable to herself in relation to her employment under this Agreement which is
proposed at any meeting of the Board;
	 
	 	(b)	 	in respect of every financial year of the Company (which expression shall include
any other financial period in respect of which the Company’s accounts are made up), a
discretionary bonus of such amount as shall be determined by the Board (provided that
the aggregate of such amount and all discretionary bonuses payable by the Company to its
executive directors in any financial year shall not exceed ten per cent. of the net
profits (after tax and after extraordinary items) of the Company for such year as shown
in its audited accounts), provided that such discretionary bonus shall be paid only on a
pro rata basis in respect of any financial year of the Company during a portion only of
which the Executive has served the Company hereunder, unless her employment shall have
been terminated pursuant to Clause 10.02, in which case no discretionary bonus is
payable.






			
	6.	 	OTHER BENEFITS






	 	 	In addition to the foregoing remuneration and benefits, the Executive shall also be entitled
to such other benefits under any applicable employee benefit plan and employee share option
scheme adopted by the Company and any member of the Group of which the Executive is a director
or holds office for their respective employees (including the Executive) as the Board shall
from time to time determine.




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	7.	 	EXPENSES






	 	 	The Company shall reimburse the Executive (against receipts or such other reasonable evidence
of expenditure as the Board may require) for all reasonable expenses properly incurred in the
course of her employment hereunder or in promoting or otherwise in connection with the
business of the Company.






			
	8.	 	DEDUCTIONS






	 	 	The Company shall be entitled, subject to any laws or agreements to the contrary, at any time
to deduct from the Executive’s remuneration hereunder any monies due from her to any member
of the Group including, but not limited to, any outstanding loans, advances, the cost of
repairing any damage to or loss of the Company’s property caused by her (and of recovering
the same) and any other monies owed by her to the Company or any of its subsidiaries.






			
	9.	 	LEAVE






	 	 	The Executive shall be entitled after completion of each year of service with the Company to
fifteen (15) days’ leave (in addition to public holidays) with full pay, which leave shall be
taken at such time or times as may be convenient to the Board having regard to the exigencies
of the Group’s business provided that:






	 	(a)	 	if the employment of the Executive hereunder is to cease on the completion of any
year of service, the Executive shall be entitled to take her said leave immediately
prior to the end of such year of service notwithstanding that at that time such year of
service shall not have been completed;
	 
	 	(b)	 	if the employment of the Executive hereunder is to cease (for any reason other
than termination pursuant to Clause 10.02) during any year of service, the Executive
shall be entitled to an amount of leave proportionate to the part of the year during
which she has been employed by the Company, such leave to be taken immediately prior to
the termination of her employment; and
	 
	 	(c)	 	if for any reason the Executive shall not have taken her full entitlement of
leave in any particular year she shall not have any claim against the Company in respect
thereof nor, unless the reason is the exigencies of the Company’s business (of which the
Board shall be the sole judge), shall she be entitled to additional leave in any year in
respect of leave not taken in previous years.






			
	10.	 	TERMINATION






	10.01	 	If the Executive is at any time incapacitated by illness, injury or accident from performing
her duties hereunder and (if so required) furnishes the Board with evidence satisfactory to it
of such incapacity and the cause thereof she shall be




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	 	 	entitled to receive her full salary for the first three (3) months or any shorter period
during which such incapacity continues and if she continues so incapacitated for a longer
period than three (3) consecutive months or if she is so incapacitated at different times for
more than ninety (90) days in any one period of fifty-two (52) consecutive weeks then and in
either of such cases her employment may be terminated by the Company by one (1) month’s notice
in writing.






	10.02	 	If at any time during the term of her employment hereunder the Executive shall be guilty of
or commit any serious misconduct which in the absolute opinion of the Board is in any way
detrimental to the interests of any member of the Group, or shall be in breach of any of the
terms of this Agreement, or shall commit any act of bankruptcy or become insolvent, or make
any arrangements or composition with her creditors generally, or become through mental
disorder incapable of managing her own affairs, or fail to pay her personal debts or shall be
guilty of persistent insobriety or be convicted of any criminal offense involving her
integrity or honesty, the Company may terminate the Executive’s employment hereunder forthwith
without any notice or payment in lieu of notice and upon such termination, the Executive shall
not be entitled to any bonus or any payment whatsoever (other than salary actually accrued due
and payable pursuant to Clause 5(a)) for or in respect of the then current year of service or
to claim any compensation or damages for or in respect of or by reason of such termination.
	 
	10.03	 	In the event that: (a) the Executive is lawfully removed from her office as a director of
the Company by virtue of a resolution passed by the members of the Company; or (b) the
Executive, having retired from the office of director of the Company in accordance with the
Bye-laws of the Company or any other applicable regulation or law, is not re-elected as a
director of the Company by the shareholders of the Company at an annual general meeting of the
Company, the Company may within seven (7) days of the date of such vacation from office by the
Executive, terminate this Agreement forthwith by written notice to the Executive.
	 
	10.04	 	In the event of termination of the Executive’s employment for whatever reason, the
Executive shall:






	 	(a)	 	(if not already vacated from such office(s)) forthwith resign as a
director of the Company and from all directorships or other offices held by her in
any member of the Group (and the Executive irrevocably authorises the Company in her
name and on her behalf to execute all documents and do all things necessary to
effect such resignation in the event of her failure to do so);
	 
	 	(b)	 	shall vacate her office and return all properties of the Company,
including without limitation all equipment, vehicles, fixtures, furniture, all
originals or copies of any and all notes, data, tapes, reference items, sketches,
drawings, memoranda, records, files, correspondence, customer lists and addresses,
and other materials or documents in any way relating to any of the confidential
information or to the Company’s business, which shall belong exclusively to the
Company; and




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	 	(c)	 	shall cease to be entitled to any benefits under this Agreement and the
Executive shall not be entitled to claim any other compensation whatsoever from the
Company in respect of such termination except where the Board otherwise agrees or as
expressly provided for under this Agreement.






	10.05	 	Any delay or forbearance by the Company in exercising any right to terminate this Agreement
shall not constitute a waiver of such right.
	 
	10.06	 	If notice is served by either party pursuant to Clause 3, then for up to a maximum period of
three (3) months, the Company shall not be obliged, at any time after the notice of
termination is served, to provide any work for the Executive or to assign to or vest in the
Executive any powers, duties or functions and may in its absolute discretion suspend the
Executive from work, and suspend the contractual benefits of the Executive set out in Clause
5(b) and 6 and to require the Executive to refrain from entering any premises of any member(s)
of the Group and to refrain from contacting any customers, clients, employees or suppliers of
any member(s) of the Group.






			
	11.	 	EXECUTIVE’S UNDERTAKING






	11.01	 	The Executive shall not either during the continuance of her employment hereunder or at any
time thereafter divulge to any person whomsoever or to any body corporate or unincorporated
(except to those officers of the Group whose province it is to know the same) or use for her
own purposes or for any purposes other than those of the Group and shall use her best
endeavours to prevent the unauthorised publication or disclosure of any trade secret or any
confidential information concerning the business or finances of any member of the Group or any
of its dealings, transactions or affairs or those of its customers, suppliers, management and
shareholders which may come to her knowledge during or in the course of her employment.
Confidential information shall include, without limitation, lists or details of customers and
suppliers, information relating to the working of any process of invention carried on or used
by any member of the Group, information relating to research and other projects, prices,
discounts, mark-ups, future business strategy and development, marketing, price-sensitive
information and any other information which is not generally available to the public.
	 
	11.02	 	Forthwith upon the termination of the employment of the Executive hereunder, and/or at any
other time if the Company shall so request:






	 	(a)	 	the Executive shall not, directly or indirectly, disseminate, disclose,
divulge, reveal, report, publish, transfer or use, for any purpose whatsoever, any
information which has been obtained by or disclosed to the Executive as a result of or
in relation to the Executive’s employment by the Company, including without limitation
any confidential information (which includes without limitation all lists of customers
and clients, specific customer names and data, business plans, marketing plans,
business contracts, distribution and sales and marketing networks, designs,
specifications, processes, formulas, trade secrets, business secrets, sales




6









 






	 	 	 	information, systems, programs, procedures, manuals, financial and personnel
information, and any other proprietary information or data which the Company has
received in confidence from others) and any of the terms and conditions of this
Agreement; provided, however, that disclosure of any confidential information shall
not be prohibited if (i) such disclosure is directly pursuant to a valid and
existing order of a court of competent jurisdiction or other governmental body or
agency, (ii) the Executive shall first have given prompt notice to the Company of
any such possible or prospective order (or proceeding pursuant to which any such
order may result), and (iii) the Company shall have been afforded a reasonable
opportunity to respond to (and if so advised by counsel, to challenge) such order;
provided further, that each party may disclose terms and conditions of this
Agreement to her or its attorneys and accountants to the extent such disclosure is
necessary to enable such attorneys and accountants to render professional services
to such party;






	 	(b)	 	the Executive, her representatives, heirs, successors and assigns shall
completely release and forever discharge the Company, its present, former or future
parent, subsidiary, affiliated, associated and other related companies, and any of
their present, former and future shareholders, directors, officers, employees, agents,
partners consultants, representatives and attorneys, and each of their successors and
assigns from all claims, demands, rights, causes of action, obligations, liabilities
and/or attorneys’ fee claims, of any and every kind, nature and character whatsoever
wheresoever, known or unknown, which the Executive may now have or has ever had
against the Group, including without limitation those arising from or in any way
connected with the employment of the Executive by the Company or the resignation or
termination thereof, whether base on tort, express or implied contract, law, rule,
regulation, or ordinance; and
	 
	 	(c)	 	the Executive shall preserve the good name of, and shall not make any
disparaging comments about the Group and any of the Company’s present, former and
future shareholders, directors, officers, employees, agents, partners, consultants,
representatives and attorneys, and each of their successors and assigns.






	11.03	 	The Executive shall not file, or cause to be filed, in any court or with any governmental or
quasi-governmental agency, any action, claim or charge against the Company, its present,
former or future parent, subsidiary, affiliated, associated and other related companies and
any of their present, former and future shareholders, directors, officers and employees and
each of their successors and assigns.
	 
	11.04	 	The Executive shall not at any time during the continuance of her employment hereunder or
for a period of twelve (12) months thereafter, in any country or place where any member of the
Group has carried on business, carry on or be employed or interested directly or indirectly in
(whether as shareholder, director, partner, agent or otherwise and whether alone or jointly
with others) any business carried on by any member of the Group during the continuance of the
said employment in




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	 	 	competition with any member of the Group (other than as a holder of not more than five (5)
per cent of the issued shares, debentures or other securities of any company listed on any
recognised stock exchange) provided that the provisions of this Clause 11.04 shall only
apply in respect of business activities or services with which the Executive was personally
concerned or for which she was responsible during her said employment.






	11.05	 	The Executive shall not at any time during the continuance of her employment hereunder or
for a period of twelve (12) months thereafter either on her own account or in conjunction with
or on behalf of any other person or body corporate or unincorporated in competition with any
member of the Group directly or indirectly solicit or entice away from any member of the
Group, any person or body corporate or unincorporated who now is or at any time during or at
the date of the termination of the said employment may have been or become a customer or
supplier or prospective customer or supplier of any member of the Group and with whom the
Executive had personal contact or dealings during her said employment.
	 
	11.06	 	The Executive shall not at any time during the continuance of her employment hereunder or
for a period of twelve (12) months thereafter solicit or entice away from any member of the
Group or employ or otherwise engage any person who now is or at any time during or at the date
of the termination of the said employment may have become an employee of any member of the
Group and with whom the Executive had contact during her said employment, whether or not such
person would commit any breach of her contract of employment by reason of leaving the service
of the relevant member of the Group.
	 
	11.07	 	The Executive shall not at any time or for any purpose after termination of her employment
hereunder use either the English or Chinese name of the Company or any name similar thereto in
connection with her own or any other name in any way calculated to suggest that she is or has
been connected with the Company’s business, nor in any way hold herself out as having had any
such connection.
	 
	11.08	 	While the restrictions contained in Clauses 11.01 to 11.07 are considered by the parties to
be reasonable for the protection of the business and interest of the Group and in all the
circumstances and do not work harshly upon the Executive it is recognised that restrictions of
the nature in question may fail for technical reasons unforeseen and accordingly it is hereby
agreed and declared that if any such restrictions shall be adjudged to be void as going beyond
what is reasonable in all the circumstances for the protection of the interests of the
member(s) of the Group but would be valid if part of the working thereof were deleted or the
periods (if any) thereof were reduced or the range of products or area dealt with thereby were
reduced in scope, the said restriction shall apply with such modifications as may be necessary
to make it valid and effective.






			
	12.	 	INTELLECTUAL PROPERTY RIGHTS






	12.01	 	The Company (or any other member of the Group as the case may be) shall be entitled free of
charge to the sole ownership and exclusive use of any invention or




8









 






	 	 	improvement made or discovered by the Executive and of any copyright, design right, trade
mark, service mark or trade name created or used by the Executive (hereinafter referred to
as the “intellectual property rights”) in the course of or for the purpose of providing
services hereunder to the Company or any other member of the Group.






	12.02	 	The Executive shall forthwith and from time to time both during and after the term of this
Agreement and at the request and costs of the Company, insofar as it is within her power, do
such acts and things and execute such documents, as may in the opinion of the Company be
reasonably necessary for obtaining letters patent, registration or other protection for any
such intellectual property rights in any part of the world and shall effect such registration
and vest such letters patent or other protection in the Company (or any other member of the
Group as the case may be) or its nominees. The Executive irrevocably authorises the Company
for the purposes aforesaid in the name of the Executive and execute any document or do
anything on her behalf. The Executive shall at the cost and request of the Company render all
reasonable assistance to the Company (or any other member of the Group as the case may be) for
and in connection with the purposes aforesaid.
	 
	12.03	 	The Executive shall not during or after the termination of the Agreement use to the
detriment or prejudice of the Group or divulge to any person any confidential information
concerning the intellectual property rights of the Group which may have come to her knowledge.






			
	13.	 	MISCELLANEOUS






	13.01	 	This Agreement shall be in substitution for any subsisting agreement or arrangement (oral or
otherwise) made between the Company and the Executive which shall be deemed to have been
terminated by mutual consent as from the date on which the Executive’s employment under this
Agreement commences.
	 
	13.02	 	The expiration or termination of this Agreement howsoever arising shall not operate to
affect such of the provisions hereof as in accordance with their terms are expressed to
operate or have effect thereafter.
	 
	13.03	 	In the event of any variation of the remuneration payable to the Executive hereunder being
made by consent of the parties hereto, such variation shall not constitute a new agreement but
(subject to any express agreement to the contrary) the employment of the Executive hereunder
shall continue subject in all respects to the terms and conditions of this Agreement with such
variation as aforesaid.
	 
	13.04	 	Each notice, demand or other communication given or made under this Agreement shall be in
writing and delivered or sent to the relevant party at its address or facsimile number set out
below (or such other address or facsimile number as the addressee has by five (5) days’ prior
written notice specified to the other parties):




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	 	To the Company:	 	Man Sang International Limited
	 
	 	 	 	21st Floor, Railway Plaza 39 Chatham Road South
	 
	 	 	 	Tsimshatsui, Kowloon Hong Kong
	 
	 	 	 	Fax number: (852) 2317 5243
	 
	 	 	 	Attention : Mr. Cheng Chung Hing
	 
	 	 	 	 
	 
	 	To the Executive:	 	Yan Sau Man Amy
	 
	 	 	 	19B, Sky Garden
	 
	 	 	 	223 Prince Edward Road
	 
	 	 	 	Kowloon, Hong Kong
	 
	 	 	 	Hong Kong







	 	 	Any notice, demand or other communication so addressed to the relevant party shall be
deemed to have been delivered (a) if given or made by letter, by post, two (2) clear
business days after the date of posting, or by recorded delivery, when actually delivered
to the relevant address; and (b) if given or made by facsimile, when despatched subject to
receipt of machine-printed confirmation of error-free despatch of the whole of the notice,
demand or communication to the facsimile number of the intended addressee.
	 
	13.05	 	If at any time any provision of this Agreement is or becomes illegal, invalid or
unenforceable in any respect, the legality, validity and enforceability of the remaining
provisions of this Agreement shall not be affected or impaired thereby.
	 
	13.06	 	No failure or delay by the Company in exercising any right, power or remedy under this
Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of the
same preclude any further exercise thereof or the exercise of any other right, power or
remedy. Without limiting the foregoing, no waiver by the Company of any breach by the
Executive of any provision in ths Agreement shall be deemed to be a waiver of any subsequent
breach of that or any other provision in this Agreement.
	 
	13.07	 	This Agreement shall be government by and construed in accordance with the laws of Hong Kong
and the parties hereby irrevocably submit to the non-exclusive jurisdiction of the Hong Kong
courts.




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IN WITNESS WHEREOF this Agreement has been executed on the day and year first above written.




	 	 	 
	SIGNED by Cheng Chung Hing

for and on behalf of MAN SANG

INTERNATIONAL LIMITED

in the presence of:

	 	/s/ CHENG Chung Hing
	 
	 	 
	SIGNED by

Yan San Man Amy

in the presence of:

	 	/s/ YAN San Man, Amy









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