Document:

chda8k20100427ex10-a.htm

    
      

      

    

    SERVICE
AGREEMENT

    

    This
Service Agreement (“Agreement”) is entered into as of the 28st day of April,
2010 (“Effective Date”) between China Digital Animation Development Inc., whose
principal offices are located at 15 W 39th
Street, 14th Floor New York, NY 10018 (hereinafter referred to as the
“Company”), and Shaogiu Xia, having an address at c/o ZQ  Power,
Harbin, China (hereinafter referred to as the “Director”), to provide the terms
under which the Director shall perform his functions as an elected independent
member of the Board of Directors of the Company during his  respective
terms.

    

    WHEREAS,
the Company’s business consists of the development of digital animation design
and production, network integration systems and delivery of financial
information  (the “Business”) and the Company is a public company
subject to the securities laws and rules and other applicable laws and rules of
the United States.

    

    WHEREAS,
the Company recognizes the unique qualifications and contributions of the
Director and desires to secure the services of the Director on the terms and
conditions set forth herein; and

    

    WHEREAS,
the Independent Director is prepared to commit to such services in return for
specific arrangements, compensation and other benefits on the terms and
conditions set forth herein.

    

    NOW
THEREFORE, in consideration of the foregoing premises and the mutual covenants
and agreements herein contained, the Company and the Director do hereby agree as
follows:

    

    
      	
              1.

            	
              DUTIES
      OF THE INDEPENDENT DIRECTOR:

            

    

    

    
      	
               
      

            	
              The
      Director shall carry out his duty as an independent director to the
      Company and shall make himself available to perform such functions in
      keeping with all the applicable laws, rules, and regulations of the United
      States of America, including, not limited to, the applicable securities
      laws and the laws of the State of
Delaware.

            

    

    

    
      	
               
      

            	
              The
      Director hereby agrees faithfully to render the service expected of an
      independent director and to promote the interests of the Company to the
      best of his ability and keep his duty of care, confidentiality and
      loyalty, among other duties. The Director further agrees to devote the
      necessary time, attention, skill, and best efforts to the performance of
      his duties under this agreement. The
      Director shall not self-deal or do anything harmful to the interest of the
      Company or its shareholders and shall not engage in any insider trading or
      similar activities.

            

    

    
    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
               The
      Director shall maintain his standing and capacity as an “independent
      director” under the rules of the Securities and Exchange Commission and
      the rules and regulations of relevant stock exchanges, and shall not
      engage in any employment or service with the Company or otherwise that may
      impair such standing.

            

    

    

    
      	
               
      

            	
              The
      Director shall serve on one or more Board Committees in his capacity as an
      independent director.

            

    

    

    
      	
              2.

            	
              COMPENSATION
      AND EXPENSES

            

    

    

    During
his term as a Director until the end of his function as a Director:

    

    
      	
               
      

            	
              2.1

            	
              The
      Company agrees to issue to the Director, an annual retainer (“the
      Retainer”) consisting of 10,000RMB cash per
  year.

            

    

     

    
      	
               
      

            	
              2.2

            	
              The
      Company shall promptly pay or reimburse the Director for all reasonable
      expenses actually and properly (in accordance with the Company’s policy)
      incurred or paid by him in connection with the performance of his services
      under the Agreement (including, without limitation, travel expenses) upon
      presentation of expense statements or vouchers or such other supporting
      documentation in such form and containing such information as the Company
      may from time to time require. Any expense above $500 shall be
      pre-approved by the Company.

            

    

    

    
      	
              3.

            	
              INDEMNIFICATION

            

    

    

    The
Company shall indemnify the Director to the full extent permitted by the General
Corporation Law of the State of Delaware.

    

    
      	
              4.

            	
              MISCELLANEOUS

            

    

     
 

    
      	
               
      

            	
              This
      Agreement expresses the entire understanding and agreement of the parties
      and supersedes any and all prior agreements and understandings, whether
      written or oral, relating in any way to the subject matter of this
      Agreement. This Agreement cannot be modified, amended, or supplemented
      except by a written instrument or instruments executed by each of the
      parties hereto.

            

    

    

    
      	
               
      

            	
              This
      Agreement shall have a term during the period director serves as an
      director of the Company until such time that he is removed by the board of
      directors by a majority vote or not elected by the next shareholder
      meeting, whichever comes
earlier.

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              This
      Agreement shall be governed by and construed under the laws of the State
      of Delaware. If any provision of this Agreement shall be invalid or
      unenforceable, this Agreement shall be deemed amended but only to the
      extent required to make it valid and enforceable, and this Agreement as
      thereby amended shall remain in full force and
  effect.

            

    

    

    
      	
               
      

            	
              Arbitration
      is the only and exclusive remedy to the parties for any dispute arising
      from this agreement. The Parties hereby expressly waive the right to any
      jury or non-jury trial and hereby expressly submit to the exclusive
      jurisdiction of an arbitration tribunal under the auspices of the American
      Association in the City of New York with such tribunal composed of three
      arbitrators of which one is selected by each party and the third one
      selected by the two arbitrators already selected respectively by the
      parties. The award of the tribunal shall be exclusive, binding, final and
      enforceable against the parties. In any arbitration arising out of this
      Agreement, the prevailing party shall be entitled to request, and receive
      an amount as and for the reasonable counsel fees and expenses incurred by
      the prevailing party in connection with such action, proceeding, or
      arbitration.

            

    

    

    IN
WITNESS WHEREOF, the Company and the Director have executed this Agreement
as of the day and year first above written.

    

    

    
      	
              Signed:

            	
              Signed:

            
	 
      	 
      
	
              /s/
      Shaoqiu Xia

            	
              /s/
      Qiang Fu

            
	 
      	 
      
	
              Name
      in Print: Shaoqiu Xia

            	
              Name
      in Print: Qiang Fu

            
	
              Title:
      Independent Director

            	
              Title:
      ChairmanExhibit 10.1

 

 

April 23,
2010

 

Via
Email

 

Stanley
J. Kott

 

Dear
Stan:

 

This
letter confirms our and your understanding and agreement on the terms under
which your employment as Chief Executive Officer of Montpelier Underwriting
Inc. (together with its affiliates, the “Company”) will terminate.

 

In consideration for your
execution of this letter agreement, and provided that you are in full
compliance with all of the terms and conditions of the contents of this letter
agreement, the Company and you agree as follows:

 

1.             Transition Period;
Separation from Employment. Commencing on May 1,
2010, you agree to step back from the day-to-day management and operations of
Montpelier Underwriting Inc. and to concentrate your efforts full-time on the
development of Montpelier U.S. Insurance Company (“MUSIC”) until your
last date of employment with the Company, its ultimate parent, Montpelier Re
Holdings Ltd., and any of their affiliated entities, which shall be April 30,
2011 (“Termination Date”).  No
later than the Termination Date, you agree to resign as a director and officer
of the Company, Montpelier Re Holdings Ltd. and any of their affiliated
entities (collectively, the “Montpelier Group”).

 

2.             Employee Benefits.  You will continue to receive a “base salary”
(payable in installments pursuant to the Company’s then-current payroll
policies) and be eligible for continued participation in the Company’s
employment benefit plans, as the same may be amended from time to time, through
the Termination Date, including participation in the Company’s group medical
and dental plans, Company-sponsored 401(k) plan and continued vesting of
Restricted Stock Units (“RSUs”) previously granted to you under the
Montpelier Re Holdings Ltd. 2007 Long-Term Incentive Plan (the “Plan”)
as provided for in this letter agreement and as illustrated in Schedule A
attached hereto.  Other than the
continued vesting of RSUs through the Termination Date as set forth in the
preceding sentence and as provided for in Paragraph 3, below, you will not be eligible
to participate in the Plan or any other Montpelier Group incentive compensation
or bonus plans, policies or arrangements for 2010.  For purposes of this letter agreement, “base
salary” shall be USD $425,000 per annum and benefits, as outlined in Section 3.01(c) of
the Employment Agreement between you and Montpelier Re Holdings Ltd. dated as
of May 14, 2007 (“Employment Agreement”), shall continue as
provided for under the Employment Agreement through December 31, 2010 and
thereafter though the Termination Date shall be provided on the same terms
available to all other employees of the Company plus continuation of life
insurance, long-term disability insurance and long-term care.

 

3.             Vesting of RSUs.  For the avoidance of doubt, none of the RSUs
currently held by you shall continue to vest after the Termination Date except
for 20,000 of the RSUs originally 

 

 

awarded to you on July 1,
2007 which are scheduled to vest in May 2011 which shall be accelerated
and shall vest on your Termination Date, subject to Montpelier Re Holdings Ltd.’s
Compensation and Nominating Committee’s approval.

 

4.             Additional Incentive Compensation.  In lieu of continued vesting of any RSUs
currently held by you after your Termination Date you will receive a one-time
payment of USD$100,000 on or before April 30, 2011.

 

5.             Certain Rights Upon Change
of Control.  In the
event a transaction or event that would constitute a “Change in Control” (as
such term is defined in Section 10 of the Plan) is completed or occurs on
or before the Termination Date, sub-clause (a) of Section 10 of the
Plan and Article II of the Montpelier Re Holdings Ltd. Severance Plan
shall apply.

 

6.             Waiver of Certain
Post-Employment Restrictive Covenants.  Notwithstanding the survival of Sections 4.02
through 4.06 of the Employment Agreement, the Company will waive the
non-competition covenants contained in Paragraph 4.01 of the Employment
Agreement with effect from April 30, 2011. 
Notwithstanding the preceding sentence you will remain subject to all
other restrictive covenants contained in Section 4.01 of the Employment
Agreement through the Termination Date and the non-solicitation covenants will
remain in effect for twelve (12) months thereafter.

 

7.             No Additional Claim for
Compensation of Benefits.  You
acknowledge that other than the payments, vesting rights and other benefits
described in Paragraphs 1 through 6 of this letter agreement, you will have no
further claim for salary, notice pay, incentive pay, bonus, severance, RSUs, or
other forms of compensation, nor for any employment benefits, except as set
forth in, and as consideration for, the release of claims agreed to in this
letter agreement.

 

8.             New Consideration. You are
entitled to the payments, vesting rights and other benefits provided for in
this letter agreement only if you (a) timely sign and return to the
Company this letter agreement, (b) do not revoke your acceptance as
provided for in Section 20, below, and (c) comply with all the
provisions of this letter agreement.

 

9.             Taxes.  The payments and benefits provided to you
under this letter agreement are gross amounts and may be subject to tax
withholdings and other deductions as required by law with respect to federal,
state and local taxes, FICA, Medicare, unemployment compensation taxes and similar
taxes, assessments, or other withholding requirements

 

10.           Release of Claims.  In consideration for and as a condition of
receiving the payments and benefits described in Paragraphs 1 through 6, above,
you for yourself and your heirs and assigns, voluntarily, knowingly,
irrevocably and forever discharge the Company and its members, shareholders,
parents, affiliates, subsidiaries, divisions, any and all of their respective
current and former directors, officers, employees, agents, and contractors and their
heirs and assigns, and any and all employee pension benefit or welfare benefit
plans of the Company, including current and former trustees and administrators
of such employee pension benefit and welfare benefit plans (collectively, the “Releasees”)
from all actions, claims, demands, causes of actions, obligations, damages,
liabilities, expenses and controversies of any nature whatsoever, whether known
or not now known or suspected, which you had, have or may have against any of
the Releasees as of the date that you sign this letter agreement (the “Claims”).  These Claims that you forever and irrevocably
give up and release include, but are not limited to, all claims related to:

 

(a)           your employment with the Company, the Company’s
decision to terminate your employment, and/or the termination of your
employment therefrom;

 

(b)           statements, acts or omissions by the Company or any
Releasee;

 

2

 

(c)           any employment-related contract, promise or
agreement between you and the Company or any other Releasee, including but not
limited to the Employment Agreement;

 

(d)           any public policy, contract, tort or common law
obligation, including but not limited to breach of express or implied contract
or of an implied covenant of good faith and fair dealing, negligent or
intentional infliction of emotional distress, wrongful discharge, defamation,
slander, negligent or intentional misrepresentation, claims of intentional or
negligent interference with economic, employment, or contractual rights or
promissory estoppel;

 

(e)           any federal, state, or local law or regulation
prohibiting discrimination or retaliation in employment on the basis of race,
color, sex, sexual harassment, pregnancy, sexual orientation, disability or
perceived disability, handicap, religion, national origin, age, veteran status
or any other protected category, including but not limited to, claims under the
Equal Pay Act of 1963, Title VII of the Civil Rights Acts of 1964, as amended,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act of 1967,
as amended (ADEA), the Older Worker Benefit Protection Act (OWBPA), the Family
and Medical Leave Act of 1993 (FMLA), the Americans with Disabilities Act of
1990 (ADA), the Worker Adjustment and Retraining Notification Act (WARN), the
Fair Labor Standards Act of 1938, as amended (FLSA), the National Labor
Relations Act, as amended (NLRA), the Employee Retirement Income Security Act
of 1974, as amended (ERISA), 42 U.S.C. Sections 1981-1988, the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended (COBRA), the Connecticut
Human Rights and Opportunities Act (HROA), the Connecticut Fair Employment
Practices Act (CFEPA), and other federal, state or local laws prohibiting
discrimination; and

 

(f)            any claim for wages, bonuses, incentive
compensation, equity, RSUs, paid time off, severance, employee benefits,
expenses or allowances of any kind, or any other payment or compensation, except with respect to claims related to
payments or other benefits provided for under this letter agreement.

 

THIS MEANS THAT BY ENTERING INTO THIS LETTER AGREEMENT,
YOU WILL HAVE WAIVED ANY RIGHT YOU MAY HAVE TO BRING A LAWSUIT OR MAKE ANY
CLAIM OF ANY KIND WHATSOEVER AGAINST ANY OF THE RELEASEES BASED ON ANY ACTIONS
OR OMISSIONS OF ANY OF THE RELEASEES UP TO THE DATE OF SIGNING THIS LETTER
AGREEMENT.

 

11.           Prohibited and Permitted
Claims.

 

(a)           Agreement Not to Sue or Bring Certain Claims Against
any Releasee.  By signing
this letter agreement, you accept the consideration offered to you in
Paragraphs 1 through 6 of this letter agreement as full satisfaction of any and
all Claims you may have against the Company or any other Releasee arising prior
to your execution of this letter agreement. 
You represent that you have not filed a lawsuit or Claim against the
Company or any other Releasee, and you agree to withdraw any lawsuit or Claim
should one be pending as of the date you sign this letter agreement.  You also acknowledge and agree that you are
also giving up any right to sue or bring such a Claim against or involving the
Company or any other Releasee, or to become or remain a member of any class of
persons seeking to bring a Claim against the Company or any Releasee. This
letter agreement may be used by the Company or any other Releasee as a full and
complete defense to a Claim or, or to dismiss or enjoin any such proceeding
involving a Claim instituted or maintained by you, your heirs or assigns.

 

3

 

(b)           Claims that May be Brought Notwithstanding this
Agreement.  No
provision of this letter agreement should be read as preventing you from (i) filing
a charge or complaint or participating in any investigation or proceeding
conducted by the Equal Employment Opportunity Commission (“EEOC”) or
similar state agency, or (ii) filing an action to enforce the provisions
of this Agreement.  While you may
participate in such investigation or proceeding, you acknowledge and agree that
you will have waived your right to recover monetary damages, of any kind, in
such investigation or proceeding, arising from or in any way relating, to your
employment with, or separation from, the Company that may have arisen prior to
your signing this letter agreement.

 

12.           Protection of Proprietary
Information. You agree to hold all Proprietary Information, as
defined below, in confidence and not to, directly or indirectly, disclose, use,
copy, publish, summarize or remove from the Company premises any Proprietary
Information.  Although the Company may
request that certain Company property be returned earlier, you agree that you
will return to the Company no later than the Termination Date, all Proprietary
Information and related reports, files, memoranda, and records, credit cards,
card key passes, door and file keys, computer access codes, software, and other
physical and personal property which you received or prepared or helped prepare
in connection with your employment and which are in your possession or control,
and you further agree that you will not retain any copies, duplicates,
reproductions or excepts thereof.  As
used in this paragraph, “Proprietary Information” means any information
in whatever form, tangible or intangible, directly related to the business of
the Company unless the information is publicly available through lawful
means.

 

13.           Non-Disclosure. You
understand and agree that you will not, directly or indirectly, divulge to any
person or use for your own benefit or the benefit of any person any information
of a private, secret or confidential nature concerning the business, accounts
or finances of the Company or any of the secrets, dealings, transactions or
affairs including mergers, acquisitions, divestitures, joint ventures,
partnership or equity participations, investors, reinsurance terms or any
business plans of the Company or of any customer or client of the Company which
have come into your knowledge during the course of your employment with the
Company.  Without prejudice to the
generality of this clause, confidential information includes any and all data,
plans, specifications, drawings, documents, computer software and other
information belonging to or owned or developed by and unique to the Company or
any of its affiliated companies.

 

14.           Non-Disparagement.  You agree that you will not disparage the
Company, or issue or cooperate with the issuance of any article, memorandum,
release, interview, publicity or statement, whether oral or written of any
kind, to any individual, the public, the press or the media, which in any way
may disparage or defame the goodwill, reputation, image or current or future
commercial interests or prospects of the Company or any of its affiliated
entities.  In addition, you agree not to
engage in any conduct or activity inimical, contrary or harmful to the interests
of the Company or any affiliate thereof.

 

15.           Remedies for Violation of
Non-Disparagement and Confidentiality Provisions.  You acknowledge and agree that any violation
of the obligations in Paragraphs 11, 12, 13 or 14 of this letter agreement or
Sections 4.01 through 4.05 of the Employment Agreement shall cause the Company
irreparable harm. You agree that the Company is entitled to protection from
such violations, both actual and threatened, including protection by injunctive
relief, without bond, in addition to other remedies available under the
law.  All of the Company’s remedies for
the breach of these provisions shall be cumulative and the pursuit of any one
remedy shall not be deemed to exclude any other.

 

16.           Non-Admission.  You understand and agree that this letter
agreement, and the payment of the consideration set forth in Paragraphs 1
through 6, above, does not constitute an 

 

4

 

admission by the Company or
any other Releasee of any wrongdoing, including, but not limited to, a
violation of statute, law, or regulation, or breach of an express or implied
contract.

 

17.           Notices and Representations.  You represent and agree that you have read
this letter agreement and you knowingly and voluntarily enter into this letter
agreement, which includes a release and waiver of Claims.  Furthermore, you have been informed by the
Company and understand and agree as follows:

 

(a)           You understand the terms of this letter agreement,
you are signing voluntarily and with the full understanding of its
consequences, and you have not been forced or coerced in any way.

 

(b)           You realize and understand the release in this
letter agreement covers all Claims against the Company and any Releasee,
whether or not you know or suspect them to exist at the present time, including
any right you may have to bring a claim under the ADEA.

 

(c)           You have been advised in writing to consult with an
attorney prior to executing this letter agreement.

 

(d)           You have been given a period of twenty-one (21) days
from the date of receipt of this letter agreement within which to consider this
letter agreement and, if you elect to sign it before that time, you acknowledge
that you have done so voluntarily.

 

(e)           Your release and waiver of claims in this letter
agreement is in exchange for “consideration,” which means the payments and
other benefits described in Paragraphs 1 through 6, above, which you would not
be entitled to receive, and will not receive, unless you enter into this letter
agreement.

 

18.           Non-Disclosure of this
Agreement.  Except as
otherwise provided in this letter agreement or otherwise required by law, you
agree not to disclose (except to family members, financial and tax advisors or
retained legal counsel who first agree to maintain the confidentiality of this
letter agreement) the terms, conditions or existence of this letter agreement.

 

19.           Duty to Cooperate.  You shall, at the request of the Company and
for no additional consideration, assist the Company and cooperate in the defense
and/or investigation of any third party claim or any investigation or any
proceeding, whether actual or threatened, including, without limitation,
participating as a witness in any litigation, arbitration, hearing or other
proceeding between the Company and a third party or any government body.

 

20.           Right of Revocation;
Effective Date.  You have
seven (7) days after signing this latter Agreement to revoke it.  Any revocation will be in writing and
addressed to Kevin Long, SVP Human Resources, Montpelier Technical Resources
Ltd., One Constitution Plaza, Hartford, CT 06103. This letter agreement will
not become effective and no portion of the consideration in Paragraphs 1
through 6 of this letter agreement shall become due or payable until the
Effective Date, which is defined as the earliest date after (a) both
parties have executed this letter agreement and (b) the seven-day
revocation period has passed without revocation.

 

21.           Entire Agreement.  This letter agreement sets forth the entire
agreement between you and the Company relating to the subject matter and
supersedes any and all prior agreements, representations, or understandings of
the parties, whether written or oral. 
You acknowledge that you have not relied on any representations,
promises or agreements of any kind in connection with your decision to accept
this letter agreement.  This letter
agreement may only be modified in writing and such writing must be signed by
both you and the Company.

 

5

 

22.           Breach. You agree
that in the event you breach or otherwise violate any material term or
condition of this letter agreement, including any breach of Article 4 of
the Employment Agreement, the Company shall be entitled to obtain in a court of
competent jurisdiction a temporary or permanent injunction enjoining and
restraining you from any committing, or continuing to commit, any such
violation or breach. You further agree that, in the event you breach or
otherwise violate any term or condition of this letter agreement or Article 4
of the Employment Agreement, you shall have no entitlement to any of the
payments or benefits provided under Paragraphs 1 through 6 of this letter
agreement and/or that you will be required to reimburse the Company for any
payments or benefits previously paid. 
The prevailing party in any legal action or proceeding to enforce the
terms of this letter agreement or to seek damages resulting from any breach of
this letter agreement shall be awarded reasonable legal fees and costs incurred
in such legal action or proceeding.

 

23.           Governing Law/Interpretation.  This Agreement shall
be deemed to have been made within the State of Connecticut, and shall be
interpreted and construed and enforced in accordance with Connecticut law and
before the state or federal courts of competent jurisdiction in
the State of Connecticut.  Should any provisions of this Agreement be
declared illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to become legal and enforceable, such provision will
immediately become null and void, leaving the remainder of this letter
agreement in full force and effect.

 

	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  MONTPELIER
  RE HOLDINGS LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Christopher L. Harris

  
	
   

  	
   

  	
  Name:
  Christopher L. Harris

  
	
   

  	
   

  	
  Title: Chief Executive Officer

  

 

Your
signature below acknowledges that you knowingly and voluntarily agree to all of
the terms and conditions contained in this letter agreement.

 

Voluntarily Agreed to and Accepted this 23 day of April, 2010.

 

	
  By:

  	
  /s/ Stanley J. Kott

  	
   

  
	
   

  	
  Stanley J. Kott

  	
   

  

 

6

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