Document:

Exhibit 10.5

 

Tmall Service Agreement

  

Party A: Fit Boxx Import and Export
Trading (Shenzhen) Company Limited

 

Party B: Zhejiang Tmall Technology Co.,
Ltd.

 

Party C: Zhejiang Tmall Network Co., Ltd.

 

This Agreement is entered into by and
among the legal entity who consents to and uses Tmall services in compliance with the provisions hereof (hereinafter referred
to as the “Merchant” or “Party A”), Zhejiang Tmall Technology Co., Ltd. (hereinafter referred to as “Party
B”), and Zhejiang Tmall Network Co., Ltd. (hereinafter referred to as “Party C”).

 

The three parties hereto are hereinafter
referred to collectively as the “Parties”, and Party B and Party C are hereinafter referred to collectively as “Tmall”.

 

I. Content and Validity

 

The content hereof includes the text hereof
and all types of rules that Tmall has published or will publish and notify the Merchant of (see guize.tmall.com and the Merchant’s
background “Business Center”; where there is any discrepancy between the content of any rule at the former and that
of the same rule at the latter, the content displayed at the “Business Center” shall prevail). All rules published
by Tmall are an integral part hereof, and have the same legal force and effect as the text hereof. The Merchant undertakes to
accept and comply with the provisions of relevant rules in using the services provided by Tmall. Tmall may on the basis of its
needs modify this Agreement or formulate and modify all types of rules from time to time, provided that it shall announce publicly
alterations which affect the Merchant’s rights and obligations at its website at least 7 days in advance.

 

Any amendment hereto or formulation
or modification of rules shall, once taking effect, constitute a supplement to the rights and obligations of the Parties, and
become a part hereof. Where the Merchant does not consent to relevant alteration, it shall forthwith notify Tmall by a formal
written notice affixed with its seal, and Tmall may choose to terminate relevant alteration or forthwith dissolve this Agreement
with the Merchant. Where after relevant alteration has become effective, the Merchant logs on to or continue to use Tmall services,
it will be deemed that the Merchant has accepted the amended agreement. Unless otherwise specified or a separate agreement
is executed, any expanded scope of service or software enhancement shall be bound by this Agreement.

 

Once the Merchant or any person authorized
by the Merchant clicks on the button for the confirmation hereof, this Agreement shall become legally binding upon the Merchant
and Tmall. For any renewing Merchant who has enabled Tmall services prior to the effectiveness hereof, this Agreement shall constitute
an amendment and supplement to the agreement entered into by and among the Parties with respect to the use of Tmall services.

 

II. Definitions

 

“Tmall platform” refers to
the e-commerce platform website [www.tmall.com (or any URL modified from time to time by Tmall based on its business needs, including
but not limited to the URL of computer internet or mobile device internet) and client.

 

“Rules” refer to all rules,
interpretations, public announcements, and other content that have been or will be published subsequently in the rule channel
of the Tmall platform and all types of rules, implementing regulations, product process explanations, public announcements, etc.
published by Tmall at maowo.tmall.com and its forum and help center.

 

“Entry criteria” refer to
the preconditions that shall be met by the Merchant in order to use the services provided on the Tmall platform, e.g., the amount
of registered capital, registration of trademarks, and the quality of products of an enterprise. The Merchant’s clicking
on the button for the confirmation hereof will be deemed as its commitment to Tmall that it has met the criteria for entry into
Tmall and will at all time meet such criteria during its use of Tmall services in the future. Tmall may amend the entry criteria
and inspect the Merchant’s compliance with such criteria from time to time.

 

“Merchant” refers to any legal
entity who operates goods or services on Tmall platform.

 

“Tmall account” refers to
an exclusive number for using the services obtained by the Merchant with the consent of Tmall (numbers are different from one
another), and is also known as “Tmall user name”.

 

“Service enabling” refers
to the process through which Tmall permits the Merchant to open an online store at Tmall and use Tmall services and notifies the
Merchant thereof after the Merchant has logged on to the Tmall website, completed information submission, agreement execution,
and fees payment, and passed inspection.

 

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“Services” refer to the internet
information service and the software service, second level domain name service, points system software service, etc. in relation
thereto provided by Party B and/or Party C for the Merchant at the Tmall platform. All services hereunder are provided and
terminated at the same time, and the Merchant may not order or use any service separately.

 

“Internet information service”,
a kind of Tmall services, refers to the service provided by Party C for the Merchant to display product information for the Merchant
at the Tmall platform.

 

“Software service in relation to
internet information service”, a kind of Tmall services, which falls under the “software development/information system
integration/data processing and storage service industry” in the [classification of national economic industries],
refers to the software service provided by Party B for the Merchant in relation to information display and internet trading. Party
B shall pay for such software service by means of either real-time payment deduction or yearly payment.

 

“Second level domain name service”,
a kind of Tmall services, refers to the use by the Merchant of second level domain names bearing its brand keywords, trade name,
and other signs as permitted by Tmall in accordance with the Tmall Store Naming Conventions.

 

“Points system software service”
refers to the software service provided by Tmall for the Merchant in relation to the use of points software. See Article VI hereof
for details on the use of points software.

 

“Other services” refer to
other information services or software services which have been provided by Tmall for the Merchant. The specific service items
are subject to the provisions of Appendix II hereto, Terms of Tmall Services, or any supplementary agreements entered into
by and among the Parties.

 

“Alipay services” refer to
the “Alipay” software service system and the accompanying payment for goods and collection of payments for goods services
provided by Alipay (China) Network Technology Co., Ltd. (hereinafter referred to as “Alipay”) for the Merchant.

 

“Alipay account” refers to
an exclusive number provided by Alipay for the Merchant for using the Alipay services (numbers are different from one another).
The Merchant shall set a password for its Alipay account, with which it may check and calculate its payments received, prepayments,
and accounts receivable or payable.

 

“Terms of Tmall Services”
refer to Appendix II hereto, or any Terms of Tmall Services otherwise executed by and among the Parties in writing and
affixed with their seals (supplementary provisions in relation to Merchant information, service fee, and other personalized content).
Where there is any conflict between the content of the Terms of Tmall Services otherwise executed by and among the Parties
and that of Appendix II hereto, the former shall prevail.

 

“Consumer” refers to any natural
person or organization who purchases products on Tmall platform for consumption, and may also be named as “buyer”.

 

III. Submission of Merchant Information

 

During its use of Tmall services, Merchant
shall use its Tmall account in combination with the password set by itself to log on to the Tmall website (www.tmall.com). Such
password shall be kept by the Merchant by itself. The Merchant shall keep properly its Tmall service account and password and,
without the consent of Tmall, may not transfer to others or authorize others to use the same, otherwise in order to safeguard
the legitimate rights and interests of consumers, Tmall will terminate the provision of services for such Tmall account. Any and
all operations or acts done or commitments made through the Merchant’s Tmall account are deemed as the Merchant’s
own acts or having been fully authorized by the Merchant.

 

If the Merchant intends to use the services
hereunder, it shall submit its information and relevant documentation to Tmall or any designated partner thereof as required by
the entry criteria of the time when it applied for entry into Tmall. Tmall will provide Tmall services for the Merchant only
to the extent that the brands and categories of the products and the scope of business of the Merchant meet Tmall’s conditions
(i.e., the brands and categories of the products of the Merchant which may be displayed shall be subject to examination and approval
by Tmall), provided that Tmall will examine the Merchant’s information and documentation only with non-professional and
average person’s duty of care, and will not bear any liability for any loss caused by the Merchant’s relying on the
result of examination.

 

The Merchant ensures that the information
and documentation provided by it are authentic and meet the current Tmall entry criteria during the term hereof.

 

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Where during the performance hereof, the
Merchant alters the information and documentation provided by it, or requires to add new brands or categories of products for
operation or expand its scope of business, it shall comply with the latest Tmall entry criteria.

 

Tmall may conduct random inspection of
the Merchant’s information and documentation from time to time, so as to examine the authenticity, legitimacy and validity
thereof, and the Merchant agrees that Tmall may request the Merchant to submit more information or documentation for the aforesaid
purpose.

 

IV. Security Deposit and Alipay Balance

 

The Merchant agrees to pay a certain amount
as a monetary pledge (hereinafter referred to as the “security deposit”) to guarantee its performance of and compliance
with this Agreement. The specific amount of security deposit that shall be paid shall be subject to the provisions of the Tmall
Entry Criteria. The Merchant’s security deposit will be deposited with Alipay, and the payment thereof will be suspended
in the Merchant’s Alipay account. In case of any adjustment of the means of payment, Tmall will notify the Merchant 15 days
in advance.

 

(I) Amount of security deposit

 

The specific amount of security deposit
that shall be paid by each Merchant shall be determined in accordance with the Tmall entry criteria. Where the Merchant fails
to make up for the security deposit within fifteen (15) days upon receipt of notification, Tmall may forthwith suspend the provision
of services or terminate this Agreement.

 

(II) Nature of security deposit

 

Payment of the Merchant’s security
deposit will be suspended in the form of a special account. During the period of payment termination, the right to dispose of
and use the security deposit is owned by Tmall. The Merchant’s security deposit is a monetary pledge for guaranteeing the
performance hereof by the Merchant, and shall be used for its designated purpose only.

 

In case of dissolution, liquidation
or bankruptcy of the Merchant, Tmall enjoys the right to be paid in priority with the security deposit.

 

(III) Payment and use of the security
deposit

 

1. Payment of security deposit

 

The Merchant shall, upon executing this
Agreement (by affixing its seal and signature hereto in writing or clicking on the “accept” button online), deposit
a sufficient amount of money into its Alipay account, and Tmall will, prior to enabling services for the Merchant, instruct Alipay
to suspend the payment of the corresponding amount in the Merchant’s Alipay account.

 

2. Use of security deposit

 

In addition to the suspension of payment
of security deposit, Tmall may give instructions to Alipay in the following ways with respect to the management and use of the
security deposit:

 

i) Unless otherwise provided for herein,
Tmall will, within ten (10) working days upon the fulfillment of all of the following conditions, give an instruction to Alipay
to revoke the suspension of payment of the security deposit:

 

a. This Agreement has been terminated;
and

 

b. There are neither any transaction which
has not been completed nor any complaint, punishment or dispute (including but not limited to controversy or dispute with Tmall,
consumers or any other third party) which has not been handled by the Merchant within three consecutive months after the termination
hereof.

 

ii) Tmall may dispose of the security
deposit upon the occurrence of the following circumstances:

 

a. Where in any transaction conducted
on Tmall platform, the Merchant violates the state laws and regulations, regulatory policies, or its commitments to the buyer,
which results or may result in damage to the buyer’s rights and interests, the Merchant agrees that Tmall may determine
the liability therefor, and inform based on the aforesaid determination Alipay to deduct the security deposit for returning
the payment for goods and paying liquidated damages and/or compensation on behalf of the Merchant to the buyer.

 

b. Where in any transaction conducted
on Tmall platform, the Merchant violates this Agreement or rules of Tmall, or shall return in accordance with the provisions thereof
the payment for goods or pay liquidated damages and/or compensation to the buyer, the Merchant agrees that Tmall may determine
the liability therefor, and inform based on the aforesaid determination Alipay to deduct the security deposit for returning
the payment for goods and paying liquidated damages and/or compensation on behalf of the Merchant to the buyer.

 

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c. Where the Merchant violates state laws
and regulations or regulatory policies, which results in damage to Tmall’s rights and interests (including but not limited
to being subject to administrative penalty, media exposure, or goodwill impairment, or being convicted of infringement), Tmall
may inform Alipay to transfer corresponding amount from the security deposit to Tmall’s account as liquidated damages and/or
compensation.

 

d. Where the Merchant violates this Agreement
or rules of Tmall, and shall pay in accordance with the provisions thereof liquidated damages and/or compensation to Tmall, Tmall
may inform Alipay to transfer corresponding amount from the security deposit to Tmall’s account as liquidated damages and/or
compensation.

 

e. Where there is any overdue amount payable
by the Merchant to Tmall (no matter based on this Agreement or not), Tmall may inform Alipay to forthwith transfer corresponding
amount from the security deposit to Tmall’s account.

 

f. Where the Merchant violates the provisions
of any agreement between it and any of Tmall’s affiliates (hereinafter referred to collectively as the “affiliates”),
as a result of which any economic loss is incurred to the affiliate, or the Merchant shall pay liquidated damages thereto, the
Merchant authorizes Tmall to inform at the request of the affiliate Alipay to suspend the payment of corresponding amount in the
security deposit in full or in part or directly transfer such amount to the affiliate’s Alipay account. The Merchant will
be otherwise notified of the specific scope of the affiliates by Tmall, and agrees that Tmall will not bear any liability for
such instruction on the suspension of payment or transfer, and that controversies and disputes in relation thereto will be settled
by and between the Merchant and the aforesaid affiliate.

 

3. Where Tmall instructs in accordance
with this Agreement and relevant rules Alipay to deduct the security deposit for payment to Tmall, consumers or other third parties,
it shall notify the Merchant in writing via email, direct message, facsimile, or other means. In the written notice issued to
the Merchant, Tmall will specify the reason for and amount of deduction.

 

4. After Alipay deducts or pays the Merchant’s
security deposit as instructed by Tmall, the Merchant agrees that Tmall may inform Alipay to suspend the payment of corresponding
amount in the balance in the Merchant’s Alipay account to make up for the security deposit. Where such balance is insufficient
to make up for the security deposit, the Merchant shall otherwise pay the security deposit within 15 days upon notification by
Tmall.

 

5. Upon the occurrence of the following
circumstances, as a result of which the amount of payments or compensations that have been or may be made by Tmall exceeds the
disposable balance of the security deposit, Tmall may request Alipay to directly suspend the payment of the amount in the Merchant’s
Alipay account in case of compensation, or directly pay such amount to Tmall, so as to compensate Tmall for any loss suffered
by it:

 

i) The Merchant applies for bankruptcy
or is subject to application for bankruptcy;

 

ii) The Merchant assumes any debt of
an amount much higher than the balance of the security deposit as a result of its business conduct on the Tmall platform;

 

iii) There is evidence proving that the
Merchant’s solvency has dropped significantly, or the Merchant is engaged in property transfer or the obtaining of security
deposit from Tmall by fraud;

 

V. Services and Fees

 

Prior to the execution by the Parties
of a separate written Terms of Tmall Services (Minimum Guarantee) affixed with their seals, Party A shall settle with Tmall
in respect of the following content, otherwise the provisions of the Terms of Tmall Services (Minimum Guarantee) shall
prevail:

 

(I) Services provided by Party B and charges

 

1. Software service in relation to
internet information service

 

i) Party B will provide the Merchant with
software service in relation to internet information service, including but not limited to a software system for searching products,
generating orders, managing transactions, and completing payments. Party B will charge the Merchant a software service fee, which
consists of an annual fee and real-time deductions.

 

ii) The specific amount of the annual
fee shall be determined based on the category of goods operated by the Merchant, subject to the List of Annual Fees and Software
Service Fees for Different Categories of Goods of Tmall in 2017. Unless a separate written agreement is executed by and among
the Parties affixed with their seals, the annual fee shall be deposited by the Merchant into its Alipay account prior to the enabling
of services, and Tmall services may be enabled only after Party B gives an instruction on deduction to Alipay and the deduction
is completed successfully. The Merchant shall, prior to the enabling of services, pay to Party B the annual fee for an entire
year in accordance with the amount provided for in the List of Annual Fees and Software Service Fees for Different Categories
of Goods of Tmall in 2017, and Party B will settle upon the termination hereof the annual fee based on the period of actual
use of the services (including the period during which the store is subject to authority constraint, ranking lowering in searches,
blocking out and supervision due to its violation of this Agreement and Tmall rules).

 

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iii) Real-time deductions will be made
based on the Alipay turnover at the rate specified in the List of Annual Fees and Software Service Fees for Different Categories
of Goods of Tmall in 2017. Upon the confirmation by a consumer of its receipt of goods on a transaction order place with the
Merchant, Party B will give an instruction on deduction to Alipay automatically through the software system, and a real-time deduction
will be made at the software service fee rate as provided for herein. The turnover shall be subject to the Merchant’s Alipay
turnover as recorded by the Alipay software system. In case of return of goods and there is no fault on the part of the Merchant,
Tmall will, after confirming that the return of goods is true, return to the Merchant the software service fee collected for such
return of goods through real-time deduction, provided that the same applies only to refunds completed by consumers and the Merchant
through Tmall online refund system. Where the Merchant provides any refund for the consumer offline, no matter what evidence
is provided by the Merchant to prove that the refund in relation to the return of goods has actually occurred, Tmall will not
support the return of software service fee collected through real-time deduction in respect of the refund to the Merchant.

 

iv) In order to encourage the Merchant
to improve service quality and increase turnover, except for special categories or unless otherwise agreed to by and among the
Parties, Tmall will give conditional commercial discounts in the annual fee to the Merchant. See the List of Annual Fees and
Software Service Fees for Different Categories of Goods of Tmall in 2017 for details of the specific preferential conditions
and standards of discounts. The settlement of discount in the annual fee will start upon the termination hereof, and the specific
amount of discount in the annual fee will be calculated according to the length of time the Merchant uses Tmall services.

 

v) The following conditions shall be met
for the Merchant’s turnover to be included into the turnover of the whole year or the service period and serve
as the basis for the calculation of the discount in the annual fee:

 

a. Products are displayed under correct
categories, and have not been misplaced;

 

b. The Merchant’s turnover needs
to be authentic, legitimate, and not in violation of the Merchant’s agreement with Tmall and corresponding rules; and

 

c. Tmall has received payment for software
service fee through real-time deduction in respect of product transactions;

 

For Merchants who have used services for
at least a whole year, Tmall will conduct settlement for the return of annual fee according to the annual turnover of the Merchant’s
store; for Merchants who have used services for less than a year, Tmall will recalculate the annual fee payable and the turnover
that shall be achieved by the Merchant according to the ratio of the period of use of services to a whole year, and conduct assessment
based on the turnover during the period of use of services to decide on whether to give any annual fee discount.

 

2. Software service fee in relation
to the points system

 

The Merchant agrees to use the Tmall points
module (and similar points modules subsequently provided by Tmall; the names thereof shall be subject to that actually used by
Tmall) in the points system software (a marketing software that may be used to increase customer stickiness; see Article VI hereof
for details), and pay the points system software service fee to an Alipay account designated by Tmall according to a certain ratio
(see Appendix II hereto or a separate Terms of Tmall Services executed by the Parties for details) based on the amount
of Tmall points granted by it to the consumers via the points system software (the actual amount shall be subject to that recorded
by the Tmall system). The turnover shall be subject to the Merchant’s Alipay turnover recorded by the Alipay system.

 

The deduction and payment of the points
system software service fee in Tmall points module will be completed automatically by Alipay according to the payment instructions
given by Tmall via the software system. In case of return of goods and there is no fault on the part of the Merchant, Tmall will,
after confirming that the return of goods is true, return to the Merchant the points system software service fee collected in
respect of such return of goods, provided that the same applies only to refunds completed by the consumers and the Merchant via
the Tmall online refund system. Where the Merchant provides any refund for the consumer offline, no matter what evidence is
provided by the Merchant to prove that the refund in relation to the return of goods has actually occurred, Tmall will not support
the return of the points system software service fee collected in respect of the refund to the Merchant.

 

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(II) Services provided by Party C and
charges

 

1. Internet information services

 

Party C, as the owner of the domain name
tmall.com, displays through its website page for the Merchant information on the Merchant’s goods and services, and provides
the Merchant and consumers with a carrier for trading and communication. For the time being, Party C does not charge the Merchant
or consumers any fee for the internet information services provided by it.

 

2. Second level domain name services

 

Party C permits the Merchant to use second
level domain names bearing its brand keywords, trade name, and other signs pursuant to the Tmall Store Naming Conventions.
The title to the second level domain names is vested in Party C, and Party C may withdraw second level domain names based on complaints
filed by third parties or for self-use by Tmall. For the time being, Party C does not charge the Merchant for the second level
domain name services provided by it.

 

3. Other services

 

During the performance hereof, Party C
may provide the Merchant with marketing-like service, market consultation service, training service, etc. from time to time. Unless
any separate agreement on the charging of fees is concluded and executed by the Parties, Party C does not charge the Merchant
any fee for the above services for the time being.

 

(III) Service fee invoice

 

Upon the incurrence of any service fee,
the Merchant may confirm information on invoice issuing with Tmall in the background of the Tmall store system, and Tmall will
issue, upon receipt of the confirmation information, a VAT invoice for software service fee of corresponding amount and type to
the Merchant. The specific issuing dates and intervals shall be subject to the provisions of Tmall rules.

 

(IV) Settlement of fees by renewing Merchants

 

For Merchants who have enabled services
prior to the effectiveness hereof, upon their acceptance hereof, the fees payable by them for the civil year of 2016 shall still
be settled in accordance with the agreement that has been reached by and among the Parties in respect of the use of Tmall services.
In particular, for Merchants who have made commitments on minimum turnover and/or software service fee to Tmall within the
civil year of 2016, fees shall still be settled with Tmall in accordance with the provisions of Terms of Tmall Services (Minimum
Guarantee).

 

VI. Points system

 

During the operation of the Tmall platform,
the Merchant agrees to use the points system software provided by Tmall (the collective name for marketing software provided by
Tmall; the points include but are not limited to Tmall points, coupons, red envelope coupons, Tmall currency, and other types
of points provided subsequently by Tmall), and pay software service fee in relation to the points system to Tmall in accordance
with the provisions of Article V hereof.

 

(I) Grant of points

 

Subject to the payment of points system
software service fee by the Merchant as provided for herein, the Merchant agrees that Tmall grants points to consumers in accordance
with the following provisions:

 

1. Tmall grants Tmall points (and/or other
types of points provided subsequently by Tmall) to consumers at a certain ratio (the minimum ratio is determined by Tmall,
and may be raised by the Merchant) based on the amount paid by consumers for each order.

 

2. Tmall grants a certain amount of Tmall
points to consumers in accordance with the provisions of Tmall rules on compensations made by Tmall Merchants to their members
in the form of Tmall points (the specific amount of Tmall points to be granted shall be subject to the provisions of specific
rules).

 

(II) Use of points

 

Consumers may enjoy discounts in the Merchant’s
store with all types of points obtained by them. The Merchant may not refuse to allow consumers to enjoy prescribed discounts
with points of corresponding types, and consumers may make payments for orders according to the discounted price. Given that the
Merchant accepts Tmall points, and provides brand and points software promotion services for Tmall, Tmall will pay relevant promotional
activity service fees to the Merchant according to the number of points used by consumers in transactions conducted in the Merchant’s
store (the ratio of points to activity fees is determined by Tmall).

 

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(III) Return of points activity fees and
invoicing

 

1. Where any transaction in which points
are used by any consumer to offset against the amount of any order is finally cancelled, the Merchant shall return to Tmall the
points activity service fees that have been paid.

 

2. Where any consumer fails to use points
in accordance with Tmall rules (including without limitation rules on the common use of Tmall points, and other rules on the use
of points), or uses points by taking advantage of any software vulnerability or system bug in the Tmall platform, such points
will become void, and Tmall is not required to pay points activity service fees to the Merchant in respect thereof.

 

3. The Merchant shall, prior to May 31
in the following year after the execution hereof (or the date of termination hereof if this Agreement is terminated prior to May
31 in the following year), issue to Tmall a VAT special invoice for service fees in accordance with the points activity service
fees received by it in the previous year.

 

VII. Consumer Protection Obligation

 

Consumer protection means that the Merchant
shall perform the obligations of “accurate description of goods”, “return or replacement of goods without reason
within 7 days”, and “genuine product guarantee” in displaying through the Tmall platform products other than
second-hand and idle ones (hereinafter referred to as “brand new products”) and selling brand new products to buyers
through Alipay services in accordance with the terms and conditions provided for herein and the rules published in Tmall website.
Tmall will from time to time publish newly added consumer protection obligations or amend the original consumer protection obligations
on Tmall website. Where the Merchant has any objection to the newly added or amended consumer protection obligations, it shall
notify Tmall in writing, and Tmall may choose to dissolve this Agreement with the Merchant, or terminate the implementation of
the newly added or amended content. Where upon the effectiveness of the newly added or amended content, the Merchant continues
to use Tmall services, it will be deemed that the Merchant accepts the content newly added or amended by Tmall.

 

(I) Consumer protection items

 

The Merchant undertakes that in displaying
product information and conducting product trading with buyers through the Tmall platform, it will:

 

1. perform the obligation of “accurate
description”. “Accurate description” means that the Merchant undertakes that the product information uploaded
by it to the Tmall website is in conformity with the real objects, and bears the burden of proof with respect to the accuracy
and conformity of description. The obligation of “accurate description” shall cover the following content:

 

(i) All information in relation to any
product per se as chosen or filled out by the Merchant for displaying the product, including but not limited to text description
and product picture, which may be directly viewed by buyers on the detail page of such product;

 

(ii) The information on any product per
se, postage, delivery, accessories, and other descriptions provided by the Merchant for any buyer during its communication with
the buyer via Alitalk in the course of transaction falls under product information.

 

(iii) The Merchant is obliged to bear
the liability for any quality problem or flaw of any product per se, unless the Merchant has described the quality problem or
flaw in advance, and such quality problem or flaw is not in violation of the provisions of state laws and regulations or this
Agreement;

 

(iv) Where the Merchant displays any product
under the categories of men’s wear, women’s wear/women’s fine products, it shall use pictures of real objects,
i.e., pictures of such product per se actually shot by the Merchant, excluding pictures from magazines or official websites and
publicity pictures. If the Merchant violates the provisions of this clause, it will be deemed that the Merchant has violated the
obligation of accurate description of products;

 

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2. perform the obligation of “return
or replacement of goods without reason within 7 days”. “Return or replacement of goods without reason within 7 days”
means that after any buyer has purchased any product from the Merchant through Alipay services, within 7 days upon its signed
receipt of the product, if for subjective reasons the buyer is unwilling to complete the transaction, the Merchant undertakes
that it will agree to provide the service of return or replacement of goods for the buyer in accordance with the provisions hereof.
Where the buyer and the Merchant fails to reach any agreement through negotiation with respect to the return or replacement of
goods, as a result of which the buyer files an application with Tmall for right protection against the Merchant and compensation
on the ground of “return or replacement of goods without reason within 7 days”, and Tmall determines that the buyer’s
application for compensation is established, the Merchant agrees to make corresponding compensation to the buyer as determined
by Tmall, or have Tmall make compensation for the buyer on its behalf in advance. The obligation of “return or replacement
of goods without reason within 7 days” covers the following content:

 

(i) The Merchant agrees to provide the
service of return or replacement of goods without reason within 7 days based on the content published by Tmall on its website
(including without limitation the “return or replacement of goods without reason within 7 days” service specifications
of Tmall).

 

(ii) The Merchant agrees that once any
application for the service of return or replacement of goods without reason within 7 days is filed with it by any buyer within
7 days upon its receipt of goods, the Merchant shall actively cooperate with and take the initiative to negotiate with the buyer,
in the hope of the conclusion of an agreement on the return of goods and refund by and between both parties on a friendly and
voluntary basis. With respect to any application for the replacement of any postage included product, the Merchant agrees to bear
the postage for redelivery. The aforesaid time of signed receipt by the buyer shall be subject to the time recorded on the logistics
receipt. Where there is a specific time on the logistics receipt, 7 days shall be 168 hours after such time; where there is only
a date on the logistics receipt, 7 days shall be 168 hours as of the zero hour on the day immediately following such date;

 

(iii) The Merchant agrees that once a
buyer files an application for refund upon its receipt of goods or claims for compensation within 14 days after the transaction
is successfully completed on the ground of “return or replacement of goods without reason within 7 days”, the Merchant
shall render active cooperation, and provide authentic, legitimate and valid evidence materials within the prescribed time limit
at the request of Tmall. According to different categories of products, the Merchant shall submit according to the requirements
informed by Tmall different evidence materials, and Tmall may request based on the handling of rights protection the Merchant
to further provide other evidence materials;

 

(iv) The Merchant agrees that Tmall
may, in handling claims for compensation filed by buyers based on “return or replacement of goods without reasons within
7 days” or relevant applications for return of goods, conduct surface examination of the evidence materials submitted by
the Merchant and the buyers with an ordinary or non-professional level of knowledge, and make judgements based on the result of
such examination. Where any damage is caused as a result of Tmall’s wrong judgement, Tmall will not bear any liability therefor,
and the Merchant agrees to claim for compensation from the beneficiary by itself.

 

(v) Where the Merchant fails to provide
relevant evidence materials within the prescribed time limit, or relevant evidence materials are obviously invalid, Tmall will
determine that the buyer’s claim for compensation is established, and the Merchant agrees that it will compensate the buyer
for any loss suffered by it according to the provisions hereof, and the amount of compensation shall be the price of the product
that has been actually paid by the buyer.

 

3. perform the obligation of “observing
commitments”. “Observing commitments” means that the Merchant shall strictly observe commitments made directly
or indirectly to the buyers by all means, including but not limited to commitments made to the buyers through this Agreement,
relevant rules of Tmall, online store, webpage on product details, and Alitalk communication.

 

4. perform the obligation of “genuine
product guarantee”. “Genuine product guarantee” means that after any buyer has received any product purchased
by it through Alipay services from the Merchant on the Tmall website, if the buyer deems that the product is a counterfeit (including
pirated copyright) one, or is not an original and genuine one, or is imported without customs declaration, or is made up of counterfeit
materials and ingredients (the definitions of counterfeit products, products imported without customs declaration, and products
made up of counterfeit materials and ingredients shall be subject to the provisions of Tmall rules) and claims for rights protection
against the Merchant and applies for compensation within the time limit prescribed by Tmall after negotiation between it and the
Merchant fails, and Tmall determines that the buyer’s claim for compensation is established, the Merchant agrees to return
to the buyer the price of the product that has been actually paid by it, increase the compensation to the buyer for any loss suffered
by it (the amount of increased compensation shall be four times the price of the product that has been actually paid by the buyer),
and bear all logistics fees for the product which is involved in rights protection. For any product sent by any consumer to Tmall
for judgement and is determined by Tmall to be a counterfeit product, Tmall may contact the administration for industry and commerce
for direct destruction, without returning it to the Merchant. As to measures for compensation concerning products under special
categories (e.g. food), if the compensation standards provided for in relevant state laws and regulations are higher than those
herein, the Merchant agrees that the provisions of such laws and regulations shall prevail.

 

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(II) Consumer protection responsibility
and handling

 

1. Compensation in advance: means that
after the Merchant has traded with any buyer in any transaction conducted on Tmall network platform through Alipay services, if
the Merchant fails to perform any of its consumer protection commitments, Tmall may determine based on relevant evidence materials
with an ordinary or non-professional level of knowledge whether the Merchant shall perform its refund or compensation obligations
in accordance with the provisions of this Agreement and relevant rules of Tmall. Where it determines that the Merchant shall
provide refund for or pay liquidated damages and/or compensation to any consumer, Tmall may inform Alipay to directly deduct corresponding
amount from the Merchant’s security deposit to pay to the consumer, or use its own funds to pay to the consumer on behalf
of the Merchant.

 

2. The Merchant clearly understands and
agrees that it is the responsible subject for consumer protection. Upon the occurrence of any of the aforesaid circumstances under
which the Merchant shall perform its consumer protection obligations, the Merchant shall ensure the buyers’ consumer rights
and interests. Requests made by buyers in respect of the above issues shall be handled actively by the Merchant. The Merchant
agrees that when Tmall accepts any application for consumer rights protection and compensation filed by any buyer, it shall render
active cooperation, and provide relevant evidence materials within the time limit prescribed by Tmall, so as to prove that the
product traded by it with the buyer does not have the problems pointed out by the buyer or conforms to the agreement between both
parties, and ensure that the evidence materials submitted by it are authentic and legitimate.

 

VIII. Undertakings and Warranties of
the Merchant

 

During the use of services, the Merchant
undertakes and warrants that:

 

(I) It meets the application requirements
provided for the current Tmall entry criteria, will provide Tmall with authentic, legitimate, accurate and valid information
and materials, ensures the validity and security of its email address, contact number, contact address, post code, and other information,
and ensures that Tmall and other users may contact it through the aforesaid means of contact. Meanwhile, the Merchant is obliged
to update relevant information and materials in a timely manner upon any actual change to relevant materials.

 

(II) It will comply with this Agreement,
Taobao Platform Service Agreement, Payment Service Agreement, Ant Check Later Payment Service Agreement,
Alipay Points Service Agreement, and all rules and procedures published on Tmall.

 

(III) It has the capacity for rights and
acts to conclude this Agreement and use relevant Tmall services.

 

(IV) All information displayed by it on
Tmall is authentic and accurate, and conforms to relevant laws and regulations, this Agreement and Tmall rules.

 

(V) It has the legal right to sell the
products involved in the transaction information displayed on Tmall.

 

(VI) It will sell products and provide
“three guarantees” (for repair, replacement or compensation of faulty products) and other aftersales services according
to requirements not lower than those provided for in the Quality Law of the People’s Republic of China, Law of
the People’s Republic of China on the Protection of the Rights and Interests of Consumers, and other regulations, department
rules and national mandatory standards.

 

(VII) It has the obligation to issue
qualified invoices to the buyers in respect of the amount of cash actually paid in transactions conducted in its Tmall store;
it will make tax declarations in accordance with the law to the competent taxation authority at the place where it is located
in a timely manner and in full amount with respect to the actual amount of turnover of its Tmall store.

 

(VIII) It will make it clear that it only
accepts “Alipay services” or other means of payment provided by Alipay as the payment instrument for it to conclude
transactions through Tmall.

 

(IX) It warrants that during its use of
services to conclude transactions, it will comply with the principle of good faith and will not engage in any act of unfair competition
during the course of any transaction, disturb the normal order of online transactions, or engage in any act irrelevant with online
transaction on Tmall platform.

 

(X) It warrants that all acts conducted
by it during its use of services are in compliance with the state laws and regulations, relevant rules and provisions of Tmall,
and social public interests and public morality.

 

(XI) It agrees that it will not make
any commercial use of any data on Tmall, including but not limited to reproducing, transmitting, disclosing to others, or using
any materials displayed by other users by any other means on Tmall website without prior written approval of Tmall.

 

(XII) It undertakes that it is obliged
to manage its store and forthwith delete any information appearing in its store which is in violation of the provisions of relevant
state laws and regulations and Tmall rules.

 

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(XIII) It undertakes that it has legitimate
rights and qualification to upload to Tmall relevant product sales information and sell products, and the aforesaid acts have
not constituted any infringement upon the legitimate rights and interests of any third party, including but not limited to the
intellectual property rights, property right, right of portrait of any third party.

 

(XIV) It undertakes to disable the “pay
with balance” function of its Alipay account (the Alipay account bound to the Merchant’s store hereunder). The Merchant
authorizes Tmall to give an instruction to Alipay to disable the “pay with balance” function of its Alipay account.

 

(XV) It acknowledges that Tmall may
assess and judge independently its entry information and brand operation applications, and the examination result shall be subject
to the assessment and judgement by Tmall.

 

(XVI) It undertakes not to use any keyword
of unauthorized brands in the products displayed by it.

 

(XVII) It undertakes to accept casual
inspections conducted by Tmall to find out whether the products sold by it are from legitimate sources, and it has the obligation
to keep relevant vouchers evidencing the legitimate source of its products. Where it is unable to provide any evidence in support
of the legitimate source of its products, Tmall will, according to the actual situation, judge the authenticity of products, and
the Merchant agrees to bear the unfavorable consequences of the evidence in respect thereof.

 

(XVIII) It acknowledges and accepts the
spot checking of the quality and verification of the authenticity of its products conducted by Tmall in accordance with published
rules for the purpose of maintaining a good market order and protecting consumers’ rights and interests. The Merchant may
raise objections to the results of spot checking and verification in accordance with the published rules. With respect to any
product which is proved through spot checking to have any quality problem or determined through verification to be counterfeit
goods, all reasonable expenses incurred in the spot checking or verification shall be borne by the Merchant.

 

(XIX) It undertakes to agree that Tmall
may display information on Tmall activities (e.g., “Double Eleven” online shopping event), consumer protection, and
other information in a fixed position in the Merchant’s store, specifically, the space below the “product parameters”
in the webpage on product details. The content of such information will be designed and made by Tmall based on relevant themes.

 

(XX) The Merchant agrees to authorize
Tmall to cancel product transactions published by the Merchant which violate laws and regulations or may infringe upon the consumers’
personal and property rights and interests and, for completed transactions, notify the consumers of return of goods and refund.

 

(XXI) The Merchant agrees that Tmall prohibits
the sale on Tmall platform of any brand which does not meet mandatory standards or is seriously inconsistent with recommended
standards and its associated brands on products under the same category (including brands jointly used on products under the same
category and brands registered by the same applicant and used separately on products under the same category, etc.), no matter
whether the aforesaid brands serve as the main labels of its products.

 

(XXII) When selling goods, the Merchant
undertakes that it will use its own source of goods or the source of goods of its affiliates or on the Tmall distribution platform
to deliver goods to the consumers as the final retailer, and will not deliver goods to consumers through other retailers, retail
enterprises, and retail websites. Tmall reserves the right to terminate this Agreement if the merchant violates the aforementioned
commitments.

 

(XXIII) The Merchant undertakes that
it will not take any means or measures, including but not limited to requesting expressly or impliedly users to or by any other
means transfer any transaction which may be concluded by it through Tmall network platform, or receive the amount of any transaction
without Alipay services, so as to avoid paying relevant service fees to Tmall.

 

IX. Rights and Obligations of Tmall

 

(I) Tmall has the obligation to maintain
the normal operation of the entire Tmall online transaction platform with the existing technologies, so as to ensure the smooth
completion of the Merchant’s online transactions; Tmall may decide, adjust or permit the categories, types and quantity
of products of the Merchant to display based on the scope of business specified on the Merchant’s business license, the
scope of brand license received by the Merchant, and the Merchant’s description of the scope of business of its own store;

 

(II) With respect to problems in relation
to transaction or registration encountered by the Merchant during its registration and use of services and circumstances reported
by the Merchant in respect thereof, Tmall shall give replies in a timely manner;

 

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(III) Due to the particularity of online
transaction platforms, Tmall is not obliged to conduct any prior review of the transaction acts of all Merchants and other matters
in relation to transaction, unless:

 

1. Any third party informs Tmall that
it deems that some specific Merchant or transaction may have significant problems;

 

2. The Merchant or any third party informs
Tmall that there is any illegal or improper act on the transaction platform;

 

3. Tmall finds out that some specific
Merchant or transaction may have significant problems.

 

Through judgement with an ordinary
or non-professional level of knowledge, Tmall may deem that relevant content or act is of an illegal or improper nature, and may
choose to delete relevant information, take restrictive measures against the Merchant’s store, or cease the provision of
services for the Merchant as the case may be.

 

(IV) Tmall may review the Merchant’s
registration data and transactions and, in case of finding any problem in or having any doubt about the above information, send
notification on query or requesting for corrections to the Merchant, or handle the same directly by deletion or taking restrictive
measures against the Merchant’s store;

 

(V) Where it is confirmed in any effective
national legal instrument or decision on administrative penalty that the Merchant is engaged in any illegal act, or Tmall has
sufficient factual basis for determining that the Merchant is engaged in any act in violation of the law or this Agreement, Tmall
may publish on Tmall website the Merchant’s illegal and/or breaching act;

 

(VI) Tmall may delete or take other restrictive
measures with respect to some information displayed by the Merchant on Tmall online transaction platform without notifying the
Merchant. Such information includes but is not limited to those under the following circumstances:

 

1. Tmall has reason to believe that the
information is for the purpose of avoiding Tmall fees;

 

2. Tmall has reason to believe that the
information is for the purpose of commercial hype, so as to improve credit rating and increase sales;

 

3. Tmall has reason to believe that the
information contains fraudulent or other malicious or fake content;

 

4. Tmall has reason to believe that the
information is irrelevant with online transaction or is not for trading purpose;

 

5. Tmall has reason to believe that the
information involves malicious bidding or other factors with the intention of disturbing the normal trading order;

 

6. Tmall has reason to believe that the
information is in violation of public interests or may seriously damage the legitimate interests of Tmall and/or other users.

 

(VII) The Merchant hereby grants Tmall
a free license (and the right to grant sublicenses) for Tmall to, for the purpose of promoting relevant products and/or brands,
use, reproduce, amend, rewrite, display, translate, distribute and present (in full or in part) all kinds of information published
by the Merchant in its Tmall online store (including without limitation product trademark, logo, work, order information, and
turnover) or produce derivative work thereof, and/or include the aforesaid information into other work in any form or through
any media or technology currently known or developed in the future;

 

(VIII) Tmall will set or access Tmall
cookies on the Merchant’s computer. Tmall permits companies that publish advertisements on Tmall webpage to set or access
cookies on the Merchant’s computer. By obtaining data when the Merchant logs on, Tmall can provide the Merchant with personalized
services with cookies. If cookies are rejected, the Merchant will not be able to use the services.

 

(IX) Tmall may transfer all of its rights
and obligations hereunder to its affiliates based on business adjustment, in which case it will notify the Merchant in the form
of website announcement 30 days in advance.

 

(X) Tmall may publish the monthly sales,
monthly transaction records, and accumulated number of ratings of and other information on each product in the Merchant’s
store, or use the same for publicity and promotion, and during the Merchant’s participation in market activities held by
Tmall officially (including but not limited to “1111 Shopping Carnival”), Tmall may publish the total turnover and
the turnover of goods under a certain category or a certain product in the Merchant’s store during the activity, or use
the aforesaid information for publicity and promotion.

 

    11/18

     

    

 

X. Enabling and Term of Services

 

(I) Services will be enabled within fourteen
(14) working days upon the satisfaction of all the following conditions:

 

1. The information submitted by the Merchant
to Tmall is approved through examination by Tmall;

 

2. The Merchant meets the current Tmall
Entry Criteria;

 

3. The Merchant and Tmall execute this
Agreement by clicking on the button for the confirmation hereof online;

 

4. The Merchant and Tmall execute the
Terms of Tmall Services by clicking on the button for the confirmation hereof online;

 

5. Payment of the annual software service
fee payable by the Merchant has been successfully suspended in its Alipay account or remitted to Tmall Alipay;

 

6. Payment of the Merchant’s security
deposit has been successfully suspended;

 

7. There has been no termination of cooperation
by Tmall or violation of any agreement with Tmall prior to the application for the use of services;

 

8. Tmall has sent the notification of
the enabled services to the Merchant.

 

(II) The term of services shall start
from the date on which services are actually enabled and end on Dec. 31, 2017.

 

(III) Where the Merchant still fails to
meet all conditions for the enabling of services as provided for in Paragraph 1 of this clause within fourteen (14) working days
upon executing this Agreement or accepting the same online, or Tmall for any reason sends notification on refusing to provide
services to the Merchant, Tmall may refuse to enable the services and terminate this Agreement. Where this Agreement is terminated
before services are enabled, Tmall will not bear any liability for breach of contract or compensation.

 

XI. Confidentiality

 

(I) Trade secrets referred to herein include
but are not limited to this Agreement, the content stated in any supplementary agreement, and other confidential information involved
during the course of cooperation. No Party may, without the consent of the provider of any trade secret, disclose, transmit, edit
or display such information to any third party. The Parties undertake that they will continue to bear the confidentiality obligation
under this clause after the termination hereof, and the period of confidentiality will be extended for another three years.

 

(II) Where any trade secret is disclosed
with the written consent of the other Parties or due to any compulsory administrative or judicial act of the state, the disclosing
party does not bear any liability; where such trade secret is known by the public, the disclosing party does not bear any liability.

 

XII. Anti-commercial Bribery

 

Where the Merchant or any of its employees,
shareholders, legal representatives, actual controllers or affiliates provides any employee or consultant of Tmall or its affiliates
with physical objects, cash, cash equivalents, labor, trips, or other interests with a value significantly above that required
for normal contact, it may be deemed that the Merchant is engaged in the act of offering commercial bribes.

 

In case of the above circumstances,
Tmall may forthwith terminate all cooperation relationship with the Merchant (including but not limited to cooperation based on
this Agreement) and collect liquidated damages and/or compensation from the Merchant. The liquidated damages shall be subject
to the provisions of Tmall rules, and the amount of compensation shall be calculated based on the economic losses and loss of
business reputation suffered by Tmall as a result of the Merchant’s bribery.

 

XIII. Limited Liability

 

(I) Tmall services are provided on
an “as is” and “available” basis. The Merchant has fully understood the functions and service features
of Tmall platform prior to the enabling of Tmall services, and agrees that Tmall is not required to bear any liability to the
Merchant in respect of the existing software defect, insufficient function or any matter that requires improvement.

 

(II) Since Tmall has to provide services
for a large number of Merchants, and the services provided are complex and highly technical, Tmall only bears the liability for
breach of contract and/or compensation in respect of any loss suffered by the Merchant as a result of Tmall’s intentional
or gross negligence, and the amount thereof shall be no higher than the service fees that have been paid by the
Merchant.

 

(III) The use of Tmall to download any
service or obtain any information is based on the independent judgment and at the risk of the Merchant. The Merchant is sorely
responsible for any loss incurred to its computer system or data as a result thereof.

 

(IV) Under no circumstances will Tmall
be responsible for any failure to provide or delay in the provision of services caused by Internet connection failure, computer
system failure, communication failure, power failure, computer virus, hacking, strike, labor dispute, riot, uprising, riot, fire,
flood, storm, explosion, war, and other force majeure events or any third party reasons.

 

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(V) Tmall only serves as the place for
its users to search for objects to trade with, conduct negotiations about the trading of goods and services, and obtaining all
kinds of services in relation to trading. The execution hereof does not mean that Tmall has become a participant in any transaction
conducted by the Merchant with any third party on Tmall website, and Tmall only provides software service for the aforesaid transaction,
and does not make any express or implied guarantee for the legitimacy and validity of the Merchant’s acts and the authenticity,
legitimacy and validity of products.

 

(VI) During the use of Tmall services,
the Merchant authorizes Tmall to perform the consumer protection obligation and bear the liability for making payments or compensation
to the buyers on behalf of the Merchant. When Tmall makes any payment or compensation to any consumer on behalf of the Merchant,
the Merchant agrees that Tmall may determine the liability for any transaction dispute and the amount thereof with non-professional
or ordinary duty of care, and acknowledges such liability and amount determined by Tmall. Where it is finally proved that the
determination of liability by Tmall is wrong, or the amount of compensation is too high, the Merchant agrees to recover the same
from the beneficial consumer by itself, and not to hold Tmall accountable or claim for any right against Tmall.

 

XIV. Termination

 

(I) Natural termination: this Agreement
will be terminated upon the completion of the performance hereof or the termination for whatever reason of the Payment Service
Agreement executed by and between the Merchant and Alipay.

 

(II) Termination by notification: any
Party hereto may terminate this Agreement by written notification fifteen (15) days in advance, provided that if the Merchant
has made commitments on minimum turnover and/or software service fee to Tmall, before the minimum turnover is achieved or the
minimum fee is settled, the Merchant may not exercise its right to dissolve this Agreement ex parte. Where the Merchant clicks
on the “OK” button for exit online to apply for the termination hereof, the Merchant’s store will forthwith
enter into the status of “supervision” (means that within a certain period of time the Merchant’s store and
all information on products therein cannot be viewed through searching or visiting the store or product links), and fifteen (15)
days later this Agreement will be terminated and the store will formally enter into the exit procedure. The Merchant may and may
only use its Tmall account to handle transaction disputes and to settle accounts and invoices with Tmall within thirty (30) days
of the withdrawal procedure.

 

(III) In case of the following
circumstances, Tmall may forthwith exercise its right to dissolve this Agreement ex parte and close down the Merchant’s
store:

 

1. The Merchant has violated Tmall
rules to the extent that the cooperation between it and Tmall is required to be terminated;

 

2. Any information or document submitted
by the Merchant is unauthentic, illegal or void, or the Merchant is unable to prove the authenticity, legitimacy and validity
of its information or documents;

 

3. The Merchant does not have any legal
qualification (administrative license or filing) for selling its products or services, or its products and services do not conform
to state laws and regulations, rules and policies;

 

4. The Merchant violates Paragraphs
(XXII) or (XXIII), Article VIII hereof;

 

5. The security deposit paid by the
Merchant is insufficient; the Merchant fails to make up for the same by itself, and still fails to do so within a prescribed time
limit after being urged by Tmall;

 

6. The Merchant is engaged in any violation
of this Agreement or Tmall rules, and fails to make corrections within a reasonable time limit upon notification by Tmall;

 

7. Tmall determines that the Merchant
is engaged in counterfeiting others’ trademark, product name, package and decoration, enterprise name, product quality mark,
etc., which tends to result in confusion and misunderstanding among consumers;

 

8. The Merchant applies for bankruptcy,
or is subject to bankruptcy application;

 

9. The Merchant loses its subject qualification
(e.g., it applies for enterprise de-registration, or its business license is revoked).

 

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(IV) Where the Merchant fails to log on
to Tmall with its Tmall service account and password within more than ninety (90) days, Tmall may terminate this Agreement.

 

(V) Handling of relevant matters after
the termination hereof

 

1. After the termination hereof, Tmall
will have no obligation to keep for the Merchant any information in the Merchant’s Tmall service account or in relation
thereto, or forward any unread or unsent message to the Merchant or any third party, and will not bear any liability to the Merchant
or any third party for the termination hereof;

 

2. No matter for what reason this Agreement
is terminated, the Merchant shall fully and independently assume compensation and liabilities resulting form its acts prior to
the termination hereof;

 

3. After the termination hereof, Tmall
may keep the Merchant’s registration data and previous transaction records. Where the Merchant is engaged in any illegal
act or violation hereof on Tmall online transaction platform prior to the termination hereof, Tmall still may exercise its rights
provided for herein;

 

4. Where prior to the termination hereof:
i) no transaction agreement has been reached in respect of the product information that has been uploaded by the Merchant to Tmall
website, Tmall may delete relevant information on such product upon the termination hereof; ii) a transaction agreement has been
reached by and between the Merchant and another user with respect to certain product information, Tmall may choose not to delete
such transaction, provided that Tmall may notify the buyer in such transaction of the termination hereof upon the termination
hereof.

 

5. Where this Agreement is terminated
by Tmall for any of the above reasons, the Merchant’s store will forthwith enter into the exit procedure upon the termination
hereof by Tmall, and the Merchant may and may only use its Tmall account to handle transaction disputes and to settle accounts
and invoices with Tmall within thirty (30) days of the withdrawal procedure.

 

(VI) Where this Agreement is terminated
during the term hereof for reasons other than the Merchant’s breach of contract or fault, the Merchant may request with
the original of the invoice issued by Tmall for this Agreement (if issued) and refund application Tmall to return the service
fees (if any) for the part of services that have not been performed to a bank account designated by the Merchant. In case of
termination hereof under other circumstances, the service fees for the part of services that have not been performed will be directly
used to offset against the liquidated damages or compensation payable by the Merchant.

 

(VII) After the termination of this
service agreement, the Merchant agrees that Tmall may inform Alipay to suspend the payment of the balance in the Merchant’s
Alipay account for 30 days, and use the same for the settling disputes over contract performance after the termination hereof
or making compensation for consumer or third party right protection.

 

(VIII) Where the Merchant has any objection
to the termination hereof by Tmall, it shall file a lawsuit with a people’s court with competent jurisdiction within 30
calendar days as of the date of receipt of notification on the termination hereof.

 

XV. Liability for Breach of Contract

 

(I) Where during its use of Tmall services,
the Merchant is engaged in any infringement upon the rights and interests of any third party (e.g., consumer, intellectual property
right holder, or actual user of products/services), violation of state laws and regulations, or any other violation of this Agreement
and/or Tmall rules, in addition to the payment of liquidated damages to Tmall in accordance with this Agreement and/or Tmall
rules, it shall compensate Tmall for losses (if any) suffered by Tmall as a result thereof. The losses for which the Merchant
shall make compensation include but are not limited to:

 

1. The liquidated damages or compensation
that shall be paid by Tmall to any third party as specified in any judicial decision against Tmall;

 

2. The refund, liquidated damages or
compensation paid by Tmall on behalf of the Merchant to consumers;

 

3. The amount of any administrative penalty
imposed on Tmall;

 

4. Lawyer’s fee paid by Tmall, and
necessary costs incurred for eliminating ill effects.

 

(II) Where there is any overdue amount
payable by the Merchant to Tmall, unless otherwise specified in Tmall rules, the Merchant shall pay liquidated damages to Tmall
in the amount of five thousandths of such amount per day as of the date on which such amount becomes overdue.

 

(III) Any Party hereto exercising its
right to dissolve this Agreement ex parte in accordance with the provisions hereof is not required to bear the liability for breach
of contract, provided that where the Merchant has undertaken to pay minimum software service fee to Tmall, and it intends to
exercise its right to dissolve this Agreement, it shall pay the minimum software service fee in full to Tmall in advance, otherwise
it constitutes and shall bear the liability for breach of contract.

 

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(IV) Where the Merchant fails to issue
within a prescribed time limit to Tmall an invoice for the costs of the points activity in the previous year, or the invoice type
is not qualified, which is in violation of the provisions of Paragraph (III), Article VI hereof, the Merchant agrees to pay to
Tmall 30% of the amount of the invoice for the costs of the points activity in the previous year as liquidated damages.

 

(V) Where the Merchant violates the
provisions of Paragraph (XXIII), Article VIII hereof, Tmall may deduct all balance of the Merchant’s security deposit as
liquidated damages, and recover losses (including but not limited to reduced income) incurred to Tmall as a result thereof from
the Merchant.

 

(VI) Where any third party requests
Tmall to delete the Merchant’s information on the ground of infringement by the Merchant, the Merchant agrees that Tmall
does not bear any liability for the deletion. Where it is finally proved that the third party is in bad faith or lacks document
of title, the Merchant agrees to hold the third party accountable by itself.

 

(VII) Where the Merchant’s interests
are damaged due to Tmall’s intentional or gross negligence, Tmall’s liability for breach of contract and/or compensation
to the Merchant shall be calculated based on the direct losses suffered by the Merchant.

 

XVI. Termination of business relationship

 

Where during the use of Tmall services
(including without limitation the service items hereunder), the Merchant or any actual controller, director, manager, business
responsible person thereof has conducted any of the following acts, Tmall may forthwith terminate the use by the Merchant of any
of Tmall’s services (including but not limited to closing down all stores opened by the Merchant at Tmall), and Tmall and
its affiliates may terminate any cooperation and cease to carry out any business cooperation with the Merchant:

 

1. Commercial bribery in violation of
the principle of business integrity or affecting the business reputation of Tmall;

 

2. Suspected criminal offense in violation
of the principle of business integrity or affecting the business reputation of Tmall;

 

3. Other acts in violation of the principle
of business integrity or affecting the business reputation of Tmall.

 

XVII. Valid Notice

 

(I) The Merchant shall, at the time
of entering into Tmall, provide authentic and valid contact information and, in case of any change thereto, have the obligation
to update relevant information in a timely manner, and remain contactable.

 

(II) The Merchant’s member account
(including subaccounts) generated when the Merchant registers with Tmall for logging on to the Tmall platform to receive and send
direct messages, system messages and Alitalk instant messages, shall also serve as the Merchant’s valid contact information.

 

(III) Notices sent by the Merchant
to Tmall hereunder shall be made in writing, and the delivery thereof shall be subject to receipt by Tmall Customer Satisfaction
Department (attn.: Tmall Customer Satisfaction Department, add.: Post Office No. 1, Wenyi West Road, Yuhang District, Hangzhou,
Zhejiang Province).

 

Notices sent by Tmall according to
the valid contact information provided by the Merchant for Tmall shall be deemed delivered, in case of written notice on paper
carrier, on the fifth natural day after mailing to the correspondence address provided by the Merchant or, in case of written
notice sent to the Merchant by electronic means, including but not limited to announcements on Tmall platform, announcements on
Taobao platform, short messages sent to the mobile number provided by the Merchant, emails sent to the email address provided
by the Merchant, and Alitalk messages, system messages and direct messages sent to the Merchant’s account, after being sent
successfully.

 

(IV) With respect to any dispute arising
from its engagement in business operations on Tmall, the Merchant agrees that judicial authorities (including but not limited
to people’s courts) may serve legal instruments (including litigation documents) to the Merchant by means of short message,
email, Alitalk, or other modern communication mode, or mailing. The mobile number, email box, Alitalk account, and other contact
information designated by the Merchant to receive legal instruments shall be the mobile number and email box provided by the Merchant
when registering with and updating information on Tmall and the Alitalk account generated when the Merchant registers with Tmall.
Legal instruments are deemed served after being sent by judicial authorities by the aforesaid contact means. The mailing address
designated by the Merchant shall be the Merchant’s legal correspondence address, or any other valid correspondence address
provided by the Merchant.

 

    15/18

     

    

 

The Merchant agrees that judicial authorities
may serve legal instruments to the Merchant by using more than one or many of the above delivery methods. Where multiple delivery
methods are used by a judicial authority to serve any legal instrument to the Merchant, the legal instrument shall be deemed served
when it first reaches the Merchant, no matter by what means.

 

The aforesaid delivery methods acknowledged
by the Merchant apply to all stages of judicial proceedings, including without limitation first instance, second instance, retrial,
enforcement and supervision.

 

The Merchant warrants that the contact
information provided by it is accurate and valid. In case of any alteration thereto, the Merchant shall notify Tmall and/or judicial
authorities of the altered valid contact information in a timely manner. Where the contact information provided is inaccurate,
or the altered address is not given in a timely manner, as a result of which any legal instrument cannot be served or is not served
on time, the Merchant shall bear legal consequences that may arise therefrom.

 

XVIII. Settlement of Dispute and Miscellaneous

 

The interpretation and application hereof
and disputes in relation hereto shall all be governed by the laws of the People’s Republic of China, and subject to the
jurisdiction of the people’s court at the place where Tmall is located as the court of first instance.

 

If any terms hereof are  deemed
invalid or unenforceable, the aforesaid terms may be severed, and the remaining part hereof shall still have legal force and
effect.

 

Tmall’s waiver of its rights provided
for herein in case of any negligence or breach of contract by the Merchant shall not be deemed as its waiver of rights with respect
to other negligence or breach of contract or negligence or breach of contract of the same kind in the future by the Merchant.

 

XIX. List of Appendixes

 

The Appendixes hereto are an integral
part hereof, and have the same legal force and effect as the terms hereof.

 

Appendix I: Letter of Authorization

 

Appendix II: Tmall Service Terms

 

Party A: Fit Boxx Import and Export
Trading (Shenzhen) Company Limited

(Seal: Fit Boxx Import and Export Trading
(Shenzhen) Company Limited)

 

 

Party B: Zhejiang Tmall Technology
Co., Ltd.

(Seal: Zhejiang Tmall Technology Co.,
Ltd.Special Seal for Contract (1))

 

 

Party C: Zhejiang Tmall Network Co.,
Ltd.

(Seal: Zhejiang Tmall Network Co.,
Ltd. Special Seal for Contract (1))

 

    16/18

     

    

 

Appendix I:

 

Letter of Authorization

 

To: Alipay (China) Network Technology
Co., Ltd.

 

We hereby inform you that we authorize
you to directly suspend the payment of and pay the balance in our Alipay account with you in accordance with the provisions of
the Tmall Service Agreement entered into by and among us and Zhejiang Tmall Network Co., Ltd. and Zhejiang Tmall Technology
Co., Ltd. (hereinafter referred to collectively as “Tmall”) and the appendixes thereto as instructed by Tmall during
the term thereof.

 

    17/18

     

    

Appendix II:

 

	Terms
    of Tmall Services
	Party
    A:	Fit
    Boxx Import and Export Trading (Shenzhen) Company Limited
	Party
    B:	Zhejiang
    Tmall Technology Co., Ltd.
	Party
    C:	Zhejiang
    Tmall Network Co., Ltd.
	Party
    A undertakes that:	i)
it will not sell products under categories or of brands which have not been approved by Tmall through examination;

        ii) it will not sell counterfeit
        products, non-original and genuine products, and those imported without customs declaration;

        

        iii) the products displayed on
        Party C’s platform are not in short supply, out of stock, and the price thereof does not deviate significantly from
        the market price;

        

        iv) it will comply with relevant
        rules of Tmall and earnestly perform its obligations as a seller; where Party A violates any of the above commitments,
        Party B and Party C may forthwith terminate all services and relevant agreements.

        

	Party
    A’s information
	Tmall
    service account (i.e., name of Tmall store):	hoii
    flagship store
	Alipay
    account name:	queenielam@fitboxx.com
	Amount
    of the Merchant’s security deposit:	150,000.00
	Services
    provided by Party B and charges
	Service
    Items	Fees	Amount	Terms
    of Payment	Note
	Software
    service in relation to internet information service	Software
    service fee deducted in real time	Calculation
    formula: rate × turnover	Specific
    rates shall apply according to the categories of products actually sold (see the List of Annual Fees and Software Service
    Fees for Different Categories of Goods of Tmall in 2017 for details)	Real-time
    transfer by Alipay from the payments for orders made by buyers to the Merchant to the beneficiary account of Tmall	Software
    service fee is calculated in accordance with the “calculation formula” at the corresponding rate selected automatically
    from the List of Annual Fees and Software Service Fees for Different Categories of Goods of Tmall in 2017 based on
    the information on products actually traded by Party A and deducted in real time by the system
	 	 	 	 
	 	Annual
    software service fee	Calculated
    at the rates in the List of Annual Fees and Software Service Fees for Different Categories of Goods of Tmall in 2017 based
    on the term of service	A
    lump sum payment of the fees for a whole year prior to the enabling of services	In
    order to encourage the Merchant to improve service quality and increase turnover, except for special categories, Tmall will
    give conditional commercial discounts in the annual software service fee to the Merchant. See the List of Annual Fees and
    Software Service Fees for Different Categories of Goods of Tmall in 2017 for details of the specific preferential conditions
    and standards of discounts.
	Software
    service in relation to the points system	Points
    system software service fee	Calculation
    formula: rate × turnover	Real-time
    transfer by Alipay from the payments for orders made by buyers to the Merchant or the Merchant’s Alipay account to the
    beneficiary account of Tmall	The
    rate is 1%. The specific rate is subject to that set in the system.
	Services
    provided by Party C and charges
	Internet
    information service	Display
    service fee	No
    charges for the time being	/	/
	Second
    level domain name service	Second
    level domain name service fee	No
    charges for the time being	/	/
	Other
    services	Market
    research fee, etc.	No
    charges for the time being	/	/
	Term
    of service	From
    the date of enabling of services to Dec. 31, 2017

  

18/18osur-ex101_6.htm

Exhibit 10.1

RETIREMENT AGREEMENT 

This Retirement Agreement (“Agreement”), which takes effect on January 1, 2019 (“Effective Date”) is made by and between Brian Smith (“Executive”) and DNA Genotek Inc. (collectively, with its predecessors, successors, affiliates and subsidiaries, the “Company”) (jointly referred to as the “Parties” and singularly as a “Party”).  

RECITALS 

WHEREAS Executive is currently employed by the Company as its Executive Vice President and Business Unit Leader, Molecular; and 

WHEREAS Executive and the Company are currently parties to an Employment Agreement, dated January 7, 2008, which was amended on July 25, 2011 and June 10, 2016 (“Employment Agreement”); and  

WHEREAS Executive will retire from the Company effective as of February 5, 2020, or such other date as may be agreed to by Executive and the Company in writing (the “Retirement Date”); and 

WHEREAS, in consideration of Executive’s service to the Company and the benefits of the transition to retirement that is stipulated herein, Executive and the Company have entered into this Agreement to set forth the terms and conditions of Executive’s employment between the Effective Date and the Retirement Date (the “Transition Period”) for the purpose of bringing about an amicable end to the Executive’s employment relationship with the Company on the Retirement Date. 

NOW THEREFORE, in consideration of the mutual promises made herein, intending to be legally bound, the Parties hereby agree as follows: 

COVENANTS 

	
1.
	
Termination of Employment and Resignation.  Executive hereby covenants to retire and resign his employment along with all offices, titles and positions with the Company effective the Retirement Date. Executive acknowledges and agrees that his resignation is voluntary and, as such, it does not constitute a termination or constructive termination of his employment. Executive acknowledges that, by entering into this Agreement, Executive is hereby forfeiting any right to claim common law notice of termination or pay in lieu of said notice as well as compensation for a termination of employment pursuant to the terms of the Employment Agreement, as amended.  Executive also acknowledges and agrees that no Termination Pay (or benefits continuances) or Severance Pay will be owed to Executive under the Employment Standards Act, 2000 (“ESA”).  

	
2.
	
Service During Transition Period.  During the Transition Period, Executive shall serve as Vice Chairman and Executive Vice President, Innovation in accordance with the Employment Agreement, as amended by this Agreement, and shall agree to (i) perform his duties set forth in Schedule “A” attached hereto consistent with the established practices of the Parties, and (ii) assist the Company with matters that arise out of the Executive’s transition from the Company. In addition, Executive will remain a director of the Company during the Transition Period until a successor is appointed by the Company, so that the Company can continue to meet the residency requirements for directors under applicable law.

 

 

	
3.
	
Compensation Upon Retirement.  In consideration of Executive’s retirement on the Retirement Date and Executive fulfilling his obligations under this Agreement and the Employment Agreement, Executive shall be entitled to the compensation set forth in Sections 4, 5, 6 and 7 of this Agreement.  Executive and the Company acknowledge and agree that Executive would not have been entitled to all of said compensation had Executive not executed this Agreement and the  Release Agreement (as defined below) and that such items of compensation constitutes consideration sufficient to make this Agreement binding. 

	
4.
	
2019 Bonus.  Executive shall be eligible to receive an incentive cash bonus under the OraSure Technologies, Inc. (“OraSure”) 2019 Incentive Plan (“2019 IP”) based on a 40% base salary target, subject to adjustment to reflect performance in 2019 and the actual bonus pool funding under the 2019 IP approved by the OraSure Board of Directors, consistent with past practices.  Payment of the 2019 bonus shall be made at the same time the Company pays bonuses to other senior executives under the 2019 IP, less applicable taxes and withholdings.  Executive shall not be entitled to receive any cash bonus for performance during 2020.

	
5.
	
Treatment of Outstanding Equity Awards.  Subject to Executive’s compliance with this Agreement and the Employment Agreement, (i) all awards of time-vested OraSure Technologies, Inc. (“OraSure”) restricted stock (“Restricted Stock”) granted to Executive prior to the date of this Agreement and which are outstanding and unvested as of the Retirement Date, shall vest in full on the Retirement Date and (ii) all awards of performance-vested restricted units (“PVRUs”) granted to Executive prior to the date of this Agreement and which are outstanding and unvested as of the Retirement Date, shall vest in full three (3) years after the applicable grant date in accordance with the terms of the relevant award agreement pursuant to which such PVRUs were granted to Executive and the terms of the OraSure Stock Award Plan (“Award Plan”) without the requirement that Executive continue to be employed by the Company after the Retirement Date.  The vesting of PVRUs shall also be subject to the satisfaction of the relevant performance measures applicable to such PVRUs, as specified in the applicable award agreement.  Any shares of OraSure common stock that vest with respect to such PVRUs shall be paid out and delivered to Executive at the same time and in the same manner as such awards are paid to other Company senior executives in accordance with the applicable award agreements and the Award Plan, consistent with past practices.

	
6.
	
2019 and 2020 LTIP Annual Equity Awards.  Subject to Executive’s compliance with this Agreement and the Employment Agreement, Executive shall receive normal annual equity awards in 2019 for performance during 2018 and in 2020 for performance during 2019, consistent with past practices and the terms of the OraSure Long-Term Incentive Policy then in effect (“LTIP”), with such awards containing terms as provided in this Section 6 (collectively, the “2019/2020” LTIP Awards”).  The 2019/2020 LTIP Awards shall have a grant date value determined for an Executive Vice President as provided in the LTIP, shall consist of 50% Restricted Stock and 50% PVRUs and shall be awarded and determined at the same time as the annual LTIP awards are granted to other Company senior executives for such years.  Consistent with past practices, the PVRUs shall vest three years after the grant date so long as certain performance metrics are met as determined by the OraSure Board of Directors. The terms and conditions of the 2019/2020 LTIP Awards shall be the same as the awards made to other senior executives under the LTIP, except that (i) the portion of the 2019/2020 LTIP Awards consisting of Restricted Stock shall vest as of 

2

 

 

		
the Retirement Date and (ii) the portion of the 2019/2020 LTIP Awards consisting of PVRUs shall vest in accordance with the terms of the applicable award agreement without the requirement that Executive continue to be employed by the Company after the Retirement Date. Any shares of OraSure common stock that vest with respect to PVRUs contained in the 2019/2020 LTIP Awards shall be paid out and delivered to Executive at the same time and in the same manner as such awards are paid to other Company senior executives in accordance with the applicable award agreements and the Award Plan, consistent with past practices.

	
7.
	
2019 and 2020 Supplemental Equity Awards.  Subject to Executive’s compliance with this Agreement and the Employment Agreement, Executive shall receive supplemental equity awards in 2019 and 2020 at the same time annual LTIP awards are granted to other Company senior executives during such years (each a “Supplemental Award”), containing terms as provided in this Section 7.  Each Supplemental Award shall consist of PVRUs that vest one (1) year after the grant date to the extent that a Net Revenue target (as defined below) for the Company, as determined by the OraSure Board of Directors, is met with respect to the applicable year.    Each Supplemental Award shall provide for a range of 25,000 to 37,500 PVRUs for achievement of 100% to 120% of the applicable Net Revenue target for each year, with the actual number of PVRUs to be determined linearly for performance in between 100% and 120% of the applicable Net Revenue target.  Net Revenue target shall mean the revenue budget for the Company for 2019 or 2020, as applicable, as determined by the OraSure Board of Directors.  

	
8.
	
Confidential Information.  Executive shall maintain the confidentiality of all of the Company’s confidential and proprietary information and Executive covenants to continue to abide by the terms and conditions of the Confidentiality and Proprietary Information Agreement that the Parties entered into on January 7, 2008 (“Confidentiality and Proprietary Information Agreement”), which is incorporated herein by reference.  Executive shall also return to the Company all of the Company’s property, including all confidential and proprietary information, and all documents and information that Executive obtained in connection with his employment with the Company, on or before the Retirement Date or such later date as the Company may specify.   Notwithstanding the foregoing, Executive Shall be entitled to retain his laptop and cell phone provided by the Company. 

	
9.
	
Payment of Accrued Salary and Benefits.  The Company shall pay Executive all unpaid salary, accrued vacation, paid time off, and any and all other benefits or compensation that is earned, accrued or vested but unpaid as of the Retirement Date (the “Accrued Benefits”) on the first normal payroll date of the Company following the Retirement Date or such other time as may be specified in the applicable plan, agreement or other arrangement governing the terms of the Accrued Benefits. 

	
10.
	
Release of Claims.  Executive agrees to execute the Full and Final Release Agreement attached hereto as Schedule “B” (the “Release Agreement”) concurrently with the Executive’s execution of this Agreement.  The executed Release Agreement shall be held by the Company in escrow until close of business on the Retirement Date at which time it shall be binding on the Parties unless it has been previously revoked by the Executive in writing. To be clear, the Executive’s right to revoke the Release Agreement shall cease at close of business on the Retirement Date. Executive acknowledges that the terms and conditions of the Release Agreement constitute a material inducement for the Company to 

3

 

 

		
enter into this Agreement.  Executive further acknowledges and agrees that the receipt of the compensation specified in Sections 4, 5, 6 and 7 of this Agreement is contingent upon the Parties entering into said Release Agreement and said Release Agreement not being revoked by the Executive. 

	
11.
	
No Pending or Future Lawsuits.  Executive represents that he has no lawsuits, claims, or actions pending in his name, or on behalf of any other person or entity, against the Company or any of the other Releasees (as defined in the Release Agreement).  Executive also represents that he does not intend to bring any claims on his own behalf or on behalf of any other person or entity against the Company or any of the other Releasees. 

	
12.
	
Application for Employment.  Executive understands and agrees that, as a condition of this Agreement, he shall not be entitled to any employment with the Company, and he hereby waives any alleged right of employment or re-employment with the Company.  Executive further acknowledges and agrees that the forbearance to seek future employment stated in this paragraph is purely contractual, and is in no way involuntary, discriminatory or retaliatory.   

	
13.
	
Assistance.  Executive agrees to personally provide reasonable assistance and cooperation to the Company in activities related to the prosecution or defense of any pending or future lawsuits or claims involving the Company.  The Company will reimburse Executive for any reasonable out of pocket costs and expenses incurred in connection with providing such assistance. 

	
14.
	
No Cooperation.  Except as otherwise prohibited by law, Executive agrees that he will not knowingly counsel or assist any attorneys or their clients in the presentation or prosecution of any disputes, differences, grievances, claims, charges, or complaints by any third party against any of the Releasees, unless under a summons or other court order to do so.  Employee agrees both to immediately notify the Company upon receipt of any such summons or court order, and to furnish, within three (3) business days of its receipt, a copy of such summons or court order to the Company.  If approached by anyone for counsel or assistance in the presentation or prosecution of any disputes, differences, grievances, claims, charges, or complaints against any of the Releasees, Executive shall state no more than that he cannot provide counsel or assistance. 

	
15.
	
Non-Disparagement.  At no time before, on or after the Retirement Date shall Executive publish or otherwise transmit any disparaging, derogatory or defamatory remarks, comments or statements, whether written or oral, regarding the Company, its affiliates or their respective officers, directors, employees, consultants, reputations, products, operations, procedures, policies or services, which are reasonably likely to (i) damage the reputation of the Company or its affiliates or (ii) interfere with the contracts or business relationships of the Company or its affiliates.  This paragraph shall not restrict or prevent Executive from providing truthful testimony as required by court order or other legal process.   

	
16.
	
Arbitration.  The parties agree that any and all disputes arising out of, or relating to, the terms of this Agreement, their interpretation, and any of the matters herein released, shall be subject to binding arbitration in Ottawa, Ontario under the Ontario Arbitration Act, 1991, S.O. 1991, c. 17. The Arbitration shall be presided over by a single Arbitrator who is agreeable to the Parties or appointed by the Ontario Superior Court of Justice. Upon the 

4

 

 

		
appointment of an Arbitrator, the Arbitration shall thereafter be governed by the ADR Institute of Canada, Inc. ADRIC Arbitration Rules. The Parties agree that the prevailing Party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award.  The arbitrator shall have no authority to add to, subtract from, or otherwise modify the terms of this Agreement or to make awards beyond those provided for by the statute.  This section will not prevent either Party from seeking injunctive relief (or any other provisional remedy) from any court having jurisdiction over the Parties and the subject matter of a dispute. 

	
17.
	
Representations.  Each Party represents that it has had the opportunity to consult with a lawyer, and has carefully read and understands the scope and effect of the provisions of this Agreement.  Neither Party has relied upon any representations or statements made by the other Party hereto which are not specifically set forth in this Agreement. 

	
18.
	
Severability; Substitution.  In the event that any provision in this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable, or void, this Agreement shall continue in full force and effect without said provision so long as the remaining provisions remain intelligible and continue to reflect the original intent of the Parties.   

	
19.
	
Entire Agreement.  This Agreement, the agreements referenced herein, and any and all restricted stock award agreements, restricted unit award agreements and stock option agreements represent the entire agreement and understanding between the Company and Executive concerning the subject matter of this Agreement and Executive’s relationship with the Company, and supersede and replace any and all prior agreements and understandings between the Parties concerning the subject matter of this Agreement and Executive’s relationship with the Company. 

	
20.
	
No Oral Modification.  Any modification or amendment of this Agreement, or additional obligation assumed by either Party in connection with this Agreement, shall be effective only if placed in writing and signed by both Parties or their authorized representatives. 

	
21.
	
Governing Law.  This Agreement shall be governed by the laws of the Province of Ontario, Canada. 

	
22.
	
Counterparts.  This Agreement may be executed in counterparts, and each counterpart shall have the same force and effect as an original and shall constitute an effective, binding agreement on the part of each of the undersigned. 

	
23.
	
Headings Irrelevant.  The headings in this Agreement are intended as a convenience to the reader and are not intended to convey any legal meaning. 

 

 

INTENTIONALLY LEFT BLANK 

 

 

5

 

 

	
24.
	
Voluntary Execution of Agreement.  This Agreement is executed voluntarily and with the full intent of releasing all claims, and without any duress or undue influence by any of the Parties.  The Parties acknowledge that: 

	
 
	
(a)
	
They have read this Agreement; 

	
 
	
(b)
	
They have been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of their own choice or that they have voluntarily declined to seek such counsel; 

	
 
	
(c)
	
They understand the terms and consequences of this Agreement and of the releases it contains; and 

	
 
	
(d)
	
They are fully aware of the legal and binding effect of this Agreement. 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement on the dates set forth below. 

 

DNA GENOTEK INC. 

By: /s/ Stephen S. Tang

Name:  Stephen S. Tang

Title:  Chief Executive Officer

 

 

EXECUTIVE

	
/s/ Brian Smith
	

Brian Smith 

 

Dated:  December 14, 2018

6

 

 

SCHEDULE “A”

 

DUTIES AND RESPONSIBILITIES AS VICE CHAIRMAN

AND EXECUTIVE VICE PRESIDENT, INNOVATION

 

	
 
	
•
	
Assist in a successful and smooth transition of EVP & Business Unit Leader, Molecular duties and shared objectives with that transitioned colleague.

	
 
	
•
	
Develop the strategic and operational plans for the OraSure Innovation organization and establish and communicate the strategic direction to OraSure.

	
 
	
•
	
Translate innovation into functional imperatives to both protect the core and establish capabilities that ensure continued, long-range growth of the business.

	
 
	
•
	
Manage to the defined Innovation organization budgets by setting and achieving annual and longer-term goals and managing organizational costs. 

	
 
	
•
	
Engage with thought leaders in current and emerging technologies relevant to OraSure’s core and “beyond the core” business interests, by establishing Scientific Advisory Board(s) and other means for meaningful connection.

	
 
	
•
	
Provide leadership across the organization by communicating key Innovation goals, milestones, objectives, and metrics to members of OraSure’s EC, Leadership Team, and other employees. 

	
 
	
•
	
Participate in the management and negotiation of business relationships, including Scientific Advisory Boards, as required.

	
 
	
•
	
Provide support to Business Development during all aspects of pursuits, due diligence, transactions, and post-merger integration.

	
 
	
•
	
Participate, as directed by OraSure’s President and CEO, in corporate-wide initiatives, including but not limited to support of core businesses and decision-making for corporate policies and procedures.

	
 
	
•
	
Prepare and present reports as required. 

	
 
	
•
	
Travel as required for Company, Innovation, Business Development, and support of core businesses.

	
 
	
•
	
Other duties deemed appropriate for an EVP, Innovation, as directed by OraSure’s President and CEO. 

7

 

 

SCHEDULE “B”

 

FULL AND FINAL RELEASE AGREEMENT 

 

 

	
1.
	
RELEASE

In consideration of the payments to me by DNA Genotek Inc. (the “Company”) as detailed in the attached Retirement Agreement, the sufficiency of which consideration is hereby acknowledged, I, Brian Smith, for myself, my heirs, dependents, executors, administrators, and assigns hereby wholly and forever release, remise and discharge the Company, its predecessors, subsidiaries and affiliates, and all its officers, directors, shareholders, agents and employees (hereinafter collectively referred to as the “Releasees”), jointly and severally, from any and all actions, causes of action, contracts (whether expressed or implied), claims and demands for damages, loss, or injury, suits, debts, sums of money, indemnity, expenses, interest, costs and claims of any and every kind and nature whatsoever, at law or in equity, I ever had, now have, or may hereafter have, by reason of or arising out of any employment with the Releasees, or the cessation thereof.  Without limiting the generality of the foregoing, I hereby acknowledge that the said consideration is in satisfaction of all claims for damages, including all non-salary benefits ordinarily provided to me or on my behalf in respect of my employment, wages, salary, termination pay, severance pay, vacation pay, commissions, bonuses, expenses, allowances, incentive payments, insurance and other benefits howsoever arising out of my employment with the Releasees, and the cessation of that employment, whether available pursuant to contract, common law, or any statute including, but not limited to the Employment Standards Act, 2000  and the Human Rights Code, and including any claim(s) for reinstatement or other forms of statutory relief.

 

	
2.
	
NO ADMISSION

I acknowledge and agree that the payments and other consideration referred to herein do not constitute any admission or recognition of liability by or on behalf of the Releasees.

 

3.INDEMNITY FOR TAXES, ETC.

I further agree that for the aforesaid payment, I will indemnify and save harmless the Releasees from and against any and all claims, demands, taxes or penalties which may be made by the Canada Revenue Agency or related entities requiring the Releasees to pay 

8

 

 

income tax under the Income Tax Act in respect of income tax payable by myself in excess of the income tax previously withheld, as well as in respect of any and all claims, charges, taxes, or penalties and demands which may be made on behalf of the Canada Revenue Agency or any other government department under the Income Tax Act, the Employment Insurance Act or the Canada Pension Plan and/or any regulation or authority under said legislation, with respect to any amount which may in the future be found to be payable by the Releasees in respect of myself.

 

	
4.
	
EMPLOYMENT STANDARDS

I acknowledge receipt of all wages, commission, incentives, overtime pay, vacation pay, holiday pay, termination pay and severance pay to which I am entitled by virtue of the Employment Standards Act, 2000 and confirm that there are no such amounts due and owing to myself by the Releasees, either pursuant to the Employment Standards Act, 2000 or pursuant to the terms and conditions of my employment and/or common law.

 

	
5.
	
FURTHER CLAIMS

I agree not to make a claim or take any proceedings against any other person or corporation which might claim contribution or indemnity under the provisions of any statute or otherwise against the Releasees with respect to any matter which arose or may have arisen up to the present time, in connection with the matters covered by this Release.

 

	
6.
	
UNDERSTANDING

I HEREBY DECLARE that I have had the opportunity to seek independent legal advice with respect to the matters addressed herein and in the Retirement Agreement. I acknowledge that the terms of this Release and the Retire Agreement are fully understood by me, and that I voluntarily agree to retire from the Company on said.

 

 

DATED at Ottawa, Ontario this 14th day of December, 2018.

 

		
	
/s/ Linda Saad Smith

Witness
	
/s/ Brian Smith

BRIAN SMITH 

 

9

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