Document:

ex10x1.htm

Exhibit 10.1

Appointment as a Non-Executive Director of China Executive Education Corp.

Date: ___________, 2010

Dear Mr. [                                ],

This letter confirms your appointment on ___________, 2010 as a Non-Executive Director of China Executive Education Corp., a Nevada corporation (the “Company”), [and as the Chair of the Audit Committee of the Company’s Board of Directors (the “Board”)] (the “Appointment”) and outlines the terms of the Appointment.

Appointment

1.  Subject to your consent to act as a Director of the Company, you will hold office from ___________, 2010 until you fail to be re-elected or your earlier resignation or removal from office.

 

2.  Notwithstanding any other provision of this letter, the Company may terminate your Appointment in accordance with relevant laws and regulations or the Company’s by-laws, or upon your resignation.  You may resign by providing to the Company’s Chairman your written notice of resignation.  Upon such termination or resignation for any reason, you shall not be entitled to any damages for loss of office and no fee will be payable to you with respect to any remaining portion of the term of the Appointment.

 

3.  During the Appointment, you also may be asked to serve on one or more other committees of the Board.

 

4.  Based on the information you have provided to the Company on your background and experience, the Company has determined that you qualify as an independent Non-Executive Director of the Company under the applicable standards and rules and you will be identified as such in the Company’s annual report and other documentation. If your current circumstances change and you believe that your independence may be in doubt, you agree to discuss this with the Chairman as soon as practicable.

 

Time Commitment

5.  The Company anticipates a time commitment of no fewer than 15 days per year, but the nature of the role makes it impossible to be specific about the time commitment involved in your Appointment. You are expected to attend regular and emergency Board meetings. You also will be expected to attend meetings of any Board committee of which you are a member. In addition, you will be expected to devote appropriate preparation time in advance of each meeting. Attendance of meetings may be in person or via teleconference, if available.

 

6.  By accepting the Appointment, you confirm that you are able to allocate sufficient time to perform your role.

 

 

Page 1 of 6

  

  

  

Role

7.  As a Non-Executive Director, you have the same legal responsibilities to the Company as any other Director.

 

8.  The Board as a whole is collectively responsible for promoting the success of the Company by directing and supervising the Company’s affairs. The Board:

 

	
·     

	
provides leadership of the Company within a framework of prudent and effective controls which enable risk to be assessed and managed;

	
·     

	
sets the Company’s strategic aims, ensures that the necessary financial and human resources are in place for the Company to meet its objectives, and reviews management performance; and

	
·     

	
sets the Company’s values and standards and ensures that its obligations to its shareholders and others are understood and met.

9.  In addition to these requirements of all Directors, the role of the Non-Executive Director has the following key elements:

 

	
·     

	
Strategy: Non-Executive Directors should constructively challenge and contribute to the development of strategy;

	
·     

	
Performance: Non-Executive Directors should scrutinize the performance of management in meeting agreed goals and objectives and monitor the reporting of performance;

	
·     

	
Risk: Non-Executive Directors should satisfy themselves that financial information is accurate and that financial controls and systems of risk management are robust and defensible; and

	
·     

	
People: Non-Executive Directors are responsible for determining the appropriate levels of remuneration for the Company’s executive officers and have a prime role in appointing, and where necessary removing, senior management and in succession planning.

10.  In addition, responsibilities of the Audit Committee as a whole shall include the following:

 

	
·     

	
Pre-approve audit and non-audit services;

	
·     

	
Receive reports from auditor on critical accounting policies; receive reports from auditor on discussion with management on alternative GAAP, their effects, and the auditor’s preference; receive reports from auditor on material communications with management. Auditor reports shall be delivered directly to the Audit Committee.

	
·     

	
Oversee the auditor engagement, including engaging, compensation, and resolving disagreement with management on financial reporting.

	
·    

	
Provide procedures to receive, retain, and treat complaints; provide procedures to confidentially handle employee complaints.

 

 

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Compensation

11.  As a Non-Executive Director, you will be paid a base fee currently of RMB [] per annum. [In addition, you will be paid a fee of RMB [] per annum for acting as Chair of the Audit Committee.] Fees are payable quarterly in arrears, in either RMB or equivalent USD, and will be deposited into your bank account, details of which you will provide to the Company.  You will not be paid any bonus or other compensation for your service as a Director.

 

12.  In the event that you cease to act as a Director [and/or Chair of Audit Committee] of the Company due to termination or resignation for any reason or failure to be re-elected, you will only receive compensation for the period in which you served as a Director.

 

Expenses

13.  In addition to the compensation described in 11 above, the Company will reimburse you for all reasonable and properly documented expenses you incur in performing your role, including but not limited to traveling, lodging, and reasonable meal expenses in the trips. You should submit any details of expenses incurred to the Company’s Secretary. The Company shall pay the reimbursed amount in cash or to your designated account no later than five (5) working days after receiving the reimbursement documents.

 

Indemnity and D&O Liability Insurance Coverage

14.  The Company will provide and maintain directors' and officers' (D&O) liability insurance coverage for you in respect of the period for which you are a director of the Company at such levels, for such risks and subject to such terms, and for such a period after you cease to be a director of the Company, as the Company provides and maintains such coverage for its directors generally for each year thereafter, including such self insurance coverage as the Company makes available or obtains on behalf of itself or its directors.

 

Confidential Information

15.  You agree that both during and after your time as a director of the Company, you will not use for your own or another's benefit or disclose or permit the disclosure of any confidential information about the Company, its suppliers, customers or other constituents, other than as appropriate in connection with the proper performance of your duties as a director or otherwise in accordance with prior authorization provided by the Company. Confidential information shall include, without limitation, all and any information, whether or not recorded, of the Company which you have obtained by virtue of your Appointment and which (i) the Company regards as confidential, (ii) is apparently confidential by reason of its nature or the circumstances in which it comes to your knowledge, and/or (iii) in respect of which the Company is bound by any obligation of confidence to a third party. Confidential information may include, without limitation:

 

15.1  all and any information relating to results of operations, financial condition, plans and prospects, business methods, corporate plans, future business strategy, management systems, borrowing activities, possible transactions with other parties, possible restructuring, liquidity issues, litigation (pending or threatened), senior management changes, securities offerings, dividend policy, and maturing new business opportunities;

 

 

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15.2  all and any information relating to research and/or development projects;

 

15.3  all and any information concerning the curriculum vitae, compensation details, work-related experience and other personal information concerning those employed or engaged by the Company;

 

15.4  all and any information relating to marketing or sales of any past, present or future product or service of the Company including sales targets and statistics, market share and pricing statistics, marketing surveys and strategies, marketing research reports, sales techniques, price lists, mark-ups, discounts, rebates, tenders, advertising and promotional material, credit and payment policies and procedures, and lists and details of customers, prospective customers, suppliers, prospective suppliers, joint venture partners and prospective joint venture partners, including their identities, business requirements and contractual negotiations and arrangements with the Company;

 

15.5  all and any trade secrets, secret formulae, processes, inventions, design, know-how, research projects, technical specifications and other technical information in relation to the creation, production or supply of any past, present or future product or service of the Company, including all and any information relating to the working of any product, process, invention, improvement or development carried on or used by the Company and information concerning the intellectual property portfolio and strategy of the Company; and

 

15.6  any other information that a reasonable investor would consider important in making a decision to buy, hold or sell the Company’s securities.

 

16. The restrictions contained in the clause 15 above shall cease to apply to any confidential information which:

 

16.1  may (other than by reason of your breach of these terms) become available to the public generally; or

 

16.2  is required to disclose by law, governmental rule or regulation (in which event you shall promptly notify the Company a reasonable period in advance of such disclosure).

 

Other Directorships and Business Interests

17.  The Company acknowledges that you have business interests other than those of the Company and that you have declared any conflicts that are apparent at present. In the event that you become aware of any potential conflicts of interest, these should be disclosed to the Chairman and Company’s Secretary as soon as they become apparent.

 

 

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Miscellaneous

18.  Nothing in this letter shall create the relationship of employee and employer between you and the Company.

 

19.  The agreement constituted by this appointment letter shall be governed by and construed in accordance with laws of the State of New York.

 

20.  Both you and the Company irrevocably agree that the Courts of the State of New York shall have exclusive jurisdiction in relation to any claim, dispute or difference concerning this appointment letter and any matter arising therefrom.

 

21.  Both you and the Company irrevocably waive any right that you or the Company may have to object to an action being brought in those Courts, to claim that the action has been brought in an inconvenient forum, or to claim that those Courts do not have jurisdiction.

 

Entire Agreement and Severability

22.  This appointment letter represents the entire understanding, and constitutes the whole agreement, in relation to your appointment and supersedes any previous agreement between yourself and the Company with respect thereto and, without prejudice to the generality of the foregoing, excludes any warranty, condition or other undertaking implied at law or by custom.

 

23.  You confirm that:

 

23.1  in entering into the agreement constituted by this appointment letter you have not relied on any representation, warranty, assurance, covenant, indemnity, undertaking or commitment which is not contained in this appointment letter; and

 

23.2  in any event, without prejudice to any liability for fraudulent misrepresentation or fraudulent misstatement, the only rights or remedies in relation to any representation, warranty, assurance, covenant, indemnity, undertaking or commitment given or action taken in connection with this appointment are under this appointment letter and, for the avoidance of doubt and without limitation, neither party has any right or remedy (whether by way of a claim for contribution or otherwise) in tort (including negligence) or for misrepresentation (whether negligent or otherwise, and whether made prior to, and/or in, this appointment letter).

 

23.3  in the event that any part (including any sub clause or part thereof) of this appointment letter shall be void or unenforceable by reason of any applicable law, it shall be deleted and the remaining parts of this appointment letter shall continue in full force and effect and, if necessary, both parties shall use their best endeavors to agree any amendments to the appointment letter necessary to give effect to the spirit of this appointment letter.

 

 

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Language and Counterparts

24.  This appointment letter is written in English language. In case there are any discrepancies between the original English version and its Chinese translation, the English version shall apply.

 

25.  This appointment letter may be executed by facsimile and in counterparts, all of which taken together shall constitute one and the same instrument.

 

Waiver

26.  The failure of either party to insist upon strict performance of any of the terms in this appointment letter shall not constitute a waiver of any of its rights hereunder. Further, the waiver by either party of the breach of any provision of this appointment letter shall not operate or be construed as a waiver of any subsequent breach thereof.

 

Assignment

27.  The rights and benefits of the Company under this appointment letter shall be transferable and shall inure to the benefit of its successors and assigns. Your duties and obligations under this appointment letter are personal and therefore you may not assign any right or duty under this appointment letter without the prior written consent of the Company.

 

Yours sincerely,

________________________ 

Kaien Liang, Chairman and Chief Executive Officer

for and on behalf of China Executive Education Corp.

I, [                      ], hereby accept the terms of appointment set out in this letter.

________________________ 

Signature

 

________________________, 2010

Date

 

 

 

Page 6 of 6gnba10k20100630ex10-2.htm

Exhibit 10.2

 

FORM OF

 

SECURED PROMISSORY NOTE

 

 

	$_________________       	 _______, 20__

Salt Lake City, Utah

 

For value received GROEN BROTHERS AVIATION, INC., a Utah corporation having an address at 2640 West California Avenue, Suite A, Salt Lake City, Utah 84104 (the "Company"). promises to pay to ______________________, a ________________________, or its assigns (the "Lender"), the principal sum of _____________________DOLLARS and NO/100 ($________), together with interest on the unpaid principal balance hereof at the rate and at the times set forth herein.

 

This Secured Promissory Note (the "Note") is issued pursuant to that certain Note Purchase Agreement (the "Purchase Agreement") dated as of October 9, 2008 by and among the Company and the Lender, and is subject to the terms and conditions contained therein. The obligations hereunder arc secured by that certain Security Agreement and Intellectual Property Security Agreement, each entered into as of October 9, 2008 by and among the Company and the Lender. Capitalized terms used but not defined herein shall have the meanings set forth in the Purchase Agreement.

 

1.          Payment of Interest. Interest shall accrue on the unpaid principal balance of this Note at the rate of fifteen percent (15.0%) per annum, simple interest. All accrued and unpaid interest shall be payable on the Maturity Date (as defined below). Upon and during the occurrence of and during the continuance of an Event of Default (as defined below), the unpaid principal balance of this Note shall bear interest, from the dale of the occurrence of such Event of Default until such Event of Default is cured or waived, payable on demand in immediately available funds, at a rate equal to eighteen percent (18.0%) per annum.

 

2.          Payment of Principal. The entire outstanding principal balance of this Note, together with all accrued and unpaid interest and all other amounts due hereunder, shall be due and payable on April 9, 2009 (the "Maturity Date'").

 

3.          Manner of Payment. All sums payable under this Note shall be paid in lawful money of the United States of America and in immediately available funds. Payments shall be made to the Lender at ___ _____________________________________(or at such other address or by wire transfer to such account as shall, in either case, be specified by the Lender to the Company at least five (5) days prior to the relevant payment date). If any payment under this Note shall become due on a Saturday, Sunday or a bank or legal holiday, such payment shall be due on the next succeeding business day.

 

4.          Prepayment. Company may, at its option, prepay this Note, in whole or in part, at any time and from time to time, without premium or penalty upon one (1) day prior written notice to Lender.

 

5.          Late Charges. If any sum of money required to be paid by the terms of this Note is not paid within ten (10) days after the same becomes due, then the Company will pay a late fee equal to five percent (5%) of the overdue payment. The Company will pay this late fee promptly, but only once on each late payment.

 

6.          Events of Default. The occurrence of any of the following events shall constitute an "Event of Default" under this Note:

  

  

  

i.              failure to pay when due any payment of principal, interest or other amount due and owing under this Note on or before the date such payment is due;

 

ii.             Borrower becomes the subject of any Bankruptcy proceeding, or is declared Bankrupt, while this Note is still outstanding. "Bankruptcy" shall mean (i) the adjudication of Borrower as bankrupt or insolvent, (ii) the institution by or against Borrower of a petition for arrangement or of any other type of insolvency proceeding under the United States Bankruptcy Code, as amended (but, with respect to an involuntary proceeding, only if such proceeding is not discharged within 60 days), (iii) the making by Borrower of a general assignment for the benefit of creditors, (iv) the appointment of a liquidator, administrator, receiver or trustee in bankruptcy of Borrower or its assets or (v) the taking, making or institution of any like or similar act or proceeding involving Borrower;

 

iii.             the Lender determines that there has been a material adverse change in Borrower, Borrower's financial condition or Borrower's business prospects;

 

iv.             Borrower breaches any of the material covenants, conditions, promises or agreements contained in this Note or the Purchase Agreement;

 

v.             the occurrence of any breach, default or "event of default" as defined or described in any other now existing or future promissory note or other instrument, or any guaranty, mortgage or security agreement, representing or securing indebtedness of Borrower (or any of its Affiliates) to Lender (or any of its Affiliates).

 

"Affiliate" means, with respect to any person or entity, any person or entity controlling, controlled by or under common control with the specified person or entity. "Control." for the foregoing purposes, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person or entity, whether through the ownership of voting securities or voting interests, by contract or otherwise.

 

7.          Remedies. Upon the maturity of this Note (whether at the stated Maturity Date, by acceleration or otherwise), all amounts due under this Note, including the unpaid balance of principal and interest hereof, shall, at the option of the Lender (but automatically with respect to an Event of Default described in Section 6(ii)), become immediately due and payable, and the Lender may exercise any of its rights and remedies granted herein, under applicable law or that the Lender may otherwise have against Borrower. Such remedies shall be cumulative and concurrent and may be pursued singly, successively or together, in Lender's sole and absolute discretion and as often as occasion therefor shall arise. Failure by the Lender to exercise any of its remedies shall not constitute a waiver of the right to exercise the same at any subsequent time.

 

8.          Cross Collateralization: Obligations Recourse to Borrower.

 

i.              All property mortgaged, pledged or otherwise provided as security (collectively, "Collateral'") for repayment of any other note, liability or obligation of any kind or nature, whether now or hereafter in existence and whether now or hereafter held by Lender, or any of its Affiliates, that is signed, cosigned, guaranteed or endorsed by any party who has signed, cosigned, guaranteed or endorsed this Note (or by any Affiliate of any such party) ("Other Indebtedness"') shall stand as collateral for repayment of tins Note and for performance of all obligations hereunder. In addition, all Collateral provided as security for the Borrowers' obligations under this Note shall stand as collateral for repayment of all Other Indebtedness and for performance of all obligations thereunder.

  

  

  

ii.             Notwithstanding any security and/or guarantees that may be provided for this Note, this Note shall be recourse to the Borrower such that the Lender may seek to enforce against the Borrower any monetary judgment with respect to the sums due under this Note.

 

9.           Collection Costs. Borrower hereby agrees to pay all costs and expenses of collection of this Note that are paid or incurred by the Lender (including, without limitation, the fees and all disbursements of the Lender's attorneys) (collectively, "Collection Costs"! irrespective of whether an action has been commenced against Borrower.

 

10.          No Usury. In no contingency or event whatsoever, whether by reason of advancement of the proceeds hereof or otherwise, shall the amount paid or agreed to be paid to Lender for the use, forbearance or detention of money advanced hereunder exceed the highest lawful rate permissible under any law which a court of competent jurisdiction may deem applicable hereto; and, in the event of any such payment inadvertently paid by the Company or inadvertently received by Lender, such excess sum shall be, at the Company's option, returned to Company forthwith or credited as a payment of principal, but shall not be applied to the payment of interest. It is the intent hereof that the Company not pay or contract to pay, and that Lender not receive or contract to receive, directly or indirectly in any manner whatsoever, interest in excess of that which may be paid by the Company under applicable law.

 

11.          Miscellaneous.

 

i.              This Note may be amended or modified only by an instrument in writing signed by the Company and the Lender.

 

ii.             All payments under this Note shall be applied first to Collection Costs, next to accrued interest and thereafter to principal.

 

iii.             Presentment, demand, protest and other notice of any kind are hereby expressly waived by the Company.

 

i v.            No delay or omission on the part of the Lender in the exercise of any right or remedy hereunder shall operate as a waiver thereof, and no partial exercise of any right or remedy precludes other or further exercise thereof or the exercise of any other rights or remedy.

 

v.             If any provision of this Note is invalid and unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (a) the other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in favor of the Lender in order to carry out the purposes of this Note as nearly as may be possible and (b) the invalidity or unenforceability of any provision hereof in any jurisdiction shall not affect the validity or enforceability of such provision in any other jurisdiction.

 

vi.             This Note shall be jointly and severally binding upon the Company and its successors and assigns.

 

vii.            THE COMPANY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE AND/OR ANY DOCUMENT EXECUTED IN CONJUNCTION HEREWITH AND/OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENT (WIIETHER ORAL OR WRITTEN) OR ACTIONS OF OR BY THE COMPANY OR THE LENDER.

  

  

  

 

This Note shall be construed in accordance with, and be governed by, the internal laws of the State of New York, without giving effect to the choice of law principles thereof.

 

[Signature appears on following page]

 

 

 

  

  

  

IN WITNESS WHEREOF, the Company has caused this Note to be executed the day and year first above written.

 

	  	
GROEN BROTHERS AVIATION, INC.

 

 

	  	  
	  	
By ___________________________________

	  	
Name: David Groen

	  	
Title: President & CEO

 

  

  

  

Exhibit 10.2 Cont’d

Groen Brothers Aviation, Inc.

Schedule of Promissory Notes Issued Under the Note Purchase Agreement Dated October 9, 2008

	
         Date

	
                              Lender

	
Principal Amount

	
October 9, 2008

	
Westford Special Situations Master Fund L.P.

	
$482,460.00

	
October 9, 2008

	
Westford Special Situations Fund II, L.P.

	
17,415.00

	
October 9, 2008

	
Westford Special Situations Fund II Ltd.

	
145,125.00

	
November 5, 2008

	
Westford Special Situations Master Fund L.P.

	
194,480.00

	
November 5, 2008

	
Westford Special Situations Fund II, L.P.

	
7,020.00

	
November 5, 2008

	
Westford Special Situations Fund II Ltd.

	
58,500.00

	
December 4, 2008

	
Westford Special Situations Master Fund L.P.

	
201,960.00

	
December 4, 2008

	
Westford Special Situations Fund II, L.P.

	
7,290.00

	
December 4, 2008

	
Westford Special Situations Fund II Ltd.

	
60,750.00

	
February 2, 2009

	
Westford Special Situations Master Fund L.P.

	
181,260.00

	
February 2, 2009

	
Westford Special Situations Fund II, L.P.

	
6,615.00

	
February 2, 2009

	
Westford Special Situations Fund II Ltd.

	
55,125.00

	
February 24, 2009

	
Westford Special Situations Master Fund L.P.

	
22,440.00

	
February 24, 2009

	
Westford Special Situations Fund II, L.P.

	
810.00

	
February 24, 2009

	
Westford Special Situations Fund II Ltd.

	
6,750.00

	
March 25, 2009

	
Westford Special Situations Master Fund L.P.

	
325,380.00

	
March 25, 2009

	
Westford Special Situations Fund II, L.P.

	
11,745.00

	
March 25, 2009

	
Westford Special Situations Fund II Ltd.

	
97,875.00

	
April 22, 2009

	
Westford Special Situations Master Fund L.P.

	
160,072.00

	
April 22, 2009

	
Westford Special Situations Fund II, L.P.

	
5,778.00

	
April 22, 2009

	
Westford Special Situations Fund II Ltd.

	
48,150.00

	
June 1, 2009

	
Westford Special Situations Master Fund L.P.

	
163,064.00

	
June 1, 2009

	
Westford Special Situations Fund II, L.P.

	
5,886.00

	
June 1, 2009

	
Westford Special Situations Fund II Ltd.

	
49,050.00

	
July 21, 2009

	
Westford Special Situations Master Fund L.P.

	
165,000.00

	
August 6, 2009

	
Westford Special Situations Master Fund L.P.

	
220,000.00

	
September 15, 2009

	
Westford Special Situations Master Fund L.P.

	
170,000.00

	
October 13, 2009

	
Westford Special Situations Master Fund L.P.

	
180,000.00

	
November 10, 2009

	
Westford Special Situations Master Fund L.P.

	
280,000.00

	
December 22, 2009

	
Westford Special Situations Master Fund L.P.

	
210,000.00

	
February 15, 2010

	
Westford Special Situations Master Fund L.P.

	
390,000.00

	
April 6, 2010

	
Westford Special Situations Master Fund L.P.

	
200,000.00

	
May 10, 2010

	
Westford Special Situations Master Fund L.P.

	
190,000.00

	
June 14, 2010

	
Westford Special Situations Fund II, L.P.

	
180,000.00

	
June 28, 2010

	
New Holdborn LTD

	
4,000,000.00

	
July 30, 2010

	
New Holdborn LTD

	
400,000

	
September 2, 2010

	
New Holdborn LTD

	
370,000

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