Document:

Longhai Steel, Inc.: Exhibit 10.2 - Filed by newsfilecorp.com

Exhibit 10.2

 

 

 

INDEPENDENT DIRECTOR AGREEMENT 

THIS INDEPENDENT DIRECTOR AGREEMENT (this
“Agreement”) is made effective as of November 18, 2010 by and
between Longhai Steel Inc. (the “Company”), and Ms. Jean Kester
(“Director”).

WHEREAS, the Company seeks to attract and retain as
directors, capable and qualified persons to serve on the Company’s board of
directors (the “Board”); and 

WHEREAS, the Company has requested and received from
Director certain information regarding Director’s qualifications and fitness to
serve on the Board and has considered and relied upon the accuracy of such
information in offering Director the opportunity to serve on the Board; and 

WHEREAS, the Company believes that Director possesses
the necessary qualifications and abilities to serve as a director of the Company
and to perform the functions and meet the Company’s needs related to its
Board.

NOW, THEREFORE, the parties agree as follows:

1. Service to the Board. 

(a) Service as a Director. Director
will serve for a period of three years (the “term as a director of the Company
in accordance with the bylaws of the Company and perform all duties as a
director of the Company, including without limitation (1) attending meetings of
the Board, (2) serving on such committees of the Board (each a
“Committee”) to which Director has been appointed, (3) attending
meetings of each Committee of which Director is a member and (4) performing
Director’s duties on behalf of the Company in good faith and in a manner that is
not opposed to the best interests of the Company. 

(b) Service on Committees. Director
will serve on the following committees and in the capacities stated:

	  	Member 	Chairperson 
	Audit Committee 	  	X 
	Compensation/Nominating Committee 	X 	  
	Corporate Governance Committee 	X 	  

To the extent Director serves as Audit Committee Chairperson,
Director agrees that Director is also serving as the financial expert for
purposes of filings before the Securities and Exchange Commission.

2. Term. The term of this Agreement shall commence as of
the date of Director’s appointment by the Board of Directors of the Company and
shall continue until the Director’s removal or resignation. 

Date: 18.11.2010 

Page 2 of 4 

3. Compensation and Expenses.   

(a) Director Compensation. In recognition of the services provided by and to be provided by Director, the Company agrees to issue to Director, an aggregate of 7500 restricted shares of the Company’s common stock per
annum (such issuance, the “Compensation”), half of the restricted shares to be granted on the date that is six (6) months following the closing date of a secondary offering of shares of the Company’s common stock, and half the
annual Compensation to be granted on each six (6) month interval thereafter (each such date a “grant date”). The Board reserves the right to change the Compensation from time to time, to take into consideration the responsibilities
associated with different committees in setting Compensation levels and to grant additional restricted shares periodically, which may vary from the terms described in this section. If Director ceases to serve as a director on the Company’s
Board at any time and for any reason prior to a grant date associated with any restricted shares, all restricted shares described in the restricted share agreement that have not been granted as of such time of cessation of services will not be
granted. All such cancelled or forfeited restricted shares shall be returned to the Company’s incentive pool.

 (b) Expenses. The Company will reimburse Director for all reasonable, out-of-pocket expenses, approved by the Company in advance, incurred in connection with the performance of Director’s duties under this
Agreement (“Expenses”), upon submission of receipts and a written request for payment. Such statement shall be accompanied by sufficient documentary matter to support the expenditures. The Company may withhold from any
payment any amount of withholding required by law.

(c) Future Compensation and Benefits. The Board, with the compensation committee, reserves the right to determine the compensation for services provided under this Agreement. The Board may from time to time authorize additional
compensation and benefits for Director, including stock options and restricted stock.

(d) Insurance and Indemnification. This Agreement is effective only when the directors’ and officers’ insurance policy previously shown to the Director is in place and an Indemnification Agreement satisfactory to the
Director is signed by the Company. When and if the Company anticipates the successful qualification of its common stock for trading on the NASDAQ Stock Exchange or any similar exchange for securities trading, the Company shall amend its existing
directors’ and officers’ insurance policy to increase limits available to independent directors by approximately $5,000,000 or a lesser or greater amount which is determined and approved by the Board to be appropriate, with such
insurance effective on date of such listing or as soon thereafter as possible, provided that such increase is in the best interests of the Company and its shareholders.

The Company has provided the Director with a summary of the limits and terms of its current Directors’ and Officers’ Liability Insurance (the “D&O Insurance”) and the provisions of its corporate by-laws and
governing documents dealing with indemnification of directors (the “Indemnification Provisions”). To the fullest extent permitted by applicable law, the Company agrees that it will not voluntarily change the terms of such
D&O Insurance or the Indemnification Provisions to the detriment of the Director at anytime while he is entitled to benefit of such D&O Insurance or Indemnification Provisions.

4. Confidentiality. The Company and Director each acknowledge that, in order for the intents and purposes of this Agreement to be accomplished, Director shall necessarily be obtaining access to certain confidential information concerning the
Company and its affairs,
including, but not limited to business methods, information systems, financial data and strategic plans which are unique assets of the Company (“Confidential Information”). Director covenants not to, either directly or indirectly,
in any manner, utilize or disclose to any person, firm, corporation, association or other entity any Confidential Information.

Date: 18.11.2010 

Page 3 of 4 

5. Termination. With or without cause, the Company and Director may each terminate this Agreement at any time upon ten (10) days written notice, and the Company shall be obligated to pay to Director the compensation and expenses due up to the
date of the termination. Nothing contained herein or omitted herefrom shall prevent the shareholder(s) of the Company from removing Director with immediate effect at any time for any reason.

6. Amendments and Waiver. No supplement, modification or amendment of this Agreement will be binding unless executed in writing by both parties. No waiver of any provision of this Agreement on a particular occasion will be deemed or will
constitute a waiver of that provision on a subsequent occasion or a waiver of any other provision of this Agreement.

7. Binding Effect. This Agreement will be binding upon and inure to the benefit of and be enforceable by the parties and their respective successors and assigns.

8. Severability. The provisions of this Agreement are severable, and any provision of this Agreement that is held by a court of competent jurisdiction to be invalid, void, or otherwise unenforceable in any respect will not affect the validity
or enforceability of any other provision of this Agreement.

9. Governing Law. This Agreement will be governed by and construed and enforced in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in that state without giving effect to the principles of
conflicts of laws.

10. Notice. Any and all notices referred to herein shall be sufficient if furnished in writing at the addresses specified on the signature page hereto or, if to the Company, to the Company’s address as specified in filings made
by the Company with the U.S. Securities and Exchange Commission.

11. Assignment. The rights and benefits of the Company under this Agreement shall be transferable, and all the covenants and agreements hereunder shall inure to the benefit of, and be enforceable by or against, its successors and
assigns. The duties and obligations of Director under this Agreement are personal and therefore Director may not assign any right or duty under this Agreement without the prior written consent of the Company.

12. Entire Agreement. Except as provided elsewhere herein, this Agreement sets forth the entire agreement of the parties with respect to its subject matter and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any officer, employee or representative of any party to this Agreement with respect to such subject matter.

13. Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one instrument. Facsimile execution and delivery of this Agreement is legal, valid and binding for all purposes.

Date: 18.11.2010 
Page 4 of 4 

IN WITNESS WHEREOF, the parties hereto have caused this
Independent Director Agreement to be duly executed and signed as of the day and
year first above written.

LONGHAI STEEL INC.

By: /s/Dr. Eberhard
Kornotzki         
Name: Dr.
Eberhard Kornotzki 
Title: Chief Financial Officer 

DIRECTOR

_________________________
Name: Ms.
Jean Kester
Address:Longhai Steel, Inc.: Exhibit 10.3- Filed by newsfilecorp.com

Exhibit 10.3

 

 

 

INDEPENDENT DIRECTOR AGREEMENT 

THIS INDEPENDENT DIRECTOR AGREEMENT (this
“Agreement”) is made effective as of November 23, 2010 by and
between Longhai Steel Inc. (the “Company”), and Mr. Basil Hwang
(“Director”).

WHEREAS, the Company seeks to attract and retain as
directors, capable and qualified persons to serve on the Company’s board of
directors (the “Board”); and 

WHEREAS, the Company has requested and received from
Director certain information regarding Director’s qualifications and fitness to
serve on the Board and has considered and relied upon the accuracy of such
information in offering Director the opportunity to serve on the Board; and 

WHEREAS, the Company believes that Director possesses
the necessary qualifications and abilities to serve as a director of the Company
and to perform the functions and meet the Company’s needs related to its
Board.

NOW, THEREFORE, the parties agree as follows:

1. Service to the Board. 

(a) Service as a Director. Director
will serve for a period of three years (the “term”) as a director of the Company
in accordance with the bylaws of the Company and perform all duties as a
director of the Company, including without limitation (1) attending meetings of
the Board, (2) serving on such committees of the Board (each a
“Committee”) to which Director has been appointed hereunder, (3)
attending meetings of each Committee of which Director is a member and (4)
performing Director’s duties on behalf of the Company in good faith and in a
manner that is not opposed to the best interests of the Company. 

(b) Service on Committees. Director
will serve on the following committees and in the capacities stated:

	  	Member 	Chairperson 
	Audit Committee 	X 	  
	Compensation/Nominating Committee 	  	X 
	Corporate Governance Committee 	X 	  

To the extent Director serves as Audit Committee Chairperson,
Director agrees that Director is also serving as the financial expert for
purposes of filings before the Securities and Exchange Commission.

2. Term. The term of this Agreement shall commence as of
the date of Director’s appointment by the Board of Directors of the Company and
shall continue until the Director’s removal or resignation. 

Date: 18.11.2010 

Page 2 of 4 

3. Compensation and Expenses.  

(a) Director Compensation. In recognition of the services provided by and to be provided by Director, the Company agrees to issue to Director an aggregate of 5000 restricted shares of the Company’s common stock per
annum (such issuance, the “Compensation”), half of the restricted shares to be granted on the date that is six (6) months following the closing date of a secondary offering of shares of the Company’s common stock, and half the
annual Compensation to be granted on each six (6) month interval thereafter (each such date a “grant date”). The Board reserves the right to change the Compensation from time to time, to take into consideration the responsibilities
associated with different committees in setting Compensation levels and to grant additional restricted shares periodically, which may vary from the terms described in this section. If Director ceases to serve as a director on the Company’s
Board at any time and for any reason prior to a grant date associated with any restricted shares, all restricted shares described in the restricted share agreement that have not been granted as of such time of cessation of services will not be
granted. All such cancelled or forfeited restricted shares shall be returned to the Company’s incentive pool.

 (b) Expenses. The Company will reimburse Director for all reasonable, out-of-pocket expenses, approved by the Company in advance, incurred in connection with the performance of Director’s duties under this
Agreement and any reasonable travel and accommodation expenses incurred in attending meetings of the Board (“Expenses”), upon submission of receipts (or other sufficient documentary support) and a written request for
payment.

 (c) Future Compensation and Benefits. The Board, with the compensation committee, reserves the right to determine the compensation for services provided under this Agreement. The Board may from time
to time authorize additional compensation and benefits for Director, including stock options and restricted stock.

(d) Insurance and Indemnification. This Agreement is effective only when the directors’ and officers’ insurance policy previously shown to the Director covering the Director is in place and an Indemnification Agreement
satisfactory to the Director is signed by the Company. When and if the Company anticipates the successful qualification of its common stock for trading on the NASDAQ Stock Exchange or any similar exchange for securities trading, the Company shall
amend its existing directors’ and officers’ insurance policy to increase limits available to independent directors by approximately $5,000,000 or a lesser or greater amount which is determined and approved by the Board to be
appropriate, with such insurance effective on date of such listing or as soon thereafter as possible, provided that such increase is in the best interests of the Company and its shareholders.

The Company has provided the Director with a summary of the limits and terms of its current Directors’ and Officers’ Liability Insurance (the “D&O Insurance”) and the provisions of its corporate by-laws and
governing documents dealing with indemnification of directors (the “Indemnification Provisions”). To the fullest extent permitted by applicable law, the Company agrees that it will not voluntarily change the terms of such
D&O Insurance or the Indemnification Provisions to the detriment of the Director at anytime while he is entitled to benefit of such D&O Insurance or Indemnification Provisions.

4. Confidentiality. The Company and Director each acknowledge that, in order for the intents and purposes of this Agreement to be accomplished, Director shall necessarily be obtaining access to certain confidential information concerning the
Company and its affairs, including, but not limited to business methods, information systems, financial data and strategic plans which are unique assets of the Company (“Confidential Information”). Director
covenants not to, either directly or indirectly, in any manner, utilize or disclose to any person, firm, corporation, association or other entity any Confidential Information.

Date: 18.11.2010 

Page 3 of 4 

5. Termination. With or without cause, the Company and Director may each terminate this Agreement at any time upon ten (10) days written notice, and the Company shall be obligated to pay to Director the compensation and expenses due up to the
date of the termination. Nothing contained herein or omitted herefrom shall prevent the shareholder(s) of the Company from removing Director with immediate effect at any time for any reason.

6. Amendments and Waiver. No supplement, modification or amendment of this Agreement will be binding unless executed in writing by both parties. No waiver of any provision of this Agreement on a particular occasion will be deemed or will
constitute a waiver of that provision on a subsequent occasion or a waiver of any other provision of this Agreement.

7. Binding Effect. This Agreement will be binding upon and inure to the benefit of and be enforceable by the parties and their respective successors and assigns.

8. Severability. The provisions of this Agreement are severable, and any provision of this Agreement that is held by a court of competent jurisdiction to be invalid, void, or otherwise unenforceable in any respect will not affect the validity
or enforceability of any other provision of this Agreement.

9. Governing Law. This Agreement will be governed by and construed and enforced in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in that state without giving effect to the principles of
conflicts of laws.

10. Notice. Any and all notices referred to herein shall be sufficient if furnished in writing at the addresses specified on the signature page hereto or, if to the Company, to the Company’s address as specified in filings made
by the Company with the U.S. Securities and Exchange Commission.

11. Assignment. The rights and benefits of the Company under this Agreement shall be transferable, and all the covenants and agreements hereunder shall inure to the benefit of, and be enforceable by or against, its successors and
assigns. The duties and obligations of Director under this Agreement are personal and therefore Director may not assign any right or duty under this Agreement without the prior written consent of the Company.

12. Entire Agreement. Except as provided elsewhere herein, this Agreement sets forth the entire agreement of the parties with respect to its subject matter and supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any officer, employee or representative of any party to this Agreement with respect to such subject matter.

13. Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one instrument. Facsimile execution and delivery of this Agreement is legal, valid and binding for all purposes.

Date: 18.11.2010 
Page 4 of 4 

IN WITNESS WHEREOF, the parties hereto have caused this
Independent Director Agreement to be duly executed and signed as of the day and
year first above written.

LONGHAI STEEL INC.

By: /s/ Dr. Eberhard Kornotzki                          

Name: Dr. Eberhard Kornotzki 
Title: Chief Financial Officer 

DIRECTOR

_________________________________

Name: Mr. Basil Hwang
Address:

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