Document:

Exhibit 10.3

 

SHARED SERVICES AGREEMENT

January 14, 2022

 

This SHARED SERVICES AGREEMENT
(the “Agreement”) effective as of the date first written above (the “Effective Date”), is by and
between Foremost Worldwide Co., Ltd. (“Service Provider”) and FGI Industries, Ltd. (“Service Recipient”).

 

BACKGROUND

 

WHEREAS, Service Recipient
desires to contract with Service Provider for the provision of the Services, subject to the terms and conditions of this Agreement.

 

NOW, THEREFORE, in
consideration of the foregoing and the mutual and dependent covenants hereinafter set forth, the parties agree as follows:

 

Effective Date AGREEMENT

 

	1.	Definitions. As used herein, the following terms shall have the following definitions:

 

	 	 	“Headcount Ratio” shall mean the total full-time and part-time employees of Service Recipient in the Taipei Office divided by the total full-time and part-time employees of Service Provider in the Taipei Office.

 

	 	 	“Service” shall mean the service or services set forth on Exhibit A attached hereto.

 

	 	 	“Service Fee” shall mean the Total Service Cost multiplied by the Headcount Ratio, payable by the Service Recipient to Service Provider for the provision of such Service.

 

	 	 	“Taipei Office” shall mean the principal office of Service Provider located at Int’l Commerce Bldg. 9F-4, Chang An East Road, Sec. 1, Taipei, Taiwan 10441.

 

	 	 	“Total Service Cost” shall mean the total financial expenses incurred by the Service Provider for the provision of Services in the Taipei Office both to its own full-time and part-time employees in addition to those of Service Recipient, as accounted for by Service Provider on a fiscal quarterly basis in accordance with all applicable International Financial Reporting Standards.

 

	2.	Description of the Services. Service Provider will provide to Service Recipient all of the Services set forth on Exhibit A (as such exhibit may be amended or supplemented from time to time) as mutually agreed. Notwithstanding the contents of Exhibit A, Service Provider agrees to respond in good faith to any reasonable request by Service Recipient for access to any additional services that are necessary for the operation of the business of Service Recipient and which are not currently contemplated by Exhibit A, at a price to be agreed upon after good faith negotiations between the parties. Any additional services provided shall be subject to the terms and conditions of this Agreement. Service Provider shall have the right to utilize affiliated or third-party subcontractors to provide all or part of any Service hereunder.

 

	3.	Obligations of Service Provider; Disclaimer. Service Provider will provide qualified personnel who are experienced in rendering the Services and maintain adequate staffing levels to provide Service Recipient with the continual prompt delivery of the Services. Service Provider will carry out the Services in a professional, competent and timely manner. Service Recipient acknowledges and agrees that this Agreement does not create a fiduciary relationship, partnership, joint venture or relationships of trust or agency between the parties and that all Services are provided by Service Provider as an independent contractor. For such time as any employees or independent contractors of Service Provider are providing the Services to Service Recipient under this Agreement, (a) such employees will remain employees of Service Provider and shall not be deemed to be employees or independent contractors of Service Recipient for any purpose, and (b) Service Provider shall be solely responsible for the payment and provision of all wages, fees, bonuses and commissions, employee benefits, including severance and worker's compensation, and the withholding and payment of applicable taxes relating to such employment or provision of contractor services.

 

	4.	Obligations of Service Recipient; Access. Service Recipient shall provide Service Provider with access to its facilities, books, records and related documents and instructions required by Service Provider to perform the Services. Service Recipient shall pay the Service Fee to Service Provider in accordance with the terms of the Agreement. Service Provider agrees that all of its employees and subcontractors, when on the property of Service Recipient or when given access to any equipment, computer, software, network or files owned or controlled by Service Recipient, shall conform to the policies and procedures of Service Recipient concerning health, safety confidentiality and security which are made known to Service Provider in advance in writing.

 

	5.	Ownership of Intangible Property. As between the parties, all right, title, and interest in the intangibles used in the provision of the Services shall at all times remain the sole and exclusive property of Service Provider.

 

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	6.	Term and Termination of Agreement.

 

	 	(a)	This Agreement shall have an initial term of one year from the Effective Date and shall be renewed automatically thereafter for successive one-year periods, unless either party elects not to renew this Agreement upon not less than 60 days written notice prior to the end of any such term or otherwise terminates this Agreement pursuant to Section 6(b) of this Agreement.

 

	 	(b)	Either party may terminate any Service or terminate this Agreement in its entirety at any time for any reason by sending written notice to the other party at least 120 days in advance of the intended date of termination.

 

	7.	Payment Terms.

 

	 	(a)	Service Fee: As consideration for provision of the Services, Service Recipient shall pay to Service Provider the Service Fee for each Service as specified on the attached Exhibit A. In addition to such amount, in the event that Service Provider incurs reasonable and documented out-of-pocket expenses in the provision of any Service on behalf of Service Recipient, excluding payments made to employees, independent contractors, officers or directors of Service Provider, Service Recipient shall reimburse Service Provider for all such out-of-pocket expenses. Service Fees include but are not limited to: direct labor costs such as salaries and benefits; indirect overhead such as indirect labor, facilities, depreciation, travel, and other costs incurred in regard to the provision of the Services, as mutually agreed by the parties. Service Fees shall exclude income taxes, interest expense and other related financing charges, government subsidies and other similar amounts. Any costs for which Service Provider seeks reimbursement are subject to production of appropriate receipts by Service Provider and/or verification by Service Recipient.

 

	 	(b)	Timing of payments: Service Provider will invoice Service Recipient the actual Service Fee up to 30 days after the end of each fiscal quarter. Payment is due 60 days after the invoice date.

 

	 	(c)	Provider’s records: Service Provider is committed to keeping good records of services or work performed relating to the Services, as well as cost and expenses incurred, and will provide them to Service Recipient upon request.

 

	 	(d)	Price adjustment clause:

 

	 	 	If any taxing authority that has jurisdiction makes or proposes to make any assessment or reassessment to one of the parties to the Agreement with respect to income tax or any other tax based on the fact that the intercompany service charge is greater or less than an arm’s length charge, then the intercompany service charge should be augmented retroactively, in respect of the period assessed.

 

	 	 	If the Services performed by Service Provider change significantly in the future, Service Provider and Service Recipient may agree to adjust the Services Fee.

 

	 	(e)	Taxes: Service Recipient shall be responsible for all sales or use taxes imposed or assessed as a result of the provision of Services by Service Provider.

 

	 	(f)	Right of Offset: Service Provider shall have the right to offset any amounts owed (or to become due and owing) to Service Provider by Service Recipient under this Agreement, against any amounts owed (or to become due and owing) by Service Provider to the Service Recipient, whether under this Agreement or otherwise.

 

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	8.	Miscellaneous.

 

	 	(a)	Accounting. The budgeted intercompany service charge allocated to Service Recipient based on the pricing set forth on Exhibit A attached hereto will be recorded in the internal books and records of Service Provider and Service Recipient on a monthly basis. The budgeted intercompany service charge will be adjusted to actual within 30 days of each calendar year end.

 

	 	(b)	Governing Law; Submission to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the laws of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Delaware. Any action or dispute arising out of, based upon or related to this Agreement may only be instituted in the federal courts of the United States of America located in the State of Delaware or, if such courts lack jurisdiction, in the courts of the State of Delaware located in the City of Wilmington and County of New Castle, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such action or dispute. Service of process, summons, notice or other document by mail to such party’s address set forth herein shall be effective service of process for any action or dispute brought in any such court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any action or dispute in such courts and irrevocably waive and agree not to plead or claim in any such court that any such action or dispute brought in any such court has been brought in an inconvenient forum. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION OR DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT.

 

	 	(c)	Confidentiality. Any information obtained by either party in the course of this Agreement is confidential and proprietary of the disclosing party and shall not be disclosed by the receiving party, except as required by law. No parties to this Agreement shall disclose the terms of this Agreement to any third party without the consent of the other parties, except as required by law or the rules and regulations of the U.S. Securities and Exchange Commission or any stock exchange or national market system upon which a party’s securities are listed. 

 

	 	(d)	Indemnities. Service Recipient shall defend, indemnify and hold Service Provider harmless from and against any damages, liabilities, costs and expenses arising out of the Services provided by Service Provider.

 

	 	(e)	Assignability. No party shall assign this Agreement without the prior written consent of the other party.

 

	 	(f)	Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall use their best efforts to find and employ alternative means to achieve the same or substantially the same result as that contemplated by such term or other provision.

 

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	 	(g)	Notice. All notices, reports, invoices and other communications between the parties shall be in writing and sent to the respective parties at the address indicated by each such party to the other parties to this Agreement.

 

	 	(h)	Amendment. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto.

 

	 	(i)	Counterparts. This Agreement may be executed by electronic signature and in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement.

 

	 	(j)	No Third-Party Beneficiaries. The parties agree that the provisions of this Agreement are intended exclusively for the benefit of Service Provider and Service Recipient. Nothing in this Agreement shall be construed as giving any other person or entity any right, remedy or claim under or in respect of this Agreement or any provision hereof.

 

[Remainder of page intentionally left blank;
signature page follows.]

 

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IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the Effective Date.

 

	 	FOREMOST WORLDWIDE CO., LTD.
	 	 
	 	/s/ Keh-Jean “Jay” Yeh
	 	Name:	Keh-Jean “Jay” Yeh
	 	Title:	CEO    

 

	 	FGI INDUSTRIES, LTD.
	 	 
	 	/s/ David Bruce
	 	Name:	David Bruce
	 	Title:	CEO             

 

[Signature Page to Shared Services Agreement]

 

     

     

    

 

EXHIBIT A

SERVICES

 

	 	Description of Service	Service Fees	Location
	 	 	 	 
	1. 	IT System Services	See Section 1, Definitions.	Taipei Office
	 	 	 	 
	2. 	HR Services (including, but not limited to the provision of payroll, retirement benefits and insurance administration services)	See Section 1, Definitions.	Taipei Office
	 	 	 	 
	3. 	Office Administration Services (including, but not limited to, the provision of space, utilities, and general administrative services)	See Section 1, Definitions.	Taipei OfficeExhibit 10.4

 

GLOBAL SOURCING AND PURCHASE AGREEMENT

 

This GLOBAL SOURCING AND PURCHASE AGREEMENT (the
 "Agreement") is made this 14 day of January 2022, by and between Foremost Worldwide Co. Ltd. ("FWW") and FGI
Industries, Ltd. ("FGI").

 

WHEREAS, FWW is engaged in the manufacture, distribution
and export of products including, but not limited to, wooden furniture, cabinetry and shower systems for the bath and kitchen markets
(hereinafter referred to as "Products");

 

WHEREAS, FGI is engaged in the worldwide sales,
marketing and distribution of products including, but not limited to, wooden furniture, cabinetry and shower systems for the bath and
kitchen markets and would like to engage FWW as a sourcing agent for its Products; and

 

WHEREAS, FWW agrees to source and sell Products
to FGI on the conditions and terms set out in this agreement;

 

NOW THEREFORE, in consideration of the promises
and releases contained herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties
agree as follows:

 

	1.	Services:

 

FGI hereby appoints and FWW agrees
to act as FGI’s sourcing agent for the Products on a worldwide basis (hereinafter “Territories”). FWW shall provide
FGI with the following services:

 

	 	a)	FWW shall find, source and/or provide factories/manufacturers for the production of Products specified and requested by FGI, as highlighted under Exhibit A;
	 	 	 
	 	b)	FWW shall negotiate on behalf of FGI the cost of production, prepayments, shipping and any other elements as necessary for the production and delivery of Products specified by FGI either directly to FGI or to FGI’s customers. For the avoidance of doubt, FWW and FGI agree that the terms negotiated by FWW on behalf of FGI are not binding upon FGI unless and until FGI enters into any binding written agreement with the third party;
	 	 	 
	 	c)	FWW shall inspect the merchandise before it is shipped to FGI or destinations required by FGI to ensure the quality, performance, specifications, and quantity of products meet the requirements and standards of FGI which will not be less than industry standard (hereinafter “Quality Control” or “QC”); and
	 	 	 
	 	d)	FWW shall prepare relevant shipping documentation and shipping information to FGI as it pertains to Products that have been approved and ordered by FGI.
	 	 	 
	 	e)	All pricing associated with any manner of services described in this Section shall be invoiced, ordered, or otherwise in the form of United States Dollars (“USD”).

 

	2.	Representations:

 

FWW represents and warrants to FGI
that FWW:

 

	 	a)	is a corporation duly organized, validly existing and in good standing under the laws of Hong Kong SAR;
	 	 	 
	 	b)	has all requisite corporate power and authority to carry on its business as it is now being conducted;
	 	 	 
	 	c)	has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby, and the execution and consummation of this Agreement shall not violate the charter documents of FWW, or any other commitment or agreement to which FWW is a party; and
	 	 	 
	 	d)	to the best of its knowledge, entry in this Agreement, and its performance hereunder, does not and shall not violate any law, statute or regulation or any contractual obligation of FWW; and (iv) FWW has the requisite skill, competence and resources to carry out its obligations under this Agreement.
	 	 	 
	 	e)	shall not commit any act or do anything which might reasonably be considered: (i) to be immoral, deceptive, scandalous or obscene; or (ii) to injure, tarnish, damage or otherwise negatively affect the reputation and goodwill associated with FGI and any of its affiliates.

 

FGI represents and warrants
to FWW that FGI:

 

	 	a)	has the full right, power and authority to enter into this Agreement;
	 	 	 
	 	b)	has been duly authorized to enter into this Agreement in accordance with its operating agreement and bylaws; and
	 	 	 
	 	c)	to the best of its knowledge, entry in this Agreement, and its performance hereunder, does not and shall not violate any law, statute or regulation or any contractual obligation of FGI.

 

    	 	 	 

     

    

 

	3.	Limitation of Liability and Indemnification: 

 

FWW agrees to indemnify and hold harmless
FGI and its directors, officers, employees and representatives from and against all losses, penalties, damages (but not any punitive damages),
liabilities, suits, claims and expenses (including without limitation reasonable outside attorneys’ fees) arising out of or in connection
with third party claims against FWW for any breach by FWW of any of its representations, warranties or covenants in this Agreement, provided
that FGI gives FWW prompt written notice of all claims and/or suits to which this indemnification applies. Upon notice to FGI that FWW
is responsible for the entire third party claim or suit, FWW shall have the option to undertake and solely control the defense and/or
settlement of any such third party claim or suit at FWW’S cost and expense. FGI shall cooperate with FWW in the defense of any such
claims and/or suits, and both parties shall act to mitigate any damage arising out of or related to such claims and/or suits.

 

	4.	Payment and Commissions:

 

	 	a)	FGI agrees to pay FWW a commission for services rendered under this Agreement. The commission rate shall be set forth in Exhibit B for the Products which FWW services for FGI as specified in the Section 1 of this Agreement. This rate will be reviewed and/or revised by FGI and FWW annually.
	 	 	 
	 	b)	All commissions shall be computed on the basis of the "FOB" of the sales (“FOB Sales”) in USD, defined as the quantity sold at the accepted order price, including charges for freight, shipping, taxes, insurance, and minus the application of any prompt payment discounts, other discounts, returns, cost of display, store set up, return freight, and other allowances or bad debts.
	 	 	 
	 	c)	FGI shall not be liable to FWW for any commission upon FOB sales that are lost or delayed for any cause.
	 	 	 
	 	d)	It is agreed by the Parties that FWW shall provide the Product pricing and once confirmed by FGI, that price will be fixed and agreed between FGI and FWW unless a price revision is recognized and confirmed by FGI in writing. FGI shall remit payment to FWW for commission earned within fourteen (14) calendar days after FGI receives the Products.
	 	 	 
	 	e)	FWW shall agree that FGI may deduct payment from its service commission to FWW for any quantity shortage, shipment delay, or incorrect packaging of merchandise until any dispute is resolved.
	 	 	 
	 	f)	In the event that FGI disputes the amount of any commission owed to FWW, FGI shall remit payment to FWW for the undisputed portion of the commission owed to FWW and provide written notice to FWW that it disputes the amount of the commission owed to FWW and the reason for such dispute ("Commission Dispute Notice"). The Parties agree that upon FWW’s receipt of a Commission Dispute Notice, that both Parties shall negotiate in good faith regarding the disputed commission and that FGI shall not be obligated to pay the disputed portion of any commission, or any interest thereon, unless and until FGI and FWW mutually agree to the proper amount of the commission owed by FGI to FWW subject to any agreed-upon adjustments.
	 	 	 
	 	g)	With respect to any special/custom products which may demand more work for FWW in the ordinary course of business (“Specialty Products”), FWW and FGI agree to a negotiate a different commission rate which shall be applied to the Specialty Products without affecting any Products specified under this Agreement. For the avoidance of doubt, written approval by FWW and FGI shall be required to such effectuate any change in commission for Specialty Product orders.

 

	5.	Term of the Agreement:

 

	 	a)	The term of this Agreement shall be for a period of one year commencing on the date of execution of this Agreement (the "Term").
	 	 	 
	 	b)	Unless terminated within sixty (60) days, this Agreement shall be automatically renewed for an additional Term upon every anniversary day of this Agreement.

 

	6.	Termination of the Agreement:

 

	 	a)	This Agreement may be terminated by either FWW or FGI by giving a written notice to the other party 60 (sixty) days prior to the proposed termination date.
	 	 	 
	 	b)	If FWW enters into a similar Agreement with another party whom FGI deems to be a competitor, FGI retains the right to terminate this Agreement immediately and without notice.
	 	 	 
	 	c)	FGI retains the right to enter into a similar Agreement with another party whom FWW deems to be a competitor. In such an event, FWW maintains the right to the terminate this Agreement in accordance with the provisions of 6a.

 

	7.	Governing Law:

 

This Agreement shall be governed and
construed in accordance with the laws of the State of New Jersey, United States of America.

 

    	 	 	 

     

    

 

	8.	Miscellaneous:

 

	 	a)	Exclusive jurisdiction: For the purpose of any action that may be brought in connection with this Agreement, FWW and FGI hereby consent to the exclusive jurisdiction and venue of the United States District Court for the District of New Jersey and waive the right to contest the jurisdiction and venue of said court on the ground of inconvenience or otherwise and, further, waive any right to bring any action or proceeding in connection with this agreement in any court other than the United States District Court for the District of New Jersey.
	 	 	 
	 	b)	Counterparties: This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument and facsimile copies shall be deemed originals for all purposes.
	 	 	 
	 	c)	Notices: All notices that are required or may be given pursuant to the terms of this Agreement shall be in writing and delivered by hand or national overnight courier service, sent by facsimile transmission, sent via electronic-mail to a respective Party’s address, or mailed by registered or certified mail, postage prepaid, to the addresses designated by either Party hereto. A notice shall be deemed to have been given (i) upon personal delivery, if delivered by hand or courier, (ii) three business days after the date of deposit in the mails, postage prepaid, if mailed by certified or registered mail, or (iii) the next business day if sent by facsimile transmission or electronic mail (if receipt is electronically confirmed).
	 	 	 
	 	d)	Entirety: This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral and written, among the parties hereto with respect to the subject matter hereof. No representation, warranty, promise, inducement or statement of intention has been made by any party that is not embodied in this Agreement or such other documents, and none of the parties shall be bound by, or be liable for, any alleged representation, warranty, promise, inducement or statement of intention not embodied herein or therein.
	 	 	 
	 	e)	Assignments and Successors: This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective permitted successors and assigns. Notwithstanding anything contained in this Agreement to the contrary, nothing in this Agreement, express or implied, is intended to confer on any person or entity other than the parties hereto or their respective permitted successors and assigns, any rights, remedies, obligations or liabilities under or by reason of this Agreement. This Agreement may not be assigned by either party without the prior written consent of the other party.
	 	 	 
	 	f)	Independent Contractor: FWW is and shall be construed as an independent contractor. Nothing contained in this Agreement shall be construed as creating a joint venture, partnership, employee/employer relationship, association or formal or informal business organization by and between the parties.
	 	 	 
	 	g)	Confidentiality: FWW shall maintain strict confidentiality with respect to any and all information, whether in writing, oral or otherwise, concerning FGI or Products developed specifically for FGI or ordered by FGI, with respect to the nature and extent of the mutual business relationship as well as with respect to the commercial and manufacturing secrets of FGI, and shall not make any such information available to third parties, including this Agreement and any of its terms. FWW shall take measures to ensure that its employees also adhere to this confidentiality obligation. FWW hereby acknowledges that any breach or attempted breach of this Section by FWW or its owners, shareholders, directors, officers, employees, agents or representatives shall result in irreparable harm to FGI for which a remedy at law shall be inadequate. In case of any breach or attempted breach of this Section by FWW or its owners, shareholders, directors, officers, employees, agents or representatives, FGI shall be entitled to, in addition to any other remedies to which FGI may be entitled, specific performance and injunctive and other equitable relief without the necessity of proof of irreparable harm or posting of bond.
	 	 	 
	 	i)	Amendments: This Agreement may only be amended, varied or supplemented by an instrument in writing, signed by the parties hereto.

 

    	 	 	 

     

    

 

IN WITNESS WHEREOF,
these presents have been executed by authorized signatories for and on behalf of the parties hereto on the day and year first before
written.

 

	/s/ Keh Jean “Jay” Yeh	 
	Keh Jean “Jay” Yeh	 
	CEO	 
	FOREMOST WORLDWIDE CO. LTD	 

 

	/s/ David Bruce	 
	David Bruce	 
	CEO	 
	FGI INDUSTRIES, LTD.	 

 

    	 	 	 

     

    

 

Exhibit A

Products sourced by FWW and sold to FGI include:

 

	 	·	Bath Furnishings: this includes, but is not limited to, vanities, mirrors, cabinetry, shelving and storage products typically produced for the bathroom space.
	 	·	Kitchen Furnishings: this includes, but is not limited to, cabinetry, shelving and storage products typically produced for the kitchen space.

 

Exhibit B

	Product Category	Commission Rate
	Bath Furnishings	2.5% of FOB Sales
	Kitchen Furnishings	2.5% of FOB Sales

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