Document:

Unassociated Document

     

    Exhibit
      10.1

    EXECUTIVE
      EMPLOYMENT AGREEMENT

    

    This
      Executive Employment Agreement (this “Agreement”) is made as of the 17th day of
      March, 2008 by and between InferX Corporation, a Delaware corporation (the
      “Company”), and Michael Brown, a natural person, residing in the State of
      Colorado (“Executive”).

    

    WHEREAS,
      the Company wishes to employ Executive as its President and Chief Executive
      Officer (“CEO”) and Executive wishes to accept such employment;

    

    WHEREAS,
      the Company and Executive wish to set forth the terms of Executive’s employment
      and certain additional agreements between Executive and the
      Company.

    

    NOW,
      THEREFORE, in consideration of the foregoing recitals and the representations,
      covenants and terms contained herein, the parties hereto agree as
      follows:

    

    
      	 	
              1.

            	
              Employment
                Period

            

    

    

    The
      Company will employ Executive, and Executive will serve the Company, under
      the
      terms of this Agreement commencing March 17, 2008 (the “Commencement Date”) for
      a term of one (1) year unless earlier terminated under Section 4 hereof. The
      period of time between the commencement and the termination of Executive’s
      employment hereunder shall be referred to herein as the “Employment
      Period.”

    

    
      	 	
              2.

            	
              Duties
                and Status

            

    

    

    The
      Company hereby engages Executive as its President and CEO on the terms and
      conditions set forth in this Agreement including the terms and conditions of
      the
      Employee Proprietary Information, Inventions, and Non-Competition Agreement
      attached hereto as Exhibit
      A
      and
      incorporated herein (the “Non-Disclosure Agreement”). During the term of the
      Employment Period, Executive shall report directly to the Board of Directors
      of
      the Company (the “Board”) and shall exercise such authority, perform such
      executive functions and discharge such responsibilities as are reasonably
      associated with Executive’s position, commensurate with the authority vested in
      Executive pursuant to this Agreement and consistent with the governing documents
      of the Company. 

    

    
      	 	
              3.

            	
              Compensation
                and Benefits

            

    

    

    
      	 	
              (a)

            	
              Salary.
                During the Employment Period, the Company shall pay to Executive,
                as
                compensation for the performance of his duties and obligations under
                this
                Agreement, a base salary of $48,000 per annum, payable semi-monthly.
                Such
                base salary will increase to $120,000 per annum, payable semi-monthly
                in
                the month following a quarterly reporting period whereby the Company
                reports EBITDA of $250,000 or more.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              Bonus.
                During the Employment Period, Executive shall be eligible for a bonus
                to
                be paid in cash, stock or both on terms that shall be mutually acceptable
                to the Board and Executive.

            

    

     

    
      	 	
              (c)

            	
              Equity.
                As partial consideration for entering into this Agreement and subject
                to
                Executive executing the agreements under the Company Company’s 2007 Stock
                Incentive Plan (the “Plan”), the Company hereby grants Executive 150,000
                options to purchase shares of the Company’s common stock at an exercise
                price of $.50 per share that shall vest as follows: 50,000 options
                upon the Company executing contracts that will generate $500,000
                in gross
                revenues over the term of the contracts; 50,000 options upon the
                Company
                executing contracts that will generate $1,000,000 in gross revenues
                over
                the term of the contracts and in contracts and 50,000 upon the Company
                executing contracts that will generate $1,500,000 in gross revenues
                over
                the term of the contracts

            

    

     

    
      	 	
              (d)

            	
              Immediate
                Vesting Provision.
                Any options or other forms of equity granted now or in the future
                by the
                Company to Executive (“Equity”) shall vest immediately if Executive’s
                employment is terminated for good reason (as described in Section
                4
                hereof) or due to a change of control, sale of a majority of the
                common
                stock or sale of substantially all of the assets of the
                Company.

            

    

     

    
      	 	
              (e)

            	
              Other
                Benefits.
                During the Employment Period, Executive shall be entitled to participate
                in all of the employee benefit plans, programs and arrangements of
                the
                Company in effect during the Employment Period which are generally
                available to senior executives of the Company, subject to and on
                a basis
                consistent with the terms, conditions and overall administration
                of such
                plans, programs and arrangements. In addition, during the Employment
                Period, Executive shall be entitled to fringe benefits and perquisites
                comparable to those of other senior executives of the Company including,
                but not limited to, standard holidays, twenty (20) days of vacation
                pay
                plus five (5) sick/personal days, to be used in accordance with the
                Company’s vacation pay policy for senior
                executives.

            

    

     

    
      	 	
              (f)

            	
              Business
                Expenses.
                During the Employment Period, the Company shall promptly reimburse
                Executive for all appropriately documented, reasonable business expenses
                incurred by Executive in the performance of his duties under this
                Agreement, including telecommunications expenses and travel
                expenses.

            

    

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              4.

            	
              Termination
                of Employment

            

    

    

    
      	 	
              (a)

            	
              Termination
                for Cause.
                The Company may terminate Executive’s employment hereunder for Cause
                (defined below). For purposes of this Agreement and subject to Executive’s
                opportunity to cure as provided in Section 4(c) hereof, the Company
                shall
                have Cause to terminate Executive’s employment hereunder if such
                termination shall be the result of:

            

    

    

    
      	 	
              (i)
                

            	
              a
                material breach
                of fiduciary duty or material breach
                of the terms of this Agreement or any other agreement between Executive
                and the Company (including without limitation any agreements regarding
                confidentiality, inventions assignment and
                non-competition);

            

    

     

    
      	 	
              (ii)
                

            	
              the
                commission by Executive of any act of embezzlement, fraud, larceny
                or
                theft on or from the Company;

            

    

     

    
      	 	
              (iii)
                

            	
              substantial
                and continuing neglect or inattention by Executive of the duties
                of his
                employment or the willful misconduct or gross negligence of Executive
                in
                connection with the performance of such duties which remains uncured
                for a
                period of fifteen (15) days following receipt of written notice from
                the
                Board specifying the nature of such
                breach;

            

    

     

    
      	 	
              (iv)
                

            	
              the
                commission and indictment by Executive of any crime involving moral
                turpitude or a felony; and

            

    

     

    
      	 	
              (v)
                

            	
              Executive’s
                performance or omission of any act which, in the judgment of the
                Board, if
                known to the customers, clients, stockholders or any regulators of
                the
                Company, would have a material and adverse impact on the business
                of the
                Company.

            

    

     

    
      	 	
              (b)

            	
              Termination
                for Good Reason.
                Executive shall have the right at any time to terminate his employment
                with the Company upon not less than thirty (30) days prior written
                notice
                of termination for Good Reason (defined below). For purposes of this
                Agreement and subject to the Company’s opportunity to cure as provided in
                Section 4(c) hereof, Executive shall have Good Reason to terminate
                his
                employment hereunder if such termination shall be the result
                of:

            

    

     

    
      	
            	(i)	
              the
                Company’s material breach of this Agreement;
                or

            

    

     

    
      	 	
              (ii)

            	
              A
                requirement by the Company that Executive perform any act or refrain
                from
                performing any act that would be in violation of any applicable
                law;

            

    

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (iii)

            	
              The
                Company is acquired by another entity.

            

    

     

    
      	 	
              (c)

            	
              Notice
                and Opportunity to Cure.
                Notwithstanding the foregoing, it shall be a condition precedent
                to the
                Company’s right to terminate Executive’s employment for Cause and
                Executive’s right to terminate for Good Reason that (i) the party seeking
                termination shall first have given the other party written notice
                stating
                with specificity the reason for the termination (“breach”) and (ii) if
                such breach is susceptible of cure or remedy, a period of fifteen
                (15)
                days from and after the giving of such notice shall have elapsed
                without
                the breaching party having effectively cured or remedied such breach
                during such 15-day period, unless such breach cannot be cured or
                remedied
                within fifteen (15) days, in which case the period for remedy or
                cure
                shall be extended for a reasonable time (not to exceed an additional
                thirty (30) days) provided the breaching party has made and continues
                to
                make a diligent effort to effect such remedy or
                cure.

            

    

    

    
      	 	
              (d)

            	
              Voluntary
                Termination.
                Executive, at his election, may terminate his employment upon not
                less
                than sixty (60) days prior written notice of termination other than
                for
                Good Reason.

            

    

    

    
      	 	
              (e)

            	
              Termination
                Upon Death or Permanent and Total Disability.
                The Employment Period shall be terminated by the death of Executive.
                The
                Employment Period may be terminated by the Board of Directors of
                the
                Company if Executive shall be rendered incapable of performing his
                duties
                to the Company by reason of any medically determined physical or
                mental
                impairment that can be reasonably expected to result in death or
                that can
                be reasonably be expected to last for a period of either (i) six
                (6) or
                more consecutive months from the first date of Executive’s absence due to
                the disability or (ii) nine (9) months during any twelve-month period
                (a
                “Permanent and Total Disability”). If the Employment Period is terminated
                by reason of a Permanent and Total Disability of Executive, the Company
                shall give thirty (30) days’ advance written notice to that effect to
                Executive.

            

    

    

    
      	 	
              (f)

            	
              Termination
                at the Election of the Company. At
                the election of the Company, otherwise than for Cause as set forth
                in
                Section 4(a) above, upon not less than sixty (60) days prior written
                notice of termination.

            

    

    

    
      	 	
              (g)

            	
              Termination
                for Business Failure.
                Anything contained herein to the contrary notwithstanding, in the
                event
                the Company’s business is discontinued because continuation is rendered
                impracticable by substantial financial losses, lack of funding, legal
                decisions, administrative rulings, declaration of war, dissolution,
                national or local economic depression or crisis or any reasons beyond
                the
                control of the Company, then this Agreement shall terminate as of
                the day
                the Company determines to cease operation with the same force and
                effect
                as if such day of the month were originally set as the termination
                date
                hereof. In the event this Agreement is terminated pursuant to this
                Section
                4(g), the Executive will not be entitled to severance
                pay.

            

    

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              5.

            	
              Consequences
                of Termination

            

    

    

    
      	 	
              (a)

            	
              By
                Executive for Good Reason or the Company Without Cause.
                In the event of a termination of Executive’s employment during the
                Employment Period by Executive for Good Reason pursuant to Section
                4(b) or
                the Company without Cause pursuant to Section 4(f) the Company shall
                pay
                Executive (or his estate) and provide him with the following, provided
                that Executive enter into a release of claims agreement agreeable
                to the
                Company and Executive:

            

    

    

    
      	 	
              (i)

            	
              Cash
                Payment.
                A
                cash payment, payable over a six (6) month period after Executive’s
                termination of employment, equal to the sum of the
                following:

            

    

     

    
      	 	
              (A)

            	
              Salary.
                The equivalent of six (6) months (the “Severance Period”) of Executive’s
                then-current base salary; plus

            

    

     

    
      	 	
              (B)

            	
              Earned
                but Unpaid Amounts.
                Any previously earned but unpaid salary through Executive’s final date of
                employment with the Company, and any previously earned but unpaid
                bonus
                amounts prior to the date of Executive’s termination of
                employment.

            

    

    

    
      	 	
              (C)

            	
              Equity.
                All Options vested at time of termination shall be retained by Executive
                and all Options that are not vested shall be accelerated and be deemed
                vested for purposes of this Section
                5.

            

    

    

    
      	 	
              (ii)

            	
              Other
                Benefits.
                The Company shall provide continued coverage for the Severance Period
                under all health, life, disability and similar employee benefit plans
                and
                programs of the Company on the same basis as Executive was entitled
                to
                participate immediately prior to such termination, provided that
                Executive’s continued participation is possible under the general terms
                and provisions of such plans and programs. In the event that Executive’s
                participation in any such plan or program is barred, the Company
                shall use
                its commercially reasonable efforts to provide Executive with benefits
                substantially similar (including all tax effects) to those which
                Executive
                would otherwise have been entitled to receive under such plans and
                programs from which his continued participation is barred. In the
                event
                that Executive is covered under substitute benefit plans of another
                employer prior to the expiration of the Severance Period, the Company
                will
                no longer be obligated to continue the coverages provided for in
                this
                Section 5(a)(ii).

            

    

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              (b)

            	
              Other
                Termination of Employment.
                In the event that Executive’s employment with the Company is terminated
                during the Employment Period by the Company for Cause (as provided
                for in
                Section 4(a) hereof) or by Executive other than for Good Reason (as
                provided for in Section 4(b) hereof), the Company shall pay or grant
                Executive any earned but unpaid salary, bonus, and Options through
                Executive’s final date of employment with the Company, and the Company
                shall have no further obligations to
                Executive.

            

    

    

    
      	 	
              (c)

            	
              Withholding
                of Taxes.
                All payments required to be made by the Company to Executive under
                this
                Agreement shall be subject only to the withholding of such amounts,
                if
                any, relating to tax, excise tax and other payroll deductions as
                may be
                required by law or regulation.

            

    

    

    
      	 	
              (d)

            	
              No
                Other Obligations.
                The benefits payable to Executive under this Agreement are not in
                lieu of
                any benefits payable under any employee benefit plan, program or
                arrangement of the Company, except as specifically provided herein,
                and
                Executive will receive such benefits or payments, if any, as he may
                be
                entitled to receive pursuant to the terms of such plans, programs
                and
                arrangements. Except for the obligations of the Company provided
                by the
                foregoing and this Section 5, the Company shall have no further
                obligations to Executive upon his termination of
                employment.

            

    

    

    
      	 	
              (e)

            	
              Mitigation
                or Offset.
                Executive shall be required to mitigate the damages provided by this
                Section 5 by seeking substitute employment or otherwise and there
                shall be
                an offset of the payments or benefits set forth in this Section
                5.

            

    

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              6.

            	
              Governing
                Law 

            

    

    

    This
      Agreement and the rights and obligations of the parties hereto shall be
      construed in accordance with the laws of the Commonwealth of Virginia, without
      giving effect to the principles of conflict of laws.

    

    
      	 	
              7.

            	
              Indemnity
                and Insurance

            

    

    

    The
      Company shall indemnify and save harmless Executive for any liability incurred
      by reason of any act or omission performed by Executive while acting in good
      faith on behalf of the Company and within the scope of the authority of
      Executive pursuant to this Agreement and to the fullest extent provided under
      the Bylaws, the Articles of Incorporation and the Stock Corporation Act of
      Virginia, except that Executive must have in good faith believed that such
      action was in, or not opposed to, the best interests of the Company, and, with
      respect to any criminal action or proceeding, had no reasonable cause to believe
      that such conduct was unlawful.

    

    The
      Company shall provide that Executive is covered by any Directors and Officers
      insurance that the Company provides to other senior executives and/or board
      members.

    

    
      	 	
              8.

            	
              Cooperation
                with the Company After Termination of
                Employment

            

    

    

    Following
      termination of Executive’s employment for any reason, Executive shall fully
      cooperate with the Company in all matters relating to the winding up of
      Executive’s pending work on behalf of the Company including, but not limited to,
      any litigation in which the Company is involved, and the orderly transfer of
      any
      such pending work to other employees of the Company as may be designated by
      the
      Company. Following any notice of termination of employment by either the Company
      or Executive, the Company shall be entitled to such full time or part time
      services of Executive as the Company may reasonably require during all or any
      part of the sixty (60)-day period following any notice of termination, provided
      that Executive shall be compensated for such services at the same rate as in
      effect immediately before the notice of termination.

    

    
      	 	
              9.

            	
              Notice

            

    

    

    All
      notices, requests and other communications pursuant to this Agreement shall
      be
      sent by overnight mail of by fax with proof of transmission to the following
      addresses:

    

    If
      to
      Executive:

    

    Michael
      Brown

    P.
      O. Box
      4544

    Boulder,
      Colorado 80306

    Phone:
      (303) 954-8242 

    Email: Michaelbrown@att.net

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

     

    If
      to the
      Company:

    

    InferX
      Corporation

    Attn:
      Scott Parliament, Chief Financial Officer and Corporate Secretary

    1600
      International Drive

    Suite
      110

    McLean,
      Virginia 22102

    Phone:
      (703) 917-0880

    Fax: (703)
      917-0563

    Email sparliament@inferx.com

    

    
      	 	
              10.

            	
              Waiver
                of Breach

            

    

    

    Any
      waiver of any breach of this Agreement shall not be construed to be a continuing
      waiver or consent to any subsequent breach on the part of either Executive
      or of
      the Company.

    

    
      	 	
              11.

            	
              Non-Assignment
                / Successors

            

    

    

    Neither
      party hereto may assign his/her or its rights or delegate his/hers or its duties
      under this Agreement without the prior written consent of the other party;
      provided, however, that (i) this Agreement shall inure to the benefit of and
      be
      binding upon the successors and assigns of the Company upon any sale or all
      or
      substantially all of the Company’s assets, or upon any merger, consolidation or
      reorganization of the Company with or into any other corporation, all as though
      such successors and assigns of the Company and their respective successors
      and
      assigns were the Company; and (ii) this Agreement shall inure to the benefit
      of
      and be binding upon the heirs, assigns or designees of Executive to the extent
      of any payments due to them hereunder. As used in this Agreement, the term
      “Company” shall be deemed to refer to any such successor or assign of the
      Company referred to in the preceding sentence.

    

    
      	 	
              12.

            	
              Severability

            

    

    

    To
      the
      extent any provision of this Agreement or portion thereof shall be invalid
      or
      unenforceable, it shall be considered deleted there from and the remainder
      of
      such provision and of this Agreement shall be unaffected and shall continue
      in
      full force and effect.

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    
      	 	
              13.

            	
              Counterparts

            

    

    

    This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed to be an original but all of which together will constitute one and
      the
      same instrument.

    

    
      	 	
              14.

            	
              Arbitration
                

            

    

    

    Executive
      and the Company shall submit to mandatory and exclusive binding arbitration,
      any
      controversy or claim arising out of, or relating to, this Agreement or any
      breach hereof where the amount in dispute is greater than or equal to $50,000,
      provided,
      however,
      that
      the parties retain their right to, and shall not be prohibited, limited or
      in
      any other way restricted from, seeking or obtaining equitable relief from a
      court having jurisdiction over the parties. In the event the amount of any
      controversy or claim arising out of, or relating to, this Agreement, or any
      breach hereof, is less than $50,000, the parties hereby agree to submit such
      claim to mediation. Such arbitration shall be governed by the Federal
      Arbitration Act and conducted through the American Arbitration Association
      (“AAA”) in the District of Columbia, before a single neutral arbitrator, in
      accordance with the National Rules for the Resolution of Employment Disputes
      of
      the American Arbitration Association in effect at that time. The parties may
      conduct only essential discovery prior to the hearing, as defined by the AAA
      arbitrator. The arbitrator shall issue a written decision which contains the
      essential findings and conclusions on which the decision is based. Mediation
      shall be governed by, and conducted through, the AAA. Judgment upon the
      determination or award rendered by the arbitrator may be entered in any court
      having jurisdiction thereof.

    

    
      	 	
              15.

            	
              Entire
                Agreement

            

    

    

    This
      Agreement and all schedules and other attachments hereto constitute the entire
      agreement by the Company and Executive with respect to the subject matter hereof
      and, except as specifically provided herein, supersedes any and all prior
      agreements or understandings between Executive and the Company with respect
      to
      the subject matter hereof, whether written or oral. This Agreement may be
      amended or modified only by a written instrument executed by Executive and
      the
      Company.

     

    Signature
      page follows

    

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

    

     

    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date
      above

    

    
      	 	
              INFERX
                CORPORATION 

            	 
	 	 	 	 
	 	
              /s/
                Scott
                Parliament                  
                

            	 
	 	
              By:
                

            	
              Scott
                Parliament

            	 
	 	
              Its:
                

            	
              Chief
                Financial Officer and Corporate Secretary

            
	 	 	 	 
	 	 	 	 
	 	
              EXECUTIVE

            	 
	 	 	 	 
	 	
              /s/
                Michael
                Brown                  
                

            	 
	 	
              Michael
                Brown

            	 

    

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    Exhibit
      A

     

    Employee
      Proprietary Information, Inventions, and Non-Competition
      Agreement

     

    
      
        
        

      

      
        -11-Unassociated Document

     

    

      
        	
                

              	
                100
                  N. Barranca Ave. #810

                West
                  Covina, California 91791

                Tel:
                  (626) 839-9116

              

      

      

      

      March
        __,
        2008

      

      

      Via
        Electronic Mail

      

      [director
        candidate name]

      [address]

      

      

      Re:     Board
        of Directors - Offer Letter

      

      Dear        :

      

      Ever-Glory
        International Group, Inc., a Florida corporation (the “Company”), is pleased to
        offer you a director position on its Board of Directors (the “Board”). The
        Board’s purpose is to oversee or direct the property, affairs and business of
        the Company. 

      

      Should
        you chose to accept this position as a member of the Board, this letter shall
        constitute an agreement between you and the Company (the “Agreement”) and
        contains all the terms and conditions relating to the services you are to
        provide.

      

      1.    Term.
        This
        Agreement shall be for the ensuing year, commencing on March __, 2008 (the
        “Effective Date”). Your term as director shall continue until your successor is
        duly elected and qualified. The position shall be up for re-election each
        year
        at the annual shareholder’s meeting and upon re-election, the terms and
        provisions of this agreement shall remain in full force and effect unless
        otherwise revised on such terms as mutually agreed to by you and the
        Company.

      

      2.    Services.
        You
        shall render services in the area of overseeing or directing the Company’s
        property, affairs and business (hereinafter your “Duties”). Every year, the
        Board shall hold such number meetings at such times and locations as determined
        by the Chairman of the Board, and participate in the meetings via
        teleconference, video conference or in person. Upon the reasonable request
        of
        the Chairman, you agree to attend one or more board meetings in person (each,
        an
“Attended Meeting”). You shall consult with the other members of the Board as
        necessary via telephone, electronic mail or other forms of correspondence.
        In
        addition, you agree to be appointed to certain special committees of the
        Board,
        initially consisting of the Audit and Compensation Committees, and participate
        as necessary, in person or via teleconference or video conference in the
        meetings of those special committees. 

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      3.    Services
        for Others.
        You will
        be free to represent or perform services for other persons during the term
        of
        this Agreement. However, you agree that you do not presently perform and
        do not
        intend to perform, during the term of this Agreement, similar Duties, consulting
        or other services for companies whose businesses are or would be, in any
        way,
        competitive with the Company (except for companies previously disclosed by
        you
        to the Company in writing). Should you propose to perform similar Duties,
        consulting or other services for any such company, you agree to notify the
        Company in writing in advance (specifying the name of the organization for
        whom
        you propose to perform such services) and to provide information to the Company
        sufficient to allow it to determine if the performance of such services would
        conflict with areas of interest to the Company.

      

      4.    Compensation.
        In
        consideration for your service as a member of the Board, the Company agrees
        to
        pay you the following annual compensation (the “Annual Compensation”) for 2008:

      

        
          	
                  Service
                    Description

                	
                  Amount
                    (in U.S. dollars)

                
	 	 
	
                  [Base
                    Compensation

                	
                  $3,000]  
                        

                
	
                  [Audit
                    Committee Member

                	
                  $1,000]  
                        

                
	
                  [Compensation
                    Committee Member

                	
                  $1,000]  
                        

                
	
                  [Audit
                    Committee Chairman

                	
                  $3,000]  
                        

                
	
                  [Audit
                    Committee Financial Expert

                	
                  $26,000]  
                        

                
	 	
                
	
                  Total:
                    

                	
                  $[_______]  
                        

                

        

      

      

      The
        Annual Compensation shall be paid to you in such number of shares of the
        Company’s restricted common stock having the aggregate value equal to the Annual
        Compensation, as determined by the average per share closing prices of the
        Company’s common stock as quoted on the OTC Bulletin Board or national exchange,
        as applicable, for the five trading days leading up to and including the
        last
        trading date of the second quarter of the year for which compensation is
        being
        paid. The restricted shares of the Company’s common stock described in this
        Section 4 are collectively referred to as the “Shares”. Compensation, in the
        form of shares, shall be issued and paid semi-annually, within 30 days following
        the end of the second quarter (beginning with the second quarter of 2008),
        and
        within 30 days after the end of the fourth quarter, of each calendar year.
        In
        addition, the Annual Compensation will be pro rated daily (based on a 360
        day
        year) for any portion of the year during which you serve as a director.

      

      If
        the
        Chairman requests your presence at an Attended Meeting, the Company agrees
        to
        reimburse all of your travel and other reasonable expenses relating to the
        Attended Meeting. In addition, the Company agrees to reimburse you for
        reasonable expenses that you incur in connection with the performance of
        your
        duties as a director of the Company. 

      

      Your
        compensation as a director and for service on committees in any future periods
        is subject to the determination of the Board of Directors, and may differ
        in
        future periods should you continue to serve on the board. 

      

      5.    D&O
        Insurance Policy.
        The
        Company agrees to obtain, within a reasonable time, Directors and Officers
        Liability Insurance from an internationally recognized underwriter with terms
        of
        coverage appropriate for a company of our size and nature, which shall be
        maintained throughout the term of this Agreement. 

      

      6.    No
        Assignment.
        Because
        of the personal nature of the services to be rendered by you, this Agreement
        may
        not be assigned by you without the prior written consent of the Company.
        

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      7.    Confidential
        Information; Non-Disclosure.
        In
        consideration of your access to the premises of the Company and/or you access
        to
        certain Confidential Information of the Company, in connection with your
        business relationship with the Company, you hereby represent and agree as
        follows: 

      

      a.    Definition.
        For
        purposes of this Agreement the term “Confidential Information”
means:

      

      i.    Any
        information which the Company possesses that has been created, discovered
        or
        developed by or for the Company, and which has or could have commercial value
        or
        utility in the business in which the Company is engaged; or

      

      ii.    Any
        information which is related to the business of the Company and is generally
        not
        known by non-Company personnel. 

      

      iii.    By
        way of
        illustration, but not limitation, Confidential Information includes trade
        secrets and any information concerning products, processes, formulas, designs,
        inventions (whether or not patentable or registrable under copyright or similar
        laws, and whether or not reduced to practice), discoveries, concepts, ideas,
        improvements, techniques, methods, research, development and test results,
        specifications, data, know-how, software, formats, marketing plans, and
        analyses, business plans and analyses, strategies, forecasts, customer and
        supplier identities, characteristics and agreements. 

      

      b.    Exclusions.
        Notwithstanding the foregoing, the term Confidential Information shall not
        include: 

      

      i.    Any
        information which becomes generally available to the public other than as
        a
        result of a breach of the confidentiality portions of this agreement, or
        any
        other agreement requiring confidentiality between the Company and you;

      

      ii.    Information
        received from a third party in rightful possession of such information who
        is
        not restricted from disclosing such information; and 

      

      iii.    Information
        known by you prior to receipt of such information from the Company, which
        prior
        knowledge can be documented. 

      

      c.    Documents.
        You
        agree that, without the express written consent of the Company, you will
        not
        remove from the Company’s premises, any notes, formulas, programs, data,
        records, machines or any other documents or items which in any manner contain
        or
        constitute Confidential Information, nor will you make reproductions or copies
        of same. In the event you receive any such documents or items by personal
        delivery from any duly designated or authorized personnel of the Company,
        you
        shall be deemed to have received the express written consent of the Company.
        In
        the event that you receive any such documents or items, other than through
        personal delivery as described in the preceding sentence, you agree to inform
        the Company promptly of your possession of such documents or items. You shall
        promptly return any such documents or items, along with any reproductions
        or
        copies to the Company upon the Company’s demand or upon termination of this
        agreement. 

      

      d.    No
        Disclosure.
        You
        agree that you will hold in trust and confidence all Confidential Information
        and will not disclose to others, directly or indirectly, any Confidential
        Information or anything relating to such information without the prior written
        consent of the Company, except as maybe necessary in the course of his business
        relationship with the Company. You further agree that you will not use any
        Confidential Information without the prior written consent of the Company,
        except as may be necessary in the course of your business relationship with
        the
        Company, and that the provisions of this paragraph (d) shall survive termination
        of this agreement.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      8.    Certain
        Representations.
        You
        represent and agree that you are accepting the Shares for your own account
        and
        not with a view to or for sale in connection with any distribution thereof.
        You
        understand that the Shares will be subjected to the restrictions in the
        Company’s Articles of Incorporation and Bylaws and will not be freely
        transferable. You further represent that you are an “accredited” investor as
        this term is defined in the Securities Act, and that by reason of your business
        or financial experience, you have the capacity to protect your own interest
        in
        connection with receiving the Shares as compensation. You further represent
        that
        you were not solicited by publication of any advertisement in connection
        with
        the receipt of the Shares and that you have consulted tax counsel as needed
        regarding the Shares.

      

      9.    Independent
        Contractor.
        In
        performing your services on the Board, you will be an independent contractor
        and
        not an employee of the Company. Except as set forth in this Agreement, you
        will
        not be entitled to any additional compensation or participate in any benefit
        plans of the Company in connection with your services on the Board. You may
        not
        bind the Company or act as a principal or agent thereof.

      

      10.    Entire
        Agreement; Amendment; Waiver.
        This
        Agreement expresses the entire understanding with respect to the subject
        matter
        hereof and supersedes and terminates any prior oral or written agreements
        with
        respect to the subject matter hereof. Any term of this Agreement may be amended
        and observance of any term of this Agreement may be waived only with the
        written
        consent of the parties hereto. Waiver of any term or condition of this Agreement
        by any party shall not be construed as a waiver of any subsequent breach
        or
        failure of the same term or condition or waiver of any other term or condition
        of this Agreement. The failure of any party at any time to require performance
        by any other party of any provision of this Agreement shall not affect the
        right
        of any such party to require future performance of such provision or any
        other
        provision of this Agreement.

      

      The
        Agreement has been executed and delivered by the undersigned and is made
        effective as of the date set first set forth above. 

      
        	 	 	 
	 	Sincerely,
	 	 
	 	EVER-GLORY
                INTERNATIONAL GROUP, INC.
	 
 	 
 	 
 
	 	By:  	 
	 	
                
    Kang
                Yihua
	 	    Chief
                Executive Officer 

      

      

      AGREED
        AND ACCEPTED:

      

      

      

      
        
          

        
[name of director]

       

      
        
          
          

        

        
          4

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