Document:

ex_159317.htm

Exhibit 10.3

CHANGE IN CONTROL AGREEMENT

(Executive Officers)

 

THIS CHANGE IN CONTROL AGREEMENT entered into as of September 30, 2019 (the “Effective Date”) by and between Ottawa Savings Bank, (the “Bank”) and Mark M. Stoudt (the “Executive”) and Ottawa Bancorp, Inc., the holding company for the Bank (the “Company”), as guarantor (the “Agreement”).

 

WHEREAS, to continue to encourage Executive’s dedication to his assigned duties in the face of potential distractions arising from the prospect of a Change in Control, the Bank wishes to provide certain benefits and payments in the event Executive’s employment is terminated involuntarily without Cause or voluntarily for Good Reason within twelve (12) months of a Change in Control.

 

NOW THEREFORE, in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows.

 

1.     Termination after a Change in Control. 

 

(a)     Cash benefit. Notwithstanding any other provisions in this Agreement, if the Executive’s employment terminates involuntarily but without Cause (as defined in paragraph (d) of this Section 1) or voluntarily but with Good Reason (as defined in paragraph (e) of this Section 1) , in either case within 12 months after a Change in Control, the Bank shall make a lump-sum cash payment equal to two (2) times the sum of Executive’s: (i) base salary (at the rate in effect immediately prior to the Change in Control or, if higher, the rate in effect when the Executive terminates employment) and (ii) the most recent cash incentive award paid by the Company and/or the Bank to the Executive.  Unless a delay in payment is required under Section 1(b) of this Agreement, the payment required under this Section 1(a) shall be made within five (5) business days after the Executive’s employment termination.

 

(b)     Payment of the cash benefit. If the Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) at the time his/her employment terminates and the cash severance benefit under Section 1(a) is considered deferred compensation under Section 409A of the Code, and finally if an exemption from the six-month delay requirement of Section 409A(a)(2)(B)(i) of the Code is not available, payment of the benefit under Section 1(a) shall be delayed and shall be made to the Executive in a single lump sum without interest on the first business day of the seventh (7th) month after the month in which the Executive’s employment terminates, subject to Section 16 of this Agreement.

 

(c)     Change in Control defined. For purposes of this Agreement, a “Change in Control” means any of the following events:

 

	 	
			(i)

				
			Merger: The Company or the Bank merges into or consolidates with another corporation, or merges another corporation into the Company or the Bank, and as a result less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of the Company or the Bank immediately before the merger or consolidation.

			

 

 

 

 

	 	(ii)	Acquisition of Significant Share Ownership: There is filed, or required to be filed, a report on Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner of 25% or more of a class of the Company’s voting securities, but this clause (ii) shall not apply to beneficial ownership of Company voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns 50% or more of its outstanding voting securities.
	 	 	 
	 	(iii)	Change in Board Composition: During any period of two consecutive years, individuals who constitute the Company’s or the Bank’s Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of the Company’s or the Bank’s Board of Directors; provided, however, that for purposes of this clause (iii), each director who is first elected by the board (or first nominated by the board for election by the stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the beginning of the two-year period shall be deemed to have also been a director at the beginning of such period; or
	 	 	 
	 	(iv)	Sale of Assets: The Company or the Bank sells to a third party all or substantially all of its assets.

 

(d)     Cause defined. For purposes of this Agreement involuntary termination of the Executive’s employment shall be considered termination with Cause if the Executive shall have been terminated for any of the following reasons:

 

	 	
			(i)

				
			Personal dishonesty;

			

	 	
			(ii)

				
			Willful misconduct;

			

	 	
			(iii)

				
			Breach of fiduciary duty involving personal profit;

			

	 	
			(iv)

				
			Intentional failure to perform stated duties;

			

	 	
			(v)

				
			Willful violation of any law, rule or regulation (other than traffic violations or similar offenses) that reflect adversely on the reputation of the Bank or the Company, any felony conviction, any violation of law involving moral turpitude or any violation of a final cease-and-desist order; or

			

	 	
			(vi)

				
			Material breach by Executive of any provision of this Agreement.

			

 

2

 

 

Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause by the Bank or the Company unless there shall have been delivered to Executive a copy of a resolution duly adopted by the affirmative vote of a majority of the entire membership of the Board at a meeting of such Board called and held for the purpose (after reasonable notice to Executive and an opportunity for Executive to be heard before the Board with counsel), of finding that, in the good faith opinion of the Board, Executive was guilty of the conduct described above and specifying the particulars thereof.

 

(e)     Good Reason defined. For purposes of this Agreement, “Good Reason” shall mean, unless consented in writing thereto, the occurrence of any of the following within 12 months of a Change in Control:

 

(i)     The assignment to the Executive of duties that constitute a material diminution of his authority, duties, or responsibilities (including reporting requirements)

 

(ii)     A material diminution in the Executive’s base compensation; or

 

(iii)     Relocation of the Executive’s primary workplace to a location outside a radius of 40 miles of the Company’s corporate headquarters in Ottawa, Illinois;

 

provided, however, that within ninety (90) days after the initial existence of such event, the Bank shall be given notice and an opportunity, not less than thirty (30) days, to effectuate a cure for such asserted “Good Reason” by the Executive. The Executive’s resignation hereunder for Good Reason shall not occur later than sixty (60) days following the initial date on which the event the Executive claims constitutes Good Reason occurred.

 

2.     Continuation of Benefits. 

 

(a)     If the Executive timely and properly elects continued Bank-provided group health plan coverage pursuant to the Consolidated Omnibus Reconciliation Act of 1985, as amended (“COBRA”), the Bank shall provide the Executive with a lump sum cash payment, within 30 days of his termination of employment, equal to (on an after-tax amount determined using an assumed aggregate tax rate of 40%) the monthly cost for the Bank’s group health and dental plans under which the Executive was covered at the time of his termination of employment multiplied by 24.

 

(b)     In addition to the cash benefits in Sections 1(a) and 2(a) of the Agreement, the Bank shall pay to the Executive any earned and unpaid annual cash incentive award for the completed fiscal year preceding the fiscal year in which the Change in Control occurs, calculated by taking into account the degree of achievement of the applicable objective performance goals for such preceding fiscal year, in a lump sum on the date on which the annual cash incentive award would have been paid to the Executive but for the Executive’s termination of employment. The treatment of any outstanding equity awards shall be determined in accordance with the terms of the applicable equity plan and the applicable award agreements evidencing such awards.

 

3

 

 

3.     Termination for Which No Benefits Are Payable. Despite anything in this Agreement to the contrary, the Executive shall be entitled to no benefits under this Agreement if the Executive’s employment terminates with Cause, if the Executive dies while actively employed by the Bank, or if the Executive becomes totally disabled while actively employed by the Bank. For purposes of this Agreement, the term “totally disabled” means that because of injury or sickness the Executive is unable to perform the Executive’s duties. The benefits, if any, payable to the Executive or the Executive’s beneficiary or estate relating to the Executive’s death or disability shall be determined solely by such benefit plans or arrangements as the Bank may have with the Executive relating to death or disability, not by this Agreement.

 

4.     Term of Agreement. 

 

(a)     The term of this Agreement shall consist of: (i) the period commencing on the Effective Date and ending September 30, 2021, plus (ii) any and all extensions of the initial term made pursuant to this Section 4.

 

(b)     Commencing on September 30, 2020 (the “anniversary date”) and continuing on each subsequent anniversary date thereafter, the disinterested members of the Board of Directors of the Bank may extend the Agreement term for an additional year, so that the remaining term of the Agreement, following Board action, will be two (2) years, unless Executive elects not to extend the term of this Agreement by giving proper written notice. The Board of Directors of the Bank will review the Agreement and Executive’s performance annually for purposes of determining whether to extend the Agreement term and will include the rationale and results of its review in the minutes of the meetings. The Board of Directors of the Bank will notify Executive as soon as possible after each annual review whether it has determined to extend the term of the Agreement.

 

5.     Change in Control Best Payments Determination. 

 

Notwithstanding any other provision of this Agreement to the contrary, if payments made or benefits provided pursuant to Sections 1 and 2 or otherwise from the Bank, the Company or any affiliate of the Bank or the Company are considered “parachute payments” under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), then such payments or benefits shall be limited to the greatest amount that may be paid to Executive under Section 280G of the Code without causing any loss of deduction to the Company or its affiliates under such section, but only if, by reason of such reduction, the net after tax benefit to Executive shall exceed the net after tax benefit if such reduction were not made. “Net after tax benefit” for purposes of this Agreement shall mean the sum of (i) the total amounts payable to Executive under Sections 1 and 2, plus (ii) all other payments and benefits which the Executive receives or then is entitled to receive from the Bank, the Company or any affiliate of the Bank or the Company that would constitute a “parachute payment” within the meaning of Section 280G of the Code, less (iii) the amount of federal, state and local income and payroll taxes payable with respect to the foregoing calculated at the maximum marginal tax rates for each year in which the foregoing shall be paid to Executive (based upon the rate in effect for such year as set forth in the Code at the time of termination of Executive’s employment), less (iv) the amount of excise taxes imposed with respect to the payments and benefits described in (i) and (ii) above by Section 4999 of the Code. The determination as to whether and to what extent payments are required to be reduced in accordance with this Section 5 shall be made at the Bank’s expense by an accounting firm or law firm experienced in such matters. Any reduction in payments required by this Section 5 shall occur in the following order: (i) any cash severance, (ii) any other cash amount payable to Executive, (iii) any benefit valued as a “parachute payment,” (iv) the acceleration of vesting of any equity awards that are options, and (v) the acceleration of vesting of any other equity awards. Within any such category of payments and benefits, a reduction shall occur first with respect to amounts that are not “deferred compensation” within the meaning of Section 409A of the Code and then with respect to amounts that are. In the event that acceleration of compensation from equity awards is to be reduced, such acceleration of vesting shall be canceled, subject to the immediately preceding sentence, in the reverse order of the date of grant.

 

4

 

 

6.     This Agreement Is Not an Employment Contract. The parties hereto acknowledge and agree that (x) this Agreement is not a management or employment agreement and (y) nothing in this Agreement shall give the Executive any rights or impose any obligations to continued employment by the Bank or any subsidiary or successor of the Bank.

 

7.     Withholding of Taxes. The Bank may withhold from any benefits payable under this Agreement all Federal, state, local or other taxes as may be required by law, governmental regulation, or ruling.

 

8.     Successors and Assigns.

 

(a)      This Agreement shall inure to the benefit of and be binding upon any corporate or other successor to the Company and the Bank which shall acquire, directly or indirectly, by merger, consolidation, purchase or otherwise, all or substantially all of the assets or stock of the Company and the Bank.

 

(b)     Since the Company and the Bank are contracting for the unique and personal skills of Executive, Executive shall be precluded from assigning or delegating his rights or duties hereunder without first obtaining the written consent of the Company and the Bank.

 

9.     Notices. All notices, requests, demands and other communications in connection with this Agreement shall be made in writing and shall be deemed to have been given when delivered by hand or 48 hours after mailing at any general or branch United States Post Office, by registered or certified mail, postage prepaid, addressed to the Company and/or the Bank at their principal business offices and to Executive at his/her home address as maintained in the records of the Company and the Bank.

 

10.     Captions and Counterparts. The headings and subheadings in this Agreement are included solely for convenience and shall not affect the interpretation of this Agreement. 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 shall constitute one and the same agreement.

 

5

 

 

11.     Amendments. No amendments or additions to this Agreement shall be binding unless made in writing and signed by all of the parties, except as herein otherwise specifically provided.

 

12.     Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof.

 

13.     Applicable Law. Except to the extent preempted by federal law, the laws of Illinois shall govern this Agreement in all respects, whether as to its validity, construction, capacity, performance or otherwise.

 

14.     Entire Agreement. This Agreement, together with any understanding or modifications thereof as agreed to in writing by the parties, shall constitute the entire agreement among the parties hereto with respect to the subject matter hereof, other than written agreements with respect to specific plans, programs or arrangements described in Sections 1 and 2. No agreements or representations, oral or otherwise, expressed or implied concerning the subject matter hereof have been made by either party that are not set forth expressly in this Agreement.

 

15.     No Mitigation. Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise and no such payment shall be offset or reduced by the amount of any compensation or benefits provided to Executive in any subsequent employment.

 

16.     Internal Revenue Code Section 409A. The parties to this Agreement intend for the payments to satisfy the short-term deferral exception under Section 409A of the Code or, in the case of medical, dental and life insurance benefits, not constitute deferred compensation (since such amounts are not taxable to the Executive). However, notwithstanding anything to the contrary in this Agreement, to the extent payments do not meet the short-term deferral exception of Section 409A of the Code and, in the event the Executive is a “Specified Employee” (as defined herein) no payment shall be made to the Executive under this Agreement prior to the first day of the seventh month following termination of employment in excess of the “permitted amount” under Section 409A of the Code. For these purposes the “permitted amount” shall be an amount that does not exceed two times the lesser of: (A) the sum of the Executive’s annualized compensation based upon the annual rate of pay for services provided to the Company for the calendar year preceding the year in which the Executive terminates employment, or (B) the maximum amount that may be taken into account under a tax-qualified plan pursuant to Section 401(a)(17) of the Code for the calendar year in which occurs the termination of employment occurs. The payment of the “permitted amount” shall be made within five (5) business days of the termination of employment. Any payment in excess of the permitted amount shall be made to the Executive on the first day of the seventh month following the Executive’s termination of employment. “Specified Employee” shall be interpreted to comply with Section 409A of the Code and shall mean a key employee within the meaning of Section 416(i) of the Code (without regard to paragraph 5 thereof), but an individual shall be a “Specified Employee” only if the Company is a publicly-traded institution or the subsidiary of a publicly-traded holding company. References in this Agreement to Section 409A of the Code include rules, regulations, and guidance of general application issued by the Department of the Treasury under Section 409A of the Code.

 

6

 

 

17.     Regulatory Limitations.      In no event shall the Bank or the Company be obligated to make any payment pursuant to this Agreement that is prohibited by Section 18(k) of the Federal Deposit Insurance Act (codified at 12 U.S.C. § 1828(k)), 12 C.F.R. Part 359, or any other applicable law.

 

18.     Arbitration. Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before a panel of three arbitrators (selected by the Bank and agreed to by the Executive) who are sitting in Ottawa, Illinois in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

 

 

19.     Source of Payments. All payments provided in this Agreement shall be timely paid in cash or check from the general funds of the Bank. The Company, however, unconditionally guarantees payment and provision of all amounts and benefits due hereunder to Executive and, if such amounts and benefits due from the Bank are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

 

[Signature page to follow]

7

 

 

IN WITNESS WHEREOF, the parties have executed this Change in Control Agreement as of September 30, 2019.

 

 

	 	OTTAWA SAVINGS BANK
	 	 
	 	 
	 	 
	 	/s/ William J. Kuiper
	 	On behalf of the Board of Directors
	 	 
	 	 
	 	 
	 	 
	 	/s/ Mark M. Stoudt
	 	Executive
	 	 
	 	 
	 	OTTAWA BANCORP,  INC.
	 	(as guarantor)
	 	 
	 	 
	 	 
	 	/s/ Jon L. Kranov

 

8Exhibit 10.1

 

Executive
Employment Agreement

 

This
Executive Employment Agreement (“Agreement”) is entered into as of October 1, 2019 by and between
Song Tiewei (“Executive”) and NF Energy Saving Corporation, a Delaware corporation (the
“Company”), to become effective as of the Effective Date (as defined in Appendix A).

 

Certain
capitalized terms in this Agreement have the meanings set forth in Appendix A attached to this Agreement, which
is incorporated into this Agreement in its entirety.

 

	1.	EMPLOYMENT

 

The
Company agrees to employ Executive, and Executive agrees to accept employment by the Company as its CEO and report
to the Company’s Board of directors. The term of cooperation hereunder is two (2) years, from October 1,
2019 to September 30th, 2021.

 

Subject
to Sections 3.3 and 3.4, changes may be made from time to time by the Company in its sole discretion to the duties, reporting
relationships and title of Executive. Executive will perform the duties as are commensurate and consistent with Executive’s position
and will devote Executive’s full working time, attention and efforts to the Company and to discharging the responsibilities of
Executive’s position, and such other duties as may be assigned from time to time by the Company, which relate to the business
of the Company and are reasonably consistent with Executive’s position. During Executive’s employment, Executive will not engage
in any business activity that, in the reasonable judgment of the Board of Directors, conflicts with the duties of Executive under
this Agreement, whether or not such activity is pursued for gain, profit or other advantage. Executive agrees to comply with the
Company’s standard policies and procedures, and with all applicable laws and regulations.

 

	2.	COMPENSATION
                                         AND BENEFITS

 

The
Company agrees to pay or cause to be paid to Executive and Executive agrees to accept in exchange for the services rendered hereunder
the following compensation and benefits:

 

		2.1	Annual
                                         Salary

 

Executive’s
compensation shall consist of an annual base salary (the “Salary”) of $500,000, payable in semi-monthly
installments in accordance with the payroll practices of the Company. The Salary shall be reviewed, and shall be subject to change,
by the Board of Directors (or the Compensation Committee thereof), as applicable, at least annually while Executive is employed
hereunder.

 

		2.2	Bonus
                                         And Equity Awards

 

Executive
shall be eligible to participate in the Company’s incentive bonus plans as may be adopted from time to time by the Board of Directors
(or the Compensation Committee thereof), subject to and in accordance with the terms and conditions of such plans. Executive also
may be eligible to receive equity awards under the Company’s equity plan, as may be adopted from time to time by the Board of
Directors (or the Compensation Committee thereof).

 

     

     

    

 

		2.3	Benefits

 

Executive
shall be eligible to participate, subject to and in accordance with applicable eligibility requirements, in such employee benefit
plans, policies, programs and arrangements as are generally provided to the Company’s other similarly situated executives, which
shall include, at a minimum, basic health, dental and vision insurance.

 

		2.4	Vacation
                                         and Other Paid Time-Off Benefits

 

Each
calendar year, Executive shall be entitled to that number of weeks of paid vacation per year equal to those provided to similarly
situated executives of the Company, in accordance with the plans, policies, programs and arrangements of the Company applicable
to similarly situated executives of the Company generally. Executive also shall be provided such holidays and sick leave as the
Company makes available to all of its other employees.

 

	3.	TERMINATION

 

		3.1	Employment
                                         At Will

 

Executive
acknowledges and understands that employment with the Company is at will and can be terminated by either party for no reason
or for any reason not otherwise specifically prohibited by law. Nothing in this Agreement is intended to alter
Executive’s at-will employment status or obligate the Company to continue to employ Executive for any specific period
of time, or in any specific role or geographic location. Except as expressly provided for in this Agreement, upon any
termination of employment, Executive shall not be entitled to receive any payments or benefits under this Agreement other
than unpaid Salary earned through the date of termination and unused vacation that has accrued as of the date of
Executive’s termination of employment that would be payable under the Company’s standard policy.

 

		3.2	Automatic
                                         Termination on Death or Total Disability

 

This
Agreement and Executive’s employment hereunder shall terminate automatically upon the death or Total Disability of
Executive. “Total Disability” shall mean Executive’s inability, with reasonable
accommodation, to perform the duties of Executive’s position for a period or periods aggregating ninety (90) days in
any period of one hundred eighty (180) consecutive days as a result of physical or mental illness, loss of legal capacity or
any other cause beyond Executive’s control. Executive and the Company hereby acknowledge that Executive’s ability
to perform Executive’s duties is the essence of this Agreement. Termination hereunder shall be deemed to be effective
(a) at the end of the calendar month in which Executive’s death occurs or (b) immediately upon a determination by the
Board of Directors (or the Compensation Committee thereof) of Executive’s Total Disability. In the case of termination
of employment under this Section 3.2, Executive shall not be entitled to receive any payments or benefits under this
Agreement other than unpaid Salary earned through the date of termination and unused vacation that has accrued as of the date
of Executive’s termination of employment that would be payable under the Company’s standard policy.

 

    2

     

    

 

		3.3	Termination
                                         of Employment Without Cause or for Good Reason, Other Than in Connection with a Change
                                         of Control

 

(a) 
If (1) the Company terminates Executive’s employment without Cause (as defined in Appendix A), or (2)
Executive resigns for Good Reason (as defined in Appendix A), then Executive shall be entitled to receive the
following termination payments and benefits; provided, however, that this Section 3.3 shall not apply to, and shall have no
effect in connection with, any termination to which Section 3.2 or Section 3.4 of this Agreement applies:

 

(i) an amount equal to six (6) months’ Salary, at the rate in effect immediately prior to termination, payable to Executive in accordance
with the terms below (“Severance Payments”);

 

(ii) unpaid Salary earned through the date of termination and unused vacation that has accrued and would be payable under the Company’s
standard policy (collectively, the “Accrued Obligations”), payable in a lump sum on the next regularly
scheduled payroll date following the date on which Executive’s employment terminated; and

 

(iii) COBRA continuation coverage paid in full by the Company, so long as Executive has not become actually covered by the medical plan
of a subsequent employer during any such month and is otherwise entitled to COBRA continuation coverage, with such payments for
up to a maximum of six (6) months following the date of termination. After such period, Executive is responsible for paying the
full cost for any additional COBRA continuation coverage to which Executive is then entitled.

 

(b) 
As a condition to receiving the payments and benefits under this Section 3.3 other than the Accrued Obligations, Executive
shall execute (and not revoke within the applicable revocation period) a general release and waiver of all claims against the
Company, which release and waiver shall be in a form acceptable to the Company, and in substantially the form attached hereto
as Appendix B. Such release and waiver shall be delivered to the Company no later than the date specified by
the Company (which date shall in no event be later than twenty-one (21) days or forty-five (45) days, as applicable, after
the date on which Executive is presented with the terms of the release and waiver).

 

(c) 
Notwithstanding the foregoing, termination of employment by Executive will not be for Good Reason unless (1) Executive notifies
the Company in writing of the existence of the condition which Executive believes constitutes Good Reason within thirty (30) days
of the initial existence of such condition (which notice specifically identifies such condition), (2) the Company fails to remedy
such condition within thirty (30) days after the date on which it receives such notice (the “Remedial Period”),
and (3) Executive actually terminates employment within thirty (30) days after the expiration of the Remedial Period and before
the Company remedies such condition. If Executive terminates employment before the expiration of the Remedial Period or after
the Company remedies the condition (even if after the end of the Remedial Period), then Executive’s termination will not be considered
to be for Good Reason.

 

(d) 
Subject to Section 3.3(b), Severance Payments under Section 3.3(a)(i) shall be paid to Executive through the Company’s
normally scheduled payroll during the six (6) month period commencing within sixty (60) days following the date on which Executive’s
employment was terminated without Cause or Executive resigned for Good Reason. Each such payment shall be treated as a separate
payment for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”),
including the rules and regulations thereunder (“Code Section 409A”).

 

    3

     

    

 

		3.4	Termination
                                         of Employment in Connection with a Change of Control

 

		3.4.1	Benefits
for Qualified Terminations in Connection with a Change of Control

 

(a) 
If (1) during the period commencing on the date the Company enters into a definitive agreement with respect to a transaction
that would constitute a Change of Control (as defined in Appendix A) and ending on the date the definitive
agreement therefor is terminated or the Change of Control is consummated, the Company terminates Executive’s employment
without Cause (as defined in Appendix A), (2) during the period commencing upon the consummation of the Change
of Control and ending eighteen (18) months thereafter, the Company or, if applicable, the surviving or successor employer
(“Successor Employer”) terminates Executive’s employment without Cause (as defined in Appendix
A), or (3) during the period commencing upon the consummation of the Change of Control and ending eighteen (18)
months thereafter, Executive resigns for Good Reason (as defined in Appendix A), then Executive shall be
entitled to receive the following termination payments and benefits and shall not also be eligible to receive the payments
and benefits under Section 3.3:

 

(i) an amount equal to $10,000,000, payable to Executive in accordance with the terms below (“CIC Severance Payments”);

 

(ii) Accrued Obligations, payable in a lump sum on the next regularly scheduled payroll date following the date on which Executive’s
employment terminated; and

 

(iii) COBRA continuation coverage paid in full by the Company, so long as Executive has not become actually covered by the medical plan
of a subsequent employer during any such month and is otherwise entitled to COBRA continuation coverage, with such payments for
up to a maximum of six (6) months following the date of termination. After such period, Executive is responsible for paying the
full cost for any additional COBRA continuation coverage to which Executive is then entitled.

 

(b) 
As a condition to receiving the payments and benefits under this Section 3.4.1 other than the Accrued Obligations, Executive shall
execute (and not revoke within the applicable revocation period) a general release and waiver of all claims against the Company,
which release and waiver shall be in a form acceptable to the Company (including any Successor Employer thereto), and in substantially
the form attached hereto as Appendix B. Such release and waiver shall be delivered to the Company (or any Successor
Employer thereto) no later than the date specified by the Company (or any Successor Employer thereto) (which date shall in no
event be later than twenty-one (21) days or forty-five (45) days, as applicable, after the date on which Executive is presented
with the terms of the release and waiver).

 

(c) 
Notwithstanding the foregoing, termination of employment by Executive will not be for Good Reason unless (1) Executive
notifies the Company (or a Successor Employer thereto) in writing of the existence of the condition which Executive believes
constitutes Good Reason within thirty (30) days of the initial existence of such condition (which notice specifically
identifies such condition), (2) the Company (or a Successor Employer thereto) fails to remedy such condition within thirty
(30) days after the date on which it receives such notice (the “Remedial Period”), and (3)
Executive actually terminates employment within thirty (30) days after the expiration of the Remedial Period and before the
Company (or a Successor Employer thereto) remedies such condition. If Executive terminates employment before the expiration
of the Remedial Period or after the Company (or a Successor Employer thereto) remedies the condition (even if after the end
of the Remedial Period), then Executive’s termination will not be considered to be for Good Reason.

 

    4

     

    

 

(d) 
Subject to Section 3.4.1(b), the CIC Severance Payments under Section 3.4.1(a) shall be paid to Executive within sixty (60) days
following the date on which Executive’s employment was terminated without Cause or Executive resigned for Good Reason. Such payment
shall be treated as a separate payment for purposes of Code Section 409A.

 

	4.	ASSIGNMENT

 

This
Agreement is personal to Executive and shall not be assignable by Executive. The Company may assign its rights hereunder to (a)
any Successor Employer; (b) any other corporation resulting from any merger, consolidation or other reorganization to which the
Company is a party; (c) any other corporation, partnership, association or other person to which the Company may transfer all
or substantially all of the assets and business of the Company existing at such time; or (d) any subsidiary, parent or other affiliate
of the Company. All of the terms and provisions of this Agreement shall be binding upon and shall inure to the benefit of and
be enforceable by the parties hereto and their respective successors and permitted assigns.

 

	5.	AMENDMENTS
                                         IN WRITING

 

No
amendment, modification, waiver, termination or discharge of any provision of this Agreement, or consent to any departure therefrom
by either party hereto, shall in any event be effective unless the same shall be in writing, specifically identifying this Agreement
and the provision intended to be amended, modified, waived, terminated or discharged and signed by the Company and Executive,
and each such amendment, modification, waiver, termination or discharge shall be effective only in the specific instance and for
the specific purpose for which given. No provision of this Agreement shall be varied, contradicted or explained by any oral agreement,
course of dealing or performance or any other matter not set forth in an agreement in writing and signed by the Company and Executive.

 

	6.	NOTICES

 

Every
notice relating to this Agreement shall be in writing and shall be given by personal delivery, by a reputable same-day or overnight
courier service (charges prepaid), by registered or certified mail (postage prepaid, return receipt requested) or by facsimile
to the recipient with a confirmation copy to follow the next day to be delivered by personal delivery or by a reputable same-day
or overnight courier service to the appropriate party’s address or fax number below (or such other address and fax number as a
party may designate by notice to the other parties):

 

    5

     

    

 

	 	If to the Company:       	3106,TowerC,390Qingnian
	 	 	Avenue,HepingDistrict,Shenyang,China110015
	 	 	 
	 	If to the Executive:	29th Floor, R&F Center, No. 6 Gangxing Road, Zhongshan District, Dalian, Liaoning, China

 

	7.	APPLICABLE
                                         LAW

 

This
Agreement shall in all respects, including all matters of construction, validity and performance, be governed by, and construed
and enforced in accordance with, the laws of the State of New York, without regard to any rules governing conflicts of laws.

 

	8.	ENTIRE
                                         AGREEMENT

 

This
Agreement, on and as of the Effective Date, constitutes the entire agreement between the Company and Executive with respect to
the subject matter hereof, and all prior or contemporaneous oral or written communications, understandings or agreements between
the Company and Executive with respect to such subject matter are hereby superseded in their entirety, except as otherwise provided
herein.

 

	9.	SEVERABILITY

 

If
any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule
in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement or
any action in any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision had never been contained herein.

 

	10.	WAIVERS

 

No
delay or failure by any party hereto in exercising, protecting, or enforcing any of its rights, titles, interests, or remedies
hereunder, and no course of dealing or performance with respect thereto, shall constitute a waiver thereof. The express waiver
by a party hereto of any right, title, interest, or remedy in a particular instance or circumstance shall not constitute a waiver
thereof in any other instance or circumstance. All rights and remedies shall be cumulative and not exclusive of any other rights
or remedies.

 

	11.	HEADINGS

 

All
headings used herein are for convenience only and shall not in any way affect the construction of, or be taken into consideration
in interpreting, this Agreement.

 

	12.	COUNTERPARTS

 

This
Agreement, and any amendment or modification entered into pursuant to Section 5 hereof, may be executed in any number of counterparts,
each of which counterparts, when so executed and delivered, shall be deemed to be an original and all of which counterparts, taken
together, shall constitute one and the same instrument.

 

    6

     

    

 

IN
WITNESS WHEREOF, the parties have executed and entered into this Agreement effective on the date first set forth above.

 

	 	EXECUTIVE

         

        /s/
         Song Tiewei

	 	Song
    Tiewei
	 	 

        NF

         

        By
	 

        Energy
        Saving Corporation

         

        /s/
        Tan Fengsheng

	 	 	Tan
    Fengsheng
	 	 	 
	 	Its	Director

 

     

     

    

 

Appendix
A

 

Definitions

 

Capitalized
terms used below that are not defined in this Appendix A have the meanings set forth in the Executive Employment
Agreement (“Agreement”) to which this Appendix A is attached. As used in the Agreement,

 

1. “Cause” means the occurrence of one or more of the following events:

 

(a) 
willful misconduct, insubordination or dishonesty in the performance of Executive’s duties or a knowing and material violation
of the Company’s or the Successor Employer’s policies and procedures in effect from time to time which results in a material adverse
effect on the Company or the Successor Employer;

 

(b) 
the continued failure of Executive to satisfactorily perform his duties after receipt of written notice that identifies the areas
in which Executive’s performance is deficient;

 

(c) 
willful actions in bad faith or intentional failures to act in good faith by Executive with respect to the Company or the Successor
Employer that materially impair the Company’s or the Successor Employer’s business, goodwill or reputation;

 

(d) 
conviction of Executive of a felony or misdemeanor, conduct by Executive that the Company reasonably believes violates any statute,
rule or regulation governing the Company, or conduct by Executive that the Company reasonably believes constitutes unethical practices,
dishonesty or disloyalty and that results in a material adverse effect on the Company or the Successor Employer;

 

 (e) current use by Executive of illegal substances; or

 

(f) 
any material violation by Executive of this Agreement or the Company’s Confidential Information, Inventions, Nonsolicitation and
Noncompetition Agreement.

 

2. “Change of Control” means the occurrence of any of the following events:

 

(a) 
an acquisition by any Entity of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
more than 50% of the combined voting power of the then outstanding voting securities of the Company entitled to vote generally
in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that the
following acquisitions shall not constitute a Change of Control: (i) any acquisition directly from the Company, other than an
acquisition by virtue of the exercise of a conversion privilege where the security being so converted was not acquired directly
from the Company by the party exercising the conversion privilege, (ii) any acquisition by the Company, (iii) any acquisition
by any employee benefit plan (or related trust) sponsored or maintained by the Company or any Related Company, or (v) any acquisition
by any Entity pursuant to a transaction that meets the conditions of clauses (i), (ii) and (iii) set forth in the definition of
Company Transaction;

 

     

     

    

 

(b) 
a change in the composition of the Board of Directors of the Company during any two- year period such that the individuals
who, as of the beginning of such two-year period, constitute the Board (the “Incumbent Board”)
cease for any reason to constitute at least a majority of the Board; provided, however, that for purposes of this definition,
any individual who becomes a member of the Board subsequent to the beginning of the two-year period, whose election, or
nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of those
individuals who are members of the Board and who were also members of the Incumbent Board (or deemed to be such pursuant to
this proviso) shall be considered as though such individual were a member of the Incumbent Board; and provided further,
however, that any such individual whose initial assumption of office occurs as a result of or in connection with an actual or
threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation
of proxies or consents by or on behalf of an Entity other than the Board shall not be considered a member of the Incumbent
Board; or

 

 (c) the consummation of a Company Transaction.

 

3. “Company Transaction” means consummation of:

   

 (a) a merger or consolidation of the Company with or into any other company;

 

(b) a statutory share exchange pursuant to which all of the Company’s outstanding shares are acquired or a sale in one transaction
or a series of transactions undertaken with a common purpose of all of the Company’s outstanding voting securities; or

 

(c) a sale, lease, exchange or other transfer in one transaction or a series of related transactions undertaken with a common
purpose of all or substantially all of the Company’s assets, excluding, however, in each case, any such transaction
pursuant to which

 

(i) the Entities who are the beneficial owners of the Outstanding Company Voting Securities immediately prior to such transaction
will beneficially own, directly or indirectly, at least 50% of the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors of the Successor Company in substantially the same proportions as their
ownership, immediately prior to such transaction, of the Outstanding Company Voting Securities;

 

(ii) no Entity (other than the Company, any employee benefit plan (or related trust) of the Company, a Related Company or a Successor
Company) will beneficially own, directly or indirectly, more than 50% of the combined voting power of the outstanding voting securities
of the Successor Company entitled to vote generally in the election of directors unless such ownership resulted solely from ownership
of securities of the Company prior to such transaction; and

 

(iii) individuals who were members of the Incumbent Board will immediately after the consummation of such transaction constitute at
least a majority of the members of the board of directors of the Successor Company.

 

Where
a series of transactions undertaken with a common purpose is deemed to be a Company Transaction, the date of such Company Transaction
shall be the date on which the last of such transactions is consummated.

 

     

     

    

 

4. “Effective Date” shall be the date of this Agreement.

 

 5. “Entity” means any individual, entity or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act).

 

6. “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

7. “Good Reason” means that Executive, without Executive’s express, written consent, has:

 

(a) 
incurred a material reduction in authority, duties or responsibilities at the Company or a Successor Employer (with respect to
a termination in connection with a Change of Control, relative to authority, duties or responsibilities immediately prior to the
Change of Control);

 

(b) 
incurred a material reduction in Executive’s annual Salary or bonus opportunity (except for reductions in connection with a general
reduction in annual Salary for all executives of the Company by an average percentage that is not less than the percentage reduction
of Executive’s annual Salary);

 

(c)
suffered a material breach of this Agreement by the Company or a Successor Employer; or

 

(d)
been required to relocate or travel more than fifty (50) miles from Executive’s then current place of employment in
order to continue to perform the duties and responsibilities of Executive’s position (not including customary travel as
may be required by the nature of Executive’s position).

 

8. 
“Parent Company” means a company or other entity which as a result of a Company Transaction owns the
Company or all or substantially all of the Company’s assets either directly or through one or more intermediaries.

 

9. 
“Related Company” means any entity that is directly or indirectly controlled by, in control of or
under common control with the Company.

 

10.  “Successor
Company” means the surviving company, the successor company or Parent Company, as applicable, in connection with
a Company Transaction.

 

     

     

    

 

Appendix
B

 

Form
of Release

 

In
consideration for the payments and benefits to be provided pursuant to Section 3 of the Executive Employment Agreement (“Agreement”)
entered into by and between Song Tiewei (“Executive”) and NF Energy Saving Corporation,
a Delaware corporation (the “Company”), with an effective date of October 1, 2019, Executive agrees
to the following:

 

(a) 
Executive represents that Executive has not filed any complaints, charges or lawsuits against the Company with any governmental
agency or any court.

 

(b) 
Executive expressly waives all claims against the Company and releases the Company, and any of the Company’s past,
present or future parent, affiliated, related, and/or subsidiary entities, and all of the past and present directors,
shareholders, officers, general or limited partners, employees, agents, and attorneys, and agents and representatives of such
entities, and employee benefit plans in which Executive is or has been a participant by virtue of his or her employment with
the Company (collectively, the “Releasees”), from any claims that Executive may have against the
Company or the Releasees. It is understood that this release includes, but is not limited to, any claims arising directly or
indirectly out of, relating to, or in any other way involving in any manner whatsoever, (1) Executive’s employment with
the Company or its subsidiaries or the termination thereof or (2) Executive’s status at any time as a holder of any
securities of the Company, including any claims for wages, stock or stock options, employment benefits or damages of any kind
whatsoever arising out of any contracts, express or implied, any covenant of good faith and fair dealing, express or implied,
any legal restriction on the Company’s right to terminate employment, or any federal, state or other governmental
statute or ordinance, including, without limitation, the Employee Retirement Income Security Act of 1974, Title VII of the
Civil Rights Act of 1964, the federal Age Discrimination in Employment Act, the Americans With Disabilities Act, the Family
and Medical Leave Act, the Washington Law Against Discrimination Act, the Washington Family and Parental Leave Act, or any
other legal limitation on the employment relationship (the “Release”); provided, however,
notwithstanding anything to the contrary set forth herein, that this Release shall not extend to (i) benefit claims under
employee pension benefit plans in which Executive is a participant by virtue of Executive’s employment with the Company
or its subsidiaries or to benefit claims under employee welfare benefit plans for occurrences (e.g., medical care, death, or
onset of disability) arising after the execution of this Release by Executive, (ii) Executive’s rights to severance pay
and benefits under the Agreement; (iii) any claims Executive may have for indemnification pursuant to law, contract or
Company policy, (iv) any claims for coverage under any applicable directors’ and officers’ insurance policy in
accordance with the terms of such policy, or (v) any claims arising from events that occur after the date Executive signs
this Release.

 

Executive
understands that this Release includes a release of claims arising under the Age Discrimination in Employment Act (ADEA).
Executive understands and warrants that Executive has been given a period of twenty-one (21) days to review and consider this
Release or forty-five (45) days if Executive’s termination is part of a group reduction in force. Executive
further warrants that Executive understands that, with respect to the release of age discrimination claims only, Executive
has a period of seven days (7) after execution of this Release to revoke the release of age discrimination claims by notice
in writing to the Company.

 

     

     

    

 

EXECUTIVE
ACKNOWLEDGES ALL OF THE FOLLOWING:

 

(A) 
I HAVE CAREFULLY READ AND HAVE VOLUNTARILY SIGNED THIS RELEASE;

 

(B) 
I FULLY UNDERSTAND THE FINAL AND BINDING EFFECT OF THIS RELEASE, INCLUDING THE WAIVER OF CLAIMS UNDER THE AGE DISCRIMINATION IN
EMPLOYMENT ACT; AND

 

(C) 
PRIOR TO SIGNING THIS RELEASE, I HAVE BEEN ADVISED OF MY RIGHT TO CONSULT, AND HAVE BEEN GIVEN ADEQUATE TIME TO REVIEW MY LEGAL
RIGHTS WITH AN ATTORNEY OF MY CHOICE.

 

Executive
Signature

 

 

 

Executive
Name (Print)

 

	 	 

Date

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00300-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00300-of-00352.parquet"}]]