XCLL XcelMobility Inc (CE)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

Date of report (Date of earliest event reported): August 28, 2014

 

 

XcelMobility Inc.

(Exact Name of Registrant as Specified in its Charter)

 

 

Nevada		000-54333		98-0561888
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

2225 East Bayshore Road, Suite 200 Palo Alto, CA		94303
(Address of Principal Executive Offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (650) 320-1728

 

Former Name or Former Address, if Changed Since Last Report:

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Section 1 – Registrant’s Business and Operations

 

Item 1.01        Entry into a Definitive Material Agreement

 

Termination Agreement – Gregory Tse

 

Effective September 22, 2014, XcelMobility, Inc., a Nevada corporation (the “Company”) entered into a Termination Agreement (the “Termination Agreement”) with Mr. Gregory Tse, pursuant to which the Board Advisory Agreement (the “Advisory Agreement”), dated August 14, 2012, by and between the Company and Mr. Tse shall be terminated upon the resignation of Mr. Tse from the board of directors of the Company. In full satisfaction of all amounts owed to Mr. Tse for his services as a member of the board of directors of the Company, Mr. Tse shall receive 360,000 shares of Company common stock and Ninety Thousand Dollars ($90,000) upon the closing of a debt and/or equity financing by the Company of at least One Million Dollars ($1,000,000).

 

The foregoing description of the Termination Agreement is qualified in its entirety by reference to the provisions of the Termination Agreement filed as exhibit 10.1 to this Current Report on Form 8-K, which is incorporated herein by reference.

 

Amended and Restated Management Service Agreements

 

On August 28, 2014, the Company entered into Amended and Restated Management Service Agreements (the “Management Agreements”) with Ron Strauss, Chairman of the board of directors of the Company, Renyan Ge, Chief Executive Officer of the Company and Xili Wang, Chief Financial Officer of the Company (each an “Executive Officer” and collectively, the “Executive Officers”). The Management Agreements provide for indefinite terms of employment and include annual compensation for each of the Executive Officers as set forth below:

Ron Strauss – $180,000; option to purchase 500,000 shares of common stock

Renyan Ge - $180,000; option to purchase 500,000 shares of common stock

Xili Wang - $150,000; option to purchase 250,000 shares of common stock

 

The term and exercise price for the options to be issued to the Executive Officers will be determined by the board of directors of the Company in accordance with the XcelMobility, Inc. 2013 Equity Incentive Plan.

 

In addition, the Executive Officers have the right to receive shares of common stock of the Company in lieu of their respective base salaries, at a price per share equal to the lower of (i) the lowest publicly traded share price for the Company’s common stock during the thirty (30) days prior to such issuance, or (ii) the per share price paid by a third party investor during the prior twelve (12) months for shares of the Company’s common stock. The number of shares of common stock to be received by an Executive Officer in lieu of base salary shall equal an amount that is twice the amount of accrued and unpaid base salary for such Executive Officer. For each share of common stock to be received by an Executive Officer in lieu of base salary, such Executive Officer shall receive an option to purchase ten (10) shares of common stock at the same valuation as the shares received in lieu of base salary. The Executive Officers shall be eligible for an annual bonus to be determined by the board of directors of the Company.

 

The Management Agreements may be terminated by the Company at any time. If such termination is without cause, the Executive Officer is entitled to certain severance payments. If the Company undergoes a change in control (as defined in the Management Agreements) and any Executive Officer is terminated within eighteen (18) months of such change in control, such Executive Officer is entitled to a lump sum payment of eighteen (18) months’ base salary, an additional bonus payment and full vesting of any outstanding options and restricted stock. The Executive Officers may terminate their Management Agreement upon two (2) months’ written notice to the Company.

 

Pursuant to the terms of the Management Agreements, the Executive Officers are subject to standard confidentiality restrictions and a non-competition provision which survives for six (6) months following termination.

 

 

The foregoing description of the Management Agreements is qualified in its entirety by reference to the provisions of the Management Agreements filed as exhibits 10.2, 10.3 and 10.4 to this Current Report on Form 8-K, which is incorporated herein by reference.

 

Item 1.02        Termination of a Material Definitive Agreement

 

The disclosure set forth under Item 1.01 of this Current Report on Form 8-K is incorporated into this Item.

 

Section 5 – Corporate Governance and Management

 

Item 5.02.         Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

Resignation of Director

 

Effective September 22, 2014, Mr. Gregory Tse resigned as a member of the board of directors of the Company. There were no disagreements with the Company relating to Mr. Tse’s resignation, and no correspondence was provided by Mr. Tse concerning the circumstances surrounding his resignation. Mr. Tse has been provided with a copy of these disclosures and has not objected to anything contained herein.

 

The disclosure set forth under Item 1.01 of this Current Report on Form 8-K is incorporated into this Item.

 

Material Compensatory Plan

The disclosure set forth under Item 1.01 of this Current Report on Form 8-K is incorporated into this Item.

 

Section 9 – Financial Statements and Exhibits

 

Item 9.01        Financial Statements and Exhibits

 

10.1

Termination Agreement, dated September 22, 2014, between XcelMobility, Inc. and Gregory Tse.

10.2

Amended and Restated Management Service Agreement, dated August 28, 2014, between XcelMobility and Ron Strauss.

10.3

Amended and Restated Management Service Agreement, dated August 28, 2014, between XcelMobility and Renyan Ge.

10.4

Amended and Restated Management Service Agreement, dated August 28, 2014, between XcelMobility and Xili Wang.

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	XcelMobility Inc.,
	a Nevada Corporation
Dated:  September 30, 2014	/s/ Renyan Ge
	Renyan Ge
	Chief Executive Officer

 

 

 

Exhibit 10.1

 

TERMINATION AGREEMENT

 

This Termination Agreement (this “Agreement”), is entered into as of September _, 2014, by and between XcelMobility, Inc., a Nevada corporation (“Pubco”) and Gregory Tse (the “Advisor”).

 

RECITALS

 

A.           Advisor is a member of the board of directors of Pubco.

 

B.           Pubco and Advisor had entered into that certain Board Advisory Agreement, dated August 14, 2012 (the “Advisory Agreement”) pursuant to which Advisor is entitled to receive certain compensation from Pubco in consideration of his service as a director of Pubco.

 

C.           Advisory has informed Pubco of his intent to resign as a member of the board of directors of the Company.

 

D.           Pubco and the Company wish to terminate the Advisory Agreement in accordance with Section 5 of the Advisory Agreement.

 

AGREEMENT

 

In consideration of the foregoing recitals and the mutual promises set forth in this Agreement and for other consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:

 

1.          Termination of Advisory Agreement. The parties hereto acknowledge and agree that upon the resignation of Advisor from the board of directors of the Company, and in accordance with Section 5 of the Advisory Agreement, the Advisory Agreement shall terminate and be of no further force or effect, except for Sections 3 and 6 of the Advisory Agreement, and such termination shall be effective immediately upon the execution hereof.

 

2.          Compensation. The parties hereto acknowledge that Advisor shall receive, in full satisfaction of all amounts and/or compensation accrued and unpaid pursuant to the Advisory Agreement:

 

2.1           360,000 shares of Pubco common stock, par value $0.001; and

 

2.2           Ninety Thousand Dollars ($90,000) which shall be payable upon the closing of a debt and/or equity financing of at least One Million Dollars ($1,000,000).

 

 

 

3.          Release. Advisor, on behalf of himself, his descendants, ancestors, dependents, heirs, executors, administrators, assigns, and successors, and each of them, hereby covenants not to sue and fully releases, acquits, and discharges Pubco, and its subsidiaries and affiliates, (collectively referred to as "Pubco Releasees") from all claims, rights, demands, actions, obligations and causes of action of any and every kind, nature and character, known or unknown, that Advisor may now have or has ever had or will have against them based on any act or omission that occurred through the date this Agreement is signed, including without limitation : (a) any and all claims of “wrongful discharge,” breach of express or implied contract, breach of the implied covenant of good faith and fair dealing, wrongful discharge in violation of public policy, intentional infliction of emotional distress, negligent infliction of emotional distress, fraud and defamation; (b) any tort of any nature; (c) any and all claims arising under any federal, state, county or municipal statute, constitution or ordinance, including but not limited to Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Employee Retirement Income Security Act, and any other laws and regulations relating to Advisor’s service as a member of the board of directors of the Company; (d) any and all claims for compensation, bonuses, severance pay, stock options, restricted stock, vacation pay, expense reimbursement, attorneys’ fees and costs; and (e) any and all claims for relief of any kind, regardless of the basis for such claim or the nature of the remedy sought.

 

4.          General Provisions.

 

4.1           Amendments and Waivers. No waiver, modification or amendment of any term, condition or provision of this Agreement shall be valid or of any effect unless made in writing, signed by the party to be bound or its duly authorized representative and specifying with particularity the nature and extent of such waiver, modification or amendment. Any waiver by any party of any default of the other shall not affect or impair any right arising from any subsequent default.

 

4.2           Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Nevada, without giving effect to the conflicts of law principles thereof.

 

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

 

4.4           Entire Agreement. This Agreement contains the entire understanding of the parties, and there are no further or other agreements or understandings, written or oral, in effect between the parties relating to the subject matter hereof.

 

4.5           Facsimile Execution and Delivery. At the request of any party hereto, the requested party shall execute an original of this Agreement as well as any facsimile, telecopy or other reproduction hereof. A facsimile, telecopy or other reproduction of this Agreement may be executed by any of the parties hereto, and an executed copy of this Agreement may be delivered by any of the parties hereto by facsimile, pdf file or similar electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Termination Agreement as of the date first written above.

 

	Pubco:
	XcelMobility, Inc.
	By:
		Renyan Ge, Chief Executive Officer
	Advisor:
	Gregory Tse

 

Signature Page to Termination Agreement

 

 

Exhibit 10.2

 

THIS AMENDED AND RESTATED MANAGEMENT SERVICE AGREEMENT entered into as of the28th day of August 2014 (the “Agreement”)

 

BETWEEN:

 

Xcelmobility Inc., a corporation incorporated under the laws of Nevada, USA, and having an executive office at 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.

 

(the “Company”)

 

AND:

 

Ron Strauss, Businessman of 6th Floor, St. John's Building, 33 Garden Road, central, Hong Kong.

 

(“Executive”)

 

WHEREAS:

 

A.             The Company and Executive had previously entered into a Management Services Agreement, dated as of August 1, 2011 (the “Original Agreement”);

 

B.             The Company and Executive wish to amend and restate certain provisions of the Original Agreement to reflect the parties’ mutual agreement.

 

NOW THEREFORE in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

 

1.0                         MANAGEMENT SERVICES

 

1.1                         Executive represents and warrants to the Company that Executive has the required skills and experience to perform the duties and exercise the responsibilities required of Executive in the position of Executive Chairman of the Board.

 

1.2                         Executive and the Company agree to comply with and to be bound by the terms and conditions of this Agreement.

 

1.3                         During the term of employment, Executive shall well and faithfully serve and devote himself exclusively to the Company.

 

 

 1.4                         In carrying out these duties and responsibilities, Executive undertakes to comply with all lawful instructions and directions which he may receive from the Company. The duties and responsibilities to be carried out by Executive will be commensurate with the duties of a Chairman of the Board. Executive shall report to the Board of Directors of the Company (the “Board”) as a whole as requested.

 

1.5                         Executive agrees and understands that the effective performance of Executive’s duties requires the highest level of integrity and the Company’s complete confidence in Executive’s relationship with other employees of the Company, and with all persons dealt with by Executive in the course of his employment. Executive is required to ensure that he conducts himself in a professional, business-like manner at all times.

 

1.6                         Executive acknowledges and agrees to familiarize himself with and to comply with all of the Company’s policies, practices and procedures as adopted from time to time.

 

1.7                         Executive shall be subject to an annual performance review.

 

2.0                        DUTIES

 

2.1                         Job descriptions specific to the position will be developed by the Compensation Committee of the Board, but in general terms Executive shall be responsible for the following:

 

(a)

Planning and organizing all of the activities of the Board including:

(i)

the preparation for, and the conduct of, Board meetings;

(ii)

the quality, quantity and timeliness of the information that goes to Board members;

(iii)

the formation of Board committees and the integration of their activity with the work of the Board;

(iv)

the evaluation of the Board’s effectiveness and implementation of improvements;

(v)

the development of the Board, including Director recruitment, evaluation and compensation, and

(vi)

ongoing formal and informal communication with and among Directors.

 

(b)

Supervising the annual and special meetings of the shareholders as the Chairman of the Board. In conjunction with the CEO, the Chairman may meet with various groups (such as major shareholder groups), governments, the financial press, industry associations etc.

 

  

(c)

Working closely with, and through the CEO, to:

(i)

participate in the development of the Company’s vision, strategic agenda, and business plan to facilitate communication and understanding between management and the Board;

(ii)

ensure that operations conform with the Board’s view on corporate policy; and

(iii)

ensure, in consultation with the Human Resources Committee and the Board, that succession plans are in place at senior executive levels.

 

(d)

In conjunction with the CEO, participating in external relationships which fulfill the Company’s obligations as a member of industry and the community.

 

(e)

Providing the key link between the Board and management, and as a result, having a significant communication, coaching and team-building responsibility, including by:

(i)

maintaining a close ongoing relationship and open communication with the CEO;

(ii)

representing the shareholders and Board to management and management to the shareholders and Board; and

(iii)

monitoring and evaluating the performance of the CEO, in coordination with the Human Resources Committee.

 

(f)

Attending all Board committee meetings as a non-voting participant, provided, however, that at meetings of the Governance Committee, the Chairman of the Board shall be a voting member.

 

(g)

Carrying out the following duties on behalf of the Company:

(i)

ensuring that the Company meets its public company reporting requirements;

(ii)

serving as the main point of contact with the Company’s outside legal counsel;

(iii)

coordinating on financing matters;

(iv)

overseeing investor relations; and

(v)

overseeing media relations.

 

(g)

Carrying out special assignments in collaboration with the CEO and management or the Board of Directors.

 

  

3.0                         DURATION OF AGREEMENT

 

3.1                         The term of appointment and engagement of Executive shall commence on July 28, 2011 (the “Commencement Date”) and continue for an indefinite term.

 

4.0                         REMUNERATION AND BENEFITS

 

4.1                         In consideration of Executive’s undertaking and performance of the obligations contained in this Agreement, the Company will compensate Executive for his services as follows:

 

(a)          Base Salary: Executive will receive a base salary of $180,000 per year, which shall be paid to Executive in bi-monthly installments.

 

(b)          Options: For each year that Executive is employed by the Company, he shall receive an option to purchase 500,000 shares of common stock of the Company, in accordance with the XcelMobility, Inc. 2013 Equity Incentive Plan, as amended from time to time (the “Plan”), and related option documents.

 

(c)          Equity In Lieu of Unpaid Base Salary: Executive shall be entitled to purchase shares of common stock of the Company at a price equal to the lower of (a) the lowest publicly traded share price for the Company’s common stock during the thirty (30) days prior to such issuance, or (b) the per share price paid by a third party investor during the past twelve (12) months for shares of the Company’s common stock, in lieu of base salary that has accrued and remains unpaid, provided, however, that the number of shares to be received by Executive shall equal an amount that is double such accrued and unpaid base salary. Additionally, Executive shall be entitled to receive an option to purchase 10 shares of common stock of the Company for each share that he receives in lieu of base salary pursuant to this Section 4.1(c) and at the same valuation as the shares to be received in lieu of accrued and unpaid base salary. As of the date of this Agreement, the accrued and unpaid base salary for Executive is $292,145.

 

(d)          Benefits: Executive shall be entitled to receive a monthly cash payment of $3,800 in lieu of any benefits provided by the Company, including retirement fund payments.

 

(e)          Vacation: At a time or times which are mutually convenient for the Company and Executive, Executive shall be entitled to five (5) weeks’ vacation during each calendar year of his engagement, of which not more than two weeks shall be taken at one time. Executive will be permitted to carry forward any unused vacation to the next year or receive compensation in kind.

 

(f)          Bonus:

 

  

(i)          Executive is eligible for an annual bonus in an amount to be determined by the board of directors

 

(ii)         No bonus shall be payable to Executive from the date that he ceases to be actively engaged by the Company. Specifically, Executive is not entitled to a bonus for the year in which Executive terminates his engagement. In the event Executive’s engagement is terminated in the absence of just cause, Executive will receive bonus payments for the entire notice period in the amount determined by the average of the last two bonus payments made or $100,000 where no bonus payments have been made.

 

(g)          Expenses: The Company will reimburse or pay for all reasonable business expenses incurred by Executive in the execution of his duties. This includes the expenses for airfare, accommodation and other business related expenses.

 

5.0                         TERMINATION

 

5.1                         This Agreement may be terminated by the Company as follows:

 

(a)          In the absence of just cause by the Company, Executive will receive payments in lieu of notice, based upon the length of services Executive has provided the Company:

 

	Service Period		Notice
	(i)  less than thirty six (36) months of service		Eighteen (18) months’ notice
	(ii)  more than thirty-six (36) months of service		Thirty (30) months’ notice

 

(b)          Where the Company elects to give Executive notice of termination of this Agreement, in the absence of just cause, Executive may choose to receive payments due in either a lump sum, on a continuance basis or a combination of both.

 

(c)          During the period of notice, Executive will not be required to perform the responsibilities of his position and will return to the Company all property in his possession that belongs to the Company.

 

  

(d)          Where there is just cause for termination of the engagement or if Executive is in material breach of his obligations under this Agreement, Executive will not be entitled to notice, bonus payments or payment in lieu of notice of the termination of his management Services Agreement. The engagement of Executive shall cease upon receipt of notice that his services are being terminated for just cause. For the purposes of this Agreement, “just cause” will be defined by the common law.

 

5.2                         If a Change in Control is consummated during the term of this Agreement and within eighteen months immediately following such Change in Control, Executive is terminated without cause, then Executive shall be entitled to:

 

(a)          a lump sum payment equal to eighteen (18) months of base salary, which such sum shall be paid upon Executive’ termination date;

 

(b)          a bonus of $75,000; and

 

(c)          the vesting schedule of each outstanding option held by Executive to purchase shares of common stock of the Company held by Executive shall be fully accelerated so that the option shall become exercisable for an additional number of shares equal to 100% of the shares of common stock subject to the option which are unvested immediately prior to such Change in Control; and (b) the vesting schedule of each outstanding restricted stock award held by Executive shall be accelerated so that 100% of the number of unvested shares subject to such restricted stock award shall vest in full.

 

"Change In Control" shall mean the consummation of any of the following transactions effecting a change in ownership or control of the Company:

 

(a)           a merger, consolidation or reorganization, unless securities representing more than fifty percent (50%) of the total combined voting power of the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned the Company's outstanding voting securities immediately prior to such transaction; or

 

(b)          any transfer, sale or other disposition of all or substantially all of the Company's assets; or

 

 

(c)          the acquisition, directly or indirectly by any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company), of beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities pursuant to a tender or exchange offer made directly to the Company's beneficial holders.

 

5.3                         This Agreement may be terminated by Executive with two (2) months’ written notice to the Company. The Company may waive this notice requirement by written notice.

 

6.0                         CONFIDENTIAL INFORMATION AND PROPERTY

 

6.1                         Executive acknowledges that as the Chairman of the Board and in any other position the Executive may hold, a relationship of confidence, trust and fiduciary obligation is created between Executive and the Company, and Executive will acquire information about certain matters and things which are confidential to the Company, and which information is the exclusive property of the Company including:

 

(a)          financial statements, financial books and records, reserve reports and estimates and other related information;

 

(b)          information concerning products, pricing, sales and marketing policies, techniques and concepts, including costing information, in respect of products and services provided or to be provided by Executive;

 

(c)          lists of present and prospective clients and related information, including names and addresses, borrowing habits and preferences of present and prospective clients of the Company;

 

(d)          purchasing information, including the names and addresses of present and prospective suppliers of the Company and prices charged by such suppliers;

 

(e)          computer systems, computer programs, data, software, system documentation, designs, manuals, databases;

 

(f)          trade secrets; and

 

(g)          any other materials or information related to the personnel, business operations, financing or activities of the Company which are not generally known to others engaged in similar businesses or activities.

 

(collectively, “Confidential Information”)

 

  

6.2                         Executive acknowledges and agrees that the Confidential Information could be used to the detriment of the Company. Accordingly, Executive agrees and undertakes not to disclose Confidential Information to any third party either during the term of his engagement except as may be necessary in the proper discharge of his employment, or after the term of his engagement, however caused, except with the written permission of the Company.

 

6.3                         Executive understands and agrees that all items of any and every nature or kind created by Executive pursuant to Executive’s employment under this Agreement or furnished by the Company to Executive, and all equipment, automobiles, credit cards, books, records, reports, files, manuals and any other documents and confidential information shall remain and be considered the exclusive property of the Company at all times, and shall be returned and shall be returned to the Company in good condition promptly on the termination of this Agreement, for any reason.

 

7.0                         NON-COMPETITION

 

7.1                         Executive also acknowledges that, by reason of employment, Executive will continue to receive the value and advantage of special training, skills and expert knowledge and experience of and contacts with customers of the Company and other employees of the Company who are engaged in the business of the Company.

 

7.2                         Executive further acknowledges that, in the course of employment, Executive will be assigned duties that will give him knowledge of confidential and proprietary information which relates to the conduct and details of the Company’s business and which will result in irreparable harm or injury to the Company which could not be adequately compensated by monetary damages if Executive should enter into the employment of a business which is the same as, or competitive with, the business of the Company, or should Executive enter into the business of the Company.

 

7.3                         Executive shall not commence, engage in, or participate in any business competitive with the business of the Company either directly or indirectly, either as individual or as a partner or joint venturer or as an employee, principal, consultant, agent, shareholder, officer, director or representative for any person, association, organization, or in any manner for a period of six months following the termination of his employment with the Company for any reason.

 

7.4                         Executive acknowledges and agrees that without prejudice to any and all other rights of the Company, in the event of his violation of any of the covenants contained in Sections 6 and 7, an injunction or other like remedy, including an interim injunction, will be a reasonable and effective remedy to protect the Company’s rights and property.

 

  

8.0                         SUCCESSORS AND PERSONAL REPRESENTATIVES

 

8.1                         This Agreement shall enure to the benefit of and be enforceable by the personal or legal representatives, executors, administrators, successors, assigns and heirs of the parties hereto.

 

9.0                         NOTICE

 

9.1                         Any notice or other communication required or contemplated under this Agreement to be given by one party to the other shall be delivered or mailed by prepared registered post to the party to receive same at the undernoted address, namely:

 

(a)          To the Company:

Xcelmobility Inc. - 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.

 

(b)          Ron Strauss:

6th Floor, St. John's Building, 33 Garden Road, central, Hong Kong.

 

Any notice delivered shall be delivered personally to Executive and shall be deemed to have been given and received on the business day next following the date of delivery. Any notice mailed as aforesaid shall be deemed to have been given and received on the fifth business day following the date it is posted, provided that if between the time of mailing and actual receipt of the notice there shall be a mail strike, slowdown or other labour dispute which might affect delivery of the notice by mail, then the notice shall be effective only if actually delivered.

 

10.0                       MODIFICATION/AMENDMENT

 

10.1                        No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

11.0                       ENTIRE AGREEMENT

 

11.1                       No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement.

 

 

12.0                      GOVERNING LAW

 

12.1                       The validity, interpretation, construction and performance of this Agreement shall be governed in accordance with the laws of the State of Nevada.

 

13.0                      VALIDITY

 

13.1                       The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

 

14.0                      INDEMNIFICATION

 

14.1                       Executive agrees to indemnify the Company against any claims made for the collection, withholding and payment of any personal taxes associated with the work performed by Executive for the Company by any jurisdiction that makes a claim against Executive or the Company. Furthermore, Executive agrees that if necessary, he will sign additional documents that indemnify the Company against claims for taxes owed in relation to payments made to Executive based on this Management Services Agreement.

 

15.0                       SIGNATURES IN COUNTERPARTS

 

15.1                       This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. The parties hereto confirm that any facsimile, scanned or emailed copy of another party's executed counterpart of this Agreement (or its signature page thereof) will be deemed to be an executed original thereof.

 

  

IN WITNESS WHEREOF the parties hereto have executed these presents the day and year first above written.

 

The Corporate Seal of the Company,
XCELMOBILITY INC.
was hereunto affixed in the presence of:		C/S
Authorized Signatory

 

SIGNED, SEALED AND DELIVERED by
RON STRAUSS in the presence of:
Signature
Address			RON STRAUSS

 

 

Exhibit 10.3

 

THIS AMENDED AND RESTATED MANAGEMENT SERVICE AGREEMENT entered into as of the 28th day of August 2014 (the “Agreement”)

 

BETWEEN:

 

Xcelmobility Inc., a corporation incorporated under the laws of Nevada, USA, and having an executive office at 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.

 

(the “Company”)

 

AND:

 

Renyan Ge, Businessman of 3F, West Block, M-8, Maqueling Industrial Park, Nanshan District, Shenzhen, China 518057

.

(“Executive”)

 

WHEREAS:

 

	A.	The Company and Executive had previously entered into a Management Services Agreement, dated as of August 1, 2011 (the “Original Agreement”);
	B.	The Company and Executive wish to amend and restate certain provisions of the Original Agreement to reflect the parties’ mutual agreement.

 

NOW THEREFORE in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

 

1.0

MANAGEMENT SERVICES

 

1.1                        Executive represents and warrants to the Company that Executive has the required skills and experience to perform the duties and exercise the responsibilities required of Executive in the position of Chief Executive Officer CEO.

 

1.2                        Executive and the Company agree to comply with and to be bound by the terms and conditions of this Agreement.

 

1.3                        During the term of employment, Executive shall well and faithfully serve and devote himself exclusively to the Company.

 

 

1.4                        In carrying out these duties and responsibilities, Executive undertakes to comply with all lawful instructions and directions which he may receive from the Company. The duties and responsibilities to be carried out by Executive will be commensurate with the duties of a CEO. Executive shall report to the Board of Directors of the Company (the “Board”) as a whole as requested.

 

1.5                        Executive agrees and understands that the effective performance of Executive’s duties requires the highest level of integrity and the Company’s complete confidence in Executive’s relationship with other employees of the Company, and with all persons dealt with by Executive in the course of his employment. Executive is required to ensure that he conducts himself in a professional, business-like manner at all times.

 

1.6                        Executive acknowledges and agrees to familiarize himself with and to comply with all of the Company’s policies, practices and procedures as adopted from time to time.

 

1.7                        Executive shall be subject to an annual performance review.

 

 

2.0

DUTIES

 

2.1                        Job descriptions specific to the position will be developed by the Compensation Committee of the Board, but in general terms Executive shall be responsible for the following:

Job descriptions specific to the position will be developed by the Compensation Committee of the Board, but in general terms Ge shall be responsible for the following:

 

(a)	Oversees the operations of organization and manages its compliance with legal and regulatory requirements
(b)	Creates and maintains procedures for implementing plans approved by the board of directors
(c)	Promotes a culture that reflects the organization’s values, encourages good performance, and rewards productivity
(d)	Hires, manages, and fires the human resources of the organization according to authorized personnel policies and procedures that fully conform to current laws and regulations
(e)	Ensures that staff and board have sufficient and up-to-date information
(f)	Evaluates the organization’s and the staff’s performance on a regular basis
(g)	Oversees staff in developing annual budgets that support operating plans and submits budgets for board approval
(h)	Prudently manages the organization's resources within budget guidelines according to current laws and regulations
(i)	Ensures that staff practices all appropriate accounting procedures in compliance with Generally Accepted Accounting Principles (GAAP)
(j)	Provides prompt, thorough, and accurate information to keep the board appropriately informed of the organization’s financial position
(k)	Develops fund raising strategies with the board and supports the board in fund raising activities
(l)	Oversees staff in the development and implementation of fund raising plans that support strategies adopted by the Development Committee
(m)	Serves as a primary person in donor relationships and the person to make one-on-one fund raising solicitations
(n)	Oversees staff in the timely submission grant applications and progress reports for funders
(o)	Oversees design, delivery, and quality of programs and services
(p)	Stays abreast of current trends related to the organization’s products and services and anticipates future trends likely to have an impact on its work
(q)	Collects and analyzes evaluation information that measures the success of the organization’s program efforts; refines or changes programs in response to that information
(r)	Supports operations and administration of the board by advising and informing board members and interfacing between board and staff
(s)	Advises the board in the development of policies and planning recommendations

 

 

3.0

DURATION OF AGREEMENT

 

3.1                        The term of appointment and engagement of Executive shall commence on July 28, 2011 (the “Commencement Date”) and continue for an indefinite term.

 

4.0

REMUNERATION AND BENEFITS

 

4.1                        In consideration of Executive’s undertaking and performance of the obligations contained in this Agreement, the Company will compensate Executive for his services as follows:

 

(a)	Base Salary:  Executive will receive a base salary of $180,000 per year, which shall be paid to Executive in bi-monthly installments.
(b)	Options: For each year that Executive is employed by the Company, he shall receive an option to purchase 500,000 shares of common stock of the Company, in accordance with the XcelMobility, Inc. 2013 Equity Incentive Plan, as amended from time to time (the “Plan”), and related option documents.
(c)	Equity In Lieu of Unpaid Base Salary: Executive shall be entitled to purchase shares of common stock of the Company at a price equal to the lower of (a) the lowest publicly traded share price for the Company’s common stock during the thirty (30) days prior to such issuance, or (b) the per share price paid by a third party investor during the past twelve (12) months for shares of the Company’s common stock, in lieu of base salary that has accrued and remains unpaid, provided, however, that the number of shares to be received by Executive shall equal an amount that is double such accrued and unpaid base salary. Additionally, Executive shall be entitled to receive an option to purchase 10 shares of common stock of the Company for each share that he receives in lieu of base salary pursuant to this Section 4.1(c) and at the same valuation as the shares to be received in lieu of accrued and unpaid base salary.  As of the date of this Agreement, the accrued and unpaid base salary for Executive is $292,145.
(d)	Benefits:  Executive shall be entitled to receive a monthly cash payment of $3,800 in lieu of any benefits provided by the Company, including retirement fund payments.
(e)	Vacation:  At a time or times which are mutually convenient for the Company and Executive, Executive shall be entitled to five (5) weeks’ vacation during each calendar year of his engagement, of which not more than two weeks shall be taken at one time.  Executive will be permitted to carry forward any unused vacation to the next year or receive compensation in kind.

 

 

(f)	Bonus:
	(i)	Executive is eligible for an annual bonus in an amount to be determined by the board of directors
	(ii)	No bonus shall be payable to Executive from the date that he ceases to be actively engaged by the Company.  Specifically, Executive is not entitled to a bonus for the year in which Executive terminates his engagement.  In the event Executive’s engagement is terminated in the absence of just cause, Executive will receive bonus payments for the entire notice period in the amount determined by the average of the last two bonus payments made or $100,000 where no bonus payments have been made.
(g)	Expenses:  The Company will reimburse or pay for all reasonable business expenses incurred by Executive in the execution of his duties. This includes the expenses for airfare, accommodation and other business related expenses.

 

5.0	TERMINATION
5.1	This Agreement may be terminated by the Company as follows:
(a)	In the absence of just cause by the Company, Executive will receive payments in lieu of notice, based upon the length of services Executive has provided the Company:
	Service Period	Notice
	(i)  less than thirty six (36) months of service	Eighteen (18) months’ notice
	(ii)  more than thirty-six (36) months of service	Thirty (30) months’ notice
(b)	Where the Company elects to give Executive notice of termination of this Agreement, in the absence of just cause, Executive may choose to receive payments due in either a lump sum, on a continuance basis or a combination of both.
(c)	During the period of notice, Executive will not be required to perform the responsibilities of his position and will return to the Company all property in his possession that belongs to the Company.
(d)	Where there is just cause for termination of the engagement or if Executive is in material breach of his obligations under this Agreement, Executive will not be entitled to notice, bonus payments or payment in lieu of notice of the termination of his management Services Agreement.  The engagement of Executive shall cease upon receipt of notice that his services are being terminated for just cause.  For the purposes of this Agreement, “just cause” will be defined by the common law.

 

 

5.2                        If a Change in Control is consummated during the term of this Agreement and within eighteen months immediately following such Change in Control, Executive is terminated without cause, then Executive shall be entitled to:

 

(a)	a lump sum payment equal to eighteen (18) months of base salary, which such sum shall be paid upon Executive’ termination date;
(b)	a bonus of $75,000; and
(c)	the vesting schedule of each outstanding option held by Executive to purchase shares of common stock of the Company held by Executive shall be fully accelerated so that the option shall become exercisable for an additional number of shares equal to 100% of the shares of common stock subject to the option which are unvested immediately prior to such Change in Control; and (b) the vesting schedule of each outstanding restricted stock award held by Executive shall be accelerated so that 100% of the number of unvested shares subject to such restricted stock award shall vest in full.

 

"Change In Control" shall mean the consummation of any of the following transactions effecting a change in ownership or control of the Company:

 

(a)	a merger, consolidation or reorganization, unless securities representing more than fifty percent (50%) of the total combined voting power of the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned the Company's outstanding voting securities immediately prior to such transaction; or
(b)	any transfer, sale or other disposition of all or substantially all of the Company's assets; or
(c)	the acquisition, directly or indirectly by any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company), of beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities pursuant to a tender or exchange offer made directly to the Company's beneficial holders.

 

 

5.3                      This Agreement may be terminated by Executive with two (2) months’ written notice to the Company. The Company may waive this notice requirement by written notice.

 

6.0

CONFIDENTIAL INFORMATION AND PROPERTY

 

6.1                        Executive acknowledges that as the Chairman of the Board and in any other position the Executive may hold, a relationship of confidence, trust and fiduciary obligation is created between Executive and the Company, and Executive will acquire information about certain matters and things which are confidential to the Company, and which information is the exclusive property of the Company including:

 

(a)	financial statements, financial books and records, reserve reports and estimates and other related information;
(b)	information concerning products, pricing, sales and marketing policies, techniques and concepts, including costing information, in respect of products and services provided or to be provided by Executive;
(c)	lists of present and prospective clients and related information, including names and addresses, borrowing habits and preferences of present and prospective clients of the Company;
(d)	purchasing information, including the names and addresses of present and prospective suppliers of the Company and prices charged by such suppliers;
(e)	computer systems, computer programs, data, software, system documentation, designs, manuals, databases;
(f)	trade secrets; and
(g)	any other materials or information related to the personnel, business operations, financing or activities of the Company which are not generally known to others engaged in similar businesses or activities.
	(collectively, “Confidential Information”)

 

 

6.2                        Executive acknowledges and agrees that the Confidential Information could be used to the detriment of the Company. Accordingly, Executive agrees and undertakes not to disclose Confidential Information to any third party either during the term of his engagement except as may be necessary in the proper discharge of his employment, or after the term of his engagement, however caused, except with the written permission of the Company.

 

6.3                        Executive understands and agrees that all items of any and every nature or kind created by Executive pursuant to Executive’s employment under this Agreement or furnished by the Company to Executive, and all equipment, automobiles, credit cards, books, records, reports, files, manuals and any other documents and confidential information shall remain and be considered the exclusive property of the Company at all times, and shall be returned and shall be returned to the Company in good condition promptly on the termination of this Agreement, for any reason.

 

7.0

NON-COMPETITION

 

7.1                        Executive also acknowledges that, by reason of employment, Executive will continue to receive the value and advantage of special training, skills and expert knowledge and experience of and contacts with customers of the Company and other employees of the Company who are engaged in the business of the Company.

 

7.2                        Executive further acknowledges that, in the course of employment, Executive will be assigned duties that will give him knowledge of confidential and proprietary information which relates to the conduct and details of the Company’s business and which will result in irreparable harm or injury to the Company which could not be adequately compensated by monetary damages if Executive should enter into the employment of a business which is the same as, or competitive with, the business of the Company, or should Executive enter into the business of the Company.

 

7.3                        Executive shall not commence, engage in, or participate in any business competitive with the business of the Company either directly or indirectly, either as individual or as a partner or joint venturer or as an employee, principal, consultant, agent, shareholder, officer, director or representative for any person, association, organization, or in any manner for a period of six months following the termination of his employment with the Company for any reason.

 

7.4                        Executive acknowledges and agrees that without prejudice to any and all other rights of the Company, in the event of his violation of any of the covenants contained in Sections 6 and 7, an injunction or other like remedy, including an interim injunction, will be a reasonable and effective remedy to protect the Company’s rights and property.

 

 

8.0

SUCCESSORS AND PERSONAL REPRESENTATIVES

 

8.1                        This Agreement shall enure to the benefit of and be enforceable by the personal or legal representatives, executors, administrators, successors, assigns and heirs of the parties hereto.

 

9.0

NOTICE

 

9.1                        Any notice or other communication required or contemplated under this Agreement to be given by one party to the other shall be delivered or mailed by prepared registered post to the party to receive same at the undernoted address, namely:

 

(a)	To the Company:
	Xcelmobility Inc. - 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.
(b)	Renyan Ge:
	3F, West Block, M-8, Maqueling Industrial Park, Nanshan District, Shenzhen, China 518057

 

Any notice delivered shall be delivered personally to Executive and shall be deemed to have been given and received on the business day next following the date of delivery. Any notice mailed as aforesaid shall be deemed to have been given and received on the fifth business day following the date it is posted, provided that if between the time of mailing and actual receipt of the notice there shall be a mail strike, slowdown or other labour dispute which might affect delivery of the notice by mail, then the notice shall be effective only if actually delivered.

 

10.0

MODIFICATION/AMENDMENT

 

10.1                      No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

11.0

ENTIRE AGREEMENT

 

11.1                      No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement.

 

 

12.0

GOVERNING LAW

 

12.1                      The validity, interpretation, construction and performance of this Agreement shall be governed in accordance with the laws of the State of Nevada.

 

13.0

VALIDITY

 

13.1                      The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

 

14.0

INDEMNIFICATION

 

14.1                      Executive agrees to indemnify the Company against any claims made for the collection, withholding and payment of any personal taxes associated with the work performed by Executive for the Company by any jurisdiction that makes a claim against Executive or the Company. Furthermore, Executive agrees that if necessary, he will sign additional documents that indemnify the Company against claims for taxes owed in relation to payments made to Executive based on this Management Services Agreement.

 

15.0

SIGNATURES IN COUNTERPARTS

 

15.1                      This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. The parties hereto confirm that any facsimile, scanned or emailed copy of another party's executed counterpart of this Agreement (or its signature page thereof) will be deemed to be an executed original thereof.

 

 

IN WITNESS WHEREOF the parties hereto have executed these presents the day and year first above written.

 

The Corporate Seal of the Company,
XCELMOBILITY INC.
was hereunto affixed in the presence of:	C/S
Authorized Signatory

  

SIGNED, SEALED AND DELIVERED by
RENYAN GE in the presence of:
Signature
Address			RENYAN GE

 

 

Exhibit 10.4

 

THIS AMENDED AND RESTATED MANAGEMENT SERVICE AGREEMENT entered into as of the 28th day of August 2014 (the “Agreement”)

 

BETWEEN:

 

Xcelmobility Inc., a corporation incorporated under the laws of Nevada, USA, and having an executive office at 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.

 

(the “Company”)

 

AND:

 

Xili Wang, Businesswoman of 3F, West Block, M-8, Maqueling Industrial Park, Nanshan District, Shenzhen, China 518057

 

(“Executive”)

 

WHEREAS:

 

A.

The Company and Executive had previously entered into a Management Services Agreement, dated as of August 1, 2011 (the “Original Agreement”);

 

B.

The Company and Executive wish to amend and restate certain provisions of the Original Agreement to reflect the parties’ mutual agreement.

 

NOW THEREFORE in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

 

1.0

MANAGEMENT SERVICES

 

1.1                        Executive represents and warrants to the Company that Executive has the required skills and experience to perform the duties and exercise the responsibilities required of Executive in the position of Chief Executive Officer CEO.

 

1.2                        Executive and the Company agree to comply with and to be bound by the terms and conditions of this Agreement.

 

1.3                        During the term of employment, Executive shall well and faithfully serve and devote himself exclusively to the Company.

 

  

1.4                        In carrying out these duties and responsibilities, Executive undertakes to comply with all lawful instructions and directions which he may receive from the Company. The duties and responsibilities to be carried out by Executive will be commensurate with the duties of a CEO. Executive shall report to the Board of Directors of the Company (the “Board”) as a whole as requested.

 

1.5                        Executive agrees and understands that the effective performance of Executive’s duties requires the highest level of integrity and the Company’s complete confidence in Executive’s relationship with other employees of the Company, and with all persons dealt with by Executive in the course of his employment. Executive is required to ensure that he conducts himself in a professional, business-like manner at all times.

 

1.6                        Executive acknowledges and agrees to familiarize himself with and to comply with all of the Company’s policies, practices and procedures as adopted from time to time.

 

1.7                        Executive shall be subject to an annual performance review.

 

2.0

DUTIES

 

2.1                        Job descriptions specific to the position will be developed by the Compensation Committee of the Board, but in general terms Wang shall be responsible for the following:

 

(a)

Assist in performing all tasks necessary to achieve the organization's mission and help execute staff succession and growth plans.

 

(b)

Train the Finance Unit and other staff on raising awareness and knowledge of financial management matters.

 

(c)

Work with the President/CEO on the strategic vision including fostering and cultivating stakeholder relationships on city, state, and national levels, as well as assisting in the development and negotiation of contracts.

 

(d)

Participate in developing new business, specifically: assist the CEO in identifying new funding opportunities, the drafting of prospective programmatic budgets, and determining cost effectiveness of prospective service delivery.

 

(e)

Ensure adequate controls are installed and that substantiating documentation is approved and available such that all purchases may pass independent and governmental audits.

 

(f)

Provide the CEO with an operating budget. Work with the CEO to ensure programmatic success through cost analysis support, and compliance with all contractual and programmatic requirements. This includes:

  

 

i.

interpreting legislative and programmatic rules and regulations to ensure compliance with all federal, state, local and contractual guidelines,

 

ii.

ensuring that all government regulations and requirements are disseminated to appropriate personnel, and

 

iii.

monitoring compliance.

 

(g)

Oversee the management and coordination of all fiscal reporting activities for the organization including: organizational revenue/expense and balance sheet reports, reports to funding agencies, development and monitoring of organizational and contract/grant budgets.

 

(h)

Oversee all purchasing and payroll activity for staff and participants.

 

(i)

Develop and maintain systems of internal controls to safeguard financial assets of the organization and oversee federal awards and programs. Oversee the coordination and activities of independent auditors ensuring all A-133 audit issues are resolved, and all 403(b) compliance issues are met, and the preparation of the annual financial statements is in accordance with U.S. GAAP and federal, state and other required supplementary schedules and information.

 

(j)

Attend Board and Subcommittee meetings; including being the lead staff on the Audit/Finance Committee.

 

(k)

Monitor banking activities of the organization.

 

(l)

Ensure adequate cash flow to meet the organization's needs.

 

(m)

Investigate cost-effective benefit plans and other fringe benefits which the organization may offer employees and potential employees with the goal of attracting and retaining qualified individuals.

 

(n)

Oversee the production of monthly reports including reconciliations with funders and pension plan requirements, as well as financial statements and cash flow projections for use by Executive management, as well as the Audit/Finance Committee and Board of Directors.

 

(o)

Assist in the design, implementation, and timely calculations of wage incentives, commissions, and salaries for the staff.

 

(p)

Oversee Accounts Payable and Accounts Receivable and ensure a disaster recovery plan is in place.

 

(q)

Oversee business insurance plans and health care coverage analysis.

 

(r)

Oversee the maintenance of the inventory of all fixed assets, including assets purchased with government funds (computers, etc.) assuring all are in accordance with federal regulations.

  

  

3.0

DURATION OF AGREEMENT

 

3.1                        The term of appointment and engagement of Executive shall commence on July 28, 2011 (the “Commencement Date”) and continue for an indefinite term.

 

4.0

REMUNERATION AND BENEFITS

 

4.1                        In consideration of Executive’s undertaking and performance of the obligations contained in this Agreement, the Company will compensate Executive for his services as follows:

 

(a)

Base Salary: Executive will receive a base salary of $150,000 per year, which shall be paid to Executive in bi-monthly installments.

 

(b)

Options: For each year that Executive is employed by the Company, he shall receive an option to purchase 250,000 shares of common stock of the Company, in accordance with the XcelMobility, Inc. 2013 Equity Incentive Plan, as amended from time to time (the “Plan”), and related option documents.

 

(c)

Equity In Lieu of Unpaid Base Salary: Executive shall be entitled to purchase shares of common stock of the Company at a price equal to the lower of (a) the lowest publicly traded share price for the Company’s common stock during the thirty (30) days prior to such issuance, or (b) the per share price paid by a third party investor during the past twelve (12) months for shares of the Company’s common stock, in lieu of base salary that has accrued and remains unpaid, provided, however, that the number of shares to be received by Executive shall equal an amount that is double such accrued and unpaid base salary. Additionally, Executive shall be entitled to receive an option to purchase 10 shares of common stock of the Company for each share that he receives in lieu of base salary pursuant to this Section 4.1(c) and at the same valuation as the shares to be received in lieu of accrued and unpaid base salary. As of the date of this Agreement, the accrued and unpaid base salary for Executive is $186,573.

 

(d)

Benefits: Executive shall be entitled to receive a monthly cash payment of $1,100 in lieu of any benefits provided by the Company, including retirement fund payments.

 

(e)

Vacation: At a time or times which are mutually convenient for the Company and Executive, Executive shall be entitled to five (5) weeks’ vacation during each calendar year of his engagement, of which not more than two weeks shall be taken at one time. Executive will be permitted to carry forward any unused vacation to the next year or receive compensation in kind.

 

  

(f)

Bonus:

 

(i)

Executive is eligible for an annual bonus in an amount to be determined by the board of directors

 

(ii)

No bonus shall be payable to Executive from the date that he ceases to be actively engaged by the Company. Specifically, Executive is not entitled to a bonus for the year in which Executive terminates his engagement. In the event Executive’s engagement is terminated in the absence of just cause, Executive will receive bonus payments for the entire notice period in the amount determined by the average of the last two bonus payments made or $100,000 where no bonus payments have been made.

 

(g)

Expenses: The Company will reimburse or pay for all reasonable business expenses incurred by Executive in the execution of his duties. This includes the expenses for airfare, accommodation and other business related expenses.

 

5.0

TERMINATION

 

5.1

This Agreement may be terminated by the Company as follows:

 

(a)

In the absence of just cause by the Company, Executive will receive payments in lieu of notice, based upon the length of services Executive has provided the Company:

  

Service Period		Notice
(i)  less than thirty six (36) months of service		Eighteen (18) months’ notice
(ii)  more than thirty-six (36) months of service		Thirty (30) months’ notice

 

(b)

Where the Company elects to give Executive notice of termination of this Agreement, in the absence of just cause, Executive may choose to receive payments due in either a lump sum, on a continuance basis or a combination of both.

 

(c)

During the period of notice, Executive will not be required to perform the responsibilities of his position and will return to the Company all property in his possession that belongs to the Company.

 

  

(d)

Where there is just cause for termination of the engagement or if Executive is in material breach of his obligations under this Agreement, Executive will not be entitled to notice, bonus payments or payment in lieu of notice of the termination of his management Services Agreement. The engagement of Executive shall cease upon receipt of notice that his services are being terminated for just cause. For the purposes of this Agreement, “just cause” will be defined by the common law.

 

5.2                        If a Change in Control is consummated during the term of this Agreement and within eighteen months immediately following such Change in Control, Executive is terminated without cause, then Executive shall be entitled to:

 

(a)

a lump sum payment equal to eighteen (18) months of base salary, which such sum shall be paid upon Executive’ termination date;

 

(b)

a bonus of $58,000; and

 

(c)

the vesting schedule of each outstanding option held by Executive to purchase shares of common stock of the Company held by Executive shall be fully accelerated so that the option shall become exercisable for an additional number of shares equal to 100% of the shares of common stock subject to the option which are unvested immediately prior to such Change in Control; and (b) the vesting schedule of each outstanding restricted stock award held by Executive shall be accelerated so that 100% of the number of unvested shares subject to such restricted stock award shall vest in full.

 

"Change In Control" shall mean the consummation of any of the following transactions effecting a change in ownership or control of the Company:

 

(a)

a merger, consolidation or reorganization, unless securities representing more than fifty percent (50%) of the total combined voting power of the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and in substantially the same proportion, by the persons who beneficially owned the Company's outstanding voting securities immediately prior to such transaction; or

 

(b)

any transfer, sale or other disposition of all or substantially all of the Company's assets; or

 

  

(c)

the acquisition, directly or indirectly by any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company), of beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities pursuant to a tender or exchange offer made directly to the Company's beneficial holders.

 

5.3                        This Agreement may be terminated by Executive with two (2) months’ written notice to the Company. The Company may waive this notice requirement by written notice.

 

6.0

CONFIDENTIAL INFORMATION AND PROPERTY

 

6.1                        Executive acknowledges that as the Chairman of the Board and in any other position the Executive may hold, a relationship of confidence, trust and fiduciary obligation is created between Executive and the Company, and Executive will acquire information about certain matters and things which are confidential to the Company, and which information is the exclusive property of the Company including:

 

(a)

financial statements, financial books and records, reserve reports and estimates and other related information;

 

(b)

information concerning products, pricing, sales and marketing policies, techniques and concepts, including costing information, in respect of products and services provided or to be provided by Executive;

 

(c)

lists of present and prospective clients and related information, including names and addresses, borrowing habits and preferences of present and prospective clients of the Company;

 

(d)

purchasing information, including the names and addresses of present and prospective suppliers of the Company and prices charged by such suppliers;

 

(e)

computer systems, computer programs, data, software, system documentation, designs, manuals, databases;

 

(f)

trade secrets; and

 

(g)

any other materials or information related to the personnel, business operations, financing or activities of the Company which are not generally known to others engaged in similar businesses or activities.

 

  

(collectively, “Confidential Information”)

 

6.2                        Executive acknowledges and agrees that the Confidential Information could be used to the detriment of the Company. Accordingly, Executive agrees and undertakes not to disclose Confidential Information to any third party either during the term of his engagement except as may be necessary in the proper discharge of his employment, or after the term of his engagement, however caused, except with the written permission of the Company.

 

6.3                        Executive understands and agrees that all items of any and every nature or kind created by Executive pursuant to Executive’s employment under this Agreement or furnished by the Company to Executive, and all equipment, automobiles, credit cards, books, records, reports, files, manuals and any other documents and confidential information shall remain and be considered the exclusive property of the Company at all times, and shall be returned and shall be returned to the Company in good condition promptly on the termination of this Agreement, for any reason.

 

7.0

NON-COMPETITION

 

7.1                        Executive also acknowledges that, by reason of employment, Executive will continue to receive the value and advantage of special training, skills and expert knowledge and experience of and contacts with customers of the Company and other employees of the Company who are engaged in the business of the Company.

 

7.2                        Executive further acknowledges that, in the course of employment, Executive will be assigned duties that will give him knowledge of confidential and proprietary information which relates to the conduct and details of the Company’s business and which will result in irreparable harm or injury to the Company which could not be adequately compensated by monetary damages if Executive should enter into the employment of a business which is the same as, or competitive with, the business of the Company, or should Executive enter into the business of the Company.

 

7.3                        Executive shall not commence, engage in, or participate in any business competitive with the business of the Company either directly or indirectly, either as individual or as a partner or joint venturer or as an employee, principal, consultant, agent, shareholder, officer, director or representative for any person, association, organization, or in any manner for a period of six months following the termination of his employment with the Company for any reason.

 

7.4                        Executive acknowledges and agrees that without prejudice to any and all other rights of the Company, in the event of his violation of any of the covenants contained in Sections 6 and 7, an injunction or other like remedy, including an interim injunction, will be a reasonable and effective remedy to protect the Company’s rights and property.

 

  

8.0

SUCCESSORS AND PERSONAL REPRESENTATIVES

 

8.1                        This Agreement shall enure to the benefit of and be enforceable by the personal or legal representatives, executors, administrators, successors, assigns and heirs of the parties hereto.

 

9.0

NOTICE

 

9.1                        Any notice or other communication required or contemplated under this Agreement to be given by one party to the other shall be delivered or mailed by prepared registered post to the party to receive same at the undernoted address, namely:

 

(a)

To the Company:

Xcelmobility Inc. - 2225 East Bayshore Road, Suite 200, Palo Alto, CA 94303.

 

(b)

Xili Wang:

3F, West Block, M-8, Maqueling Industrial Park, Nanshan District, Shenzhen, China 518057

 

Any notice delivered shall be delivered personally to Executive and shall be deemed to have been given and received on the business day next following the date of delivery. Any notice mailed as aforesaid shall be deemed to have been given and received on the fifth business day following the date it is posted, provided that if between the time of mailing and actual receipt of the notice there shall be a mail strike, slowdown or other labour dispute which might affect delivery of the notice by mail, then the notice shall be effective only if actually delivered.

 

10.0

MODIFICATION/AMENDMENT

 

10.1                      No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to in writing and signed by Executive and such officer as may be specifically designated by the Board. No waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party will be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

 

  

11.0

ENTIRE AGREEMENT

 

11.1                      No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not expressly set forth in this Agreement.

 

12.0

GOVERNING LAW

 

12.1                      The validity, interpretation, construction and performance of this Agreement shall be governed in accordance with the laws of the State of Nevada.

 

13.0

VALIDITY

 

13.1                      The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.

 

14.0

INDEMNIFICATION

 

14.1                      Executive agrees to indemnify the Company against any claims made for the collection, withholding and payment of any personal taxes associated with the work performed by Executive for the Company by any jurisdiction that makes a claim against Executive or the Company. Furthermore, Executive agrees that if necessary, he will sign additional documents that indemnify the Company against claims for taxes owed in relation to payments made to Executive based on this Management Services Agreement.

 

15.0

SIGNATURES IN COUNTERPARTS

 

15.1                      This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. The parties hereto confirm that any facsimile, scanned or emailed copy of another party's executed counterpart of this Agreement (or its signature page thereof) will be deemed to be an executed original thereof.

 

  

IN WITNESS WHEREOF the parties hereto have executed these presents the day and year first above written.

 

The Corporate Seal of the Company,

XCELMOBILITY INC.

was hereunto affixed in the presence of:

C/S

 

Authorized Signatory

  

SIGNED, SEALED AND DELIVERED by
XILI WANG in the presence of:
Signature
Address			XILI WANG