Exhibit 10.1
AGREEMENT OF SETTLEMENT AND RELEASE
This Agreement of Settlement and Release (this "Agreement") is entered
into by Xxxxxx X. Xxxxxxx, for himself and for his affiliates, predecessors,
successors, assigns, heirs and beneficiaries, including but not limited to,
Tamin Mineracao Ltda. ("Tamin"), Mineracao Luzema Ltda., Mineracao Italia Ltda.
and Cedro Mineracao Ltda., and all other persons, firms and entities relating to
such persons or entities, and each of them (collectively referred to herein as
"Zuzu"), Toucan Gold Corporation, a Delaware Corporation, and its subsidiaries
("TGC") and Toucan Mining Limited, an Isle of Man corporation, and its
subsidiaries ("TML") TGC and TML shall be collectively referred to herein as
"Toucan." Zuzu and Toucan are collectively referred to herein as the "Parties."
WHEREAS, in September of 1996, TGC entered into an agreement to acquire
from Zuzu twenty-five (25) priority claims (the "Claims") in the Cuiaba Basin of
Brazil (the "Claims Agreement");
WHEREAS, certain terms of the Claims Agreement were set forth in that
certain Termo de Compromiso, dated September 24, 1996, by and between Igor
Mousasticoshvily, Sr., on behalf of TGC and Zuzu, on behalf of Tamin, that
certain Procuracao, dated September 26, 1996, executed by Zuzu on behalf of
Tamin and that certain Letter from Xxx X. Xxxxxxxx and addressed to Igor
Mousasticoshvily, dated as of February 22, 1996;
WHEREAS, there has been a dispute between the Parties relating to the
Claims and the amount that is to be paid by TGC to Zuzu in connection with the
delivery of the Claims; and
WHEREAS, in consideration of the terms and conditions set forth in this
Agreement, which have been agreed to by the Parties, the Parties desire to
settle and release all disputes relating to the Claims which the Parties have or
may have with one another.
NOW, THEREFORE, for and in consideration of the terms and conditions
described below and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned hereby agree as
follows:
1. Zuzu, shall and hereby does fully RELEASE, REMISE, CANCEL, ACQUIT
and FOREVER DISCHARGE Toucan and its affiliates, predecessors, successors,
assigns, attorneys and members, and their respective partners, members (and any
affiliates thereof), officers, shareholders, managers, directors, agents,
contractors, representatives, employees and attorneys, including but not limited
to, Mineradora de Bauxita Ltda., an authorized mining company organized under
the laws of Brazil, and its subsidiaries ("MBL"), Xxx X. Xxxxxxxx ("Xxxxxxxx"),
Xxxxxx X. Xxxxxxxx ("Jeffcock"), L. Xxxxx Xxxxxx ("Xxxxxx"), Xxx Xxx ("Box"),
Xxxxxx X. Xxxxxx ("Xxxxxx"), Xxxx Mousasticoshvily, Sr. ("Mousasticoshvily"),
and the successors and assigns of each of TGC, MBL, TML, Williams, Jeffcock,
Xxxxxx, Box, Xxxxxx and Mousasticoshvily (collectively, the "Released Parties")
from any and all past or present, known or unknown, suspected or unsuspected,
contingent or fixed, past, present or future debts, obligations, claims,
demands, losses, damages, causes of action, rights of action or other
liabilities whatsoever, both in law and in equity (including attorneys' fees and
costs
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in connection therewith) relating to the Claims, which such releasing party may
have had or may now have against the Released Parties, or otherwise involving
the Released Parties, in any way resulting from any actions, events or
occurrences prior in time to the date hereof.
2. In connection with the execution and delivery of the Agreement by
the Parties, TGC shall deliver to Zuzu an aggregate of 250,000 shares (the
"Shares") of TGC common stock, par value $0.01 per share (the "Common Stock").
(a) The Parties agree that pursuant to the Claims Agreement, as of
April 1997, Zuzu was entitled to receive 210,000 shares (the "Initial
Shares") of Common Stock. TGC acknowledges that the holding period for
purposes of Rule 144(k) promulgated pursuant to the Securities Act of
1933, as amended (the "Securities Act"), with respect to the Initial
Shares has expired. TGC further acknowledges that Zuzu is not an
affiliate (as such term is defined pursuant to Rule 144) of TGC and has
not been an affiliate of TGC within the preceding three (3) months,
and, therefore, Zuzu shall be entitled to sell the Initial Shares
without registration under the Securities Act pursuant to Rule 144(k),
and the stock certificate evidencing the Initial Shares shall not bear
a restrictive legend.
(b) Zuzu acknowledges that (i) the remaining 40,000 shares (the
"Restricted Shares") of Common Stock comprising the Shares shall be
restricted securities within the meaning of Rule 144; (ii) shall be
subject to the terms and conditions of Rule 144, including the two-year
holding period requirement of Rule 144(k); and (iii) the stock
certificate evidencing the Restricted Shares shall bear a securities
legend reflecting such restrictions. Zuzu further represents that he is
acquiring the Restricted Shares solely for his own account and not with
a view to or for resale in connection with any distribution or public
offering thereof, within the meaning of any applicable securities laws
and regulations, unless such distribution or offering is registered
under Securities Act or an exemption from such registration is
available, including Rule 144(k).
3. In connection with the execution and delivery of the Agreement by
the Parties, TML shall pay to Zuzu, or Zuzu's nominee, a cash payment equal to
U.S. $50,000.
4. The delivery to Zuzu of the certificates evidencing the Shares
referred to in Paragraph 3 hereof and the cash payment referenced to in
Paragraph 4 hereof shall be made on the fifth business day following the
execution of this Agreement by all of the Parties. The date of delivery of such
Certificates and cash payment shall be referred to herein as the Effective Date.
5. Zuzu will use his best efforts to deliver to TML (or its assignee)
all of the seven (7) claims described on Exhibit A, attached hereto, certified
by the Departamento Nacional De Produca Mineral ("DNPM"), with priority, having
good, clean and transferrable title and published by the Brazilian authorities
in the Government Gazette (each a "Certified Claim" and collectively the
"Certified Claims"). Prior to June 30, 2002 (the "Termination Date"), Zuzu shall
not pledge, sell, give an option to purchase, contract to sell or otherwise
assign any of the seven (7) above-referenced claims to any person or entity
other than TML (or its assignees) pursuant to this Agreement.
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6. Claim DNPM No. 869.820/96 shall be delivered to TML (or its
assignee) without consideration prior to the delivery to TML (or its assignee)
of any of the other Certified Claims (the "Other Certified Claims") set forth as
Exhibit A hereto.
7. TML shall pay to Zuzu, or Zuzu's nominee, an additional cash
payment of U.S.$20,000 for each Other Certified Claim that is delivered to TML
on the fifth business day after such Other Certified Claim is delivered to TML,
subject to the provisions of Paragraph 8 of this Agreement.
8. If a claim referenced on Exhibit A is not delivered to TML as a
Certified Claim on or before the Termination Date, TML shall have no obligation
whatsoever to make any payment to Zuzu with respect to such claim.
9. This Agreement is the result of disputed matters among the Parties
and is not intended to and does not reflect or constitute an admission or
acknowledgment of any liability or fault by any of the Parties under any theory
of liability.
10. This Agreement reflects the complete agreement of the Parties with
respect to all matters pertaining to the settlement of any and all claims
between any and all of the Parties.
11. The Parties hereto represent and warrant that they (i) have
carefully read this Agreement and know and understand this Agreement's contents
completely, (ii) have had adequate opportunity to be represented and advised by
an attorney of their choice and fully understand their right to discuss all
aspects of this Agreement with such attorney, (iii) are executing this Agreement
of their own free will, act and deed, without being induced to do so in any way
by any of the other Parties, (iv) did not rely, in making this Agreement, on any
statement or representation by any of the persons or entities that are being by
this Agreement, or by any persons representing those persons or entities, other
than as expressly stated in this Agreement, and (v) have not sold, assigned,
transferred, conveyed or otherwise disposed of any or all of the debts,
obligations, claims, demands, losses, damages, causes of action, rights of
action or other liabilities, whether known or unknown, past or present, released
by this Agreement.
12. This Agreement shall not be modified except by further written
agreement among the Parties and only as such written instrument clearly
specifies its intent to amend, modify, or change this Agreement.
13. It is understood and agreed that this Agreement shall be binding
upon and inure to the benefit of all of the Parties and their respective
beneficiaries, heirs, successors and assigns. The undersigned agree and warrant
that the representations and warranties made in this Agreement shall survive the
execution of this Agreement and shall be the continuing representations of the
undersigned.
14. The recitals made herein are incorporated into this Agreement in
their entirety as if set forth verbatim in the body of this Agreement.
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15. This Agreement supersedes any and all prior agreements,
understandings, oral or written, among the Parties pertaining to the subject
matter hereof.
16. Should any Party employ an attorney or attorneys to enforce any of
the provisions hereof or to protect its interest in any manner arising under or
relating to this Agreement, or to recover damages for breach of this Agreement,
the non-prevailing Party or Parties in any action pursued in a court of
competent jurisdiction (the finality of which is not legally contested) agree(s)
to pay, jointly or severally, to the prevailing Party or Parties all reasonable
costs, damages, and expenses, including attorneys' fees, expended or incurred in
connection therewith.
17. This Agreement may be executed in several counterparts and it
shall not be necessary for each Party to execute each of such counterparts, but
when all of the Parties have executed and delivered one of such counterparts,
the counterparts, when taken together, shall be deemed to constitute one and the
same instrument, enforceable against each Party in accordance with its terms.
18. All notices, requests, demands and other communications that are
required to be or may be given under this Agreement by any Party to any of the
other Parties shall be in writing and shall be deemed to have been duly given
when (a) delivered in person, (b) delivered by an overnight courier service
(such as Federal Express or UPS, etc.) or (c) delivered by certified or
registered first class mail, postage prepaid, return receipt requested, to the
Party to whom the same is so given or made:
If to TGC addressed to: Toucan Gold Corporation
0000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
ATTN: President
with a copy to: Jenkens & Xxxxxxxxx, P.C.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
ATTN: Xxxx X. Xxxxxx, Esq.
If to TML: Toucan Mining Limited
Xxxxxx Xxxxx
Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxx xx Xxx XX00 0XX.
ATTN: Corporate Secretary
with a copy to: Jenkens & Xxxxxxxxx, P.C.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
ATTN: Xxxx X. Xxxxxx, Esq.
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If to Zuzu: at the address of Zuzu as set forth on
Exhibit B.
19. If and to the extent that any court of competent jurisdiction holds
any provision (or any part thereof) of this Agreement to be invalid or
unenforceable, such holding shall in no way affect the validity of the remainder
of this Agreement.
20. TML may assign its rights under this Agreement (i) to any person or
entity that is an affiliate (as defined under the Securities Act) of TML, (ii)
to Minmet PLC or its affiliates, or (iii) to any other person or entity provided
that TML has deposited the sum of $120,000 minus the product of $20,000 and the
number of Other Certified Claims that have been delivered to TML and for which
Zuzu has received payment in an escrow account with a financial institution with
assets in excess of U.S.$100,000,000 pursuant to an escrow agreement that
provides for (i) the payment to Zuzu out of such escrowed funds of $20,000 for
each Other Certified Claims delivered to TML's assignee prior to the Termination
Date and (ii) the payment to TML of the escrowed funds (plus interest thereon)
remaining in the escrow account on the first business day following the
Termination Date.
21. This Agreement shall be governed by and construed in accordance
with the internal laws of Brazil, without regard to principles of conflicts of
law.
[Remainder of Page Left Intentionally Blank]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement to be
effective on the latest date written below.
Executed on ____________, 1999.
XXXXXX X. XXXXXXX,
individually and on behalf of Zuzu
TOUCAN GOLD CORPORATION,
a Delaware corporation
Executed on ____________, 1999. By: /s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
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Title: Chief Financial Officer
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TOUCAN MINING LIMITED,
an Isle of Man corporation
Executed on ____________, 1999. By: /s/ Xxxxxx X. Xxxxxxxx
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Name: Xxxxxx X. Xxxxxxxx
------------------------------
Title: Director
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EXHIBIT A
DNPM Claim Number
1. 869.820/96
2. 867.245/95
3. 867.246/95
4. 867.247/95
5. 867.249/95
6. 867.250/95
7. 867.234/95
A-1
EXHIBIT B
Zuzu's Address:
B-1
