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EXHIBIT 10.40
AGREEMENT
This AGREEMENT is made as of August 8, 1996 (the "Effective Date") by
and among Xxxx Xxxxxx, an individual ("Xxxxxx"), Xxxxxx Xxxxxxx, an individual
("Xxxxxxx"), Xxxxxx Xxxxxxxx, an individual ("Xxxxxxxx"), Xxxxxx Xxxxxxx, an
individual ("Lansing"), (the latter four individuals, collectively, the "Non-RAS
Directors"), OCTuS, Inc., a California corporation (the "Company") (the latter
five Parties, collectively, the "OCTuS Parties"), TAG Acquisition Corp., a New
York corporation ("TAG"), TAG Acquisition Group, LLC, a New York limited
liability company ("TAG LLC"), RAS Securities Corp., a New York corporation
("RAS"), Xxxxxx Xxxxx, an individual ("Xxxxx"), Xxxx Xxxxxxxx, an individual
("Xxxxxxxx"), Xxxx Xxxxxx, an individual ("Xxxxxx"), Xxxx Xxxxxxxx, an
individual ("Xxxxxxxx") (the latter seven Parties collectively the "RAS/TAG
Parties"). The OCTuS Parties and the RAS/TAG Parties are collectively referred
to herein as the "Parties" and individually as a "Party").
RECITALS
WHEREAS, issues have been raised between the OCTuS Parties and the
RAS/TAG Parties regarding an equity investment by TAG and/or TAG LLC in the
Company and with respect to other matters involving the Company.
WHEREAS, RAS and the Company had previously entered into an
Underwriting Agreement dated January 15, 1993 (the "Underwriting Agreement").
WHEREAS, TAG and the Company had previously entered into a Stock
Purchase Agreement dated May 6, 1996 (the "Stock Purchase Agreement") under
which TAG has assigned certain of its rights to TAG LLC.
WHEREAS, each of the Parties wish to settle all claims arising between
the Parties as set forth herein.
AGREEMENTS
NOW, THEREFORE, in consideration of the promises, mutual covenants and
agreements herein contained, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by each of the Parties
hereto, and intending to be legally bound hereby, each of the Parties hereby
agrees as follows:
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SECTION 1
REPRESENTATIONS
1.1 Representations and Warranties of The OCTuS Parties. The
OCTuS Parties and each of them represent and warrant to the RAS/TAG Parties as
follows:
The OCTuS Parties have the requisite legal power and authority
to execute, deliver and carry out this Agreement and the transactions
contemplated hereby and have taken all requisite corporate, partnership and/or
trust action to authorize the execution, delivery and performance of this
Agreement and the transactions contemplated hereby.
1.2 Representations and Warranties of RAS/TAG Parties. The
RAS/TAG Parties and each of them represent and warrant to the OCTuS Parties as
follows:
The RAS/TAG Parties have the requisite legal power and
authority to execute, deliver and carry out this Agreement and the transactions
contemplated hereby and have taken all necessary corporate, partnership and/or
trust action to authorize the execution, delivery and performance of this
Agreement and the transactions contemplated hereby. The RAS/TAG Parties no
longer have any interest in any proxy issued by Xxxxxx Xxxxxxx to vote any
shares of OCTuS Common Stock.
SECTION 2
ACTIONS OF THE PARTIES
2.1 Upon the execution of this Agreement by all parties hereto,
the Company will reimburse Xxxxxxxx the sum of $9,000 paid by Xxxxxxxx to the
Company's accountants.
2.2 Xxxxx has previously resigned as an OCTuS Board Member on June
24, 1996. Xxxxx acknowledges and agrees that the circumstances of such
resignation were not the result of any dispute with the Company which would
give rise to a reporting obligation under the Securities Exchange Act of 1934,
as amended.
SECTION 3
MUTUAL GENERAL RELEASES
3.1 Mutual Releases.
(a) The OCTuS Parties, and each of them, and each of
their Affiliates, and predecessors, and all other entities which an OCTuS Party
controls or as to which the OCTuS Parties, or any of them, have the power to
grant a release, hereby release and discharge the
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RAS/TAG Parties and their respective officers, directors, shareholders,
employees, advisors, accountants, lawyers (including but not limited to Broad
and Xxxxxx), agents, successors, predecessors, assignees, siblings, spouses,
children, partners, and trusts associated with the RAS/TAG Parties, parents,
subsidiaries and Affiliates from any and all manner of claims, actions,
demands, damages, accounts, sums of money, debts, liabilities, promises,
obligations, costs and expenses (including but not limited to attorneys' fees
or awards of attorneys' fees and/or costs), causes of action or suits, at law
or in equity, of whatsoever kind or nature, whether now known or unknown,
suspected or unsuspected (collectively "Claims"), which any of the OCTuS
Parties have or may have had or may have or hereafter shall or may have, by
reason of any matter, cause or thing, from the beginning of the world to the
Effective Date. Without in any way limiting the generality of the foregoing
release, such release specifically includes, but is not limited to, any Claims
relating to the Stock Purchase Agreement, the Underwriting Agreement, and/or
any Claims arising out of or in any way connected with any act or omission
committed or omitted by the RAS/TAG Parties prior to the Effective Date.
(b) The RAS/TAG Parties, and each of them, and each of
their Affiliates, and predecessors, and all other entities which the RAS/TAG
Parties control or as to which the RAS/TAG Parties, or any of them, have the
power to grant a release, hereby release and discharge the OCTuS Parties and
their respective officers, directors, employees, advisors, accountants, lawyers
(including but not limited to Xxxxxx & Xxxxxxx), shareholders, agents,
successors, predecessors, assignees, siblings, spouses, children, partners,
trusts and foundations associated with the OCTuS Parties, parents, subsidiaries
and Affiliates from any and all Claims which any of the RAS/TAG Parties have or
may have had or may have or hereafter shall or may have, by reason of any
matter, cause or thing, from the beginning of the world to the Effective Date.
Without in any way limiting the generality of the foregoing release, such
release specifically includes, but is not limited to, any Claims relating to
the Stock Purchase Agreement, the Underwriting Agreement, any proxy contest or
demand for a meeting of shareholders, and/or any Claims arising out of or in
any way connected with any act or omission committed or omitted by the OCTuS
Parties prior to the Effective Date.
3.2 Waiver of Section 1542. Section 1542 of the California Civil
Code provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM IT MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
Each of the Parties expressly waives and relinquishes all rights and benefits
afforded by Section 1542 of the California Civil Code. Each Party understands
that the actual facts
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pertaining to the events alleged or otherwise relevant to the making of this
Agreement may be different from what each Party believes to be true, and each
Party hereby accepts and assumes the risk of the facts and assumptions turning
out to be different and agrees that this Agreement shall be and remain in all
respects effective and not subject to termination or rescission by virtue of
any such difference.
3.3 No Assignment of Claims. The Parties each represent and
warrant that he, she or it has not assigned or otherwise transferred to any
person or entity any of the Claims released hereunder and shall indemnify and
hold harmless any released Parties from every cost or expense, including
without limitation, attorneys' fees and experts' fees and costs of suit,
incurred in defending, settling or satisfying any and all suits or judgments
relating to Claims which were assigned or otherwise transferred.
3.4 No Solicitation of Shareholder Claims. The RAS/TAG Parties
each represent and warrant that he, she or it has not in the past and will not
solicit or otherwise encourage any present or past shareholders of the Company
to pursue shareholder litigation or Claims or derivative litigation or Claims
against the Company and shall indemnify and hold harmless any released Parties
from every cost or expense, including without litigation, attorneys' fees and
expert fees and costs of suit, incurred in defending, settling or satisfying
any and all such suits or judgments relating to any such litigation or Claims
which has been solicited or otherwise encouraged by the RAS/TAG Parties.
3.5 No Admission of Liability. Each Party acknowledges that
nothing contained in this Agreement shall be construed as an admission of
liability by or on behalf of any Party.
3.6 No Unstated Reliance. Each Party to this Agreement hereby
acknowledges that he, she and/or it and their attorneys have investigated the
facts and the law as they relate to the claims asserted and the nature of this
Agreement. No Party (nor any agent or attorney for any Party) has made any
statement or representation to any other Party regarding any fact relied upon
in entering into this Agreement, and each Party does not rely upon any
statement, representation or promise of any other Party (or of any agent or
attorney for any other Party) in executing this Agreement, or in making the
settlement provided for herein, except as expressly stated in this Agreement.
SECTION 4
CERTAIN OTHER AGREEMENTS
4.1 Confidentiality. The Parties shall keep the terms of this
Agreement confidential, except as may be necessary to provide information to
their respective tax, legal and financial advisors or as may be required by law
or court order. No Party to this Agreement nor any of their respective
Affiliates or representatives shall initiate the release of
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any oral or written statement to a member of the press or any other public
media, or to any other person with the intention that such statement be
communicated to or disseminated by the press or other public media, concerning
this Agreement. Notwithstanding the preceding two sentences, nothing contained
herein shall affect any Party's ability or right to make a factual statement
about himself or herself or his or her career that does not reflect adversely
on any other Party and does not express any adverse opinion about any other
Party. Each Party further agrees not to publicly make any disparaging
statements regarding any of the other Parties to this Agreement.
4.2 Challenges to Agreement. Each Party hereto shall not, and
shall use its best efforts to cause each of its Affiliates and representatives
not to, challenge the validity of any provisions of this Agreement.
SECTION 5
MISCELLANEOUS
5.1 Entire Agreement. This Agreement constitutes the entire
agreement and understanding of the Parties and supersedes all prior agreements,
understandings and undertakings both written and oral, between or among the
OCTuS Parties, or any of them, on the one hand, and RAS/TAG Parties, or any of
them on the other hand, with respect to the subject matter hereof and may be
amended only by an agreement in writing executed by all the Parties hereto.
5.2 Headings. Descriptive headings are for convenience only and
shall not control or affect the meaning or construction of any provision of
this Agreement.
5.3 Counterparts. For the convenience of the Parties, any number
of counterparts of this Agreement may be executed by the Parties, and each such
executed counterpart shall be an original instrument.
5.4 Notices. All notices, deliveries, consents, requests,
instructions, approvals and other communications provided for in this Agreement
shall be validly given, made or served, if in writing and delivered personally,
by hand (except for the delivery of payments or assets) or by telecopy, or sent
by registered mail postage paid, if to the address set forth below, or to such
other address or telecopy number as any Party may, from time to time, designate
in a written notice given in a like manner. Notice given by hand or by
telecopy shall be deemed given on the date on which so hand delivered or
telecopied. Notice given by mail as set out above shall be deemed delivered
five business days after the date the same is postmarked.
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(a) To: Any OCTuS Party
c/o Xxxx Xxxxxx
OCTuS, Inc.
P. O. Xxx 000000
Xxx Xxxxx, XX 00000-0000
Telecopy No: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxxx, Esq.
Xxxxxx & Xxxxxxx
000 "X" Xxxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000-0000
Telecopy No: (000) 000-0000
(b) To: Any RAS/TAG Parties
c/o RAS Securities Corp.
0 Xxxxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxx X. Xxxxxxxx
Telecopy No: (000) 000-0000
with a copy to:
Xxxx Xxxxxxxx, Esq.
Broad and Xxxxxx
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000
Telecopy No: (000) 000-0000
and
Xxxxxx Xxxxx
0 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Telecopy No: (000) 000-0000
5.5 Successors and Assigns. This Agreement shall bind the
successors and assigns of the Parties, and inure to the benefit of any
successor or assign of any of the parties.
5.6 Governing Law. This Agreement shall be governed by and
constructed and enforced in accordance with the internal laws of the State of
California, without giving effect to the conflict of the laws principles
thereof.
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5.7 Certain Terms. As used herein, the term "Affiliate" shall
have the meaning set forth in Rule 12b-2 under the Securities Exchange Act of
1934, as amended.
5.8 Survival of Representations. All representations, warranties
and agreements made in this Agreement or pursuant hereto shall survive the date
hereof through the term of this Agreement.
5.9 No Waiver. Any waiver by any party of a breach of any
provision of this Agreement shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision
of this Agreement. The failure of a Party to insist upon strict adherence to
any term of this Agreement on one or more occasions shall not be considered a
waiver or deprive that Party of the right thereafter to insist upon strict
adherence to that term or any other term of this Agreement.
5.10 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of
law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as closely as
possible in an acceptable manner to the end that transactions contemplated
hereby are fulfilled to the extent possible.
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to
be executed as of the date first referred to above.
THE OCTUS PARTIES
Dated: July 31, 1996 OCTuS, INC.
By: /s/ Xxxx X. Xxxxxx
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Its: President & CEO
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Dated: July 31, 1996 /s/ Xxxx X. Xxxxxx
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Xxxx Xxxxxx, individually and
as director of OCTuS, Inc.
Dated: August 8, 1996 /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx Xxxxxxx, individually
and as director of OCTuS, Inc.
Dated: August 5, 1996 /s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx Xxxxxxxx, individually
and as director of OCTuS, Inc.
Dated: July 31, 1996 /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx, individually
and as director of OCTuS, Inc.
RAS/TAG PARTIES
Dated: July 31, 1996 TAG ACQUISITION CORP.,
By: /s/ Xxxx Xxxxxx
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Its: President
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Dated: July 31, 1996 TAG ACQUISITION GROUP, LLC,
By: /s/ Xxxx Xxxxxx
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Its: President
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Dated: July 31, 1996 RAS SECURITIES CORP.,
By: /s/ Xxxxxx X. Xxxxxxxxx
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Its: Chairman
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Dated: July 31, 1996 /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxx, individually
Dated: July 31, 1996 /s/ Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx, individually
Dated: July 31, 1996 /s/ Xxxx Xxxxxx
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Xxxx Xxxxxx, individually
Dated: July 31, 1996 /s/ Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx, individually
APPROVED AS TO FORM AND CONTENT:
BROAD AND XXXXXX
By /s/ A. Xxxxxxx Xxxxxxxx
_______________________________
Xxxx Xxxxxxxx, Partner
Attorneys for the RAS/TAG Parties
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XXXXXX & XXXXXXX
By /s/ Xxxxxx X. Xxxxxxx
________________________________
Xxxxxx X. Xxxxxxx, Partner
Attorneys for the OCTuS Parties
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