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EXHIBIT 10.38
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
THIS SETTLEMENT AGREEMENT AND MUTUAL RELEASE (the "Agreement") is
entered into as of this 27th day of March, 1997, by and between Xxx X. Xxxxxx
("Xxxxxx") and MotorVac Technologies, Inc. ("MTI"), on the one side, and Xxxxxx
X. Xxxxxx ("Xxxxxx") and Equipment Technology Company, Inc. ("ETCO"), on the
other.
This Agreement is executed with reference to the following facts:
RECITALS
A. On or about August 13, 1996, MTI filed a cross-complaint against
Xxxxxx Xxxxxx in the case of De-Carbon Australia Pty Ltd v. MotorVac
Technologies, Inc., Orange County Superior Court Case No. 764248. Subsequently,
on or about September 16, 1996, Xxxxxx and ETCO filed a cross-complaint in that
action against MTI and Melody. These cross-complaints shall hereinafter be
referred to collectively as the "Lawsuit".
B. This Agreement does not pertain in any way to De-Carbon Australia
Pty Ltd, Carbon Clean Corporation Pty Ltd, Carbon Tune Pty Ltd, Xxxxx Somas,
Roydn Sweet and Xxx Xxxxx (collectively "the De-Carbon Parties"), and nothing
stated herein is intended to affect the rights of the parties hereto with
respect to the De-Carbon Parties.
C. The parties hereto desire to enter into this Agreement in order to
finally resolve any and all disputes existing between them from the beginning
of time through the date hereof.
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NOW THEREFORE, in consideration of the foregoing facts and the mutual
covenants and agreements contained herein, the parties hereto agree as follows:
1. DISMISSAL OF LAWSUIT
Concurrently with the execution of this Agreement, MTI shall
dismiss its cross-complaint in the Lawsuit (except as to the De-Carbon Parties)
with prejudice, and Xxxxxx and ETCO shall dismiss their cross-complaint in the
Lawsuit with prejudice.
2. MUTUAL RELEASE
(a) For the consideration referred to herein, Melody and MTI, on
the one side, and Xxxxxx and ETCO, on the other, on behalf of themselves and
for all of their principals, agents, employees, predecessors, successors,
assigns, officers, directors, trustees, representatives, heirs, executors,
administrators, attorneys, insurance carriers, partners, joint venturers, parent
companies, subsidiaries, and affiliates, hereby forever release and discharge
each other, and the other's principals, agents, employees, predecessors,
successors, assigns, officers, directors, trustees, representatives, heirs,
executors, administrators, attorneys, insurance carriers, partners, joint
venturers, parent companies, subsidiaries, and affiliates, from any and all
claims, causes of action, judgments, injunctions, sanctions, contempt
proceedings, liens, promises, agreements, contracts, obligations, transactions,
costs, damages, losses, lawsuits, arbitrations, appeals, liabilities,
indemnifications, debts, restrictive covenants, demands, attorneys' fees or
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expenses of any nature whatsoever, and rights of any kind or character, whether
known or unknown or speculative, except as to the enforcement of obligations
expressly set forth in this Agreement, which either party has ever had against
the other from the beginning of time through the date of this Agreement.
(b) Neither the above release nor any other provision of this
Agreement shall apply to the De-Carbon Parties.
3. WAIVER OF CIVIL CODE SECTION 1542
(a) By releasing and forever discharging any and all claims, both
known and unknown, as provided for in paragraph 2 above, the parties hereto
expressly waive their rights under California Civil Code Section 1542, which
provides:
"(a) 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, must
have materially affected his settlement with the debtor."
(b) With full knowledge and understanding of Civil Code section
1542, the parties hereby waive and relinquish any and all rights and benefits
which they have or may have under section 1542, or under any similar law of any
other jurisdiction. The parties hereto acknowledge that they are aware that
they may hereafter discover facts in addition to or different from those which
they now know or believe to be true, but it is their intention hereby to fully
and finally forever settle and release any and all matters,
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disputes and differences between them, known or unknown, suspected or
unsuspected, which now exist or heretofore have existed, and that in
furtherance of this intention, the releases herein given shall be and remain in
effect as full and complete general releases, notwithstanding the discovery or
existence of any such additional or different fact.
4. STIPULATION FOR RELEASE OF CASH IN LIEU OF BOND
Concurrently with the execution of this Agreement, Xxxxxx and ETCO
shall execute a stipulation or other suitable document enabling the Orange
County Superior Court to release to MTI the cash deposited by MTI in lieu of
bond for the preliminary injunction. MTI will prepare the required
documentation.
5. PRESS RELEASE
Xxxxxx and ETCO may issue a press release containing the following
language: "The dispute between MotorVac and Xxxxxx Xxxxxx has been amicably
resolved and no disputes between the parties remain. Details of the resolution
between the parties were not disclosed." If Xxxxxx and ETCO desire to issue a
press release with wording different than the above, the wording will have to
be mutually agreed upon by all parties.
6. CONTROLLING LAW
This Agreement shall, in all respects, be deemed entered into in Orange
County, California, and interpreted, enforced and governed exclusively by and
under the laws of the State of California. Jurisdiction and venue for any
disputes that may arise out of this Agreement shall be exclusively in the
Orange County Superior Court.
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7. ATTORNEYS' FEES
In any action or proceeding at law or in equity arising out of this
Agreement, the prevailing party shall be entitled to recover from the
unsuccessful party all costs, expenses and actual attorneys' fees incurred
therein by the prevailing party.
8. SOLE AND ONLY AGREEMENT
This Agreement contains the entire understanding of the parties with
respect to the subject matter hereof, and supersedes any and all prior
agreements between the parties hereto. There are no representations,
conditions, covenants or understandings other than those expressly referred to
herein. Each party acknowledges that no other party or any agent or attorney of
any other party has made any promise, representation or warranty whatsoever,
not expressly contained herein, concerning the subject matter hereof, to induce
the other party to execute this Agreement, and each party warrants and
acknowledges that he has not executed this Agreement in reliance on any such
promise, representation or warranty not specifically contained herein.
9. BINDING ON PREDECESSORS AND SUCCESSORS
This Agreement shall apply to, be binding upon and inure to the benefit
of the respective predecessors, successors, assigns, agents, employees, heirs,
administrators, executors, trustees, and all representatives of the parties
hereto.
10. WARRANTY OF AUTHORITY
The parties executing this Agreement warrant that they have the
authority and authorization to enter into this Agreement, and to bind their
respective corporate entities.
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11. SEVERABILITY
The provisions of this Agreement are severable, and should any
provision for any reason be unenforceable, the balance shall nonetheless be of
full force and effect.
12. JOINT PREPARATION
This Agreement shall be deemed to have been jointly prepared by the
parties hereto. Therefore, any uncertainty or ambiguity that may exist herein
shall not be interpreted against any party hereto, but otherwise according to
the application of the rules on interpretation of contracts.
13. COUNTERPARTS
This Agreement may be executed in counterparts.
14. KNOWING AND VOLUNTARY EXECUTION
The parties hereto warrant and acknowledge that they fully understand
the terms and consequences of this Agreement, that they have had the
opportunity to employ the services of independent and competent legal counsel
with respect to this Agreement, and that their decision to enter into this
Agreement was of their own free will, and was not based on, influenced by or
induced by any threat or coercion whatsoever.
15. NECESSARY DOCUMENTS AND INSTRUMENTS
The parties hereto agree to execute any and all other documents and
instruments which may be reasonably necessary or proper to effectuate and carry
out the purposes of this Agreement.
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16. NO ASSIGNMENT
The parties warrant to one another that they have not assigned or
transferred, or purported to assign or transfer, to any person or entity,
either voluntarily or involuntarily, any claim, cause of action or right being
released herein.
17. GENDER
Wherever the masculine, feminine or neuter form is used in this
Agreement, said term shall apply with equal force and effect to any other
gender, or to an entity, as required by the context wherein the term appears.
18. WAIVER AND MODIFICATION
No provision of this Agreement may be waived or modified except by a
writing signed by all of the parties hereto.
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IN WITNESS WHEREOF, the parties have executed this Agreement so that
the same shall be effective as of the date first above written.
MOTORVAC TECHNOLOGIES, INC.
/s/ XXX X. MELODY
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By: Xxx X. Xxxxxx
Its: President
/s/ XXX X. MELODY
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Xxx X. Xxxxxx
EQUIPMENT TECHNOLOGY COMPANY, INC.
/s/ XXXXXX X. XXXXXX
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By: Xxxxxx X. Xxxxxx
Its: President
/s/ XXXXXX X. XXXXXX
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Xxxxxx X. Xxxxxx
APPROVED AS TO FORM AND CONTENT:
XXXXXXX, LUMSDAINE & XXXXX LLP
By: /s/ J. A LUMSDAINE
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Attorneys for MotorVac Technologies, Inc.
and Xxx X. Xxxxxx
THE XXXXXX LAW FIRM
By: /s/ XXXXXX X. XXXXXX
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Attorneys for Equipment Technology Company,
Inc. and Xxxxxx X. Xxxxxx
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