SEPARATION OF EMPLOYMENT, CONSULTING,
SETTLEMENT, RELEASE,
AND SHARE WAIVER AGREEMENT
THIS AGREEMENT ("Agreement"), is made and entered into this 17th day of
December, 1998, at Phoenix, Arizona, by and among the following persons and
entities:
1. Xxxxxxx Xxxxxxxxxxx ("Xxxxxxxxxxx")
2. United States Aircraft Corporation, a Delaware corporation
("U.S. Aircraft"); and
3. Neo Vision, Inc., an Arizona corporation ("Neo Vision").
RECITALS
A. WHEREAS, Xxxxxxxxxxx previously was employed by U.S. Aircraft
pursuant to an Employment Agreement dated June 30, 1998 (the "Employment
Agreement"), and resigned from such employment on November 9, 1998, including
having resigned as a director and officer of U.S. Aircraft and Neo Vision on
November 9, 1998; and
B. WHEREAS, as a result of the foregoing, and the desire of the parties
to develop a mutually beneficial business relationship, the parties desire to
settle any issues arising and/or relating in any way to the departure of
Xxxxxxxxxxx, and to provide a mutually satisfactory agreement to permit each to
pursue independent business ventures;
NOW, THEREFORE, in consideration of the foregoing premises and mutual
covenants hereinafter expressed, the parties do hereby agree as follows:
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AGREEMENT
1. XXXXXXXXXXX PAYMENTS. U.S. Aircraft will pay to Xxxxxxxxxxx his
accrued compensation through November 9, 1998, in the amount of Forty-One
Thousand Two Hundered Fifty Dollars ($41,250), following the approval by the
stockholders of U.S. Aircraft ("Stockholder Approval") of the amendment and
restatement of U.S. Aircraft's certificate of incorporation (the "Proposal")
described in the proxy statement (the "Proxy Statement") filed with the
Securities and Exchange Commission (the "SEC"), payable as follows: Two Thousand
Dollars ($2,000) per month commencing February 1, 1999, and then Five Thousand
Dollars ($5,000) per month commencing May 1, 1999 until the entire Forty-One
Thousand Two Hundred Fifty Dollars ($41,250) is paid in full. If the
stockholders of U.S. Aircraft do not approve the Proposal, then no sums shall be
owed to Xxxxxxxxxxx. Notwithstanding the foregoing, if Neo Vision shall obtain a
cumulative total of Two Hundred Fifty Thousand Dollars ($250,000) in financing
prior to any such stockholder vote on the Proposal, then Xxxxxxxxxxx shall be
entitled to receive Twenty Thousand Six Hundred Twenty-Five Dollars ($20,625)
within ten (10) days of Neo Vision obtaining such financing, and the remaining
Twenty Thousand Six Hundred Twenty-Five Dollars ($20,625) within ninety (90)
days of Neo Vision obtaining such financing, even if the stockholders do not
approve the Proposal, but in no event later than one hundred eighty (180) days
after the date of this Agreement, if such financing has been obtained by such
date. If U.S. Aircraft shall fail to pay such accrued compensation within the
above-described periods, the treble damages penalty of A.R.S. ss. 23-355 will be
applied. U.S. Aircraft expressly waives Christopher's failure to comply with the
notification provisions of the Employment Agreement.
2. RETURN OF PROPERTY. Xxxxxxxxxxx agrees to use his best efforts to
return all corporate property, books, and records of U.S. Aircraft and Neo
Vision, to U.S. Aircraft and Neo Vision, respectively, including without
limitation, all files, minute books, address books, and rolodexes, and the
names, addresses, and telephone numbers of all product, sale, financing, and
broker contacts.
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3. SHARES FOR DEBENTURE HOLDERS. Xxxxxxxxxxx, Neo Vision, and U.S.
Aircraft hereby agree that Six Hundred Thousand (600,000) shares of the New
Common Stock to which Xxxxxxxxxxx is entitled under the Exchange Agreement dated
as of June 30, 1998 (the "Exchange Agreement"), shall be issued to the debenture
holders of Neo Vision as of the date of this Agreement and Xxxxxxx Xxxxxxx or
his assigns, with Four Hundred Thousand (400,000) shares issued to the Debenture
holders on a pro rata basis, and Two Hundred Thousand (200,000) shares to
Xxxxxxx Xxxxxxx or his assigns, but only in the event of Stockholder Approval.
The parties intend that Christopher's waiver of his right to these shares under
the Exchange Agreement and issuance of such shares to the Neo Vision debenture
holders (collectively, the "Debenture Transactions") will not result in any
taxable income to Xxxxxxxxxxx. In the event that the Internal Revenue Service
("IRS") contends that the Debenture Transactions do result in the recognition of
taxable income to Xxxxxxxxxxx, Xxxxxxxxxxx shall notify Neo Vision of the same
and provide Neo Vision with the opportunity, and the reasonable cooperation, to
defend such IRS action. In the event of an unappealable decision that the
Debenture Transactions are taxable to Xxxxxxxxxxx or Neo Vision's decision to no
longer defend such IRS action, Neo Vision shall issue to Xxxxxxxxxxx the number
of shares of New Common Stock that have a then fair market value equal to
Christopher's tax liability with respect to the Debenture Transactions and any
tax attributable to the receipt of such shares.
4. RIGHTS OF XXXXXXXXXXX. U.S. Aircraft and Neo Vision acknowledge the
right of Xxxxxxxxxxx to compete with either company, except as set forth in this
Agreement.
5. GRANT OF EXCLUSIVE RIGHTS TO NEO VISION AND U.S. AIRCRAFT. For a
period commencing on the date of this Agreement and ending two (2) years after
the date of this Agreement, U.S. Aircraft and Neo Vision shall have the
exclusive rights to engage in the electronic and computer-based video screen
wall or related electronic business (the "Video Wall Business") in any mall or
airport location or site in the United States of America (the "Mall/Airport
Market"). In the event that Neo Vision and/or U.S. Aircraft do not have a total
of twelve (12) operating video walls at the end of one (1) year after the date
of this Agreement, then the exclusive period in this Paragraph 5 shall
terminate.
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Following the end of such two (2) or one (1) year period, as applicable,
Xxxxxxxxxxx shall have the right to compete with U.S. Aircraft and Neo Vision in
the Mall/Airport Market.
6. TRADE SECRETS. Xxxxxxxxxxx recognizes that certain applications,
technologies, and systems developed by Neo Vision may constitute trade secrets
of Neo Vision. Xxxxxxxxxxx agrees that he will not use such applications,
technologies or systems in any new venture, but reserves the right to use any
application, technology, or system which is independently available from public
or private sources. Similarly, Neo Vision. and U.S. Aircraft acknowledge
Christopher's right, except as restricted by paragraph 5 hereof, to use
applications, technologies, and systems which are not the trade secrets of Neo
Vision.
7. CONSULTING. Xxxxxxxxxxx agrees to consult with U.S. Aircraft and Neo
Vision on an informal basis with respect to the Video Wall Business from time to
time at his sole discretion.
8. EFFECT OF STOCKHOLDER NON-APPROVAL. If the stockholders do not
approve the Proposal, then Paragraphs 3 and 5 shall be null and void and without
any legal effect.
9. PROPOSAL; COOPERATION. Xxxxxxxxxxx hereby agrees to vote in favor of
the Proposal. The parties agree to cooperate in good faith with each other in
carrying out the terms and conditions of this Agreement.
10. MUTUAL RELEASE. In consideration of the consideration and
agreements called for herein, each party hereby completely releases and forever
discharges each and every other party, and their past and present officers,
directors, stockholders, agents, servants, representatives, employees,
subsidiaries, affiliates, partners, predecessors, and successors in interest,
and assigns and all other persons, firms, or corporations with whom any of the
foregoing have been or are now affiliated, of, for, from, and against any and
all past or present claims, demands, obligations, actions, causes of action,
rights, damages, costs, losses of services, expenses, and compensation of any
nature whatsoever, known or unknown, express or implied, whether based on tort,
contract, or other theory of recovery, which the parties may have had in the
past against each other.
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11. MISCELLANEOUS. In entering into this Settlement Agreement, the
parties represent and warrant:
a. REPRESENTATION BY COUNSEL. They have relied on the legal advice
of their attorneys, who are attorneys of their own choice, and
that the terms of this Agreement have been completely read and
explained to them by their attorneys, and that those terms are
fully understood and voluntarily accepted by them.
b. ENTIRE AGREEMENT, MODIFICATION. This instrument contains the
entire agreement among the parties hereto with respect to the
settlement and other matters contemplated hereby and shall not
be changed or terminated except by written amendment signed by
the parties hereto.
c. VENUE; CHOICE OF LAWS. The parties waive any objection to venue
and hereby agree that any action to enforce this Agreement shall
be brought in the Superior Court of Arizona, Maricopa County
which shall have exclusive jurisdiction to enforce this
Agreement. The laws of the State of Arizona shall govern the
validity, performance, and enforcement of this Agreement.
d. INVALIDITY. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws
effective during the term of this Agreement, such provision
shall be fully severable; this Agreement shall be construed and
enforced as if such illegal, invalid, or unenforceable provision
had never comprised a part of this Agreement; and the remaining
provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement.
Furthermore, in lieu of each such illegal, invalid, or
unenforceable provision, there
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shall be added automatically as part of this Agreement a
provision as similar in terms to such illegal, invalid, or
unenforceable provision as may be possible and be legal, valid
and enforceable.
e. HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
f. COUNTERPARTS. This Agreement may be executed in any number of
counterparts by the parties, which counterparts together shall
constitute one and the same agreement, and it shall not be
necessary for the parties to execute the same counterpart
hereto.
g. INDULGENCES; NOT WAIVERS. Neither the failure nor any delay on
the part of a party to exercise any right, remedy, power, or
privilege under this Agreement shall operate as a waiver
thereto, nor shall any single or partial exercise of any right,
remedy, power or privilege exclude any other or further exercise
of any other right, remedy, power, or privilege, nor shall any
waiver of any right, remedy, power, or privilege with respect to
any occurrence by construed as a waiver of such right, remedy,
power, or privilege with respect to any other occurrence. No
waiver shall be effective unless it is in writing and is signed
by the party asserted to have granted such waiver.
h. COSTS AND EXPENSES. Each party shall bear its own costs and
expenses (including the fees and reimbursements of counsel)
received in connection with the negotiations and preparation of
this Agreement.
i. NOTICES. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing
and shall be deemed to have
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been duly given, made and received when delivered against receipt
or when deposited in the United States mails, certified mail,
return receipt requested, postage prepaid, addressed as set forth
below:
If to U.S. Aircraft or Neo Vision:
0000 X. 00xx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
With a copy given in the manner prescribed above, to:
X'Xxxxxx, Cavanagh, Anderson,
Xxxxxxxxxxxxx & Xxxxxxxx, P.A.
Xxx Xxxx Xxxxxxxxx Xxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
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If to Xxxxxxxxxxx:
Xxxx Xxxxxxxxxxx
0000 X. Xxxxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
with a copy given in the manner prescribed above, to:
Xxxxxxxx & Xxxxxxxx
0000 X. Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Any party may alter the address to which communications or copies are
to be sent by giving notice to such of change of address in conformity with the
provisions of this paragraph for the giving of notice.
j. ATTORNEYS' FEES. In the event of any breach of this Agreement,
the breaching party agrees to pay all fees, expenses, and costs
incurred by the non-breaching party, including, without
limitation, attorneys' fees, whether or not suit is filed, and
all costs of suit and preparation for suit (whether at trial or
appellate level).
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IN WITNESS WHEREOF, the parties hereto or their duly authorized
representatives, having represented that they have the authority to do so, have
executed this Agreement at Phoenix, Arizona, on the date, month, and year first
above written.
/s/ Xxxxxxx Xxxxxxxxxxx
-----------------------------------
Xxxxxxx Xxxxxxxxxxx
UNITED STATES AIRCRAFT
CORPORATION
/s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
By: Xxxxxx X. Xxxxxxxxx
Its: CEO
NEO VISION, INC.
/s/ Xxxxxx X. Xxxxxxxxx
-----------------------------------
By: Xxxxxx X. Xxxxxxxxx
Its: CEO
STATE OF ARIZONA }
} ss.
County of Maricopa }
The foregoing was acknowledged before me by Xxxxxxx Xxxxxxxxxxx this
17th day of December, 1998.
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Notary Public
My Commission Expires:
January 12, 2002
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STATE OF ARIZONA }
} ss.
County of Maricopa }
The foregoing was acknowledged before me this 17th day of December,
1998, by Xxxxxx X. Xxxxxxxxx, the CEO of United States Aircraft Corporation.
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Notary Public
My Commission Expires:
January 12, 2002
STATE OF ARIZONA }
} ss.
County of Maricopa }
The foregoing was acknowledged before me this 17th day of December,
1998, by Xxxxxx X. Xxxxxxxxx, the CEO of Neo Vision, Inc.
/s/ Xxxxxxx X. Xxxxxx
-----------------------------------
Notary Public
My Commission Expires:
January 12, 2002
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