EXHIBIT 10.2
SETTLEMENT AGREEMENT
WHEREAS, Xxx X. Xxxxx ("Balak") previously served as an officer and
director of Power Technology, Inc. ("PWTC"), a Nevada corporation; and
WHEREAS, The Company filed a civil action, styled Case No. A465306, Power
Technology, Inc. v. Xxxxx Xxxxxx, in the District Court, Xxxxx County, Nevada,
("Case No. A465306") against Xxxxx X. Xxxxxx, ("Snaper") a former director and
officer of the Company, and against Neo-Dyne Research, Inc. ("Neo-Dyne"),
Snaper's research and development company, based upon allegations of breach of
fiduciary relationship and breach of contract, and seeking an injunction,
declaratory relief and the turnover of Company property. Snaper and Neo-Dyne
filed an answer and asserted counterclaims against PWTC and added Balak as a
third party defendant; and
WHEREAS, Balak asserts that he did not breach any duty to Snaper,
Neo-Dyne, or PWTC in his capacity as an officer or director of PWTC or in his
individual capacity and that no improper or unauthorized payments were made to
Balak; and
WHEREAS, the parties to Xxxx Xx X000000 have agreed to a settlement of the
claims which were alleged in Xxxx Xx X000000 and PWTC agreed to pay Snaper and
Neo-Dyne $20,000.00 as consideration for the for that settlement, which includes
a release by Snaper and Neo-Dyne of claims made by them against Balak; and
WHEREAS, PWTC executed a Promissory Note dated May 21, 2004, payable to
the order of CORPORATE STRATEGIES, INC., in the principal sum of $100,000.00,
("the Promissory Note") which was secured by the pledge by Balak of 27,157,483
shares of fully paid and non-assessable shares of common stock of PWTC
represented by certificate numbers 5324, 5339, 5764, 5768, and 5947 in the name
of Xxx Xxxxx, and
WHEREAS, Balak and PWTC desire to resolve any potential claims that PWTC
may have against Balak concerning his conduct while he was an officer and
director of PWTC;
NOW, THEREFORE, IT IS HEREBY AGREED that in consideration for the releases and
other promises set forth herein, the Parties agree as follows:
1. PWTC shall pay when due, to Corporate Strategies, Inc., all sums due pursuant
to the Promissory Note and shall obtain the release of and the delivery to Balak
of the pledged 27,157,483 shares of fully paid and non-assessable shares of
common stock of Power Technology, Inc., evidenced by share certificate numbers
5324, 5339, 5674, 5768, and 5947 in the name of Xxx Xxxxx.
2. Balak hereby surrenders to PWTC ownership of 4,000,000 fully paid and
non-assessable shares of the common stock of PWTC and waives all ownership
right, title, or interest in those shares. Balak shall surrender to Pacific
Stock Transfer Company, PWTC's transfer agent, share certificate Number 5947
evidencing Balak's ownership of 23,285,483 shares of fully paid and
non-assessable common stock of PWTC. Balak and PWTC shall give irrevocable
instructions to Pacific Stock Transfer Company, to cancel Balak's ownership of
4,000,000 of the shares of fully paid and non-assessable common stock
represented by certificate Number 5947 and to reissue a new share certificate to
Balak evidencing his ownership of 19,285,483 shares of fully paid and
non-assessable common stock of PWTC.
3. PWTC shall deliver to Balak a release from Snaper and Neo-Dyne which shall
release and discharge Balak, indemnify him, and hold him harmless of and from
any and all claims that were asserted or could have been asserted in the
Counterclaim filed by Snaper and Neo-Dyne against Balak in Case No. A465306.
4. PWTC hereby fully and finally settles, releases, acquits, forever discharges,
and covenants not to xxx Xxxxx with respect to any and all claims, demands,
liabilities, damages, complaints, causes of action, debts, amounts due, refunds,
intentional or negligent acts, intentional or negligent omissions,
representations, breaches of contract, breaches of warranty, breaches of duty,
intentional or nonintentional torts, conspiracies, waste or waste claims,
express indemnity, contribution, implied or equitable indemnity, economic
damages, non-economic damages, property damage, loss of use, attorneys' fees,
expert fees, repair costs, investigative costs, relocation costs, lost profits,
omissions, conduct, or damage of every kind or nature whatsoever, whether known
or unknown which are related to any act that Balak did or failed to do in his
capacity as an officer or director of PWTC.
5. Balak agrees and acknowledges that the Share Lockup Agreement of Paragraph 9
of the Consulting Services Agreement dated June 30, 2004, between PWTC and Balak
shall remain in full force and effect.
6. Each of the Parties agrees that this Agreement was the product of a
negotiated compromise relating to disputed claims and potential claims, and that
it was entered into in lieu of incurring additional costs and attorneys' fees,
and to avoid exposure to other risks and litigation, and that nothing stated
herein shall be treated as an admission of liability of any Party for any
purpose, and that the validity of any and all claims or potential claims by PWTC
against Balak was expressly denied by Balak.
POWER TECHNOLOGY, INC.,
a Nevada corporation
By:
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Xxxxxxx X. Xxxxxx - President
Subscribed and sworn to before me on this ____ day of January 2005.
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Notary Public
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Xxx Xxxxx
Subscribed and sworn before me on this the ___day of January 2005.
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Notary Public in and for the Province
of British Columbia, Canada
