COMPROMISE SETTLEMENT AGREEMENT
AND MUTUAL RELEASE
1. Parties. This Compromise Settlement Agreement and Mutual Release (the
"Release) is dated this 20th day of December, 1999 (the "Effective Date") and is
by and between Power Exploration, Inc., a Nevada corporation ("Power") and
Trident III, L.L.C., a Cayman Islands, West Indies exempted company ("Trident").
Power and Trident represent, covenant, agree to, and accept the statements,
terms and conditions hereof as evidenced by their respective signatures below.
2. Recitals. The alleged facts and circumstances giving rise to this Release are
as set forth hereinbelow.
2.1. Power and Trident executed a document entitled Loan Agreement
("Power Loan Agreement") dated to be effective October 21, 1998. A true and
correct copy of the unexecuted Power Loan Agreement is attached hereto marked
Exhibit "A" and incorporated herein by reference for all purposes (with the
executed Power Loan Agreement being identical to the document attached hereto
marked Exhibit "A" but for the inclusion of signatures).
2.2. In connection with the Power Loan Agreement, Power and Trident
executed a document entitled 10% Promissory Note ("Power Note") dated to be
effective October 21, 1998. A true and correct copy of the unexecuted Power Note
is attached hereto as Exhibit "B" and incorporated herein by reference for all
purposes (with the executed Power Note being identical to the document attached
at Exhibit "B" but for the inclusion of signatures). Pursuant to the terms of
the Power Note, Power promised to pay to Trident the principal amount of
$250,000 bearing interest and payable as therein provided.
2.3. On or about March 15, 1999, Power and Trident executed a document
entitled Agreement To Extend Repayment Obligation ("Power Modification"). A true
and correct copy of the Power Modification is attached hereto marked Exhibit "C"
and incorporated herein by reference for all purposes (with the executed Power
Note being identical to the document attached at Exhibit "C" but for the
inclusion of signatures). Pursuant to the terms of the Power Modification, Power
and Trident agreed to modify the repayment terms of the Power Note.
2.4. In connection with the Power Loan Agreement, Power and Trident
executed a document entitled Security Agreement ("Power Security Agreement")
dated to be effective October 21, 1998. A true and correct copy of the
unexecuted Power Security Agreement is attached hereto marked Exhibit "D" and
incorporated herein by reference for all purposes (with the executed Power
Security Agreement being identical to the document attached at Exhibit "D" but
for the inclusion of signatures). Pursuant to the terms of the Power Security
Agreement, Power granted to Trident a security interest in certain assets as
more fully described therein.
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2.5. Power and Trident wish to settle the matters pertaining to the
Power Loan Agreement, Power Note, Power Modification and Power Security
Agreement and have reached an agreement to that effect as set forth herein.
3. Consideration. Consideration for this Release is the mutual promises herein
and each act done by Power and Trident pursuant hereto, the receipt and
sufficiency of which is acknowledged by Power and Trident, and the following:
a) The issuance to Trident of 279,861 shares of Power common stock,
restricted under Rule 144, by certificate in the form attached hereto
at Exhibit "E" and incorporated herein by reference for all purposes
("Power Restricted Stock"), the delivery and receipt of which is hereby
acknowledged; b) The agreement by Power to register the 279,861 shares
of Power Restricted stock, restricted under Rule 144, at the time that
Power next files a SEC Registration Statement; and c) If any of the
stock acquired hereunder is not registered, is held by the holder for
the time required under Rule 144 and the legend is then removed, then
Trident agrees, with regard to the stock acquired hereunder, not to
sell more than 1% of the outstanding shares of Power every 90 days.
Power and Trident acknowledge that they will not be entitled to any additional
consideration for the execution of this Release other than as expressly set
forth and provided for herein. By their signatures below, Power and Trident
acknowledge the receipt and sufficiency of the consideration evidenced by this
Release, including, without limitation, Trident's receipt of the Power
Restricted Stock.
4. No Pending Claims. Trident warrants and represents that there are no claims
against Trident or Power or any party in any way related thereto, which are
either pending, threatened or of which Trident or Power are otherwise aware. The
parties hereto hereby agree that any warrants or options issued to either
Trident, its affiliates, or any individuals related thereto are hereby
extinguished. Trident acknowledges that Power is relying upon these
representations and that these representations are a material inducement to the
execution of this Release by Power.
5. Mutual Releases. In consideration of the agreements and compromises set forth
herein, Power and Trident each agree, covenant and represent as follows:
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5.1. Power hereby releases, acquits and forever discharges Trident, and
its respective current and former stockholders, successors, assigns, agents,
directors, officers, employees, representatives, attorneys, divisions,
subsidiaries, affiliates (and agents, directors, officers, employees,
representatives and attorneys of such divisions, subsidiaries and affiliates),
administrators, predecessors-in- interest and successors-in-interest, of and
from any and all claims, demands, actions and causes of action of whatever kind
or character which Power may now have, whether known or unknown, asserted or
unasserted, arising out of or connected in any way with the relationship between
Power and Trident including the Power Loan Agreement, Power Note, Power
Modification and Power Security Agreement and any and all other matters, from
the beginning of time until the date hereof, excluding enforcement of this
release.
5.2. Except for the obligation of Power set forth herein at paragraph
3b, Trident hereby releases, acquits and forever discharges Power, and its
respective current and former stockholders, successors, assigns, agents,
directors, officers, employees, representatives, attorneys, divisions,
subsidiaries, affiliates (and agents, directors, officers, employees,
representatives and attorneys of such divisions, subsidiaries and affiliates),
administrators, predecessors-in-interest and successors-in-interest, of and from
any and all claims, demands, actions and causes of action of whatever kind or
character which Trident may now have, whether known or unknown, asserted or
unasserted, arising out of or connected in any way with the relationship between
Power and Trident including the Power Loan Agreement, Power Note, Power
Modification and Power Security Agreement and any and all other matters from the
beginning of time until the date hereof, and excluding enforcement of this
release.
6. Settlement of a Disputed Obligation. The agreements being made herein by
Power and Trident are merely to settle disputed claims and are not to be
construed as an admission of any fault or liability by Power or Trident, such
being hereby specifically and expressly denied by Power and Trident.
7. Authorization. The making and performance of this Release has been duly
authorized and is approved by Power and Trident. This Release constitutes the
legal, valid and binding obligation of Power and Trident and is enforceable in
accordance with its terms. In addition, the undersigned are duly authorized by
the respective parties to execute this Release in their representative
capacities by all necessary proceedings.
8. Representation of Ownership. Power and Trident and/or their subsidiaries
represent and covenant that they are the owners of any and all claims at issue
herein or in any way relating to or involving the subject matter set forth
herein.
9. Review and Understanding. Power and Trident have reviewed this Release and
they (a) understand fully the terms of this Release and its consequences and (b)
have had this Release reviewed by competent legal counsel of their choice.
COMPROMISE SETTLEMENT AGREEMENT AND MUTUAL RELEASE
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10. No Other Representations. Execution of this Release is not based upon
reliance by Power or Trident upon any representation, understanding or agreement
that is not expressly set forth herein, and neither Power nor Trident have made
any representations to each other which are not expressly set forth herein; and
further, but not in limitation of the foregoing, neither Power nor Trident have
made any representations which affect the consideration or any condition for
which the Release is executed which has not been expressly embodied and fully
set forth herein.
11. Binding Effect. This Release shall be binding upon and inure to the benefit
of the parties hereto and their respective successors, assigns, heirs, and legal
representatives, but shall not be binding upon any party until signed by all
parties. It is expressly understood and agreed that the terms hereof are
contractual in nature, including those set forth in the provisions designated
"Recitals," and are not mere recitals, that the agreements herein contained and
the consideration transferred hereby are to buy peace, and the consideration
transferred and conveyed hereby shall not be construed as an admission of
liability by any of the parties to this Release.
12. Modification. No modification or amendment of this Release shall be
effective unless such modification or amendment is in writing and signed by all
parties hereto.
13. Gender and Number. Throughout this Release, the singular number shall
include the plural, the plural shall include the singular, and the use of any
gender shall be applicable to all genders.
14. Governing Law. The interpretation, construction, and performance of this
Release shall be governed by the laws of the State of Texas, without giving
effect to conflict of laws principles, and this Release is performable in
Tarrant County, Texas.
15. Headings. The headings of this Release have been included only for ease of
reference for the subject covered by each provision and are not to be used in
construing this Release or in ascertaining its meaning.
16. Severability. If any portion of this Release shall be held to be invalid or
inoperative, then, so far as is reasonable and possible, the remainder of this
Release shall be considered valid and operative, and no effect shall be given to
the intent manifested by the portion held invalid or inoperative.
17. Execution of Necessary Documents. Power and Trident further covenant and
agree to execute any and all documents necessary to effectuate the provisions of
this Release and to cooperate fully with each other in carrying out the
provisions of this Release.
COMPROMISE SETTLEMENT AGREEMENT AND MUTUAL RELEASE
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18. Survival. Each and every provision of this Release shall survive the
execution hereof.
19. Entire Agreement. This Agreement and the Purchase Agreement executed by the
parties hereto of even date herewith and incorporated herein by reference for
all purposes constitute the entire agreement between Power and Trident and
supersede all prior and contemporaneous agreements, understandings, negotiations
and discussions, whether oral or written. There are no warranties,
representations, or other agreements between the parties hereto in connection
with the subject matter hereof, except as specifically set forth herein.
20. Attorneys' Fees. In the event of any litigation concerning any controversy,
claim or dispute between Power and Trident arising out of or relating to this
Release or the breach hereof, or the interpretation hereof, the prevailing party
shall be entitled to recover from the losing party reasonable expenses,
attorneys' fees, and costs incurred therein or in the enforcement or collection
of any judgment or award rendered therein. The "prevailing party" means the
party determined by the court to have most nearly prevailed, even if such party
did not prevail in all matters, and is not necessarily the one in whose favor a
judgment is rendered.
21. Broadest Nature. Power and Trident warrant that this Release is to be of the
broadest nature and is to be dispositive of all matters between Power and
Trident with respect to the Power Loan Agreement, Power Note, Power Modification
and Power Security Agreement and all matters at issue in each, directly and
indirectly. Further, Trident warrants that it has not recorded in any
jurisdiction with any entity the Power Security Agreement nor any document in
any way related thereto including, without limitation, any UCC-1 forms.
22. Joint Preparation. This Release was prepared jointly by the parties hereto
and not by any one to the exclusion of the other.
IN WITNESS WHEREOF, the parties have caused this Release to be duly executed and
delivered as of the Effective Date.
Power Exploration, Inc. Trident III, L.L.C.
By: /s/Xxx Xxxx Xxxxxxx By: /s/Xxxxxxx X. Xxxx
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Printed Name:Xxx Xxxx Xxxxxxx Printed Name: Xxxxxxx X. Xxxx
Title: President Title: Director
COMPROMISE SETTLEMENT AGREEMENT AND MUTUAL RELEASE
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