EXHIBIT
4.1
SETTLEMENT AND RETAINER AGREEMENT
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THE TIREX CORPORATION
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SETTLEMENT AND RETAINER AGREEMENT
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Agreement, made this 25th day of June, 1999, by and among
The Tirex Corporation
000 Xx. Xxxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxx
Xxxxxx X0X 0X0
("Tirex")
Xxxxxxx Xxxx Xxxxxx
000 Xxxxx Xxxx
Xxxxxx Xxxxxx, XX 00000
("Xxxxxx")
and
Xxxxx Xxxxxxxx
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
("Rapfogel")
A. RECITALS
Whereas, Xxxxxx and Tirex are parties to an Employment Agreement, dated
December 22, 1996 (the "Xxxxxx Employment Agreement"), pursuant to which Xxxxxx
was employed by Tirex as its Corporate and United States Securities Counsel, and
Rapfogel and Tirex are parties to an Employment Agreement, dated June 22, 1998
(the "Rapfogel Employment Agreement"), pursuant to which Rapfogel was employed
by Tirex as its Assistant Corporate and United States Securities Counsel.
Whereas, effective the close of business this date, Tirex is
terminating the employment of Xxxxxx and Xxxxxxxx.
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Whereas, the termination of Xxxxxx was made other than for cause
pursuant to Paragraph 6.2 of the Xxxxxx Employment Agreement and the termination
of Rapfogel was made without cause pursuant to Paragraph 8.4 of the Rapfogel
Employment Agreement.
Whereas, Tirex has acknowledged and agreed that, pursuant to the terms
of their respective Employment Agreements, Xxxxxx is entitled to immediate
payment of $300,000 and Rapfogel is entitled to immediate payment of $220,000.
Whereas, Tirex currently lacks the financial resources to make cash
payment of the sums which it acknowledges Xxxxxx and Xxxxxxxx are presently
entitled to be paid, as set forth above and Xxxxxx and Rapfogel have agreed to
accept in lieu of such cash payment, shares of Tirex's Common Stock, $.001 par
value per share ("Common Stock") and Options to purchase Common Stock, as set
forth herein.
Whereas, Tirex acknowledges that Xxxxxx and Xxxxxxxx have agreed to
accept the above referenced shares and options on the basis of such shares
eventually having some liquid value through the market sale thereof pursuant to
the exemption from the registration requirements of the Securities Act of 1933,
as amended (the "Securities Act") provided by Rule 144 thereof ("Rule 144")
and/or pursuant to the registration of such shares by Tirex under the Securities
Act pursuant to a Form S-8 registration statement or such other Form as should
be available and practicable for such purpose.
Whereas, Tirex is in its early stage of operations with limited hard
assets, income, operations, and financial resources on hand to finance the
development of its business. Its future financial prospects and position are
therefore highly contingent and impossible to predict. Based upon the foregoing,
unregistered shares of Tirex's Common Stock, which cannot be sold into the
public market for an extended period of time, have a value which reflects
Tirex's poor financial position and uncertain future, and can be expected to be
saleable by Tirex, in arm's length transactions, for not more than fifty percent
(50%) of the current market value of the publicly traded stock of Tirex, or for
substantially less.
B. AGREEMENT
1. The parties agree that the amount immediately payable to Xxxxxx in
connection with the termination of her employment, as described above, is
$300,000 United States Dollars and the amount immediately payable to Rapfogel in
connection with the termination of his employment, as described above, is
$220,000 United States Dollars.
2. Xxxxxx and Xxxxxxxx hereby agree to accept in full satisfaction of all
payments due to them in connection with Tirex's termination of their respective
Employment Agreements, as described in Section A, above, Shares of Tirex's
Common Stock at a per share value equal to fifty percent (50%) of the average of
the high ask and low bid prices of Tirex's Common Stock
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as traded in the over-the-counter market and quoted in the OTC Electronic
Bulletin Board on Friday, June 25, 1999, as follows:
2.1 For Xxxxxx:
(a) A three-year option to purchase 2,000,000 shares at a
price of $.001 per share; and
(b) the number of shares issuable pursuant to Paragraph
2, above, less 2,000,000 shares.
2.2 For Rapfogel:
(a) A three-year option to purchase 2,000,000 shares at a
price of $.001 per share; and
(b) the number of shares issuable pursuant to Paragraph
2, above, less 2,000,000 shares.
C. RETAINER
Tirex hereby retains Xxxxxx and Xxxxxxxx, or either one of them, or any
law firm or partnership with which either one of them may in future be
associated with, as Xxxxxx and Rapfogel shall notify Tirex, for the limited
purposes of: (i) preparing and filing on behalf of Tirex one or more
registration statements on Forms S-8, registering the resale of the shares of
Common Stock underlying the options granted to them hereinabove, and (ii)
preparing and submitting to Tirex's transfer agent, legal opinion letters
respecting the propriety of removing restrictions on transfer of any shares of
Common Stock then held by Levine, Rapfogel, or, at his request, Xxxxxxx X.
Xxxxx, as such shares shall become eligible for sale, or the removal of all
restrictions, pursuant to Rule 144 or Rule 144(k) of the Securities Act of 1933.
Xxxxxx and Rapfogel agree that all such services shall be performed without
charge to Tirex.
D. LIQUIDATED DAMAGES
The parties hereto agree that in the event that Tirex shall take any
action which in any way impairs or impedes the ability or right of Rapfogel or
Xxxxxx to perform the functions for which they have been retained pursuant to
Section C of this Agreement, that Rapfogel and Xxxxxx shall be entitled to
liquidated damages in cash in an amount equal to the number of restricted shares
of Common Stock held by them multiplied by three times the per share public
market price.
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E. RELEASES
In consideration for, and in furtherance of the foregoing, Tirex, (the
"Releasor"), hereby releases and discharges Xxxxxx and Rapfogel, or either one
of them, their respective heirs, executors, administrators, successors, and
assigns (jointly and severally, the "Releasees) from all actions, causes of
action, debts, sums of money, accounts, reckonings, covenants, contracts,
controversies, agreements, promises, damages, judgments, executions, claims and
demands whatsoever, in law, admiralty or equity, which against the Releasees,
the Releasor, its successors, or assigns, ever had, now has, or hereafter can,
shall, or may, have for, upon, or by reason of any matter, cause or thing
arising out of or in any way connected with the Releasees services as legal
counsel to the Releasor, the issuance of any shares of Common Stock to the
Releasees, the Releasees rights to sell any shares of the Releasor's Common
Stock pursuant to the provisions of Rule 144, Rule 144(k), or the obligation of
Tirex to register any shares of its Common Stock heretofore or hereinafter
issued to the Releasees.
THE TIREX CORPORATION
By /s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx, President
/s/ Xxxxxxx Xxxx Xxxxxx
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Xxxxxxx Xxxx Xxxxxx
/s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx
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