EXHIBIT 10.1
MUTUAL SETTLEMENT AND RELEASE AGREEMENT
This Mutual Settlement and Release Agreement (hereinafter the "Agreement")
is made by and between Power Technology, Inc. (hereinafter "PWTC"), Xxxx X.
Xxxxxxx (hereinafter "Xxxxxxx"), X. Xxxxxx Xxxxxxx (hereinafter "Farrill"), and
Xxx Xxxxx (hereinafter "Balak") (hereinafter jointly referred to as "Power"), on
the one hand, and Xxxxx Xxxxxx (hereinafter "Al") and Neo-Dyne Research, Inc.
(hereinafter "Neo-Dyne") (hereinafter jointly referred to as "Snaper"), on the
other hand (all of the parties executing this Agreement are sometimes referred
to jointly hereinafter as the "Parties" and any one of them is sometimes
referred to hereinafter as a "Party").
1. RECITALS. The Parties hereto expressly acknowledge and agree as
follows:
A. On or about March 27, 2003, Plaintiff PWTC filed a Complaint
against Snaper in the Xxxxx County, Nevada District Court, which was assigned
Case No. A465306, and Snaper thereafter counterclaimed against Power
(hereinafter the "Litigation"). The Litigation included without limitation
claims made with respect to the ownership of certain technologies and patents
developed while Al was affiliated with PWTC (hereinafter the "Technologies").
B. The Parties have answered the claims and counterclaims and have
been in the process of prosecuting and defending the Litigation.
C. The Parties hereto now desire to settle and resolve the disputes
currently at issue between them in the Litigation and relating to the
Technologies in accordance with the terms of this Agreement.
D. The "Related Persons and Entities" of PWTC shall refer to PWTC's
parent companies, divisions, subsidiaries, and affiliates, if any, all of its
current directors and officers, its attorneys of record in the Litigation, any
and all of its assigns or successors, and shall also refer to one of its owners:
Xxxxxxx X. Xxxxxx. The "Related Persons and Entities" of Neo-Dyne shall refer to
Neo-Dyne's parent companies, divisions, subsidiaries, and affiliates, if any,
all of its current directors and officers, its attorneys of record in the
Litigation, and any and all of its assigns, or successors, and its stockholders
and owners. The "Related Persons and Entities" of any individual Party hereto
shall refer to that individual's heirs, assigns, successors-in-interest, or
spouse.
2. SETTLEMENT TERMS AND CONDITIONS. In consideration for the releases and
other promises set forth herein, the Parties agree as follows:
A. Al shall deliver an assignment to PWTC of Al's entire right,
title and interest throughout the world in the inventions and improvements which
are the subject of an application for United States Patent signed by him,
entitled CURRENT COLLECTOR STRUCTURE AND METHODS TO IMPROVE THE PERFORMANCE OF A
LEAD-ACID BATTERY, filed March 26, 2004, and assigned U.S. Serial Number
10/809,791; and to the inventions and improvements which are the subject of
International Patent Application Number PCT/US02/30607 filed September 25, 2002
at the World Intellectual Property Organization under the Patent Cooperation
Treaty, entitled CURRENT COLLECTOR STRUCTURE AND METHODS TO IMPROVE THE
PERFORMANCE OF A LEAD-ACID BATTERY, and to the invention and improvements which
are the subject of United States Patent 6,060,198, entitled ELECTROCHEMICAL
BATTERY STRUCTURE AND METHOD; these Assignments to include said applications,
any and all United States and foreign patents, utility models, and design
registrations granted for any of said inventions or improvements, and the right
to claim priority based on the filing date of said application under the
International Convention for the Protection of Industrial Property, the Patent
Cooperation Treaty, the European Patent Convention, and all other treaties of
like purposes; and the authorization of the Assignee to apply in all countries
in Al's name or in its own name for patents, utility models, design
registrations and like rights of exclusion and for inventors' certificates for
said inventions and improvements; and Al agrees for himself and his respective
heirs, legal representatives and assigns, without further compensation to
perform such lawful acts and to sign such further applications, assignments,
Powers of Attorney, preliminary statements and other lawful documents as the
Assignee may reasonably request to effectuate fully the Assignments. Al
specifically agrees to execute and deliver the Powers of Attorney, Assignments,
and Declarations attached to this Agreement as Exhibits 1-11 hereto (Snaper's
execution of Exhibits 4 and 6 containing Chinese language and characters is
based on PWTC's representation that the translation of this language and these
characters is substantially and materially the same as the English text
appearing thereabove on the same document).
B. Al and Neo-Dyne release and discharge PWTC, Farrill, Pomrehn, and
Balak, indemnify them, and hold them harmless of and from any and all claims
that were asserted or could have been asserted in the Counterclaim filed by Al
and Neo-Dyne in the Litigation. Such indemnification and hold harmless agreement
is limited to protecting the indemnitees from any action brought or
intentionally caused to be brought by Al, and does not relate to independent
claims by third parties. The release shall not constitute an admission by either
party as to the viability of any claims or defenses, except that Al and Neo-Dyne
shall acknowledge that PWTC has produced copies of thousands of pages of
accounting and financial records and having examined them, Al and Neo-Dyne find
no evidence that Farrill or Xxxxxxx has breached any duty to PWTC or acted in
any inappropriate manner, and partially in exchange for Al and Neo-Dyne
executing this Agreement containing the aforemade statement Farrill and Xxxxxxx
sign the releases referenced herein and agree not to make any claim against Al
and Neo-Dyne relating to their being named in the Litigation being settled
hereunder or relating to Al and Neo-Dyne's aforestated statement.
C. Al shall retain the share certificates evidencing his ownership
of 664,155 shares of common stock of PWTC. Al agrees that for the one-year
period immediately following the execution of this Agreement, without the
express written permission of the Board of Directors of PWTC, Al shall not sell
or transfer ownership of any of the shares of common stock of PWTC owned by Al.
One year after the execution of this Agreement, Al shall be free to sell or
transfer ownership of his shares of common stock of PWTC by presenting to PWTC's
Transfer Agent his share certificates and a legal opinion satisfactory to the
Transfer Agent that the restrictive legend on the share certificates should be
removed pursuant to SEC Rule 144 K or any other exemption and Power shall not
object to the removal of the restrictions on the transfer or sale of Al's shares
of common stock of PWTC. PWTC agrees that if it lifts any current restriction on
Xxxxxxx X. Xxxxxx or Xxx Xxxxx transferring any of their stock, it will also
concurrently lift the foregoing one-year restriction with respect to transfers
of Al's stock and will concurrently provide Al with immediate notice thereof.
D. PWTC shall pay Al $20,000.00, and Al shall not pay any monies to
PWTC.
E. PWTC, Balak, Farrill, and Xxxxxxx release and discharge Al and
Neo-Dyne, indemnify them, and hold them harmless of and from any and all claims
that were asserted or could have been asserted in the Litigation. Such
indemnification and hold harmless agreement is limited to protecting the
indemnitees from any action brought or intentionally caused to be brought by
PWTC, and does not relate to independent claims by third parties. The release
does not constitute an admission by either party as to the viability of any
claims or defenses.
F. PWTC shall surrender to Al all recordings of telephone message
left on the voice mail of 000-000-0000 on or about November 18, 2004 at or about
12:41 p.m. Central Daylight Time.
X. Xxxxxx shall deliver to PWTC in its "as is" condition and waive
any claim of ownership of two large Edison batteries containing three cells each
(totaling six cells) in Snaper's possession, all shipping costs to be paid by
PWTC.
X. Xxxxxx and their counsel may retain, until the "Return Date"
specified below, all copies of all discovery materials and documents produced by
PWTC in this Litigation (hereinafter, the "PWTC Responses") and all copies of
all financial records of PWTC that were created or maintained by Al during his
term as an officer or director of PWTC (the "PWTC Financial Documents") subject
to the following conditions. Snaper expressly agrees that the PWTC Responses and
the PWTC Financial Documents will be retained only in order to allow Snaper to
produce or utilize any of the same as may become relevant in any manner Snaper
sees fit in the defense (which shall include the prosecution of related
counterclaims or third-party claims) of certain litigation pending against Al
and brought by Xxxxxxx Xxxxxx known as Xxxxx County, Nevada District Court Case
No. A493659, or in the defense (as defined above) of any other litigation which
might be brought against Snaper prior to the resolution of the Zrenda Case No.
A493659 litigation, including for rebuttal purposes or to impeach the character
or credibility of any witness or party. If Snaper produces or utilizes any of
the PWTC Responses or the PWTC Financial Documents in any litigation, Snaper
shall give written notice to PWTC at 0000 Xx. Xxxxx Xxxxx, Xxxxx 000, Xxxxxxx,
Xxxxx, 00000, and specify which documents from the PWTC Responses or the PWTC
Financial Documents Snaper has produced or utilized. The PWTC Responses and the
PWTC Financial Documents shall otherwise not be shared with or disclosed to any
third parties other than Snaper's counsel and shall otherwise be maintained as
confidential by Snaper. Snaper shall return the PWTC Responses and the PWTC
Financial Documents to PWTC on a "Return Date" which shall be defined as
follows: 31 days after the resolution of any and all of Zrenda's claims or of
any other claims pursued by any other party in any litigation relating thereto,
or of any other litigation or suits filed against Snaper before resolution of
the Zrenda litigation, where the resolution of such claims shall mean that such
claims have been fully and finally resolved, including the resolution of any
related third-party claims or counterclaims, and including the resolution of any
appeals (or the expiration of the time period to appeal, without any appeal
being filed). After the return of the PWTC Responses and the PWTC Financial
Documents to PWTC, PWTC shall retain those documents at a location in the United
States, subject to subpoena, for a period of at least three (3) years from the
date of the execution of this Agreement, in the event such documents become
relevant to any litigation in which Al or Neo-Dyne is named. The return of the
PWTC Responses and the PWTC Financial Documents to PWTC, and the delivery of any
other documents or items required to be provided by Snaper hereunder may be made
by delivery to PWTC's local counsel in the Litigation, Xxxxxx Xxxxxxxx, Esq.
I. PWTC and its counsel shall deliver to Snaper any specific
personal documents or Neo-Dyne corporate documents produced by Snaper in this
Litigation, which documents were not created as business records of PWTC. Snaper
shall specifically designate in writing those documents which Al or Neo-Dyne
considers to be their personal or corporate documents produced in this
Litigation and not created as business records of PWTC, and PWTC shall deliver
the same to Snaper within 10 days after receipt of this written list. If there
is any dispute as to whether such documents should be so classified, then any
such dispute may be resolved as set forth in Paragraph 2(L) below.
X. Xxxxxx shall deliver to PWTC all copies of all technical
materials in their possession or subject to their control relating to the
battery technology and inventions and improvements which are the subject of the
assignments set forth in Paragraph 2(A), above. This shall include but not be
limited to all reports and data prepared by BC Research, Inc., concerning any of
the improvements which are the subject of the assignments set forth in Paragraph
2(A) above, or concerning the alloy sensor technology related to Patent No.
4,107,997 or the cold pipe joining technology related to Patent No. 5,442,846.
K. PWTC, Farrill, Pomrehn, Balak, Al, and Neo-Dyne shall each pay
their own costs of court and attorneys' fees.
L. If a dispute arises out of or in connection with this Agreement,
the Parties agree to seek an amicable settlement of that dispute by discussions
and negotiations between the Parties. Failing such a resolution, any and all
claims, disputes or controversies arising from or relating in any way to this
Agreement, at the request of any Party, may be referred to Nevada Attorney Xxxxx
X. Xxxx, Esq., Nevada Bar No. 001873 (current phone number (000) 000-0000), to
be mediated, and if a settlement does not result from such mediation, then any
such controversy will be arbitrated and finally resolved by an arbitrator
mutually agreeable to both sides, or if they cannot select an arbitrator, to be
selected by Xxxxx X. Xxxx, Esq., said arbitration to be processed in accordance
with the Commercial Arbitration Rules and Mediation Procedures of the American
Arbitration Association (except that an AAA arbitrator need not be utilized).
The place of arbitration shall be Las Vegas, Nevada. The prevailing party in any
arbitration or legal action arising out of or related to this Agreement shall be
entitled, in addition to any other rights or remedies it may have, to
reimbursement for its expenses incurred in such arbitration or action, including
court costs and attorneys' fees.
3. STIPULATION TO DISMISS LITIGATION. Effective upon completion of the
foregoing, the Parties shall direct their counsel to execute and deliver to each
other's counsel of record and to submit and file with the Court a Stipulation
and Order dismissing the Litigation with prejudice, each party to bear its own
costs and attorneys' fees.
4. RELEASE.
A. MUTUAL RELEASE. Power, on the one hand, for itself and for each
of its Related Persons and Entities, and Snaper, on the other hand, for itself
and for each of its Related Persons and Entities, do all hereby fully and
finally settle, release, acquit, forever discharge, and covenant not to xxx each
other and any and all of each other's Related Persons and Entities, 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, bodily
injury, 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 (hereinafter "Claims")
arising prior to the date hereof which are related to the allegations or claims
set forth in the Litigation, including the Technologies.
B. EXCEPTIONS. The releases set forth in this Paragraph 4 and any
and all other releases set forth in this Agreement, including in Paragraph 2,
shall have no effect on (i) any future action to enforce or construe this
Agreement; (ii) any rights, claims, or defenses relating to any allegations as
to acts or omissions occurring after the date of this Agreement; or (iii) any
indemnification rights Snaper may claim to have against Balak with respect to
any claims currently pending or brought hereafter against him by Xxxxx Xxxxxx,
including in Xxxxx County, Nevada District Court Case No. A493659.
5. NO PRIOR ASSIGNMENTS. The Parties, and each of them, hereby covenant,
promise, warrant, and agree that they, and each of them, are the owners of the
Claims released pursuant to Paragraphs 2 and 4 above and there has not occurred
any express assignment, transfer, or hypothecation of such Claims, whether
voluntary or involuntary, by subrogation, or to their knowledge any assignment
by operation of law, or otherwise, to any other person or entity. Each Party
hereto agrees to indemnify and hold the other harmless in the event that any
alleged or claimed assignee, transferee, or subrogee of the Claims released
herein by the indemnifying Party should attempt to pursue the Claims released
herein against the other Party.
6. MISCELLANEOUS.
A. Each individual who signs this document warrants and represents
that he or she is competent and authorized to enter into this Agreement on
behalf of the Party for which he or she purports to sign. Corporate resolutions
or other reasonably adequate verification of this warranty will be provided by
both corporate releasors to the other Party acknowledging the corporation's
lawful consent to enter into this Agreement.
B. The Parties acknowledge and agree that each will bear its own
costs, expenses, and attorneys' fees arising out of and/or connected with the
Litigation.
C. This Agreement is the product of negotiation and preparation by
and among the Parties and their respective attorneys. Neither this Agreement,
nor any provisions thereof, shall be deemed prepared or drafted by any one Party
or another, or its attorneys, and any ambiguity herein shall not be construed
against one Party or the other as the drafter hereof.
D. This Agreement shall be interpreted in accordance with and be
governed in all respects by the laws of the State of Nevada. The Parties
stipulate that the exclusive jurisdiction and venue for any action arising out
of or relating to this Agreement, including to enforce any arbitration award
entered hereunder, shall lie in the federal or state courts located in Las
Vegas, Nevada.
E. This Agreement shall inure to the benefit of and be binding on
the Parties to this Agreement and upon their Related Persons and Entities.
F. This Agreement may be executed in counterparts, and all such
counterparts shall constitute an agreement which shall be binding upon all
Parties hereto, notwithstanding that the signatures of all Parties' designated
representatives do not appear on the same page.
G. It is further agreed that the Parties will execute all such
further and additional documents as shall be reasonable, convenient, necessary,
or desirable to carry out the provisions of this Agreement.
H. In any subsequent action or proceeding to enforce or construe
this Agreement, the Parties stipulate that a copy of this Agreement may be
admissible to the same extent as the original Agreement.
I. Each of the Parties agrees that this Agreement was the product of
a negotiated compromise relating to disputed Claims, and that it was entered
into in lieu of incurring additional costs and attorneys' fees, and to avoid
exposure to other risks, in the 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 and defenses made by the other Party is
expressly denied by each of the Parties.
J. No breach of any provision or condition of this Agreement can be
waived unless in writing and signed by all Parties. Waiver of any breach of any
provision or condition hereof shall not be deemed to be a waiver of any other
breach of the same or other provisions or conditions contained herein. This
Agreement may be modified only by a written agreement executed by all of the
Parties hereto or by the affected Parties.
K. If any legal action, arbitration, or other proceeding is brought
to enforce or interpret the terms of this Agreement, the prevailing Party shall
be entitled to recover reasonable attorneys' fees and costs incurred in that
action or arbitration or proceeding, in addition to any other relief to which it
might be entitled.
L. If any provision or any part of any provision of this Agreement
shall for any reason be held to be invalid, unenforceable, or contrary to public
policy or any law, then the remainder of this Agreement shall not be affected
thereby and shall remain in full force and effect, unless, however, the intent
of the Parties as set forth in this Agreement cannot be effectuated without
inclusion of that provision or any part of that provision, in which case, the
entire Agreement shall be unenforceable.
M. The captions and paragraph headings set forth in this Agreement
are only inserted for the purpose of convenient reference and in no way define,
limit, or prescribe the scope or intent of this Agreement or any part hereof.
Unless otherwise provided herein, any reference to a paragraph herein shall
include the paragraph so designated and all subparts thereof.
N. The Parties hereto, and each of them, further represent and
declare that they have carefully read this Agreement and know the contents
thereof and understand the Agreement's legal significance and that they have
signed the same freely and voluntarily after obtaining necessary and appropriate
legal advice with respect thereto.
O. The Parties hereto, and each of them, agree that this Agreement
contains the entire agreement between the Parties, and it is agreed that the
terms of this Agreement are contractual and not merely a memorandum or recital.
This Agreement supersedes any and all prior agreements, understandings,
promises, warranties, and representations made by each Party to any other Party
concerning the subject matter of this Agreement and the subject Claims.
Dated this ____ day of _____________________, 2004.
POWER TECHNOLOGY, INC.,
a Nevada corporation
By:
--------------------------
Name:
------------------------
Title:
-----------------------
Subscribed and sworn to before me
this ____ day of _________________, 2004.
------------------------------------
Notary Public, State of _________________
Dated this ____ day of _____________________, 2004.
-----------------------------
Xxxx X. Xxxxxxx
Subscribed and sworn to before me
this ____ day of _________________, 2004.
------------------------------------
Notary Public, State of California
Dated this ____ day of _____________________, 2004.
-----------------------------
X. Xxxxxx Xxxxxxx
Subscribed and sworn to before me
this ____ day of _________________, 2004.
------------------------------------
Notary Public, ________________________
Dated this ____ day of _____________________, 2004.
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Xxx Xxxxx
Sworn before me at the City of ______________,
Province of British Columbia, this _____ day of
_________________, 2004.
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Commissioner/Notary Public for British Columbia
Dated this ____ day of _____________________, 2004.
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Xxxxx Xxxxxx
Subscribed and sworn to before me
this ____ day of _________________, 2004.
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Notary Public, State of Nevada
Dated this ____ day of _____________________, 2004.
NEO-DYNE RESEARCH, INC.,
a Nevada corporation
By:
--------------------------
Name:
------------------------
Title:
-----------------------
Subscribed and sworn to before me
this ____ day of _________________, 2004.
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Notary Public, State of Nevada
