SETTLEMENT AGREEMENT AND GENERAL RELEASE OF ALL CLAIMS
Exhibit
10.3
AND
GENERAL
RELEASE OF ALL CLAIMS
This
Settlement Agreement and General Release of All Claims (“Agreement”) is made by
and between Applied DNA Sciences, Inc. (“ADNAS”), APDN (B.V.I.), Inc., Applied
DNA Operations Management, Inc., Xxxxx Xxxxxxx, and Jun-Xxx Xxxx (“Defendants”),
on the one hand, and Xxxxxx Xxxxxx (“XXXXXX”) on the other hand (collectively
“the parties”) with respect to the following facts:
| X. |
XXXXXX
was at various times an employee of or consultant to Defendant
ADNAS.
|
| B. |
On
April 17, 2006, XXXXXX filed Case No. BC350904 in Los Angeles Superior
Court against Defendants (“XXXXXX’x Action”) arising out of XXXXXX’x
employment and/or consulting relationship with ADNAS, alleging
breach of
written contracts, breach of oral contracts, fraud, California
Labor Code
violations, and wrongful termination.
|
| C. |
On
March 15, 2007, ADNAS filed Case No. BC367661 against XXXXXX (“ADNAS’
Action”), alleging unjust enrichment and breach of fiduciary
duty.
|
| D. |
Both
ADNAS and XXXXXX believe that their own actions are meritorious
and the
actions against them are without merit. Notwithstanding this belief,
in
the interest of reaching a mutual negotiated resolution of all
claims or
possible claims between the parties, the parties now desire to
settle all
claims asserted or that could have been asserted in any action
arising out
of or in any way related to any acts, transactions or events that
have
occurred between them to date, including but not limited to any
claims
that may have arisen before, during, or after the employment or
consulting
relationships alleged in XXXXXX’x Action, and all claims brought in
XXXXXX’x Action and ADNAS’ Action.
|
THEREFORE,
in consideration of the promises and mutual agreements hereinafter set
forth, it
is agreed by and between the undersigned as follows:
1. Payment.
ADNAS
agrees to pay XXXXXX $225,000.00. Payment to XXXXXX will be made in five
equal
monthly installments in the amount of $45,000.00 by check made payable
to
“Makarem & Associates Attorney-Client trust account.” The first installment
shall be due to be mailed by FedEx or other overnight courier service to
Makarem
& Associates, 00000 Xxxxxxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx
00000-0000, on or before June 1, 2007, with each subsequent monthly installment
due to be mailed on or before the first business day of the following months,
with the final installment due to be mailed on or before October 1, 2007.
XXXXXX
acknowledges and agrees that the payments under this paragraph and the
other
agreements made herein by Defendants constitute adequate legal consideration
for
the promises and representations made by it in this Agreement.
2. Releases.
2.1. XXXXXX
generally, unconditionally, irrevocably and absolutely releases and discharge
Defendants, and any parent and subsidiary corporations, divisions and other
affiliated or related entities of Defendants, past and present, as well
as the
past or present employees, officers, directors, agents, attorneys, insurers,
successors and assigns of each (collectively, “Released Parties”), from all
claims related in any way to the transactions or occurrences between them
to
date, to the fullest extent permitted by law, including, but not limited
to,
XXXXXX’x hiring by and employment or consulting relationship with ADNAS,
XXXXXX’x compensation, wages or pay of any kind related to Defendants, his
separation of employment from ADNAS, and all other losses, liabilities,
claims,
charges, demands and causes of action, known or unknown, suspected or
unsuspected, arising directly or indirectly out of or in any way connected
with
XXXXXX’x employment with ADNAS. This release is intended to have the broadest
possible application and includes, but is not limited to, any tort, contract,
common law, constitutional or other statutory claims, including, but not
limited
to alleged violations of the California Labor Code or the federal Fair
Labor
Standards Act, the California Family Rights Act, Title VII of the Civil
Rights
Act of 1964 and the California Fair Employment and Housing Act, the Americans
with Disabilities Act, the Age Discrimination in Employment Act of 1967,
as
amended, and all claims for attorneys’ fees, costs and expenses. This release
unconditionally, irrevocably and absolutely releases and discharges the
Released
Parties from all of the claims asserted by XXXXXX in XXXXXX’x Action, and/or any
other claims that he could have maintained in XXXXXX’x Action. XXXXXX represents
and warrants that he is not a plaintiff or party to any suit, action or
proceeding in which any Released Party is a party, other than XXXXXX’x Action
and ADNAS’ Action. This Agreement is not intended to have any effect on any
unemployment benefits that XXXXXX may be receiving as of the date that
this
Agreement is executed.
2.2. Defendants
unconditionally, irrevocably and absolutely release and discharge XXXXXX
from
all claims related in any way to the transactions or occurrences between
them to
date, to the fullest extent permitted by law, including, but not limited
to,
XXXXXX’x hiring by and employment with or consulting relationship with ADNAS,
XXXXXX’x compensation, wages or pay of any kind related to Defendants, his
separation of employment from ADNAS, and all other losses, liabilities,
claims,
charges, demands and causes of action, known or unknown, suspected or
unsuspected, arising directly or indirectly out of or in any way connected
with
XXXXXX’x employment with ADNAS. This release is intended to have the broadest
possible application and includes, but is not limited to, any tort, contract,
common law, constitutional or other statutory claims. This release
unconditionally, irrevocably and absolutely releases and discharges XXXXXX
from
all of the claims asserted by ADNAS in ADNAS’ Action, and/or any other claims
could have been maintained in ADNAS’ Action.
2.3. The
parties acknowledge that they may discover facts or law different from,
or in
addition to, the facts or law that they know or believe to be true with
respect
to the claims released in this Agreement and agree, nonetheless, that this
Agreement and the releases contained in it shall be and remain effective
in all
respects notwithstanding such different or additional facts or the discovery
of
them.
2.4. The
parties declare and represent that they intend this Agreement to be complete
and
not subject to any claim of mistake, and that the releases herein express
full
and complete releases, and that they intend that the releases herein shall
be
final and complete. All parties execute these releases with the full knowledge
that these releases cover all possible claims against XXXXXX or the Released
Parties, to the fullest extent permitted by law.
2.5. XXXXXX
expressly waives his right to recovery of any type, including damages,
penalties, or reinstatement, in any administrative or court action, whether
state or federal, and whether brought by XXXXXX or on XXXXXX’x behalf, related
in any way to the matters released herein. Defendants similarly waive their
rights against XXXXXX to recovery of any type, including damages or penalties,
in any administrative or court action, whether state or federal, and whether
brought by Defendants or on Defendants’ behalf, related in any way to the
matters released herein.
3. California
Civil Code section 1542 Waiver.
The
parties expressly acknowledge and agree that, with respect to their respective
release of claims as set forth above, they expressly waive all rights under
Section 1542 of the California Civil Code. That section provides:
A
GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN
BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE
DEBTOR.
4. Dismissal
of XXXXXX’x Action and ADNAS’ Action.
The
parties agree to obtain the dismissal of XXXXXX’x Action in its entirety and
ADNAS’ Action as to XXXXXX, with prejudice, by taking all necessary steps to
secure such dismissals. No payment shall be made pursuant to paragraph
1 herein
until XXXXXX’x Action is dismissed with prejudice.
5. Default.
5.1. If
any
required payment is not received by the close of business on the tenth
business
day of any month when due, ADNAS shall be deemed in default of this Agreement.
Counsel for XXXXXX shall give notice of default in writing by e-mail or
facsimile to counsel for ADNAS, and ADNAS shall have ten business days
from the
date when notice of default is sent to its counsel to cure the default
by
payment of the full amount of the overdue installment.
5.2. If
ADNAS
fails to cure the default in the manner provided by Paragraph 5.1 above
by the
close of business on the tenth business day after notice of default is
sent to
their counsel, Defendants stipulate and agree that XXXXXX may cause judgment
to
be entered forthwith in the Action against Defendants Applied DNA Sciences,
Inc., APDN Operations Management, Inc., and APDN (B.V.I.), Inc., (collectively
“ADNAS Defendants”) in an amount equal to three times the remaining balance on
the date of default, plus interest on said judgment from the date of default,
enforceable against any or each of the ADNAS Defendants, in XXXXXX’x sole
discretion, ADNAS Defendants to be liable for all costs of collection.
5.3. The
Parties stipulate and agree that their respective counsel shall execute
and
submit to the Court where the Actions are pending a “Notice of Settlement;
Request that Court Retain Jurisdiction Under CCP §664.6; Stipulation for
Judgment on Default; Order Thereon” in the form attached hereto as Exhibit A,
and further stipulate and agree that in the event of Defendants’ default, the
Stipulated Judgment to be entered shall be in the form attached hereto
as
Exhibit B.
6. Promise
Not to Prosecute.
The
parties agree that they will not prosecute, nor allow to be prosecuted
on their
behalf, in any administrative agency, whether state or federal or in any
court,
whether state or federal, any claim or demand of any type related to the
matters
released above, it being the intention of the parties that with the execution
of
this release, XXXXXX and the Released Parties will be absolutely,
unconditionally and forever discharged of and from all obligations to the
other
party related in any way to the matters discharged herein.
7. No
Admissions.
By
entering in to this Agreement, neither XXXXXX nor Defendants make any admission
that they have engaged, or are now engaging, in any unlawful conduct. The
parties understand and acknowledge that this Agreement is not an admission
of
liability and shall not be used or construed as such in any legal or
administrative proceeding.
8. Older
Workers’ Benefit Protection Act.
This
Agreement is intended to satisfy the requirements of the Older Workers’ Benefit
Protection Act, 29 U.S.C. sec. 626(f). The following general provisions,
along
with the other provisions of this Agreement, are agreed to for this
purpose:
8.1. XXXXXX
acknowledges and agrees that he has read and understands the terms of this
Agreement.
8.2. XXXXXX
acknowledges that this Agreement advises him in writing that he may consult
with
an attorney before executing this Agreement, and that he has obtained and
considered such legal counsel as he deems necessary, such that he is entering
into this Agreement freely, knowingly, and voluntarily.
8.3. XXXXXX
acknowledges that he has been given at least twenty-one (21) days in which
to
consider whether or not to enter into this Agreement. XXXXXX understands
that,
at his option, he may elect not to use the full 21-day period.
8.4. This
Agreement shall not become effective or enforceable until the eighth day
after
XXXXXX signs this Agreement. XXXXXX may revoke his acceptance of this Agreement
within seven (7) days after the date he signs it. XXXXXX’x revocation must be in
writing and received by Defendants’ counsel, Xxxxxxx X. Xxxxxx, by 5:00 p.m. on
the seventh day in order to be effective. If XXXXXX does not revoke acceptance
within the seven (7) day period, XXXXXX’x acceptance of this Agreement shall
become binding and enforceable on the eighth day (“Effective Date”).
8.5. This
Agreement does not waive or release any rights or claims that XXXXXX may
have
under the Age Discrimination in Employment Act that arise after the execution
of
this Agreement.
9. Severability.
In the
event that any provision of this Agreement shall be found unenforceable
by a
court of competent jurisdiction, the provision shall be deemed modified
to the
extent necessary to allow enforceability of the provision as so limited,
it
being intended that XXXXXX and the Released Parties shall receive the benefits
contemplated herein to the fullest extent permitted by law. If a deemed
modification is not satisfactory in the judgment of such court, the
unenforceable provision shall be deemed deleted, and the validity and
enforceability of the remaining provisions shall not be affected
thereby.
10. Attorneys’
Fees and Costs.
All
parties to this Agreement agree that they will bear their own attorneys’ fees,
costs and all other expenses in connection with XXXXXX’x Action and ADNAS’
Action.
11. No
Assignment.
XXXXXX
warrants and represents that he has not assigned or transferred to any
person
not a party to this Agreement any released matter or any right to any of
the
payments or other consideration provided by Defendants pursuant to this
Agreement. XXXXXX agrees to defend, indemnify and hold Defendants and all
Released Parties harmless from any and all claims based on or in connection
with
or arising out of any such assignment or transfer made, purported or
claimed.
12. Joint
Drafters.
Counsel
for XXXXXX and counsel for ADNAS have jointly drafted this Agreement. Thus,
no
rule of law that ambiguity in an Agreement will be construed against the
drafter
shall be applied in interpreting this Agreement.
13. Applicable
Law.
The
validity, interpretation and performance of this Agreement shall be construed
and interpreted according to the laws of the United States of America and
the
State of California.
14. Full
Defense.
This
Agreement may be pled as a full and complete defense to, and may be used
as a
basis for an injunction against, any action, suit or other proceeding that
may
be prosecuted, instituted or attempted by any party in breach hereof. The
parties agree that in the event that an action or proceeding is instituted
by
any party in order to enforce the terms or provisions of this Agreement,
the
prevailing party in such proceeding shall be entitled to an award of reasonable
costs and attorneys’ fees incurred in connection with enforcing this
Agreement.
15. Tax
Issues.
In the
event that there is any federal, state or local tax assessed or to be paid
as a
result of any payments made pursuant to this Agreement, XXXXXX shall be
solely
responsible for the taxes, penalties, interest and assessments and hereby
agrees
to release and indemnify Defendants from any and all claims by any local,
state
or federal government agency for any unpaid taxes. Before any payment may
be
made pursuant to paragraph 1 of this Agreement, XXXXXX will provide to
ADNAS an
IRS Form W-9. ADNAS shall issue and file an IRS Form 1099 regarding any
payments
for which customary withholdings have not been taken.
16. Good
Faith.
The
parties agree to do all things necessary and to execute all further documents
necessary and appropriate to carry out and effectuate the terms and purposes
of
this Agreement.
17. Entire
Agreement; Modification.
This
Agreement is intended to be the entire agreement between the parties and
supersedes and cancels any and all other and prior agreements, written
or oral,
between the parties regarding this subject matter. It is agreed that there
are
no collateral agreements or representations, written or oral, regarding
the
settlement of all claims between the parties other than those set forth
in this
Agreement. This Agreement may be amended only by a written instrument executed
by all parties hereto.
18. Counterparts.
This
Agreement may be executed in counterparts and shall be binding on all parties
when each has signed either an original or copy of this Agreement. Facsimile
signatures may be treated as originals.
PARTIES
TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY UNDERSTAND
EACH
AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES HAVE EXECUTED
THIS
AGREEMENT ON THE DATES SHOWN BELOW.
Applied
DNA Sciences, Inc.
APDN
(B.V.I.), Inc.
APDN
Operations Management, Inc.
Dated:
___________________ By:
____________________________
Dr.
Xxxxx
Xxxxxxx
CEO
and
as an individual Defendant
Dated:
___________________ By:
____________________________
Dr.
Jun-Xxx Xxxx
Defendant
Dated:
___________________ By:
____________________________
Xxxxxx
Xxxxxx
Plaintiff
Approved
as to Form and Content:
Makarem
& Associates
Dated:
___________________ By:
____________________________
Xxxxx
X.
Xxxxxxxx
Attorney
for Xxxxxx XXXXXX
Xxxxxx
& Xxxxxx LLP
Dated:
___________________ By:
____________________________
Xxxxxxx
X. Xxxxxx
Attorneys
for Defendants
