EXHIBIT 10.52
AGREEMENT REGARDING CANCELLATION OF INDEBTEDNESS
This Agreement Regarding Cancellation of Indebtedness ("Agreement") is
made as of this 1st day of July, 1999 by and between Xxxx X. Xxxxxx ("Holder")
and AMDL, Inc., a Delaware corporation (the "Company").
R E C I T A L S
- - - - - - - -
A. Holder has served as an officer of the Company since January 1998.
The Company and Holder are both parties to that certain Salary Continuation
Agreement dated May 21, 1998 ("Salary Continuation Agreement") which entitled
Holder to a severance package following a "Change in Control" of the Company and
the occurrence of a "Termination Event" (as those terms are defined in the
Salary Continuation Agreement).
B. The Company and Holder are also both parties to that certain
Employment Agreement ("Employment Agreement") dated January 15, 1998.
C. The Company and Holder now wish to terminate the Salary
Continuation Agreement and the Employment Agreement in exchange for the
consideration set forth herein.
A G R E E M E N T
- - - - - - - - -
THEREFORE, the Company and Holder agree as follows:
1. Incorporation of Recitals. The foregoing Recitals are herein
-------------------------
incorporated by this reference.
2. Termination of Agreements. The Company and Holder hereby mutually
-------------------------
agree to the termination of, and hereby mutually terminate, any and all
agreements existing between them and any of them, including the Salary
Continuation Agreement and the Employment Agreement, including the termination
and nonsurvival of all representations, warranties and covenants thereunder.
3. Consideration In exchange for the termination of the Salary
-------------
Continuation Agreement and the Employment Agreement pursuant to Section 2 of the
Agreement, the Company and Holder shall enter into an incentive stock option
agreement and a non-qualified stock option agreement, both in the forms attached
hereto as Exhibit A.
4. General Release. The Company and Holder agree to execute and
---------------
deliver the General Release in the form attached hereto as Exhibit B.
5. Arbitration and Fees. Any controversy or claim arising out of or
--------------------
relating to this Agreement, or breach thereof, may be resolved by mutual
agreement; or if not, shall be settled in accordance with the arbitration rules
of the American Arbitration Association in Orange County, California. Any
decision issued therefrom shall be binding upon the parties and shall be
enforceable as a judgment in any court of competent jurisdiction. The
prevailing party in such arbitration or other proceeding shall be entitled, in
addition to such other relief as may be granted, to a reasonable sum as and for
attorneys' fees in such arbitration or other proceeding which may be determined
by the arbitrator or other officer in such proceeding. If collection is
required for any payment not made when due, the creditor shall collect statutory
interest and the cost of collection, including attorney's fees whether or not
court action is required for enforcement.
6. Miscellaneous. This Agreement contains the entire agreement
-------------
between Holder and the Company and may not be modified, altered or changed in
any manner whatsoever, except by a written agreement signed by all of the
parties hereto. Any agreement or representation concerning the subject matter of
this Agreement not set forth in this Agreement or a subsequent written agreement
signed by all of the parties hereto is null and void. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns. The rights and obligation of either party to this
Agreement may not be assigned by such party without the prior written consent of
the other party. This Agreement may be executed in two or more counterparts,
each signed by one of the parties and all of said counterparts together shall
constitute one and the same instrument. The parties agree that facsimile
signatures may be relied upon by each of the parties hereto as original
signatures.
IN WITNESS WHEREOF, the parties have executed this Agreement, the date
first above written.
"The Company"
AMDL, INC.,
a Delaware corporation
By:____________________________________________
Xxxxxx X. Xxxxxxx, Chief Financial Officer
"Holder"
By:____________________________________________
Xxxx X. Xxxxxx
-2-
EXHIBIT A
INCENTIVE STOCK OPTION AGREEMENT
--------------------------------
THIS INCENTIVE STOCK OPTION AGREEMENT ("Agreement") is entered into as of
June 30, 1999, by and between AMDL, INC., a Delaware corporation
("Corporation"), and XXXX X. XXXXXX ("Optionee").
R E C I T A L S
- - - - - - - -
A. On June 30, 199 the Board of Directors of the Corporation adopted,
subject to the approval of the Corporation's shareholders, the AMDL, INC. 1999
Stock Option Plan (the "Plan").
B. Pursuant to the Plan, on June 30, 1999, the members of the Board of
Directors of the Corporation serving on the Committee authorized granting to
Optionee options to purchase shares of the Corporation's common stock, $.001 par
value ("Shares") for the term and subject to the terms and conditions
hereinafter set forth.
A G R E E M E N T
- - - - - - - - -
It is hereby agreed as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, or the context
-------------------
otherwise clearly requires, terms with initial capital letters used herein shall
have the meanings assigned to such terms in the Plan.
2. GRANT OF OPTIONS. The Corporation hereby grants to Optionee, Options
----------------
to purchase all or any part of 147,058 Shares, upon and subject to the terms and
conditions of the Plan, which is incorporated in full herein by this reference,
and upon the other terms and conditions set forth herein.
3. OPTION PERIOD. The Options shall be exercisable at any time after the
-------------
date hereof (subject to the provisions of Section 17) and expiring on the date
five (5) years from the date of grant, unless earlier terminated pursuant to
Section 7.
4. METHOD OF EXERCISE. The Options shall be exercisable by Optionee by
------------------
giving written notice to the Corporation of the election to purchase and of the
number of Shares Optionee elects to purchase, such notice to be accompanied by
such other executed instruments or documents as may be required by the Committee
pursuant to this Agreement, and unless otherwise directed by the Committee,
Optionee shall at the time of such exercise tender the purchase price of the
Shares he has elected to purchase. An Optionee may purchase less than the total
number of Shares for which the Option is exercisable, provided that a partial
exercise of an Option may not be for less than one hundred (100) Shares. If
Optionee shall not purchase all of the Shares which he is entitled to purchase
under the Options, his right to
B-1
purchase the remaining unpurchased Shares shall continue until expiration of the
Options. The Options shall be exercisable with respect of whole Shares only, and
fractional Share interests shall be disregarded.
5. AMOUNT OF PURCHASE PRICE. The purchase price per Share for each Share
------------------------
which Optionee is entitled to purchase under the Options shall be $.68 per
Share.
6. PAYMENT OF PURCHASE PRICE. At the time of Optionee's notice of
-------------------------
exercise of the Options, Optionee shall tender in cash or by certified or bank
cashier's check payable to the Corporation, the purchase price for all Shares
then being purchased. Provided, however, the Board of Directors may, in its
sole discretion, permit payment by the Corporation of the purchase price in
whole or in part with Shares. If the Optionee is so permitted, and the Optionee
elects to make payment with Shares, the Optionee shall deliver to the
Corporation certificates representing the number of Shares in payment for new
Shares, duly endorsed for transfer to the Corporation, together with any written
representations relating to title, liens and encumbrances, securities laws,
rules and regulatory compliance, or other matters, reasonably requested by the
Board of Directors. The value of Shares so tendered shall be their Fair Market
Value Per Share on the date of the Optionee's notice of exercise.
7. EFFECT OF TERMINATION OF EMPLOYMENT. If an Optionee's employment or
-----------------------------------
other relationship with the Corporation (or a Subsidiary) terminates, the effect
of the termination on the Optionee's rights to acquire Shares shall be as
follows:
7.1 Termination For Other Than Disability Or Cause. If an Optionee
----------------------------------------------
ceases to be employed by, or ceases to have a relationship with, the Corporation
or a Subsidiary for any reason other than for disability or cause, such
Optionee's Options shall expire not later than three (3) months thereafter.
During such three (3) month period and prior to the expiration of the Option by
its terms, the Optionee may exercise any Option granted to him, but only to the
extent such Options were exercisable on the date of termination of his
employment or relationship and except as so exercised, such Options shall expire
at the end of such three (3) month period unless such Options by their terms
expire before such date. The decision as to whether a termination for a reason
other than disability, cause or death has occurred shall be made by the
Committee, whose decision shall be final and conclusive, except that employment
shall not be considered terminated in the case of sick leave or other bona fide
leave of absence approved by the Corporation.
7.2 Disability. If an Optionee ceases to be employed by, or ceases
----------
to have a relationship with, the Corporation or a Subsidiary by reason of
disability (within the meaning of Code Section 22(e)(3)), such Optionee's
Options shall expire not later than one (1) year thereafter. During such one
(1) year period and prior to the expiration of the Option by its terms, the
Optionee may exercise any Option granted to him, but only to the extent such
Options were exercisable on the date the Optionee ceased to be employed by, or
ceased to have a relationship with, the Corporation or Subsidiary by reason of
disability. The decision as to whether a termination by reason of disability
has occurred shall be made by the Committee, whose decision shall be final and
conclusive.
7.3 Termination For Cause. If an Optionee's employment by, or
---------------------
relationship with, the Corporation or a Subsidiary is terminated for cause, such
Optionee's Option shall expire immediately; provided, however, the Committee
may, in its sole discretion, within thirty (30) days of such termination, waive
the expiration of the Option by giving written notice of such waiver to the
Optionee at such Optionee's last known address. In the event of such waiver,
the Optionee may exercise the Option only to such extent, for such time, and
upon such terms and conditions as if such Optionee had ceased to be employed by,
or ceased to have a relationship with, the Corporation or a Subsidiary upon the
date of such termination for a reason other than disability, cause or death.
Termination for cause shall include termination for malfeasance or gross
misfeasance in the performance of duties or conviction of illegal activity in
connection therewith or any conduct detrimental to the interests of the
Corporation or a Subsidiary. The determination of the Committee with respect to
whether a termination for cause has occurred shall be final and conclusive.
8. NONTRANSFERABILITY OF OPTIONS. The Options shall not be transferable,
-----------------------------
either voluntarily or by operation of law, otherwise than by will or the laws of
descent and distribution and shall be exercisable during the Optionee's lifetime
only by Optionee.
9. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. As used herein, the term
------------------------------------------
"Adjustment Event" means an event pursuant to which the outstanding Shares of
the Corporation are increased, decreased or changed into, or exchanged for a
different number or kind of shares or securities, without receipt of
consideration by the Corporation, through reorganization, merger,
recapitalization, reclassification, stock split, reverse stock split, stock
dividend, stock consolidation or otherwise. Upon the occurrence of an
Adjustment Event, (i) appropriate and proportionate adjustments shall be made to
the number and kind and exercise price for the Shares subject to the Options,
and (ii) appropriate amendments to this Agreement shall be executed by the
Corporation and Optionee if the Committee determines that such an amendment is
necessary or desirable to reflect such adjustments. If determined by the
Committee to be appropriate, in the event of an Adjustment Event which involves
the substitution of securities of a corporation other than the Corporation, the
Committee shall make arrangements for the assumptions by such other corporation
of the Options. Notwithstanding the foregoing, any such adjustment to the
Options shall be made without change in the total exercise price applicable to
the unexercised portion of the Options, but with an appropriate adjustment to
the number of Shares, kind of Shares and exercise price for each Share subject
to the Options. The determination by the Committee as to what adjustments,
amendments or arrangements shall be made pursuant to this Section 10, and the
extent thereof, shall be final and conclusive. No fractional Shares shall be
issued on account of any such adjustment or arrangement.
10. NO RIGHTS TO CONTINUED EMPLOYMENT OR RELATIONSHIP. Nothing contained
-------------------------------------------------
in this Agreement shall obligate the Corporation to employ or have another
relationship with Optionee for any period or interfere in any way with the right
of the
Corporation to reduce Optionee's compensation or to terminate the employment of
or relationship with Optionee at any time.
11. TIME OF GRANTING OPTIONS. The time the Options shall be deemed
------------------------
granted, sometimes referred to herein as the "date of grant," shall be June 30,
1999.
12. PRIVILEGES OF STOCK OWNERSHIP. Optionee shall not be entitled to the
-----------------------------
privileges of stock ownership as to any Shares not actually issued and delivered
to Optionee. No Shares shall be purchased upon the exercise of any Options
unless and until, in the opinion of the Corporation's counsel, any then
applicable requirements of any laws, or governmental or regulatory agencies
having jurisdiction, and of any exchanges upon which the stock of the
Corporation may be listed shall have been fully complied with.
13. SECURITIES LAWS COMPLIANCE. The Corporation will diligently endeavor
--------------------------
to comply with all applicable securities laws before any Shares are issued
pursuant to the Options. Without limiting the generality of the foregoing, the
Corporation may require from the Optionee such investment representation or such
agreement, if any, as counsel for the Corporation may consider necessary in
order to comply with the Securities Act of 1933 as then in effect, and may
require that the Optionee agree that any sale of the Shares will be made only in
such manner as is permitted by the Committee. The Committee may in its
discretion cause the Shares underlying the Options to be registered under the
Securities Act of 1933, as amended, by filing a Form S-8 Registration Statement
covering the Options and the Shares underlying the Options. Optionee shall take
any action reasonably requested by the Corporation in connection with
registration or qualification of the Shares under federal or state securities
laws.
14. INTENDED TREATMENT AS INCENTIVE STOCK OPTIONS. The Options granted
---------------------------------------------
herein are intended to be "incentive stock options" to which Sections 421 and
422 of the Internal Revenue Code of 1986, as amended from time to time ("Code")
apply, and shall be construed to implement that intent. If all or any part of
the Options shall not be subject to Sections 421 and 422 of the Code, the
Options shall nevertheless be valid and carried into effect.
15. PLAN CONTROLS. The Options shall be subject to and governed by the
-------------
provisions of the Plan. All determinations and interpretations of the Plan made
by the Committee shall be final and conclusive.
16. SHARES SUBJECT TO LEGEND. If deemed necessary by the Corporation's
------------------------
counsel, all certificates issued to represent Shares purchased upon exercise of
the Options shall bear such appropriate legend conditions as counsel for the
Corporation shall require.
17. CONDITIONS TO OPTIONS.
---------------------
17.1 Compliance with Applicable Laws. The Corporation's obligation to
-------------------------------
issue Shares of its common stock upon exercise of the Options is expressly
conditioned upon
the completion by the Corporation of any registration or other qualification of
such Shares under any state and/or Federal law or rulings or regulations of any
governmental regulatory body, or the making of such investment representations
or other representations and undertakings by the Optionee or any person entitled
to exercise the Option in order to comply with the requirements of any exemption
from any such registration or other qualification of such Shares which the
Committee shall, in its sole discretion, deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that the Optionee or any person entitled to exercise the Option (i)
is not purchasing such Shares for distribution and (ii) agrees to have placed
upon the face and reverse of any certificates a legend setting forth any
representations and undertakings which have been given to the Committee or a
reference thereto.
17.2 Shareholder Approval of Plan. If the Options granted hereby are
-----------------------------
granted prior to approval of the Plan by the shareholders of the Corporation
pursuant to Section 8 of the Plan, the grant of the Options made hereby is
expressly conditioned upon and such Options shall not be exercisable until the
approval of the Plan by the shareholders of the Corporation in accordance with
the provisions of Section 8 of the Plan.
17.3 Maximum Exercise Period. Notwithstanding any provision of this
-----------------------
Agreement to the contrary, the Options shall expire no later than ten (10) years
from the date hereof or five (5) years if, as of the date hereof, the Optionee
owns or is considered to own by reason of Code Section 425(d) more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Corporation or any Subsidiary or parent corporation of the Corporation.
18. MISCELLANEOUS.
--------------
18.1 Binding Effect. This Agreement shall bind and inure to the
--------------
benefit of the successors, assigns, transferees, agents, personal
representatives, heirs and legatees of the respective parties.
18.2 Further Acts. Each party agrees to perform any further acts and
------------
execute and deliver any documents which may be necessary to carry out the
provisions of this Agreement.
18.3 Amendment. This Agreement may be amended at any time by the
---------
written agreement of the Corporation and the Optionee.
18.4 Syntax. Throughout this Agreement, whenever the context so
------
requires, the singular shall include the plural, and the masculine gender shall
include the feminine and neuter genders. The headings and captions of the
various Sections hereof are for convenience only and they shall not limit,
expand or otherwise affect the construction or interpretation of this Agreement.
18.5 Choice of Law. The parties hereby agree that this Agreement has
-------------
been executed and delivered in the State of California and shall be construed,
enforced and governed by the laws thereof. This Agreement is in all respects
intended by each party hereto to be deemed and construed to have been jointly
prepared by the parties and the parties hereby expressly agree that any
uncertainty or ambiguity existing herein shall not be interpreted against either
of them.
18.6 Severability. In the event that any provision of this Agreement
------------
shall be held invalid or unenforceable, such provision shall be severable from,
and such invalidity or unenforceability shall not be construed to have any
effect on, the remaining provisions of this Agreement.
18.7 Notices. All notices and demands between the parties hereto
-------
shall be in writing and shall be served either by registered or certified mail,
and such notices or demands shall be deemed given and made forty-eight (48)
hours after the deposit thereof in the United States mail, postage prepaid,
addressed to the party to whom such notice or demand is to be given or made, and
the issuance of the registered receipt therefor. If served by telegraph, such
notice or demand shall be deemed given and made at the time the telegraph agency
shall confirm to the sender, delivery thereof to the addressee. All notices and
demands to Optionee or the Corporation may be given to them at the following
addresses:
If to Optionee: Xxxx X. Xxxxxx
0000 Xxxxxx Xxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
If to Corporation: AMDL, Inc.
00000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Such parties may designate in writing from time to time such other place or
places that such notices and demands may be given.
18.8 Entire Agreement. This Agreement constitutes the entire
----------------
agreement between the parties hereto pertaining to the subject matter hereof,
this Agreement supersedes all prior and contemporaneous agreements and
understandings of the parties, and there are no warranties, representations or
other agreements between the parties in connection with the subject matter
hereof except as set forth or referred to herein. No supplement, modification
or waiver or termination of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any of the provisions of
this Agreement shall constitute a waiver of any other provision hereof (whether
or not similar) nor shall such waiver constitute a continuing waiver.
18.9 Attorneys' Fees. In the event that any party to this Agreement
---------------
institutes any action or proceeding, including, but not limited to, litigation
or arbitration, to preserve, to protect or to enforce any right or benefit
created by or granted under this Agreement, the
prevailing party in each respective such action or proceeding shall be entitled,
in addition to any and all other relief granted by a court or other tribunal or
body, as may be appropriate, to an award in such action or proceeding of that
sum of money which represents the attorneys' fees reasonably incurred by the
prevailing party therein in filing or otherwise instituting and in prosecuting
or otherwise pursuing or defending such action or proceeding, and, additionally,
the attorneys' fees reasonably incurred by such prevailing party in negotiating
any and all matters underlying such action or proceeding and in preparation for
instituting or defending such action or proceeding.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date first set forth above.
"CORPORATION"
AMDL, INC.,
a Delaware corporation
By:______________________________
Xxxxxx X. Xxxxxxx,
Chief Financial Officer
"OPTIONEE"
_________________________________
Xxxx X. Xxxxxx
NON-QUALIFIED STOCK OPTION AGREEMENT
------------------------------------
THIS NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement") is entered into as
of June 30, 1999, by and between AMDL, INC., a Delaware corporation
("Corporation"), and XXXX X. XXXXXX ("Optionee").
R E C I T A L S
- - - - - - - -
A. On June 30, 1999, the Board of Directors of the Corporation adopted,
subject to the approval of the Corporation's shareholders, the AMDL, Inc. 1999
Stock Option Plan (the "Plan").
B. Pursuant to the Plan, on June 30, 1999, the members of the Board of
Directors of the Corporation serving on the Committee authorized granting to
Optionee options to purchase shares of the common stock, $.001 par value, of the
Corporation ("Shares") for the term and subject to the terms and conditions
hereinafter set forth.
A G R E E M E N T
- - - - - - - - -
It is hereby agreed as follows:
1. CERTAIN DEFINITIONS. Unless otherwise defined herein, or the context
-------------------
otherwise clearly requires, terms with initial capital letters used herein shall
have the meanings assigned to such terms in the Plan.
2. GRANT OF OPTIONS. The Corporation hereby grants to Optionee, Options
----------------
to purchase all or any part of 102,942 Shares, upon and subject to the terms and
conditions of the Plan, which is incorporated in full herein by this reference,
and upon the other terms and conditions set forth herein.
3. OPTION PERIOD. The Options shall be exercisable at any time after the
-------------
date hereof (subject to the provisions of Section 17) and expiring on the date
five (5) years from the date of grant, unless earlier terminated pursuant to
Section 7.
4. METHOD OF EXERCISE. The Options shall be exercisable by Optionee by
------------------
giving written notice to the Corporation of the election to purchase and of the
number of Shares Optionee elects to purchase, such notice to be accompanied by
such other executed instruments or documents as may be required by the Committee
pursuant to this Agreement, and unless otherwise directed by the Committee,
Optionee shall at the time of such exercise tender the purchase price of the
Shares he has elected to purchase. An Optionee may purchase less than the total
number of Shares for which the Option is exercisable, provided that a partial
exercise of an Option may not be for less than one hundred (100) Shares. If
Optionee shall not purchase all of the Shares which he is entitled to purchase
under the Options, his right to purchase the remaining unpurchased Shares shall
continue until expiration of the Options. The
Options shall be exercisable with respect of whole Shares only, and fractional
Share interests shall be disregarded.
5. AMOUNT OF PURCHASE PRICE. The purchase price per Share for each Share
------------------------
which Optionee is entitled to purchase under the Options shall be $.68 per
Share.
6. PAYMENT OF PURCHASE PRICE. At the time of Optionee's notice of
-------------------------
exercise of the Options, Optionee shall tender in cash or by certified or bank
cashier's check payable to the Corporation, the purchase price for all Shares
then being purchased. Provided, however, the Board of Directors may, in its
sole discretion, permit payment by the Corporation of the purchase price in
whole or in part with Shares. If the Optionee is so permitted, and the Optionee
elects to make payment with Shares, the Optionee shall deliver to the
Corporation certificates representing the number of Shares in payment for new
Shares, duly endorsed for transfer to the Corporation, together with any written
representations relating to title, liens and encumbrances, securities laws,
rules and regulatory compliance, or other matters, reasonably requested by the
Board of Directors. The value of Shares so tendered shall be their Fair Market
Value Per Share on the date of the Optionee's notice of exercise.
7. EFFECT OF TERMINATION OF RELATIONSHIP OR DEATH. If Optionee's
----------------------------------------------
relationship with the Corporation as an employee terminates (whether voluntarily
or involuntarily because he is not re-elected by the shareholders), or if
Optionee dies, all Options which have previously vested shall expire six (6)
months thereafter. All unvested Options shall lapse and automatically expire.
During such six (6) month period (or such shorter period prior to the expiration
of the Option by its own terms), such Options may be exercised by the Optionee,
his executor or administrator or the person or persons to whom the Option is
transferred by will or the applicable laws of descent and distribution, as the
case may be, but only to the extent such Options were exercisable on the date
Optionee ceased to have a relationship with the Corporation as a director or
died.
8. NONTRANSFERABILITY OF OPTIONS. The Options shall not be transferable,
-----------------------------
either voluntarily or by operation of law, otherwise than by will or the laws of
descent and distribution and shall be exercisable during the Optionee's lifetime
only by Optionee.
9. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. As used herein, the term
------------------------------------------
"Adjustment Event" means an event pursuant to which the outstanding Shares of
the Corporation are increased, decreased or changed into, or exchanged for a
different number or kind of shares or securities, without receipt of
consideration by the Corporation, through reorganization, merger,
recapitalization, reclassification, stock split, reverse stock split, stock
dividend, stock consolidation or otherwise. Upon the occurrence of an
Adjustment Event, (i) appropriate and proportionate adjustments shall be made to
the number and kind and exercise price for the Shares subject to the Options,
and (ii) appropriate amendments to this Agreement shall be executed by the
Corporation and Optionee if the Committee determines that such an amendment is
necessary or desirable to reflect such adjustments. If determined by the
Committee to be appropriate, in the event of an Adjustment Event which involves
the
substitution of securities of a corporation other than the Corporation, the
Committee shall make arrangements for the assumptions by such other corporation
of the Options. Notwithstanding the foregoing, any such adjustment to the
Options shall be made without change in the total exercise price applicable to
the unexercised portion of the Options, but with an appropriate adjustment to
the number of Shares, kind of Shares and exercise price for each Share subject
to the Options. The determination by the Committee as to what adjustments,
amendments or arrangements shall be made pursuant to this Section 10, and the
extent thereof, shall be final and conclusive. No fractional Shares shall be
issued on account of any such adjustment or arrangement.
10. NO RIGHTS TO CONTINUED EMPLOYMENT OR RELATIONSHIP. Nothing contained
-------------------------------------------------
in this Agreement shall obligate the Corporation to employ or have another
relationship with Optionee for any period or interfere in any way with the right
of the Corporation to reduce Optionee's compensation or to terminate the
employment of or relationship with Optionee at any time.
11. TIME OF GRANTING OPTIONS. The time the Options shall be deemed
------------------------
granted, sometimes referred to herein as the "date of grant," shall be June
30,1999.
12. PRIVILEGES OF STOCK OWNERSHIP. Optionee shall not be entitled to the
-----------------------------
privileges of stock ownership as to any Shares not actually issued and delivered
to Optionee. No Shares shall be purchased upon the exercise of any Options
unless and until, in the opinion of the Corporation's counsel, any then
applicable requirements of any laws, or governmental or regulatory agencies
having jurisdiction, and of any exchanges upon which the stock of the
Corporation may be listed shall have been fully complied with.
13. SECURITIES LAWS COMPLIANCE. The Corporation will diligently endeavor
--------------------------
to comply with all applicable securities laws before any stock is issued
pursuant to the Options. Without limiting the generality of the foregoing, the
Corporation may require from the Optionee such investment representation or such
agreement, if any, as counsel for the Corporation may consider necessary in
order to comply with the Securities Act of 1933 as then in effect, and may
require that the Optionee agree that any sale of the Shares will be made only in
such manner as is permitted by the Committee. The Committee may in its
discretion cause the Shares underlying the Options to be registered under the
Securities Act of 1933, as amended, by filing a Form S-8 Registration Statement
covering the Options and the Shares underlying the Options. Optionee shall take
any action reasonably requested by the Corporation in connection with
registration or qualification of the Shares under federal or state securities
laws.
14. INTENDED TREATMENT AS NON-QUALIFIED STOCK OPTIONS. The Options
-------------------------------------------------
granted herein are intended to be non-qualified stock options described in U.S.
Treasury Regulation ("Treas. Reg.") (S)1.83-7 to which Sections 421 and 422 of
the Internal Revenue Code of 1986, as amended from time to time ("Code") do not
apply, and shall be construed to implement that intent. If all or any part of
the Options shall not be described in
Treas. Reg. (S)1.83-7 or be subject to Sections 421 and 422 of the Code, the
Options shall nevertheless be valid and carried into effect.
15. PLAN CONTROLS. The Options shall be subject to and governed by the
-------------
provisions of the Plan. All determinations and interpretations of the Plan made
by the Committee shall be final and conclusive.
16. SHARES SUBJECT TO LEGEND. If deemed necessary by the Corporation's
------------------------
counsel, all certificates issued to represent Shares purchased upon exercise of
the Options shall bear such appropriate legend conditions as counsel for the
Corporation shall require.
17. CONDITIONS TO OPTIONS.
---------------------
17.1 Compliance with Applicable Laws. The Corporation's obligation to
-------------------------------
issue Shares upon exercise of the Options is expressly conditioned upon the
completion by the Corporation of any registration or other qualification of such
Shares under any state and/or Federal law or rulings or regulations of any
governmental regulatory body, or the making of such investment representations
or other representations and undertakings by the Optionee or any person entitled
to exercise the Option in order to comply with the requirements of any exemption
from any such registration or other qualification of such Shares which the
Committee shall, in its sole discretion, deem necessary or advisable. Such
required representations and undertakings may include representations and
agreements that the Optionee or any person entitled to exercise the Option (i)
is not purchasing such Shares for distribution and (ii) agrees to have placed
upon the face and reverse of any certificates a legend setting forth any
representations and undertakings which have been given to the Committee or a
reference thereto.
17.2 Shareholder Approval of Plan. If the Options granted hereby are
----------------------------
granted prior to approval of the Plan by the shareholders of the Corporation
pursuant to Section 8 of the Plan, the grant of the Options made hereby is
expressly conditioned upon and such Options shall not be exercisable until the
approval of the Plan by the shareholders of the Corporation in accordance with
the provisions of Section 8 of the Plan.
18. MISCELLANEOUS.
-------------
18.1 Binding Effect. This Agreement shall bind and inure to the
--------------
benefit of the successors, assigns, transferees, agents, personal
representatives, heirs and legatees of the respective parties.
18.2 Further Acts. Each party agrees to perform any further acts and
------------
execute and deliver any documents which may be necessary to carry out the
provisions of this Agreement.
18.3 Amendment. This Agreement may be amended at any time by the
---------
written agreement of the Corporation and the Optionee.
18.4 Syntax. Throughout this Agreement, whenever the context so
------
requires, the singular shall include the plural, and the masculine gender shall
include the feminine and neuter genders. The headings and captions of the
various Sections hereof are for convenience only and they shall not limit,
expand or otherwise affect the construction or interpretation of this Agreement.
18.5 Choice of Law. The parties hereby agree that this Agreement has
-------------
been executed and delivered in the State of California and shall be construed,
enforced and governed by the laws thereof. This Agreement is in all respects
intended by each party hereto to be deemed and construed to have been jointly
prepared by the parties and the parties hereby expressly agree that any
uncertainty or ambiguity existing herein shall not be interpreted against either
of them.
18.6 Severability. In the event that any provision of this Agreement
------------
shall be held invalid or unenforceable, such provision shall be severable from,
and such invalidity or unenforceability shall not be construed to have any
effect on, the remaining provisions of this Agreement.
18.7 Notices. All notices and demands between the parties hereto
-------
shall be in writing and shall be served either by registered or certified mail,
and such notices or demands shall be deemed given and made forty-eight (48)
hours after the deposit thereof in the United States mail, postage prepaid,
addressed to the party to whom such notice or demand is to be given or made, and
the issuance of the registered receipt therefor. If served by telegraph, such
notice or demand shall be deemed given and made at the time the telegraph agency
shall confirm to the sender, delivery thereof to the addressee. All notices and
demands to Optionee or the Corporation may be given to them at the following
addresses:
If to Optionee: Xxxx X. Xxxxxx
0000 Xxxxxx Xxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
If to Corporation: AMDL, Inc.
00000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Such parties may designate in writing from time to time such other place or
places that such notices and demands may be given.
18.8 Entire Agreement. This Agreement constitutes the entire
----------------
agreement between the parties hereto pertaining to the subject matter hereof,
this Agreement supersedes all prior and contemporaneous agreements and
understandings of the parties, and there are no warranties, representations or
other agreements between the parties in connection with the subject matter
hereof except as set forth or referred to herein. No supplement, modification
or
waiver or termination of this Agreement shall be binding unless executed in
writing by the party to be bound thereby. No waiver of any of the provisions of
this Agreement shall constitute a waiver of any other provision hereof (whether
or not similar) nor shall such waiver constitute a continuing waiver.
18.9 Attorneys' Fees. In the event that any party to this Agreement
---------------
institutes any action or proceeding, including, but not limited to, litigation
or arbitration, to preserve, to protect or to enforce any right or benefit
created by or granted under this Agreement, the prevailing party in each
respective such action or proceeding shall be entitled, in addition to any and
all other relief granted by a court or other tribunal or body, as may be
appropriate, to an award in such action or proceeding of that sum of money which
represents the attorneys' fees reasonably incurred by the prevailing party
therein in filing or otherwise instituting and in prosecuting or otherwise
pursuing or defending such action or proceeding, and, additionally, the
attorneys' fees reasonably incurred by such prevailing party in negotiating any
and all matters underlying such action or proceeding and in preparation for
instituting or defending such action or proceeding.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the
date first set forth above.
"CORPORATION"
AMDL, INC.,
a Delaware corporation
By:______________________________________________
Xxxxxx X. Xxxxxxx, Chief Financial Officer
"OPTIONEE"
_________________________________________________
Xxxx X. Xxxxxx
EXHIBIT B
GENERAL RELEASE
---------------
WHEREAS, Xxxx X. Xxxxxx ("Releasor") and AMDL, INC., a Delaware corporation
("Releasee") have entered into that certain Agreement Regarding Cancellation of
Indebtedness dated as of July 1, 1999 (the "Agreement");
WHEREAS, pursuant to the Agreement, Releasee has agreed to General Release.
1. Release.
-------
(a) For valuable consideration, receipt of which is hereby acknowledged,
Releasor does hereby release, acquit and forever discharge Releasee and its
shareholders, partners, principals, employees, agents, relatives, and successors
and assigns (all of whom shall be included as a Releasee), from any and all
claims, demands, actions, causes of action, damages, costs, or other claims
whatsoever in law or equity, which Releasor may have against the Releasee. In
so doing, Releasor releases, relinquishes, remises, waives forever, discharges,
absolves, and quits the Releasee from each, every and all things, including by
way of example, but not limitation each and every claim, action, cause of action
whatsoever and all liabilities, debts, sums of money, controversies,
indebtedness, breaches of contract, breaches of duty or any relationships, acts,
omissions, promises, agreements, representations, damages and any demand of any
type, nature, kind or description, whether in law or in equity, or otherwise,
whether known or unknown, suspected or unsuspected, heretofore or now existing
which could, might or may be claimed to exist from the beginning of time unto
the date of these presents.
(b) Releasor does hereby acknowledge and agree that it is Releasor's
intention that this release shall be effective as a full and final accord and
satisfaction and settlement of and as a bar to each and every claim, demand,
debt, account, reckoning, liability, obligation, cost, expense, lien, action and
cause of action, heretofore referred to and released, which Releasor has against
Releasee. In connection with such waiver and relinquishment, Releasor
acknowledges that Releasor is aware that Releasor or Releasor's attorney may
hereafter discover facts different from or in addition to the facts which they
or their attorney now know or believe to be true with respect to the subject
matter of this release, but that it is Releasor's intention to fully, finally,
absolutely and forever settle any and all claims, disputes and differences which
to now exist or heretofore have existed between Releasor and Releasee, and that
in furtherance of such intention the releases herein given shall be and remain
in effect as a full and complete general release notwithstanding the discovery
of any such different or additional facts. Therefore, Releasor acknowledges
that Releasor is familiar with Section 1542 of the Civil Code of the State of
California which provides as follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him
must have materially affected his settlement with the
debtor."
(c) Releasor does hereby abandon, release, waive and relinquish all rights
and benefits which Releasor may acquire under Section 1542 of the Civil Code of
the State of California pertaining to the subject matter of this release.
2. Consideration.
-------------
Concurrent with the execution hereof, Releasee shall pay to Releasor the
other consideration set forth in the Agreement.
DATED: July 1, 1999
"Releasor"
__________________________________
Xxxx X. Xxxxxx
"Releasee"
AMDL, INC.,
a Delaware corporation
By:_______________________________
Xxxxxx X. Xxxxxxx
Chief Financial Officer
