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EXHIBIT 10.2
SETTLEMENT AGREEMENT
This Settlement Agreement is made this 7th day of December, 1995, by and between
the following parties:
Parties:
PAN Environmental principals:
a) Xxx Xxxxxx
b) Xxxxxx X. Xxxxxx
c) Xxxxx Xxxxxxxx
d) Xxxxxx Xxxxxx
e) Xxxx Xxxxx
f) Xxxxxx Xxxxx
g) Xxxx Xxxxxx
h) Xxxxx X. Xxxxxxx
i) Xxxxxx Xxxxxx
j) Xxxxxx Xxxxxx
k) HJS Financial Services
l) Xxxxxx Resources, Ltd.
m) Bristol, Ltd.
All hereafter referred to an "PAN Principals."
c/o PAN Environmental Corporation
0000 XX 00xx Xxx
Xxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx, President
PAN Environmental Corporation ("PAN")
0000 X.X. 00xx Xxx
Xxxxxx, XX 00000
Attn: Xxxxxxx X. Chysik, President
Maximum Resources, Inc. ("Maximum")
X.X. Xxx 00000
Xxxxxxxxx, X.X. Xxxxxx X0X 0X0
Attn: Xxxxxxxx X. Xxxxxxxx, Managing Member
Xxxxx X. Xxxxxx, Managing Member
Valhalla Financial Group, L.L.C. ("Valhalla")
0000 - 000xx Xxxxxx, X.X., Xxxxx #000
Xxxxxxxxx Xxxxxxx, XX 00000
Whereas, Maximum through its proposed U.S. subsidiary, is willing to acquire
PAN on a reverse takeover, provided that at the time of takeover, PAN is clean
and has no litigation, threatened or pending, no outstanding stock options, no
outstanding employee benefit plans nor any outstanding debts of any kind, actual
or contingent, and
Whereas, subsequent to the acquisitions, Maximum intends to conduct an
extensive investor and corporate awareness relations campaign to market-makers,
broker-dealers, existing investors and prospective investors, and
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WHEREAS, Valhalla has a consulting agreement with Maximum to obtain agreements
from the appropriate parties to ensure that PAN is clean and has no threatened
or pending litigation, no outstanding stock options, no employee benefit plans,
nor outstanding debts of any kind, actual or contingent, and
WHEREAS, PAN is a U.S. 12(g) reporting public company, and
WHEREAS, PAN currently owes Xxxxxxx X. Xxxxx (Xxxxx) and Republic Bank
C.F.B.O., Xxxxxxx X. Xxxxx X.X.X. (Xxxxx XXX) a judgment of $200,910.10
obtained March 10, 1995 which bears judgment interest at the rate of 25 percent
per annum as a result of PAN defaulting on a $161,250 stock purchase agreement
for 150,000 post split shares (450,000 shares pre-split), and
WHEREAS, PAN, excluding its debt to Xxxxxxx X. Xxxxx, currently owes taxes and
accounts payable owing of approximately U.S. $175,000.00, and
WHEREAS, Xxxxx and Xxxxx XXX also still own 150,000 post-split shares and have
granted an option to Valhalla for U.S. $1.50 per share, the proceeds of which
are to liquidate PAN's debt to Xxxxx and Xxxxx XXX which is agreed to be
$225,000, and
WHEREAS, Xxxxx X. Xxxxxxx ("Xxxxxxx") owns 112,889 post-split shares and has
granted an option to Valhalla for U.S. $0.50 per share, and
WHEREAS, Xxxxxx Xxxxxx ("Xxxxxx") owns 145,055 post-split shares and has
granted an option to Valhalla for U.S. $0.50 per share, and
WHEREAS, Valhalla will use its best efforts to sell the stock underlying the
above three stock options at a high enough price to liquidate the Xxxxx/Xxxxx
XXX debt owed by PAN and to liquidate the taxes payable, notes payable,
accounts payable debts owed by PAN, and
WHEREAS, PAN is not current in its compliance disclosures with Security and
Exchange Commission, and
WHEREAS, PAN had intentions of obtaining a listing on NASDAQ's small cap
listing service; however, due to the failure of Credit Lyonnaise to conclude
its several million dollar financing agreement with PAN, the market for PAN's
stock collapsed and PAN became insolvent, and
WHEREAS, the PAN principals are owed various accrued salaries, fees,
commissions and remunerations by PAN and have various agreements with PAN for
stock options, employee benefits, mergers and acquisitions among other things.
NOW, THEREFORE, for the mutual considerations contained herein, the parties
agree as follows:
AGREEMENT
1) Pan principals agree to accept and Maximum agrees to cause to be issued by
PAN 800,000 shares (this figure to be reduced by certain itemized events:
accounting, audits, tax returns, litigations, SEC compliance work, debt
arbitration, etc., performed or contracted for by Valhalla or Maximum and
has currently been reduced by 80,000 shares ($40,000 @ $0.50 per share) for
such services to effectuate this potential reverse merger transaction) of
PAN restricted common stock to PAN principals on a pro rata basis as to PAN
schedule of stock option grants as of March 20, 1995 as in Schedule A, to
be issued in these pro rata allotments over 4 month period as defined in
Schedule B.
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SCHEDULE A
Shares to be issued estimated
Stock Option at 720,000 shares
Name Grants Percentage (800,000 - 80,000 reduction)
---- ------------ ---------- -----------------------------
Xx. Xxx Xxxxxx 200,000 5.9426 42,787
Xx. Xxxxxx X. Xxxxxx 81,818 2.4310 17,503
Xx. Xxxxx Xxxxxxxx 564,242 16.7652 120,709
Xx. Xxxxxx Xxxxxx 514,242 15.2796 110,013
Mr. Xxxx Xxxxx 150,000 4.4569 32,090
Mr. Xxxxxx Xxxxx 100,000 2.9713 21,393
Xx. Xxxx Xxxxxx 50,000 1.4856 10,696
Xx. Xxxxx Xxxxxxx 172,283 5.1190 36,857
Xx. Xxxxxx Xxxxxx 276,722 8.2222 59,200
Xx. Xxxxxx Xxxxxx 45,000 1.3372 9,628
HJS Financial Services 427,909 12.7144 91,544
Xxxxxx Resources, Ltd. 300,000 8.9138 64,179
Bristol, Ltd. 483,334 14.3612 103,401
--------- ------- -------
Total: 3,365,550 100.00 720,000
SCHEDULE B
Schedule A's restricted common stock to be issued in these pro rata allotments
evenly (25% per month) over a four month period, with the first disbursement
beginning at the effective date of the reverse takeover.
In the event that Maximum or Valhalla on behalf of Maximum subsequently finds
itself defending itself from non-disclosure events or situation originating
from previous corporate actions of PAN prior to the reverse takeover then
Maximum on post reverse takeover basis shall reserve the right to again prorate
down the base 720,000 common share aggregate amount in the amount of two shares
for each $1.00 spent.
2. In exchange for the shares in Paragraph 1 above, PAN principals agree to
give to give up all right, title and interest in any accrued salary,
accrued employee benefits, whether separate or under an employee benefit
plan, accrued commission or fees, accrued reimbursements, stock options,
contracts, agreements or any other relationship due from or with PAN.
3. PAN principals have reviewed the three stock option agreements attached
hereto, the excess proceeds from which are the only source of funds from
which to pay PAN creditors and agree to use their best efforts to promote
PAN to broker-dealers, market makers, existing shareholders and other
investors.
4. In addition to the three stock option agreements in 3 above, PAN
principals agree to grant an option to Valhalla to purchase their PAN
shares, if any, for U.S. $0.50 per share, it being understood that all
creditors must be paid and the excess proceeds from such option agreements
are the only source to do so.
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5. PAN principals agree to hold Maximum and/or Maximum's proposed U.S.
subsidiary harmless from any creditor of PAN attempting to collect from
Maximum or from Maximum's proposed U.S. subsidiary including debt, specific
performance, attorney fees and costs and to reimburse Maximum or Maximum's
proposed U.S. subsidiary for any attorney's fees, legal costs, or other
expenses involved in Maximum's or Maximum's proposed U.S. subsidiary's
legal defense against any such attempt by PAN creditors.
6. Notices. Any notices required or permitted to be given hereunder shall be
sufficient if mailed, postage prepaid, to the respective parties at the
addresses set forth above.
7. Construction. This agreement shall be construed and interpreted in
accordance with the laws of the State of Washington.
8. Default. In the event of any default hereunder, the non-defaulting party
shall be entitled to reimbursement of all costs including reasonable
attorneys fees, incurred in enforcing this agreement, whether with or
without suit and the venue of such action may be King County, Washington.
9. Further Assurances. At any time, and from time to time, after the execution
hereof, each party will execute such additional instruments and take such
action as may be reasonably requested by the other party to confirm or
perfect title to any property transferred hereunder or otherwise to carry
out the intent and purposes of this Agreement.
10. Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same agreement.
11. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the respective parties and their heirs, successors and assigns.
12. This Agreement shall be construed and interpreted in accordance with the
laws of the State of Washington.
In Witness Whereof, the parties have executed this agreement to be effective as
of the day and year first above written.
PAN Environmental principals:
a) Xxx Xxxxxx ____________________________
b) Xxxxxx X. Xxxxxx ____________________________
c) Xxxxx Xxxxxxxx ____________________________
d) Xxxxxx Xxxxxx ____________________________
e) Xxxx Xxxxx ____________________________
f) Xxxxxx Xxxxx ____________________________
g) Xxxx Xxxxxx ____________________________
h) Xxxxx X. Xxxxxxx ____________________________
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i) Xxxxxx Xxxxxx
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j) Xxxxxx Xxxxxx /s/ XXXXXX X. XXXXXX
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k) HJS Financial Services
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l) Xxxxxx Resources, Ltd.
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m) Bristol, Ltd.
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Pan Environmental Corporation
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Xxxxx Xxxxxxxx, President
Maximum Resources, Inc.
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Xxxxxxx X. Chysik, President
Valhalla Financial Group, L.L.C. ("Valhalla")
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Xxxxxxxx X. Xxxxxxxx, Managing Member
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Xxxxx X. Xxxxxx, Managing Member
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