EXHIBIT 10.11
SETTLEMENT AND RELEASE AGREEMENT
THIS SETTLEMENT AND RELEASE AGREEMENT (this "Agreement") is entered into
and dated for reference purposes as of September 30, 2002, between NUPRO
INNOVATIONS, INC., a Delaware corporation ("Nupro"), STRONGGO, LLC, an Arizona
limited liability company ("StrongGO"), and a group of Shareholders to be
identified from among and between those individuals and entities who purchased
shares of Nupro common stock during a certain stock sale exempted from federal
securities registration through provisions of Regulation S of the Securities Act
of 1934 (hereinafter referred to as the "Reg. S Shareholders"), occurring
between June 1999 and December 2000, and subsequent shares acquired under share
warrants issued by Nupro to these Reg. S Shareholders between those same dates
(hereinafter referred to as the "Reg. S Offering") (individually referenced to
herein as a "Party" or collectively as the "Parties").
RECITALS
1. The individuals and entities within the class of Reg. S Shareholders
invested more than Eight Million Dollars ($8,000,000.00) in Nupro and shall
identify themselves as a part of this Agreement by their respective signatures
on this document below and the reconveyance of their respective Reg. S shares to
Nupro. The Reg. S Shareholders eligible for participation in this settlement and
the number of Nupro shares held by the Reg. S Shareholders are the 33
shareholders listed in Exhibit A attached hereto.
2. Certain Reg. S Shareholders have made demands upon Nupro for the
repayment of the Reg. S Shareholders' entire investment in the Reg. S Offering,
based on their allegations that certain former officers including Xxxx
Xxxxxxxxxxx, Xxxx Xxxxxxxxxxx, Xxxx Xxxxxxxx, and Xxxxxxx Xxxxxxxx de Cima, and
their de facto agent Xx. Xxxxxxxx Xxxxxx, intentionally misrepresented the
invention of, the ownership of, the reliable valuation of, and the likely sales
of a certain proprietary formulation and technology for a composite material
referred to as the "Nupro material" and "Nupro technology", which was Nupro's
principal asset at the time the Reg. S Shareholders invested in the Reg. S
Offering. Certain Reg. S Shareholders have threatened to initiate litigation
against Nupro if their investments are not returned.
3. The Reg. S Shareholders and Nupro deny all allegations made against
each other regarding representations concerning Nupro's technology.
4. The Reg. S Shareholders and Nupro deny any and all liability to one
another, but desire to fully and completely compromise, resolve and release all
of the claims between them.
5. A majority of the Reg. S Shareholders have formed another company
named StrongGO, LLC, an Arizona limited liability company ("StrongGO").
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants of the Parties
contained herein, the Parties agree as follows:
1. SETTLEMENT PROCEDURES.
(1) Certain of the Reg. S Shareholders have asserted that the
majority of the Reg. S Shareholders are prepared to settle all their alleged
claims against Nupro upon the terms and conditions set forth in this Agreement.
Nupro has agreed to settle with any or all of the Reg. S Shareholders who desire
to settle their claims with Nupro upon the terms and conditions set forth in
this Agreement, so long as Reg. S Shareholders holding at least 2,150,000 shares
of Nupro stock agree to settle on the terms and conditions set forth in this
Agreement (the "Majority of Reg. S Shareholders"). This Agreement shall be
binding upon Nupro, StrongGO, and the Reg. S Shareholders who are signatories to
this Agreement at the time that a majority of the Reg. S Shareholders execute
this Agreement (the "Effective Date"). Upon the Effective Date, all the terms
and conditions set forth in this Agreement shall be effective as between Nupro,
StrongGO, and the Reg. S Shareholders who either execute this Agreement prior to
the Effective Date, or consent to be bound by this Agreement within the Notice
Period, as defined below.
(2) When and if the Majority of Reg. S Shareholders execute this
Agreement, the parties shall provide written notice via registered mail to the
remaining Reg. S Shareholders informing them that this Agreement has become
effective by execution of the Majority of Reg. S Shareholders, and advise the
remaining Reg. S Shareholders that they have the right to participate in this
Agreement by consenting to this Agreement within fifteen (15) days after receipt
of such notice (the "Notice Period"). It shall be conclusively presumed that any
Reg. S Shareholder receives notice of his or her right to participate in this
settlement on the date receipt is evidenced by a delivery receipt from a
delivery service or postal carrier showing that the notice has been delivered to
the most current available address for that shareholder in Nupro's records.
Delivery may be made by private delivery services such as DHL, UPS, Federal
Express, etc., or by placing such notice in the United States mail or the mail
service of the country of residence of any Reg. S Shareholder.
2. RIGHT TO PARTICIPATE IN STRONGGO. Any Reg. S Shareholder who elects to
participate in this Agreement shall automatically be admitted as a member of
StrongGO. After the Notice Period has expired, the Reg. S Shareholders'
membership interests in StrongGO shall be determined by dividing the number of
shares each Reg. S Shareholder reconveys to Nupro in accordance with Section 6
below by the total number of shares reconveyed to Nupro by all the Reg. S
Shareholders who elect to participate in this Agreement. Should any Reg. S
Shareholder elect not to participate in this Agreement, by failing to execute or
consent to this Agreement prior to the expiration of the Notice Period, such
Reg. S Shareholder shall be deemed to have elected to retain his or her shares
in Nupro and be deemed to have elected to waive any right to participate in
StrongGO or this settlement. The Reg. S Shareholders who elect to participate in
this Agreement by either their execution of this Agreement prior to the
Effective Date or their consent to this Agreement within the Notice Period are
referred to herein as the "Electing Reg. S Shareholders."
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3. SETTLEMENT AMOUNT. For consideration of the promises, covenants, and
mutual releases provided for herein, Nupro hereby transfers and assigns to
StrongGO all of Nupro's right, title and interest in and to (1) the real
property in Pima County, Arizona, more particularly described at Exhibit B
attached hereto, along with all of the equipment, fixtures and inventory located
on such real property, which is described at Exhibit C attached (collectively
referred to herein as the "Real Property and Equipment"); and (2) the technology
developed by Nupro after January 30, 2002, for the manufacture of a unique
polymer compound material (the "2002 Technology").
4. ASSIGNMENT OF LEASE FOR MIXING PLANT. For consideration of the
promises, covenants, and mutual releases provided for herein, Nupro also hereby
transfers and assigns to StrongGO all of Nupro's right and interest in and to
that certain lease dated June 6, 2002 with RMP Properties, LLC (the "Lease") for
a building in Tucson, Arizona that houses Nupro's Tucson mixing plant. The Reg.
S Shareholders and StrongGO agree to satisfy all obligations under the Lease and
to indemnify and defend Nupro from and against all obligations under the Lease
which arise after the date of this Agreement.
5. RELEASE OF NUPRO'S EMPLOYEES FROM NONCOMPETE AGREEMENTS. For
consideration of the promises, covenants, and mutual releases provided for
herein, Nupro also hereby agrees to release all of its employees from their
noncompete agreements with Nupro, in the event, but only in the event, such
employees are employed by StrongGO. Nupro also hereby transfers and assigns to
StrongGO all of Nupro's right and interest in and to that certain Employment
Agreement with Xxxxxx X. Xxxxxxx dated February 15, 2002.
6. RECONVEYANCE OF ELECTING REG. S SHAREHOLDERS' STOCK IN NUPRO. For
consideration of the promises, covenants, and mutual releases provided for
herein, the Electing Reg. S Shareholders agree to reconvey to Nupro all of their
stock in Nupro upon the final assignment and recordation of the 2002 Technology,
Real Estate and Equipment, the Lease, and the Employment Agreement described in
Sections 3, 4, and 5 above. The Electing Reg. S Shareholders must reconvey their
original share certificates of Nupro to Nupro Innovations, Inc., ATTN: Xxxxxxxx
XxXxxx, 0000 X. Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxx 00000-0000 by registered mail
with a return receipt requested.
7. RELEASES OF ALL CLAIMS.
(1) The Electing Reg. S Shareholders and StrongGO hereby release and
forever discharge Nupro, and its related entities, individually and
collectively, its past and present officers, directors, shareholders,
principals, agents, representatives, employees, parents, subsidiaries,
predecessors and successors in interest, assignors and assignees, customers,
vendors, clients and insurers, except the Estate of Xxxx Xxxxxxxxxxx, Xxxx
Xxxxxxxxxxx, Xxxxxxx Xxxxxxxx de Cima, Xxxx Xxxxxxxx, and Xxxxxxxx Xxxxxx, from
all sums of money, accounts, charges, suits, proceedings, claims, contracts,
judgments, demands, or other causes of action of any nature, known or unknown,
which the Electing Reg. S Shareholders and StrongGO have, have had or may have
had against Nupro, as of the date of the execution of this Agreement, arising
out of any and all transactions and occurrences.
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(2) Nupro hereby releases and forever discharges the Electing Reg. S
Shareholders and StrongGO, and their past and present partners, officers,
directors, shareholders, principals, agents, representatives, employees,
parents, subsidiaries, predecessors and successors in interest, assignors and
assignees, customers, vendors, clients and insurers, except the Estate of Xxxx
Xxxxxxxxxxx, Xxxx Xxxxxxxxxxx, Xxxxxxx Xxxxxxxx de Cima, Xxxx Xxxxxxxx, and
Xxxxxxxx Xxxxxx from all sums of money, accounts, charges, suits, proceedings,
claims, contracts, judgments, demands, or other causes of action of any nature,
known or unknown, which Nupro, and its related entities, have, have had, or may
have had against the Electing Reg. S Shareholders and StrongGO as of the date of
execution of this Agreement, arising out of any and all transactions and
occurrences.
(3) The Electing Reg. S Shareholders, StrongGO, and Nupro agree to
fully release the Estate of Xxxx Xxxxxxxxxxx, Xxxx Xxxxxxxxxxx, Xxxxxxx Xxxxxxxx
de Cima, Xxxx Xxxxxxxx, and Xxxxxxxx Xxxxxx if they execute a release of all
claims against the Electing Reg. S Shareholders, StrongGO, and Nupro in the form
attached hereto as Exhibit D (the "Separate Release").
(4) This Agreement does not release any claims that the Parties may
have against each other regarding enforcement of this Agreement or the Separate
Release. If any Party breaches this Agreement or the Separate Release or if any
party released under this Agreement or the Separate Release initiates any legal
action against any Party to this Agreement based upon claims that are released
by this Agreement or the Separate Release, the release granted the individual or
entity initiating such action shall be null and void and be of no further force
and effect.
8. NO ADMISSION OF FAULT OR LIABILITY. While this Agreement resolves all
issues between the Electing Reg. S Shareholders, StrongGO, and Nupro relating to
the Electing Reg. S Shareholders' investment in and dealings with Nupro and all
other claims between the Parties, this Agreement does not constitute an
adjudication or finding on the merits and it is not, and shall not be construed
as, an admission of liability or fault by Nupro, StrongGO, the Electing Reg. S
Shareholders, or their related entities.
9. CHOICE OF LAW. This Agreement, its application and interpretation, and
all rights and obligations of the Parties hereunder shall be governed by and
construed exclusively in accordance with the laws of the State of Arizona,
excluding any choice of law rules which would apply the laws of another
jurisdiction.
10. CHOICE OF FORUM. Any disputes regarding this Agreement shall be
exclusively resolved in the Arizona State Superior Court for the County of Pima
should any dispute arise between or among the Parties concerning the
interpretation or enforcement of this Agreement.
11. ATTORNEYS' FEES. Should any Party initiate any action at law or in
equity affecting, enforcing, interpreting, or relating to the terms of this
Agreement, or take any nonjudicial action to prevent any other Party from
realizing any of that Party's rights or benefits under this Agreement, the
successful Party to any such action shall be entitled to receive from the
non-successful Party all reasonable attorneys' fees and costs, and necessary
disbursements, and the foregoing shall include actions required to be taken in
non-judicial circumstances as well as in judicial proceedings.
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12. ADDITIONAL DOCUMENTS. The Parties shall make, execute and deliver all
such documents and perform all such acts as may be reasonably necessary from
time to time, prior to and following the consummation of this Agreement, to
carry out the full intent and purpose of this Agreement.
13. BINDING ON SUCCESSORS AND ASSIGNEES. The provisions of this Agreement
shall be binding upon and inure to the benefit of the Parties hereto, their
permitted heirs, administrators, successors, and assigns.
14. SEVERABILITY. If any part of this Agreement is determined to be
invalid or unenforceable, that part will be amended to achieve, as nearly as
possible, the same effect as the original. The invalidity or unenforceability of
any provision shall not affect the enforceability of the remainder of this
Agreement, unless such invalidity or unenforceability would materially alter the
consideration due a Party, in which event, the affected Party may elect to
rescind this Agreement.
15. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between and reflects the reasonable expectations of the Parties pertaining to
the subject matter hereof. All prior and contemporaneous agreements,
representations, negotiations and understandings of the Parties, oral or
written, are merged herein and/or expressly declared void and are superseded by
this Agreement. No change, addition or modification shall be made to this
Agreement except by a written agreement executed by both parties intended to be
bound thereby.
16. COUNTERPARTS. This Agreement may be executed in counterparts. Each
counterpart shall be deemed an original and all taken together shall constitute
one and the same instrument. If executed in counterparts, the counterpart
signature pages may all be attached to one document, which shall then constitute
the original signed document. The execution of this Agreement is deemed to have
occurred, and this Agreement shall be enforceable and effective, only on the
complete execution and delivery of this Agreement by all the Parties. This
Agreement may be executed and delivered by facsimile copies showing the
signatures thereto. The facsimile copies showing the signatures of any of the
Parties shall constitute originally signed documents requiring no further
execution.
17. TERMS. Unless the context requires otherwise, words denoting the
singular shall be construed as including the plural, and words in the plural
shall be construed as including the singular. Words of one gender shall be
construed as including another gender or neuter if appropriate within the
context. The word "person" or "party" shall include a natural person,
corporation, firm, partnership, limited liability company, proprietorship,
trust, or any other entity.
18. CONSTRUCTION. The captions or headings of this Agreement are for
convenience of reference only and shall not control or affect the meaning or
construction of any provision herein. This Agreement is a result of negotiations
between the Parties; therefore, this Agreement shall not be construed as if it
had been prepared by one of the Parties, but rather as if both Parties have
prepared it.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the
dates shown following their respective names below.
"StrongGO" "Nupro"
STRONGGO, LLC, an Arizona limited NUPRO INNOVATIONS, INC., An Arizona
liability company, corporation
By _________________________________ By _________________________________
Its ________________________________ Its ________________________________
Date _______________________________
Date _______________________________
By _________________________________
Its ________________________________
Date _______________________________
"Electing Reg. S Shareholders"
BAVARIA HOTELHOLDINGS
INTERNATIONAL, GMBH, a German
corporation
By _________________________________
Its ________________________________
Date _______________________________
Nupro Shares Reconveyed: 2,325,000
XXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 375,000
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XX. XXXXXX XXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 300,000
XXXXXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 150,000
XXXXX XXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 100,000
XX. XXXXXXXXX XXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 100,000
CF FLEX FUND
By _________________________________
Its ________________________________
Date _______________________________
Nupro Shares Reconveyed: 100,000
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XXXXXX XXXXXXX, XXXXXX XXXXXXX, AND XXXX XXXXXXXX
By _________________________________
Date _______________________________
By _________________________________
Date _______________________________
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
XXXX-XXXXX VOELMICKE AND XXXXXXX XXXXX
By _________________________________
Date _______________________________
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
XXXXXXX XXXXXX XX.
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
XX. XXXXXX XXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
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XXXXXX XXXXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
XXXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 75,000
XXXXXX PEITZNER
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 50,000
XXXXXX PEITZNER
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 50,000
XXXXXXX TEWAAG
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 50,000
XX. XXXXX XXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 50,000
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XXXXXXXXX XXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 40,000
XXXXXXX XXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 25,000
XXXXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 20,000
XXXXXX XXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 20,000
XXX XXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 15,000
XXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 10,000
10
XXXXXXX KAERGER
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 10,000
XXXXXX XXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 10,000
XXXX XXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 10,000
XXXX XXXXXXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 10,000
MAREILIES FRANKLIN
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 5,000
XXX XXXXXXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 5,000
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XXXX XXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 5,000
XXXXX XXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 5,000
XX. XXXXXXXXX XXXXXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 5,000
XXX XXXXXXXX
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 2,500
JOCHEN AND XXXX XXXXXXXXXXXX
By _________________________________
Date _______________________________
By _________________________________
Date _______________________________
Nupro Shares Reconveyed: 2,500
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