SETTLEMENT AND RELEASE AGREEMENT
This
Settlement and Release Agreement (“Agreement”) is entered into and dated
effective as of this 21st day of August, 2007 by and between Xxxxxxx Xxxxxxxxx
& Xxxxx, LLP (“Creditor”) and Catalyst Lighting Group, Inc., a Delaware
corporation (“Catalyst”).
RECITALS
WHEREAS,
Creditor acknowledges that Catalyst owes Creditor $21,917.19 for services
previously rendered by Creditor to Catalyst (“Account Payable”);
WHEREAS,
Catalyst has insufficient financial resources to pay Creditor the Account
Payable;
WHEREAS,
Catalyst intends to file with the U.S. Securities and Exchange Commission
(“SEC”) to become a reporting company under the Securities Exchange Act of 1934,
as amended (“Exchange Act”) after the audit of Catalyst’s financial statements
is completed;
WHEREAS,
after becoming a reporting company under the Exchange Act, Catalyst intends
to
seek to effect a business combination with a corporation or other business
entity with current business operations in a reverse merger or reverse takeover
transaction (“Reverse Merger”);
WHEREAS,
in order to pursue a Reverse Merger, Catalyst needs to pay, settle and/or
satisfy all of its liabilities and obligations;
WHEREAS,
Creditor and Catalyst desire to settle and satisfy all claims, liabilities
and
obligations between them including, without limitation, the Account Payable
pursuant to the terms and conditions hereof;
WHEREAS,
Creditor and Catalyst further desire to terminate and cancel all contracts
and
agreements between them, whether oral or written, without further liability
or
obligation on behalf of either of them, pursuant to the terms and conditions
of
this Agreement; and
WHEREAS,
Creditor and Catalyst further desire to release each other from any and all
liabilities and obligations of any kind or nature, whether known or unknown,
pursuant to the terms and conditions of this Agreement;
AGREEMENTS
Now,
Therefore,
in
consideration of the above recitals, the following representations, warranties,
covenants and conditions, and other good and valuable consideration, the receipt
of which is acknowledged, the parties agree as follows:
1. Termination
of Agreements.
Subject
only to the issuance of securities by Catalyst to Creditor as set forth in
Section 3 hereof, Catalyst, on the one hand, and Creditor, on the other hand,
each hereby: (i) mutually terminate and cancel any and all agreements and
contracts (whether oral or written) between Catalyst, on the one hand, and
Creditor, on the other hand, pertaining to any matters between such parties
(“Contracts”), and (ii) release each other from any further liability and
obligations under the Contracts.
2. Waiver
and Release.
Subject
only to the issuance of securities by Catalyst to Creditor as set forth in
Section 3 hereof, Catalyst, on the one hand, and Creditor, on the other hand,
each hereby waive, and forever and irrevocably release and discharge the other
party and its respective successors and assigns, and their respective past
and
present officers and directors, employees, shareholders, members, consultants,
attorneys, accountants, other professionals, insurers, agents and all other
related entities, including, but not limited to, assigns, predecessors,
successors, controlling corporations, subsidiaries or other affiliates, from
all
liabilities and obligations owed by either party to the other party, and from
any and all claims, demands, and causes of action of every kind and nature,
including, without limitation, the Account Payable, those relating to or arising
out of any federal, state or local laws, and common law, claims for advances
or
other loans, claims for unpaid fess, interest, penalties, expense reimbursement
or other compensation, claims for fees or expenses for services rendered;
provided, however, that nothing contained herein shall be construed to limit
in
any way the rights of either party, and their successors and assigns, to enforce
the terms of this Agreement. Further, each party irrevocably
agrees to refrain from directly or indirectly asserting any claim or demand
or
commencing (or causing to be commenced) any suit, action, or proceeding of
any
kind, in any court or before any tribunal, against the other party based upon
any released claim.
3. Issuance
of Securities.
In full
satisfaction of all obligations and liabilities of Catalyst owed to Creditor,
including, without limitation, the Account Payable, Catalyst hereby agrees
to
issue to Creditor a total of 212,668 shares of Catalyst’s common stock
(“Shares”). The Shares shall be issued pursuant to an exemption from
registration under the Securities Act of 1933, as amended (“Securities Act”),
and the certificates representing the Shares shall contain the restrictive
legend under the Securities Act. Prior to the issuance of the Shares, Creditor
shall deliver to Catalyst a representation letter with respect to the issuance
of the Shares, which shall be in the form attached hereto as Exhibit A. The
Shares will be entitled to piggyback registration rights as set forth in the
Registration Rights Agreement, the form of which is attached hereto as Exhibit
B
(“Registration Rights Agreement”).
4. Representations
and Warranties of Catalyst.
Catalyst represents and warrants to Creditor that: (i) on the date of this
Agreement, Catalyst has all necessary authority to execute this Agreement;
(ii)
there is no claim, action, suit or other proceeding pending, threatened or
known, which, if decided adversely, would interfere with the consummation of
the
transaction contemplated hereby; (iii) no approval or consent of any
governmental authority or third party is required for Catalyst to enter into
or
perform this Agreement; (iv) this Agreement is enforceable in accordance with
its terms, subject to the laws of insolvency and general principles of equity;
and (v) this Agreement has been duly authorized and adopted by
Catalyst.
5. Representations
and Warranties of Creditor.
Creditor represents and warrants to Catalyst that: (i) on the date of this
Agreement, Creditor has all necessary authority to execute this Agreement;
(ii)
there is no claim, action, suit or other proceeding pending, threatened or
known, which, if decided adversely, would interfere with the consummation of
the
transaction contemplated hereby; (iii) no approval or consent of any
governmental authority or third party is required for Creditor to enter into
or
perform this Agreement; and (iv) this Agreement is enforceable against Creditor
in accordance with its terms, subject to the laws of insolvency and general
principles of equity.
6. Delivery
and Cooperation.
If
either party requires any further documentation (including, without limitation,
any UCC termination filings), the other party will promptly respond to any
reasonable requests for additional documentation.
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7. Miscellaneous.
(a) Successors
and Assigns.
This
Agreement shall be binding upon the parties hereto and their respective
successors and assigns.
(b) Survival
of Covenants and Representations.
All
agreements, covenants, representations and warranties made by the parties herein
shall survive the delivery of this Agreement.
(c) Severability.
Should
any part of this Agreement for any reason be declared invalid or unenforceable,
such decision will not affect the validity or enforceability of any remaining
portion, which remaining portion will remain in force and effect as if this
Agreement had been executed with the invalid portion thereof eliminated, and
it
is hereby declared as the intention of the parties hereto that the parties
would
have executed the remaining portion of this Agreement without including therein
any such part or portion that may, for any reason, be hereafter declared invalid
or unenforceable.
(d) Governing
Law and Venue.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware, without reference to choice of law principles.
(e) Captions.
The
descriptive headings of the various Sections or parts of this Agreement are
for
convenience only and shall not affect the meaning or construction of any of
the
provisions hereof.
(f) Entire
Agreement.
This
Agreement constitutes the entire agreement among the parties hereto concerning
the subject matter contained herein, and supersedes all prior agreements or
understanding of the parties. No provision of this Agreement may be waived
or
amended except in a writing signed by both parties. A waiver or amendment of
any
term or provision of this Agreement shall not be construed as a waiver or
amendment of any other term or provision.
(g) Counterparts.
This
Agreement may be executed by facsimile or electronic signatures and in multiple
counterparts, each of which shall be deemed an original. It shall not be
necessary that each party executes each counterpart, or that any one counterpart
be executed by more than one party so long as each party executes at least
one
counterpart.
(h) Arbitration.
All
disputes, controversies or claims (“Disputes”)
arising out of or relating to this Agreement shall in the first instance be
the
subject of a meeting between a representative of each party who has
decision-making authority with respect to the matter in question. Should the
meeting either not take place or not result in a resolution of the Dispute
within twenty (20) business days following notice of the Dispute to the other
party, then the Dispute shall be resolved in a binding arbitration proceeding
to
be held in New York, New York in accordance with the international rules of
the
American Arbitration Association. The arbitrators may award attorneys’ fees and
other related arbitration expenses, as well as pre- and post-judgment interest
on any award of damages, to the prevailing party or parties, in their sole
discretion. The parties agree that a panel of three arbitrators shall be
required, all of whom shall be fluent in the English language, and that the
arbitration proceeding shall be conducted entirely in the English language.
Any
award of the arbitrators shall be deemed confidential information for a minimum
period of five years.
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IN
WITNESS WHEREOF, this Agreement has been executed as of the date first written
above.
CATALYST LIGHTING GROUP, INC. | ||
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By: | /s/ Xxxxxx Xxxxxxxxxx | |
Xxxxxx Xxxxxxxxxx, CEO |
CREDITOR: | ||
Xxxxxxx Xxxxxxxxx & Xxxxx, LLP | ||
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By: | /s/ Xxxxx Xxxxxxx | |
Name:
Xxxxx Xxxxxxx
Title:
Managing Partner
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Exhibit
A
- Creditor Investor Representation Letter
Exhibit
B
- Registration Rights Agreement
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