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EXHIBIT 10.25
AGREEMENT, RELEASE AND COVENANT
NOT TO XXX
This agreement, made the 28th day of January, 1997 by and among Xxxxxx XxXxxxxx
("XxXxxxxx"), residing at 00 Xxxxx'x Xxxx, Xxxxxxxxxxxxx, Xxx Xxxx 00000, Xxxx
Technologies Inc., (the "Company" or "Xxxx Technologies"), Xxxx Special Systems
Corporation, Xxxx Products Corp. (collectively "Xxxx"); and Xxxxxx Xxxxxx
("Xxxxxx"), residing at 00 Xxxxxxxxx Xxxx, Xxxx, XX 00000.
WHEREAS, XxXxxxxx has commenced, and withdrawn without prejudice, an action
against Xxxx and Xxxxxx, entitled Xxxxxx XxXxxxxx x. Xxxxxx Xxxxxx, Xxxx
Technologies, Inc., Xxxx Special Systems Corporation, Xxxx Products Corp., in
the New York State Supreme Court, Westchester County (Index No. 96-17922) (the
"Action"); and
WHEREAS, XxXxxxxx possesses certain shares of common stock of Xxxx Technologies
that the Company contends were not yet vested in him, and XxXxxxxx claims that
the Company is holding 140,000 shares of common stock to which he is entitled;
and
WHEREAS, XxXxxxxx has agreed to obtain for Xxxx and general release from Xxxxx
Xxxxxx ("Xxxxxx"), an individual with whom XxXxxxxx is friendly whose claims
against Xxxx, if any, will be satisfied from the amounts XxXxxxxx will receive
hereunder, and whose release is required by the Company as a condition of
settling with XxXxxxxx; and
WHEREAS, the parties hereto have agreed to settle all claims existing among
them, including all claims, with respect to ownership of or entitlement to stock
or options, and including the claims raised in the Action, without admission of
fault or liability on the part of any of the parties hereto; and
WHEREAS, it is the intention of the parties that this agreement be construed as
broadly as possible to be given the greatest effect the law will allow;
NOW, THEREFORE, in consideration of the foregoing and for valuable
consideration, the sufficiency of which is hereby acknowledged, the parties
hereto agree as follows:
1. Payments to XxXxxxxx for XxXxxxxx and/or Xxxxxx
Xxxx Technologies agrees to pay to XxXxxxxx the sum of Sixty Thousand
Dollars ($60,000.00) less any withholding taxes, Social Security, Medicare
taxes and other deduction required by law, payable as follows: $5,000 upon
execution of this agreement, and $5,000 on February 3, 1997, and on the
first business day of each of the ten (10) succeeding months. These
payments are in full satisfaction of all monetary amounts due or to become
due, vested or contingent, from Xxxx or Xxxxxx to XxXxxxxx or Xxxxxx for
any reason whatsoever (except for payments specifically provided under
this agreement), including without limitation any amount claimed or due on
account of prior compensation, grants of stock or stock options,
severance, amounts based on an employment agreement, interest, or any
other cause.
2. Vesting of Stock and Cancellation and/or Acknowledgment of Expiration of
Rights or Options to Acquire Stock or Awards of Stock.
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Upon the effective date of this agreement, all common stock of Xxxx
Technologies registered in the name of XxXxxxxx, including the 140,000
shares represented by certificate no. DCN 1122 in the possession of the
Company (the "140,000 shares") shall be deemed fully vested in XxXxxxxx,
and the Company waives any claim to return of any such shares. Other than
shares represented by certificates already in his possession or in "street
name" held for him as beneficial owner, any other shares, options, grants,
awards or other rights or claims to shares of stock of Xxxx Technologies,
under any written plan or otherwise, whether vested or contingent, and any
shares registered in the name of Xxxxxx in the possession of the Company,
shall be deemed to have expired, or to have been waived, or to have been
transferred to, or at the direction of the Company, as it in its sole
discretion shall deem appropriate. XxXxxxxx shall execute and deliver to
the Company, at no charge, promptly upon request, all documents reasonably
required by the Company to evidence or effect the foregoing, and XxXxxxxx
shall cause Xxxxxx to do the same.
3. Purchase and Sale of the 140,000 Shares
(a) Xxxxxx hereby purchases from XxXxxxxx, and XxXxxxxx hereby sells to
Xxxxxx, the 140,000 shares for the sum of fifteen ($0.15) per share.
(b) Payment shall be made by check payable to XxXxxxxx, to be delivered
promptly following the effective date of this agreement. XxXxxxxx
shall cause to be delivered in escrow, to be delivered to Xxxxxx the
certificate representing the 140,000 shares, and duly executed stock
powers, in blank, for the 140,000 shares, with signature guaranty
sufficient to cause the Company's transfer agent to effect the
transfer of stock.
(c) The sale of stock under this paragraph is conditioned upon the
effectiveness of this agreement in its entirety and, if this agreement
does not become effective as provided in paragraph 7 below, then
neither Xxxxxx nor XxXxxxxx shall have any obligations under this
paragraph.
(d) XxXxxxxx represents and warrants to Xxxxxx that: (I) upon the
effective date of this settlement agreement, and at the time of his
sale of the 140,000 shares, he has or will have full right, title and
interest in and to the 140,000 shares; (ii) he has not transferred,
assigned, conveyed, pledged or encumbered all or any part of the
140,000 shares; and (iii) upon delivery to Xxxxxx of the
certificates(s) and stock powers as provided hereunder, Xxxxxx will
have full right, title and interest in and to the 140,000, free of all
claims, liens or encumbrances of any person, entity or taxing
authority.
4. (a) Documents to be Delivered by XxXxxxxx
XxXxxxxx shall execute and delivery his general releases in the forms
annexed hereto as Exhibit A, and a stock power for the 140,000 shares
in the form annexed hereto as Exhibit X. XxXxxxxx shall obtain from
Xxxxxx and deliver Xxxxxx'x duly executed general releases in the
forms annexed hereto as Exhibit C, and a stock power for 60,000 shares
in the form annexed hereto as Exhibit D. The stock powers shall have
signature guarantees sufficient to cause the Company's transfer agent
to effect transfer of stock.
(b) Documents to be Delivered by Xxxx
Xxxx shall execute and deliver to XxXxxxxx its general release of
XxXxxxxx in the form annexed hereto as Exhibit E, and its general
release of Xxxxxx, in the form annexed hereto as Exhibit F.
5. DiDonato's Representations
XxXxxxxx hereby represents that: (a) he has not filed any complaint or
claim against Xxxx, any of their affiliated companies or entities, or
their employees, with any other court or governmental agency, except
for the action; and (b) he has not transferred, assigned, pledged or
conveyed all or any part of his interest in any claim or property
which is the subject of this agreement or the release to be delivered
by him hereunder. The foregoing representations shall survive the
closing of the transactions provided for hereunder.
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6. Covenant Not to Xxx
XxXxxxxx, on behalf of himself, his heirs, executors, administrators,
and assigns agrees never to directly or indirectly commence or
prosecute, or assist in the commencement or prosecution, or in any way
cause, or advise to be commenced or prosecuted, any complaint, action
or proceeding against Xxxx, its subsidiaries, affiliates, divisions,
successors and assigns and their past, present or future officers,
directors, agents or employees, with respect to any matter, whether or
not known, based upon any act, transaction practice, conduct or
omission that occurred prior to the date of this agreement.
7. Effective Date
(a) This agreement, when signed by XxXxxxxx and delivered to Xxxxx &
Tisman with the documents to be held in escrow pursuant to
subparagraph 7(b) shall promptly be submitted for approval by the
Board of Directors of Xxxx Technologies. This agreement shall be
effective immediately upon such approval.
(b) All documents required to be delivered hereunder by XxXxxxxx, the
check from Xxxxxx for purchase of the 140,000 shares, the general
releases executed by Xxxx, and the check for the first payment by
Xxxx Technologies to XxXxxxxx shall be delivered to Xxxxx &
Tisman, Attention: Xxxxxxx X. Xxxxxx, Esq., to be held in escrow
pending the effectiveness of this agreement. Upon the
effectiveness of the agreement, the escrow shall be released and
Xxxxx & Tisman, promptly shall cause to be delivered to Xxxx
Xxxxxxxxx, Esq., counsel for XxXxxxxx, a copy of this agreement
duly signed by Xxxx and Xxxxxx, the general releases by Xxxx of
XxXxxxxx and Xxxxxx, and the two checks held in escrow. If this
agreement is not approved by the Board of Xxxx Technologies by
January 24, 1997, then all documents and checks shall be returned
by Xxxxx & Xxxxxx to the person or entity which provided them, and
this agreement shall be of no further force or effect.
8. Further Proceedings in the Event of Default
(a) In the event that all payments required to be made to XxXxxxxx by
Xxxxxx and Xxxx Technologies hereunder are made, then the
stipulation of discontinuance of the action previously filed shall
be deemed to be with prejudice.
(b) In the event that XxXxxxxx has complied with all of his
obligations hereunder, and Xxxx Technologies fails to make any
payment specified in paragraph 1 of this agreement, and the
Company does not cure such failure within ten (10) days after
receipt of written notice to Xxxx Technologies, Inc. (Attention:
Xxxxxx Xxxxxx), 00 Xxxxxxxxx Xxxx, Xxxx, XX 00000, with a copy to
Xxxxxxx X. Xxxxxxx, Esq., Xxxxx Xxxxxxxxx Stolzar & Xxxxxxxxx, 000
Xxxxx Xxxxxx, Xxx Xxxx XX 10022), or such other address as may be
notified to XxXxxxxx at his address first listed above, then
XxXxxxxx may, upon affidavit of counsel for XxXxxxxx made after
appropriate inquiry, and without further notice and without
further application, refile the action and enter judgment against
Xxxx Technologies, only, therein in the sum of $60,000 less all
amounts previously paid pursuant to paragraph 1 of this
stipulation. In the event that Xxxx Technologies fails to made the
payments as specified in paragraph 1 of this agreement, interest
shall accrue on all unpaid amounts at the annual rate of 9%,
calculated from the date hereof.
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9. MISCELLANEOUS
This agreement, release and covenant not to xxx: is made and entered
into in the State of New York and shall be governed by the laws of New
York applicable to contracts made and wholly to be performed in New York;
may be amended or canceled only by a writing signed by XxXxxxxx, Xxxx
Technology and Xxxxxx; and sets forth the entire agreement among the
parties, and fully supersedes any and all prior agreements or
understandings among the parties.
XXXX TECHNOLOGIES, INC.
__________________________ By:__________________________
XXXXXX XXXXXXXX Authorized Official
XXXX SPECIAL SYSTEMS
CORPORATION
By:__________________________
Authorized Official
XXXX PRODUCTS CORP.
By:__________________________
Authorized Official
__________________________
XXXXXX XXXXXX