Exhibit 10(v)
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AMENDED AND RESTATED SETTLEMENT AGREEMENT
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This Amended and Restated Settlement Agreement (this "Agreement") is made
and entered into on this _____ day of July, 2000, by and between XXXXXX X.
XXXXXX ("Xxxxxx") and ENVIRO-CLEAN OF AMERICA, INC., a Nevada corporation (the
"Company").
WHEREAS, Xxxxxx and the Company entered into a Settlement Agreement on
March 31, 2000 wherein, among other things, the Company agreed to assist Xxxxxx
in the disposition of the Company's common stock, par value $0.001 (the "Common
Stock") held by, or to be held by Xxxxxx. A copy of the March 31, 2000
Settlement Agreement is attached hereto and marked Exhibit A and incorporated
herein by reference for all relevant purposes (the "Original Agreement"); and
WHEREAS, the Company and Xxxxxx desire to amend certain provisions of the
Original Agreement by amending and restating the Original Agreement in its
entirety as herein provided and this Amended and Restated Agreement will
supercede the Original Agreement and upon the execution hereof shall represent
the Settlement Agreement by and between the Company and Xxxxxx.
NOW THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. 500,000 Shares. The Company will either purchase, or use its best
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efforts to assist Xxxxxx in the sale of, 500,000 shares of the Common Stock (the
"Shares") beneficially held by Xxxxxx at a price of no less than $2.00 per
share, with the purchase of 250,000 shares to be consummated on or before August
1, 2000 and the purchase of the remaining 250,000 shares to be consummated on or
before August 15, 2000. Xxxxxx will prepare and deliver on or before July 19,
2000 the purchase agreement between Xxxxxx and the buyer(s) of Shares which
shall contain such representations, warranties, terms and conditions as are
reasonably acceptable to Xxxxxx and such buyer(s). It is the intent of the
parties that the purchase agreement to be delivered to the Company shall be
substantially similar to the purchase agreement used in connection with Xxxxxx'
previous sale of 500,000 of his shares in the Company for a total purchase price
of $1,500,000. If the Company is not the buyer, it is understood and agreed
that the Company will not be acting as a broker or finder in any such sale and
will not be compensated for any of its efforts, but will facilitate any sale and
purchase by expediting stock transfers and providing Xxxxxx with an escrow
account. All buyers shall be "accredited investors" as such term is defined
under Regulation D, promulgated under the Securities Act of 1933. Xxxxxx
represents and warrants that in formulating his decision to sell the Shares, he
has had the opportunity to ask questions and receive answers from the Company
concerning the Company and its business and prospects, and he has been permitted
to have access to all information which he has requested in order to evaluate
the merits and risks of the sale of the Shares. Xxxxxx has been represented by
independent legal counsel with respect to the sale of the Shares and has
received such financial advice as he deems necessary from financial advisors of
his own choosing. In addition, Xxxxxx understands that in the future the
Company may issue its stock in a public or private offering for a price higher
than the price Xxxxxx receives for the Shares, or may effect a sale of the
Company or substantially all of its assets.
2. Relocation of Florida Office. Xxxxxx understands that, upon
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consummation of the sale of the Shares and receipt of the entire sales proceeds
by Xxxxxx or Xxxxxx' attorneys, the Company, at its sole cost and expense, will
commence to close the Florida office of NISSCO/NIPPCO/Sunline, Inc.
(collectively "NISSCO"), a subsidiary of the Company, and relocate as much or
all of the furniture, computers, files and staff thereof to Texas as it deems to
be necessary and advisable. It is anticipated that this move will take place by
August 31, 2000. Xxxxxx agrees to assist the Company in this relocation process
prior to August 5, 2000 and after August 20, 2000. In furtherance of this move,
Xxxxxx shall coordinate with the Company's management, and will deliver new
signature cards from Nissco's bank accounts to Xxxxxxx X. Xxxxx.
3. Resignation; Consulting; Severance Payments. Xxxxxx hereby resigns
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from all positions with the Company and NISSCO effective as of the date Xxxxxx
or his attorneys have received the entire sales proceeds from the sale of the
Shares (the "Resignation Date"). From the Resignation Date through December 31,
2000, Xxxxxx agrees to provide consulting services to the Company. Xxxxxx will
not be required to travel, but will be required to be reasonably available by
phone. Failure to comply with these requirements will excuse the Company's
obligations to make severance payments as described in this Section 3 of this
Agreement. The termination of the Company's obligation to make severance
payments under this Section 3 shall be the sole and exclusive remedy available
to the Company if Xxxxxx fails to comply with the requirements of this Section
3. Commencing on the Resignation Date and ending on December 31, 2000, the
Company will pay Xxxxxx severance pay at the rate of $6250 per month which shall
also be the full consideration for Xxxxxx'x consulting services; provided that
the first months' payment shall be prorated if the Resignation Date is on any
date other than the first day of the month. The payments shall be made in
consecutive monthly installments on or before the first day of each month;
provided that the first month's payment shall be made on or before the
Resignation Date. This is not required by any pre-existing policy or agreement.
4. Confidentiality; Return of Company Property. Xxxxxx will return all of
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the Company's property in his immediate possession no later than 5:00 p.m.
August 15, 2000. Such property shall be returned to the Company's Florida
office. This includes but is not limited to, computer equipment, cellular phone,
pager, keys, credit cards, long distance calling card, and any confidential
and/or proprietary information or files. Failure to return Company property as
required by this Agreement will excuse the Company's obligation to make
severance payments described in Section 3 of this Agreement.
Xxxxxx acknowledges that he has been permitted access to documents and
exposed to other information regarding the confidential affairs of the Company
and NISSCO, which may include, without limitation, information about their past,
present and future financial condition, the markets for their services, key
personnel, trade secrets, current and prospective customer lists, price data,
purchasing information, operational methods, acquisition plans, prospects, plans
for future development and other business affairs and information, all of which
is information not available to the public, or which is protectable under
copyright, trademark, patent, or similar
law (the "Confidential Information"). Xxxxxx covenants and agrees that at no
time shall he ever divulge, disclose or otherwise use any Confidential
Information, unless and until (a) such information is available in the public
domain by reason other than Consultant's unauthorized disclosure or use thereof,
unless such disclosure or use is expressly authorized by the Company's Chief
Executive Officer in writing in advance of such disclosure or use, or (b)
disclosure is required pursuant to a legal proceeding and Xxxxxx provides the
Company with reasonable advance notice of such disclosure. Xxxxxx also hereby
acknowledges and agrees that all Confidential Information shall remain the sole
property of the Company and that Xxxxxx has not and shall not acquire any right,
title or interest in and to any of the Confidential Information.
5. Restrictive Covenants Applicable to Xxxxxx. For a period of one (1)
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year immediately following the date of execution of this Agreement, Haines shall
not, within the United States of America:
(a) participate directly or indirectly as an owner, partner, limited
partner, joint venturer, member, employee, consultant, officer, director,
or stockholder (except solely as a stockholder holding less than a 4.9%
interest in the voting securities of a corporation, the shares of which are
traded on a national securities exchange or in the over-the-counter market)
in or otherwise be associated in any manner connected with or render
services or advice to, whether or not for compensation, any person or
entity who or which is in the business of forming and maintaining buying
groups within the janitorial supply industry (the "Janitorial Buying Group
Business");
(b) induce or attempt to induce any person who, at any time during
the term of Xxxxxx' employment at NISSCO, was a customer, supplier,
licensee, or business relation of NISSCO, the Company or any of the
Company's other subsidiaries, to cease doing business with Company, or in
any way interfere with the relationship between any such customer,
supplier, licensee or business relation and Company;
(c) directly or indirectly, either for himself or any other person,
solicit the business of any person who at any time during Xxxxxx'
employment at NISSCO was a customer of NISSCO, the Company or any of the
Company's other subsidiaries, whether or not Xxxxxx or a person under
Xxxxxx' control had personal contact with such person, with respect to
products or activities which compete in whole or in part with the
Janitorial Buying Group Business of the Company or any of its subsidiaries;
(d) directly or indirectly, on Xxxxxx' own behalf or in the service
of or on behalf of others, solicit, divert, recruit, or employ any employee
of the Company or any subsidiary or affiliate of the Company to leave
employment with the Company or otherwise terminate employment or to join a
competitor of the Company; and
Xxxxxx agrees that the covenants set forth in this Section 5 are reasonable
with respect to their duration, geographical area and scope. In consideration
for Xxxxxx' agreement to abide by the covenants set forth in this Section 5, the
Company hereby agrees to pay Xxxxxx $96,000 (the "Non-Compete Fee"), which shall
be in addition to the other payments to be made by the Company pursuant to the
terms of this Agreement. The Non-Compete Fee shall be paid in consecutive
monthly installments of $8,000 on or before the first day of each month,
beginning
on or before August 1, 2000. In the event Xxxxxx breaches any of the covenants
set forth in this Section 5, the Company's remedies shall include (i) injunctive
relief, (ii) discontinuing payment of the monthly installments of the Non-
Compete Fee which are due after the date of the breach; (iii) discontinuing
payment of the monthly installments of the severance pay as described in Section
3 which are due after the date of the breach and (iv) any and all other legal
and equitable remedies available under applicable law. In the event the Company
breaches the terms of this Section 5 by failing to make any payment of the Non-
Compete Fee when due, then the covenants applicable to Xxxxxx under this Section
5 shall immediately terminate and be of no further force or effect and any and
all other legal and equitable remedies will be available to Xxxxxx under
applicable law.
6. Non-Disparagement Covenants of Xxxxxx and the Company. For a period of
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one (1) year immediately following the date of execution of this Agreement:
(a) Xxxxxx shall refrain from making any substantive, derogatory or
disparaging remarks to any third party or government agency regarding his
employment with or separation from the Company or its affiliates (including,
without limitation, NISSCO), or regarding the products, legal compliance,
issuance of securities, services, management, officers, employees, agents, or
operators of the Company or its affiliates. In the event Xxxxxx breaches any of
the covenants set forth in this Section 6(a), the Company's remedies shall
include (i) injunctive relief, (ii) discontinuing payment of the monthly
installments of the Non-Compete Fee which are due after the date of the breach;
(iii) discontinuing payment of the monthly installments of the severance pay as
described in Section 3 which are due after the date of the breach and (iv) any
and all other legal and equitable remedies available under applicable law.
(b) the Company's employees, officers and directors will refrain from
making any substantive, derogatory or disparaging remarks about Xxxxxx. In the
event any such derogatory or disparaging remarks about Xxxxxx are made, then the
covenants applicable to Xxxxxx under Section 5 hereof shall immediately
terminate and be of no further force or effect and any and all other legal and
equitable remedies will be available to Xxxxxx under applicable law.
7. Release. In consideration of the Company's promises in this Agreement,
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Xxxxxx hereby releases and forever discharges the Company, its affiliated and
related entities, and all their past, present, and future officers, board
members, insurance carriers, agents, servants, employees, successors, assigns,
and attorneys (including, without limitation, Xxxxxxx Xxxxxx and Xxxxxxx X.
Xxxxx) jointly and severally (hereinafter "Parties Released"), from any and all
manner of actions, suits, proceedings, claims, damages, interest, benefits and
all other demands of any kind or character whatsoever, in law or in equity, in
any way directly or indirectly related to or connected with Xxxxxx' employment
or separation therefrom with NISSCO, including but not limited to violation or
alleged violation of any employment, bonus, or other compensation agreement with
the Company or NISSCO (including but not limited to claims for payment of
accumulated but unused benefits such as vacation or sick leave, or for any bonus
or other deferred compensation), or arising under the Civil Rights Act of 1964,
the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the
Americans with Disabilities Act, the Employee Retirement Income Security Act, or
any other federal, state, or local human or civil rights, wage, or labor laws,
or whether founded upon tort, contract, negligence, or breach of any
kind of alleged duty or on any other basis whatsoever, arising on or before the
date of Xxxxxx' signature to this Agreement.
Similarly, the Company hereby releases and forever discharges Xxxxxx and
his agents, heirs, successors, and assigns from any and all manner of actions,
suits, proceedings, claims, damages, interest, benefits, and all other demands
of any kind or character whatsoever, in law or in equity, in any way directly or
indirectly related to or connected with his employment or association with the
Company (including, without limitation, his actions as an employee, officer,
director or shareholder of the Company; his actions in connection with the sale
of his shares in the Company; and his actions in connection with the sale of
NISSCO to the Company) in any manner whatsoever.
8. Confidentiality of Agreement. The parties agree that the terms and
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conditions of this Agreement are strictly confidential. Each party further
agrees not to publicize or disclose or knowingly permit or authorize the
publicizing or disclosure of the contents of this document to any person, firm,
organization, or entity of any and every type, public or private, for any
reason, at any time, without the prior written consent of the other party,
except to the Company's attorneys, accountants, and employees, and to Xxxxxx'
attorneys, personal tax advisor and spouse, or as may be required by legal
process. The parties agree to use their best efforts to prevent any future
publicity or disclosure of this Agreement and the matters contained herein,
including but not limited to instructing those to whom disclosure is permitted
that its terms are confidential and must not be disclosed, and securing from
those to whom disclosure is allowed their agreement not to divulge said
information, but to maintain its confidentiality. In the event confidentiality
of this agreement is breached, each of the parties understands and agrees that
he or it will be liable to the other party for any damages arising therefrom.
9. Representation of Counsel. The parties hereto, jointly and
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individually, hereby acknowledge that they have been represented by counsel in
connection with the giving and execution of this Agreement; that they understand
the meaning of this document; that they intend to be legally bound by all of the
terms set forth herein; and that they have received consideration deemed by them
and their counsel to be sufficient for the giving and execution of this
document.
10. Limitation on Remedies. Notwithstanding anything contained in this
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Agreement to the contrary, neither party shall have the right to raise or assert
as a remedy for any breach of this Agreement by the other party the remedy of
rescission with respect to the sale of the Shares as described in Section 1
hereof.
11. Miscellaneous. No amendment, modification, or discharge of this
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Agreement, and no waiver hereunder, shall be valid or binding unless set forth
in writing and duly executed by the party against whom enforcement of the
amendment, modification, discharge, or waiver is sought. No delay or failure at
any time on the part of either party in exercising any right, power, or
privilege under this Agreement, or in enforcing any provision of the Agreement,
shall impair any such right, power, or privilege, or be construed as a waiver of
such provision, or be construed as a waiver of any default or as any
acquiescence therein, or shall affect the right of such party thereafter to
enforce each and every provision of this Agreement in accordance with its terms.
This Agreement constitutes the entire agreement between the parties hereto with
respect to the subject matter hereof, and supersedes all prior oral or written
agreements,
commitments, or understandings with respect to such matters, including the
Original Agreement. This Agreement or any interest herein may not be assigned by
either party in whole or in part without the prior written approval of the other
party. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective permitted heirs, successors and assigns.
The section headings contained herein are for the purposes of convenience only
and are not intended to define or limit the contents of said sections. This
Agreement shall be governed by and interpreted in accordance with the laws of
the State of Texas. The provisions of this Agreement are several and the
invalidity or unenforceability of any provision hereof shall not effect the
validity or enforceability of any other provision. In addition, in the event
that the provision of this Agreement (or a portion thereof) is determined by the
Court to be unenforceable as drafted by the virtue of the scope, duration,
extent or character of any obligation contained therein, the parties acknowledge
that it is their intention that such provision (or portion thereof) shall be
construed in a manner designed to effectuate the purposes of such provision to
the maximum extent enforceable under applicable law. If any of the covenants set
forth in Sections 5 or 8 are held to be unreasonable, arbitrary or against
public policy, such covenants will be considered divisible with respect to
scope, time and geographic area, and will be effective, binding and enforceable
against Xxxxxx in such lesser scope, time and geographic area as a court of
competent jurisdiction determines to be adequate under the circumstances.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above-written.
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Xxxxxx X. Xxxxxx
ENVIRO-CLEAN OF AMERICA, INC.
By:
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Xxxxxxx Xxxxxx, Chief Executive Officer
