Exhibit 10.2
SETTLEMENT AGREEMENT AND RELEASE
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This Settlement Agreement and Release (the "Settlement Agreement") is
entered into this _11th day of November, 2005, by and between Pediatric
Prosthetics Incorporated, an Idaho corporation ("Pediatric Prosthetics"), and
Secured Releases, LLC ("Secured Releases").
WHEREAS, Secured Releases owned an interest in a convertible promissory
note dated February 27, 2001, originally held by International Investment
Banking, Inc. and made by Idaho-Mountain Silver, Inc. (renamed Grant Douglas
Acquisition Corporation) and subsequently renamed Pediatric Prosthetics, Inc.
(the "Promissory Note"); and
WHEREAS, Secured Releases asserts that it entered into an Assignment of the
Promissory Note which was dated February 26, 2004 ("Assignment of Promissory
Note"), pursuant to which it purportedly assigned a portion of the Promissory
Note; and
WHEREAS, as part of the Assignment of Promissory Note, to which Pediatric
Prosthetics was not a party, it was stated that upon conversion by Secured
Releases of the Promissory Note, that Pediatric Prosthetics would issue a total
of 12,054,530 shares of common stock to Secured Releases; and
WHEREAS, Secured Releases proposed to convert $120,545.30 of the principal
amount of the Promissory Note which would represent the remaining principal
balance under the Promissory Note into 12,054,530 shares of common stock of
Pediatric Prosthetics in May, 2004; and
WHEREAS, a dispute arose between Secured Releases and Pediatric Prosthetics
whereby Pediatric Prosthetics disputes that it either owes or is obligated to
convert the Promissory Note into 12,054,530 shares of common stock to Secured
Releases; and
WHEREAS, Pediatric Prosthetics only issued 3,000,000 shares of common stock
to Secured Releases and asserts that such issuance represented full and complete
payment under the Promissory Note and that Secured Releases is not entitled to
any further rights under the Promissory Note or any other rights of conversion
under the Promissory Note; and
WHEREAS, Secured Releases asserts that it has a claim for 9,054,530
additional shares of common stock of Pediatric Prosthetics in connection with
the conversion of the Promissory Note or, alternatively, asserts that it has a
claim to an ownership interest in the Promissory Note for failure of Pediatric
Prosthetics to convert the Promissory Note into the conversion shares; and
WHEREAS, Pediatric Prosthetics disputes Secured Releases' claims for the
issuance of any additional conversion shares or that Secured Releases has any
rights, title, interest or ownership in the Promissory Note; and
WHEREAS, after extended negotiation, all of the parties hereto have
determined that it is in their mutual best interest to enter into this
Settlement Agreement upon the terms and conditions specified herein in complete
and final settlement of all disputes, issues and claims between the parties.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, including the recitals set forth hereinabove, and for other
good and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the signatory parties hereto agree to enter this Settlement
Agreement, providing for the resolution of any and all disputes, claims or
causes of action between them on the following terms:
1. Provisions of Settlement.
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(a) Pediatric Prosthetics shall pay to Secured Releases the amount of
$30,000.00, to be paid upon execution of this Settlement Agreement.
(b) Secured Releases hereby relinquishes all claims, rights, titles or
interests whatsoever in or to the Promissory Note or for the issuance of any
additional shares of common stock of Pediatric Prosthetics, including but not
limited to rights to any monies other than as set out specifically in this
Settlement Agreement.
2. Release by Pediatric Prosthetics. Pediatric Prosthetics does hereby
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for itself, its officers, directors, shareholders, agents, employees,
representatives, affiliates, subsidiaries, predecessors, successors and assigns,
or any of them, fully and forever release and discharge Secured Releases,
including its members, officers, directors, agents, employees, representatives,
affiliates, subsidiaries, predecessors, successors and assigns, or any of them,
of and from any and all cause or causes of action, suits, claims, demands,
obligations, liabilities, damages, liens, contracts, agreements, promises,
losses, costs or expenses, of any nature whatsoever, known or unknown, fixed or
contingent, whether at law or in equity, from the beginning of time to the date
of execution of this Settlement Agreement, including but not limited to those
matters that have been alleged or could have been alleged regarding or relating
to the Promissory Note, Assignment of Promissory Note, any claims for conversion
of the Promissory Note into shares of common stock of Pediatric Prosthetics or
any claims for shares of common stock of Pediatric Prosthetics or any dealings,
negotiations or transactions by and between Pediatric Prosthetics and Secured
Releases ("Claims").
3. Release by Secured Releases. Secured Releases does hereby for
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itself, its members, officers, directors, agents, employees, representatives,
affiliates, subsidiaries, predecessors, successors and assigns, or any of them,
fully and forever release and discharge Pediatric Prosthetics, including its
shareholders, officers, directors, agents, employees, representatives,
affiliates, subsidiaries, predecessors, successors and assigns, and all persons
acting by, through, under or in concert with it, or any of them, of and from any
and all cause or causes of action, suits, claims, demands, obligations,
liabilities, damages, liens, contracts, agreements, promises, losses, costs or
expenses, of any nature whatsoever, known or unknown, fixed or contingent,
whether at law or in equity, from the beginning of time to the date of execution
of this Settlement Agreement, including but not limited to those matters that
have been alleged or could have been alleged regarding or relating to the
Promissory Note, Assignment of Promissory Note, any claims for conversion of the
Promissory Note into shares of common stock of Pediatric Prosthetics or any
claims for shares of common stock of Pediatric Prosthetics or any dealings,
negotiations or transactions by and between Secured Releases and Pediatric
Prosthetics ("Claims").
4. No Admission of Liability. Each of the parties expressly
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understands and agrees that this Settlement Agreement is a compromise and
settlement of doubtful and disputed Claims and that it is not, nor is it to be
construed as an admission of liability on the part of either party. All parties
expressly deny liability and intend merely to avoid potential litigation and
further expense with respect to the Claims released herein. All parties
expressly understand and agree that this Settlement Agreement is a full and
final general release of all matters whatsoever regarding or relating to the
Claims.
5. Representations and Warranties of Parties. Each of the parties
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hereto represents and warrants to the other that (i) such party has the full
right, power and authority to enter into and this Settlement Agreement; (ii)
when fully executed and performed by all parties, this Settlement Agreement will
constitute the binding obligation of such party, fully enforceable against such
party in accordance with its terms; (iii) such party has the full right, power
and authority to settle this dispute; and (iv) such party expressly understands
and agrees that it will take no action, including, but not limited to, an appeal
or institution of a separate lawsuit, which seeks to challenge any provision of
this Settlement Agreement, any documents provided for herein, or the settlement
of the Claims referenced herein.
6. Notices. All communications required or permitted under this
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Agreement shall be in writing and any communication or delivery hereunder shall
be deemed to have been duly given the first business day following the date of
actual receipt if delivered or sent by electronic fax, or the date of receipt if
sent by nationally recognized overnight courier, or on the third business day
after mailing if mailed by registered or certified mail, postage prepaid,
addressed to the party being notified as set forth below. Any party may, by
written notice so delivered to the other, change the address to which delivery
shall thereafter be made. Notices to the parties hereto shall be made at the
addresses set forth below:
(a) If to Pediatric Prosthetics to:
Pediatric Prosthetics Incorporated
Attn: Kenneth Bean
12926 Willowchase Drive
Houston, TX 77070
With a copy to:
Robert D. Axelrod
Axelrod, Smith & Kirshbaum
5300 Memorial Drive, Ste. 700
Houston, Texas 77007
713 552 0202 - FAX
(b) If to Secured Releases, to:
Secured Releases, LLC
619 White Wing Lane
Houston Texas, 77079
281-920-5636 FAX
With a copy to:
J. Randle Henderson
Attorney at Law
1500 City West Blvd., Ste. 500
Houston, Texas 77042
713 780 3628- FAX
7. Binding Effect. This Settlement Agreement will be binding upon,
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inure to the benefit of and be enforceable by the parties and their respective
representatives, successors affiliates, assigns and heirs.
8. Counterparts. Each of the parties expressly understands and agrees
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that this Settlement Agreement may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instrument and,
further, that this Settlement Agreement shall be effective against each party
hereto, as of the date of execution by such party of a counterpart hereof,
despite the fact all other parties may not have executed the same counterpart.
9. Facsimile Signatures. Each party agrees to accept the facsimile
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signature of the other parties to this Settlement Agreement as evidence of the
execution and delivery of this Settlement Agreement. Such facsimile signature
will be deemed to be binding upon the parties sending such facsimile signature.
Any party which sends a facsimile signature agrees to deliver a manually signed
original counterpart of this Settlement Agreement to all other parties within
five (5) business days. To the extent that any party fails to deliver the
originally executed document to the other parties, such non-delivery shall not
invalidate the validity and effect of this Settlement Agreement.
10. Section Headings. The section headings contained in this
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Settlement Agreement are for convenient reference only and shall not in any way
affect the meaning or interpretation of this Settlement Agreement.
11. Entire Agreement. This Settlement Agreement constitutes the entire
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agreement among the parties hereto pertaining to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the parties pertaining to the subject matter hereof,
and there are no warranties, representations or other agreements among the
parties in connection with the subject matter hereof except as specifically set
forth herein or in documents delivered pursuant hereto. No supplement,
amendment, alteration, modification, waiver or termination of this Settlement
Agreement shall be binding unless executed in writing by the parties hereto.
Each of the parties expressly acknowledges that no promises, inducements or
agreements not herein expressed have been made to them and that the terms of
this Settlement Agreement are contractual and not merely a recital.
12. Validity. The invalidity or unenforceability of any provision of
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this Settlement Agreement shall not affect the validity or enforceability of any
other provisions of this Settlement Agreement, which shall remain in full force
and effect.
13. Survival. The respective representations, warranties, covenants
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and agreements set forth in this Settlement Agreement shall survive the
execution hereof for the maximum period allowed by law.
14. Expenses. All expenses incurred by the parties hereto in
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connection with or related to the authorization, preparation and execution of
this Settlement Agreement or the transactions contemplated hereby, shall be
borne solely and entirely by the party which has incurred the same. Each of the
parties expressly understands and agrees that in the event it shall become
necessary for any party hereto to seek enforcement hereof, or in the event of
any dispute arising hereunder, the costs and expenses of the prevailing party,
including attorney's fees, shall be paid by the non-prevailing party.
15. Choice of Law and Venue. Each of the parties expressly
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understands and agrees that the validity, enforceability and interpretation of
this Settlement Agreement shall be governed in all respects in accordance with
the procedural and substantive laws of the State of Texas, notwithstanding any
choice of law, principle or rule to the contrary and that the appropriate
federal and state courts in Harris County, Texas shall have exclusive
jurisdiction and venue concerning this Settlement Agreement and shall be the
proper forums for adjudication of these matters.
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16. Voluntary Nature of Agreement. Each of the parties expressly
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acknowledges that each of them respectively has read this Settlement Agreement;
that the terms of this Settlement Agreement, the significance and effect of this
Settlement Agreement, and the significance and effect of the settlement and
compromise of the Claims referenced herein have been explained respectively to
each of them by their respective attorneys' and that each of them respectively
understands the same, enters into same voluntarily and with full knowledge of
the effect thereof, and believes the release, settlement and compromise of the
Claims upon the terms and conditions set forth in this Settlement Agreement to
be in each party's respective best interest.
IN WITNESS WHEREOF, the parties hereto have executed or caused this
Settlement Agreement to be executed as of the date set forth above.
PEDIATRIC PROSTHETICS INCORPORATED
By: /s/ Kenneth W. Bean
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SECURED RELEASES, LLC
By:
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