Exhibit 10

 

SETTLEMENT AGREEMENT AND RELEASE

 

This Settlement Agreement and Release, effective April 27, 2004, is made between
Retractable Technologies, Inc., a company organized under the laws of the State
of Texas and having a principal place of business in Collin County, Texas
(“RTI”) and Thomas J. Shaw (“Shaw”), an individual residing in Collin County,
Texas (collectively “Plaintiffs”) and New Medical Technology, Inc. (“NMT,
Inc.”), an Indiana corporation with its principal place of business at 23
National Drive, Forge Park, Franklin, Massachusetts 02038, New Medical
Technology, LTD (“NMT, LTD”), a company organized under the laws of Scotland and
the United Kingdom, with its principal place of business in Livingston,
Scotland, and NMT Group PLC (“NMT Group”), a company organized under the laws of
Scotland and the United Kingdom, with its principal place of business in
Livingston, Scotland (collectively “NMT”).

 

WHEREAS, Thomas J. Shaw is the owner of the entire right, title, and interest in
U.S. Patent Nos. 5,385,551; 5,578,011; and 6,090,077 (the “Asserted Patents”)
subject only to an exclusive license granted to RTI;

 

WHEREAS, on February 2, 2002, RTI filed a Complaint against NMT in the United
States District Court for the Eastern District of Texas, Sherman Division, Case
No. 4:02-CV-34, which alleged that NMT was infringing RTI’s rights under U.S.
Patent Nos. 5,578,011 (“the ‘011 patent”) and 6,090,077 (“the ‘077 patent”) by
using, importing, marketing, distributing, offering for sale, and selling a
Safety Syringe (the “NMT Safety Syringe”) in the United States;

 

WHEREAS, on May 2, 2002, RTI filed a First Amended Complaint against NMT in the
United States District Court for the Eastern District of Texas, Sherman
Division, Case No. 4:02-CV-34, which alleged that NMT was infringing RTI’s
rights under the ‘011 and ‘077 patents by using, importing, marketing,
distributing, offering for sale, and selling the NMT Safety Syringe in the
United States;

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WHEREAS, on July 2, 2002, NMT filed a Counterclaim and Request for Joinder of
Thomas J. Shaw in the United States District Court for the Eastern District of
Texas, Sherman Division, Case No. 4:02-CV-34, requesting joinder of Thomas J.
Shaw as a party to the Action and alleging that NMT was not infringing the ‘011
and ‘077 patents and that the ‘011 and ‘077 patents were invalid and
unenforceable, and requesting an award of NMT’s costs against RTI;

 

WHEREAS, on August 14, 2002, the United States District Court for the Eastern
District of Texas, Sherman Division, ordered the joinder of Thomas J. Shaw as a
counter defendant in Case No. 4:02-CV-34;

 

WHEREAS, on February 19, 2003, RTI and Shaw filed a Complaint in the United
States District Court for the Eastern District of Texas, Sherman Division, Case
No. 4:03-CV-49, which alleged that NMT was infringing U.S. Patent No. 5,385,551
(“the ‘551 patent”) by using, importing, marketing, distributing, offering for
sale, and selling the NMT Safety Syringe in the United States;

 

WHEREAS, on March 18, 2003, Plaintiffs filed a Second Amended Complaint against
NMT in the United States District Court for the Eastern District of Texas,
Sherman Division, Case No. 4:02-CV-34, which alleged that NMT was infringing the
‘011 and ‘077 patents by using, importing, marketing, distributing, offering for
sale, and selling the NMT Safety Syringe in the United States;

 

WHEREAS, on April 4, 2003, NMT filed a counterclaim against RTI and Shaw
alleging that the ‘551 patent was not infringed, was invalid and unenforceable,
and requesting an award of NMT’s costs against RTI and Shaw;

 

WHEREAS, on April 14, 2003, the parties filed a Joint Motion to consolidate Case
No. 4:02-CV-34 and Case No. 4:03-CV-49;

 

WHEREAS, on May 14, 2003, the United States District Court for the Eastern
District of Texas, Sherman Division, issued an Order granting consolidation of
Case No.

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4:02-CV-34 and Case No. 4:03-CV-49 as Case No. 4:02-CV-34 (the “Consolidated
Lawsuit”);

 

WHEREAS, NMT ceased manufacturing the NMT Safety Syringe in 2003 and ceased
using, marketing, distributing, importing, offering for sale, and selling the
NMT Safety Syringe in the United States in 2003; and

 

WHEREAS, to avoid the expense and inconvenience of further litigation, the
parties have agreed to settle the differences between them according to the
terms of this Agreement.

 

Therefore, in consideration of the mutual covenants set forth herein, the
parties agree as follows:

 

  1. Stipulation and Consent Judgment. The parties have agreed to execute and
file the Stipulation and Consent Judgment attached hereto. The parties shall
execute the Stipulation and Consent Judgment contemporaneously with their
respective execution of this Settlement Agreement and Release.

 

  2. Payment. Upon the execution of this Agreement and the Stipulation and
Consent Judgment by RTI, Shaw, and NMT, NMT shall deliver on the same day to the
designated trust account of its Counsel of Record, Baker & Daniels, by
electronic wire transfer the sum of ONE MILLION U.S. DOLLARS ($1,000,000.00
U.S.). RTI and Shaw shall cause their Counsel of Record, Locke Liddell & Sapp
LLP, to file the executed Stipulation and Consent Judgment with the Court.
Within three (3) days of entry of the Stipulation and Consent Judgment by the
Court, NMT shall have Baker & Daniels deliver to the designated trust account of
Locke Liddell & Sapp LLP by electronic wire transfer the said ONE MILLION U.S.
DOLLARS ($1,000,000.00) from the said designated Baker & Daniels trust account.
The amount paid to RTI by NMT under this

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       paragraph is an amount arrived at by compromise for purposes of settling
the Consolidated Lawsuit and shall not be construed as anything other than an
agreed amount paid in compromise.

 

  3. RTI Release. Subject to payment by NMT of the amount stated in paragraph 2.
above, RTI and Shaw hereby release and forever discharge NMT, its officers,
shareholders, agents, customers, distributors, subsidiaries, contractors,
successors in interest, and assigns from any and all claims, demands, and causes
of action of any kind which have been brought or which could have been brought
in the Consolidated Lawsuit, or which exist or which may have existed as of the
date of execution of this Settlement Agreement and Release, except that this
release shall not, under any circumstance, apply or extend to: (1) Becton
Dickinson and Company, or any subsidiary or affiliate thereof; (2) Abbott
Laboratories or any subsidiary or affiliate thereof; (3) any claim that RTI or
Shaw may have under the Asserted Patents or other patents against the syringes
or syringe technology advertised by NMT as “Second Generation” as of the date of
execution of this Settlement and Release Agreement; (4) any claim that RTI or
Shaw may have under the Asserted Patents or other patents against any medical
product of NMT, its officers, shareholders, agents, customers, distributors,
subsidiaries, contractors, successors in interest, and assigns, other than the
NMT Safety Syringe that is made the subject of the Consolidated Lawsuit; or (5)
any claim that RTI or Shaw may have against any NMT entity in any jurisdiction
outside the United States for infringement of any patent issued by any country
or region other than the United States, which patent is owned or exclusively
licensed by RTI or Shaw in such jurisdiction.

 

  4. NMT Release. NMT agrees to dismiss with prejudice in the accompanying
Stipulation and Consent Judgment all claims, counterclaims, affirmative
defenses, defenses and demands for relief

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       asserted by NMT against RTI and Shaw in the Consolidated Lawsuit. NMT
hereby releases and forever discharges Shaw, RTI, its officers, shareholders,
agents, customers, distributors, subsidiaries, contractors, successors in
interest and assigns, from any and all claims, demands, and causes of action of
any kind which have been brought or which could have been brought in the
Consolidated Lawsuit, or which exist or which may have existed as of the date of
execution of this Settlement Agreement and Release, provided, however, that NMT
does not by this Settlement Agreement and Release or by the Stipulation and
Consent Judgment release any claim, counterclaim, affirmative defense, defense
or claim for relief that NMT may have in or to any action brought by RTI or Shaw
in any jurisdiction outside the United States in relation to sales of the NMT
Safety Syringe made by NMT outside the United States.

 

  5. Complete and Final Agreement. This Settlement Agreement and Release is
intended by all parties to be the complete agreement with respect to the
resolution of the parties’ disputes relating to the Asserted Patents and the
Consolidated Lawsuit. All prior understandings and agreements are deemed
integrated into this Settlement Agreement and Release, or, to the extent that
they are inconsistent with this Settlement Agreement and Release, are hereby
deemed to be superseded, except that other relief awarded in the accompanying
Stipulation and Consent Judgment is not hereby superseded. The terms of this
Settlement Agreement and Release shall not be altered except in writing signed
by all parties hereto.

 

  6. Interpretation of Agreement. As used in this Settlement Agreement and
Release, the singular or plural number shall be deemed to include the other
whenever the context so indicates or requires. The language of all parts of this
Agreement shall in all cases be construed as a whole, according to its fair
meaning, not strictly for or against any of the parties.

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  7. Governing Law, Binding Nature, Severability. This Settlement Agreement and
Release shall be governed by the laws of the State of Texas. The U.S. District
Court for the Eastern District of Texas, Sherman Division, shall retain
jurisdiction over this matter and the parties for purposes of enforcing the
accompanying Stipulation and Consent Judgment and any dispute arising under this
Settlement Agreement and Release. This Settlement Agreement and Release shall
further inure to the benefit of and be binding upon the assigns, subsidiaries,
and successors in interest of all the parties hereto. The invalidity of any
provision of this Settlement Agreement and Release shall not affect the validity
of any other provision; in the event any provision shall be deemed unenforceable
for any reason whatsoever, all the parties shall continue to abide by and be
bound by the remaining provisions.

 

  8. Counterparts. This Settlement Agreement and Release shall be executed in
three (3) numbered counterpart originals, each of which, when bearing the inked
signatures of all required signatories, shall be deemed an original.

 

  9. Authorization. Each of the undersigned represents and warrants that he or
she is competent and authorized to execute this Settlement Agreement and
Release, and further represents and warrants that he or she has read and
understands the terms of this Settlement Agreement and Release.

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IN WITNESS WHEREOF, the parties, by their duly authorized representatives, have
executed this Settlement Agreement and Release this 27th day of April, 2004.

 

Retractable Technologies, Inc.       New Medical Technology, Inc. By:   Thomas
J. Shaw       By:   /s/    Illegible            

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Title   CEO       Title   Authorized Signatory    

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Thomas J. Shaw       New Medical Technology, LTD

/s/    Thomas J. Shaw        

      By:   /s/    Illegible        

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            Title   Chairman                

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        NMT Group PLC             By:   /s/    Illegible                        

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            Title   Chairman                

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF TEXAS

SHERMAN DIVISION

 

RETRACTABLE TECHNOLOGIES, INC.    §      and THOMAS J. SHAW,    §           §   
 

Plaintiffs,

   §           §      v.    §   

Civil Action No. 4:02 cv 034

     §      NEW MEDICAL TECHNOLOGY, INC.;    §   

“Jury”

NEW MEDICAL TECHNOLOGY, LTD.;    §      and NMT GROUP PLC    §           §   

Judge Leonard Davis

Defendants.

   §           §           §      NEW MEDICAL TECHNOLOGY, INC.    §      and NMT
GROUP PLC,    §           §     

Counterclaimants,

   §           §      v.    §           §      RETRACTABLE TECHNOLOGIES, INC.   
§      and THOMAS J. SHAW,    §           §     

Counterdefendants,

   §     

 

STIPULATION AND CONSENT JUDGMENT

 

Plaintiffs, Retractable Technologies, Inc., and Thomas J. Shaw, and Defendants,
NMT Group PLC, New Medical Technology, Inc., New Medical Technology, Ltd., have
settled their dispute and pursuant to their settlement stipulate and jointly
move the Court for entry of a Consent Judgment as follows:

 

Pursuant to stipulation of the parties, the Court, being fully advised in the
premises and good cause appearing therefor, finds and orders as follows:

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1. This court has jurisdiction over the subject matter of this action and
personal jurisdiction over the parties.

 

2. Venue is proper in this judicial district.

 

3. Plaintiff Thomas J. Shaw, an individual, owns United States Patent Nos.
5,385,551; 5,578,011 and 6,090,077 (the “Asserted Patents”). The Asserted
Patents are licensed to Retractable Technologies, Inc.

 

4. Defendant NMT Group PLC manufactured the NMT Safety Syringe which was
imported and sold in the United States. Defendant New Medical Technology, Inc.
imported and sold the NMT Safety Syringe in the United States. The packaging for
the NMT Safety Syringe identified “New Medical Technology, Ltd.” NMT Group PLC
ceased manufacture of the NMT Safety Syringe and Defendants ceased importing,
offering for sale and selling of the NMT Safety Syringe in the United States in
2003.

 

5. Defendants admit that the NMT Safety Syringe infringed the Asserted Patents.

 

6. Defendants admit that the Asserted Patents are valid and enforceable.
Defendants’ affirmative defenses and counterclaims for Declaratory Judgment are
hereby dismissed with prejudice.

 

7. Pursuant to 35 U.S.C. § 283, Defendants, their agents and servants,
successors and assigns, and any and all parties acting in concert with any of
them, are hereby enjoined from importing the NMT Safety Syringe into the United
States, and from making, using, selling or offering to sell the NMT Safety
Syringe within the United States, until the lapse or expiration of all the
Asserted Patents, or until a court of

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competent jurisdiction declares the Asserted Patents invalid and all
opportunities for appeal of any such declaration are exhausted.

 

8. The Court shall retain jurisdiction over the parties and the subject matter
of this action to enforce the terms of this Stipulation and Consent Judgment and
the associated Settlement Agreement and Release executed by the parties
concurrently with this Stipulation and Consent Judgment.

 

9. Each party shall bear its own costs, expenses and attorneys’ fees.

 

STIPULATED TO:

 

         

Date: April 27, 2004

      By:  

/s/    Roy W. Hardin        

             

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Roy W. Hardin

    Texas State Bar No. 08968300

Attorney-In-Charge

Monty L. Ross

    Texas State Bar No. 17297300

Stephen D. Wilson

    Texas State Bar No. 24003187

Kristen R. Paris

    Texas Sate Bar No. 24032931

LOCKE, LIDDELL & SAPP LLP

2200 Ross Avenue, Suite 2200

Dallas, TX 75201-6776

 

Attorneys for Plaintiffs

 

Date: April 27, 2004

      By:  

/s/    Nancy G. Tinsley         

             

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Nancy G. Tinsley

    Indiana Bar No. 15376-49A

Attorney in Charge

BAKER & DANIELS

Suite 2700

300 North Meridian Street

Indianapolis, IN 46204

Tel. 317-237-0300

Fax. 317-237-1000

                and

 

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Peter K. Munson

    Texas Bar No. 14763000

MUNSON, MUNSON

CARDWELL, & KEESE, P.C.

123 South Travis Street

Sherman, TX 75090

Tel. 903-893-8161

Fax. 903-893-1345

 

Attorneys for Defendants

 

IT IS SO ORDERED and JUDGMENT IS SO RENDERED this              day of April,
2004.

 

           

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Judge Leonard Davis

U.S. District Court, E.D. Texas