EXHIBIT 10.1

 

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

 

This Settlement Agreement and Mutual Release (“Agreement”) is made as of the
13th day of January, 2009 (the “Effective Date”), by and between EF Johnson
Technologies, Inc. (formerly known as EFJ, Inc.) (“EFJ”); and the Company
Securityholders, by and through Chih-Hsiang Li, as Stockholders’ Agent pursuant
to that one certain Agreement and Plan of Merger, dated July 10, 2006 (the
“Merger Agreement”), by and among EFJ, 3e Technologies International, Inc. (the
“Company”), Avanti Acquisition Corp., Chih-Hsiang Li, as Stockholders’ Agent,
and Steven Chen, James Whang, Chih-Hsiang Li and AEPCO, Inc.  (as the “Principal
Stockholders”).  All terms not otherwise defined herein shall have the meaning
assigned to them in the Merger Agreement.

 

RECITALS

 

WHEREAS, EFJ has made a claim against the Escrow Fund established under the
terms of the Merger Agreement, for Damages arising out of certain alleged
breaches of the representations and warranties contained in the Merger
Agreement;

 

WHEREAS, the Stockholders’ Agent, acting on behalf of the Company
Securityholders, including the Principal Stockholders, has objected to such
claim;

 

WHEREAS, pursuant to the terms of the Merger Agreement and the Escrow Agreement
dated July 10, 2006 (the “Escrow Agreement”) by and among JPMORGAN CHASE BANK,
N.A., as  Escrow Agent, EFJ, the Company, and Chih-Hsiang Li, as Stockholders’
Agent, EFJ and the Stockholders’ Agent  have engaged in good faith negotiations
in an effort to resolve the dispute;

 

WHEREAS, as a result of such negotiations, the parties have agreed to settle the
dispute and to permanently and fully resolve and compromise all claims, rights
and actions, whether arising in contract, tort, statute, or regulation, between
and among the parties;

 

AGREEMENTS

 

NOW THEREFORE, for good and valuable consideration, including the mutual
covenants herein contained, it is agreed as follows:

 

1.                                       Releases.

 

1.1           In consideration of the EFJ Settlement Sum (as such term is
hereinafter defined), EFJ hereby releases and fully and forever discharges the
Company Securityholders and all of their agents, attorneys, employees, owners,
parents, partners, directors, officers, predecessors in interest, successors in
interest, and assigns, whether past or present, and all persons acting by,
through, under or in concert with any or all of them, of and from any and all
claims, demands, suits, liabilities, causes of action, judgments, settlements,
losses, damages, expenses, costs and penalties of every kind and nature
whatsoever, which they now have or may hereafter have, whether now known or
hereafter discovered, whether fixed or contingent, whether suspected or
unsuspected, and whether foreseen or unforeseen, and which arise out of or

 

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relate in any way to (i) the claim that is in EFJ’s August 11, 2008 letter to
the Escrow Agent (hereinafter referred to as the “Claim”), including attorney’s
fees and other costs that were incurred by EFJ in connection with the claim; and
(ii) the acquisition of the Company pursuant to the Merger Agreement.

 

1.2           In consideration of the Company Securityholders’ Settlement Sum
(as such term is hereinafter defined), the Company Securityholders hereby
release and fully and forever discharge EFJ and all of its agents, attorneys,
employees, stockholders, directors, officers, successors in interest, and
assigns, of and from any and all claims, demands, suits, liabilities, causes of
action, judgments, settlements, losses, damages, expenses, costs and penalties
of every kind and nature whatsoever, which they now have or may hereafter have,
whether now known or hereafter discovered, whether fixed or contingent, whether
suspected or unsuspected, and whether foreseen or unforeseen, and which arise
out of or relate in any way to (i) the acquisition the Company pursuant to the
Merger Agreement, (ii) the settlement of the Claim pursuant to this Agreement,
and (iii) fees and costs, including attorney’s fees and other costs that were
incurred by the Stockholders’ Agent and/or the Company Securityholders in
defending the Claim.

 

1.3           With respect to the foregoing releases, the parties hereby
acknowledge that they are aware that they or their attorneys may hereafter
discover claims, facts, damages or injuries based upon, relating to or arising
out of the subject matter of the released claim  in addition to or different
from those which they now know or believe to exist, but that it is nevertheless
their intention to hereby fully, finally and forever settle and release all of
the claims known or unknown, suspected or unsuspected, which each has against
the other based upon, relating to, or arising out of the subject matter of the
released claim.

 

1.4           The foregoing releases shall not be construed as releasing or
affecting any of the obligations of the Parties under this Agreement.

 

2.                                       Settlement Sum.

 

2.1           EFJ shall receive an amount equal to 100% of the funds contained
in the Escrow Fund on January 15, 2009 (the “Settlement Date”) (which amount
shall include all interest and other income earned under the Escrow Agreement
through the Settlement Date), less $1,102,129.50 (the “EFJ Settlement Sum”).

 

2.2           Immediately following payment of the EFJ Settlement Sum to EFJ,
the Company Securityholders shall be entitled to receive 100% of the funds
remaining in the Escrow Fund, including any interest which may accrue on such
amount following the Settlement Date, less (i) the Stockholders’ Agent’s fees
and expenses incurred in connection with the administration of his duties in
connection with the Merger Agreement, and (ii) the fees payable to Wells Fargo
Shareowner Services in connection with the disbursement to the Company
Securityholders of the remaining amounts contained in the Escrow Fund (the
“Company Securityholders’ Settlement Sum”).

 

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2.3           All disbursements from the Escrow Fund shall be made within five
(5) days following the Settlement Date.

 

2.4           To effectuate the Disbursement of the EFJ Settlement Sum and the
Company Securityholders’ Settlement Sum, the Parties shall sign and deliver to
the Escrow Agent a letter containing joint instructions for the disbursement of
the Escrow Fund in a form substantially similar to Attachment A hereto.

 

3.                                       Full Authority.

 

3.1           EFJ represents, warrants and agrees that it has the full right and
authority to enter into this Agreement, and to provide the covenants set forth
in this Agreement, and that the party or representative executing this Agreement
has the full right and authority to commit and bind such party according to the
provisions hereof.

 

3.2           The Stockholders’ Agent represents, warrants and agrees that he
has the full right and authority to enter into this Agreement on behalf of the
Company Securityholders, and to provide the covenants set forth in this
Agreement, and that he has the full right and authority to commit and bind the
Company Securityholders according to the provisions hereof.

 

4.             Attorney Fees and Costs.  Each of the parties shall bear all
attorney’s fees and costs arising from the actions of their own counsel in
connection with the drafting and negotiation of this Agreement and the Claim.

 

5.             Binding Effect.  This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their predecessors, successors, heirs,
assigns and representatives.  This Agreement represents the compromise of
disputed claims.

 

6.             Entire Agreement.  This Agreement constitutes the entire
agreement between the parties relating to the settlement of the Claim.  No
statements, communications, letters or other agreements, whether written or
verbal, relating to this settlement shall have any force or effect unless
embodied in this Agreement.

 

7.              Governing Law.  This Agreement shall be construed in accordance
with and governed by the internal laws of the State of Delaware without giving
effect to any choice of law rule that would cause the application of the laws of
any jurisdiction other than the internal laws of the State of Delaware to the
rights and duties of the parties, and any claim arising hereunder or in
connection herewith shall be filed and heard in the federal courts located in
Dallas County, Texas. THE PARTIES HERETO EXPRESSLY AGREE TO SUCH JURISDICTION
AND VENUE AND WAIVE ALL RIGHTS AT LAW OR IN EQUITY REGARDING A CHANGE IN VENUE
BASED UPON FORUM NON CONVENIENS OR ANY OTHER LEGAL THEORY.

 

8.             Severability.  If, after the date hereof, any provision of this
Agreement is held to be illegal, invalid or unenforceable under present or
future laws effective during the term of this Agreement, such provision(s) shall
be fully severable.  In lieu thereof, there shall be added a

 

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provision as similar in terms to such illegal or unenforceable provision as may
be possible and legal, valid and enforceable.

 

9.             Multiple Counterparts.  This Agreement may be executed in
multiple counterparts by each of the parties hereto, including by facsimile,
each of which shall be deemed an original agreement, and all of which shall
constitute one agreement, notwithstanding that all of the parties are not
signatories to the original or the same counterpart, to be effective as of the
day and year first above written.  A facsimile signature received from any party
hereto shall be treated as an original for purposes of finalizing the Agreement.

 

10.           No Admission.  This Agreement represents a compromise and
settlement of disputed matters and shall not be construed as an admission of
liability or wrongdoing by any of the Parties.

 

11.           Additional Documents and Further Assurances.  Each Party shall
give prompt notice to the other Party of the receipt of any document that the
other party reasonably requires in connection with this Agreement for purposes
of tax reporting, accounting or any other purpose related to the Agreement. 
Each Party shall execute and deliver such other instruments and perform such
other acts and things as may be reasonably necessary for either Party in
connection with matters related to this Agreement.

 

[Signatures on following page.]

 

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IN WITNESS WHEREOF, the parties have duly executed this Agreement as set forth
below, intending to be legally bound by the terms and conditions of this
Agreement.

 

Dated:

 01/13/09

 

  /s/ Chih-Hsiang Li

 

 

Chih-Hsiang Li

 

 

Stockholders’ Agent

 

 

 

 

 

 

 

 

EF Johnson Technologies, Inc.

 

 

 

 

 

 

Dated:

 01/13/09

 

By:

/s/ Michael E. Jalbert

 

 

 

Michael E. Jalbert

 

 

 

CEO and Chairman

 

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