Unassociated Document


    Exhibit 10.21

     

    
      SETTLEMENT
AND RELEASE AGREEMENT

      


      


      This
Settlement and Release Agreement (the "Agreement") is made by and between
NewCardio, Inc., a Delaware corporation (the "Company") and Samuel E. George,
M.D. (“SG”) as of October 1, 2006 (the “Effective Date”).

      


      WHEREAS,
SG served as a consultant to the Company from approximately September 24, 2004
to approximately August 22, 2005, and as Vice President and Chief Medical
Officer of the Company from approximately August 22, 2005 to approximately
August 22, 2006 and as a member of the Board of Directors of the Company from
approximately August 15, 2005 to approximately June 15, 2006;

      


      WHEREAS,
the Company has been trying to raise additional capital to fund its operations
so that it is able to hire full time employees, which may include
SG;

      


      WHEREAS,
the Company has not yet been able to secure such funding;

      


      WHEREAS,
SG and the Company are mutually desirous of working together notwithstanding the
Company’s current financial condition; and

      


      WHEREAS,
the parties hereto desire to set out the terms for SG’s ongoing involvement with
the Company and settle all existing matters.

      


      NOW
THEREFORE, in consideration for the promises made herein, the parties hereto
agree as follows:

      


      1. Consideration.

      


      (a) Accelerated Vesting of
Options.

      


       (i)
SG was previously granted options to purchase 100,000 and 150,000 shares of the
Company’s Common Stock at exercise prices of $0.001 and $0.01 per share,
respectively.  On the Effective Date, each of the aforementioned
options shall be fully vested.

      


       (ii)
SG was granted an option to purchase 350,000 shares of the Company’s Common
Stock, vesting monthly over 48 months, on August 22, 2005 (the “2005
Option”).  As of a meeting between the Parties on August 25, 2006,
87,500 shares subject to the 2005 Option have vested, and 262,500 shares subject
to the 2005 Option are unvested.  Upon the Effective Date, the 2005
Option shall be amended such that SG shall be permitted to purchase 137,500
shares of the Company’s Common Stock, such 137,500 shall be considered fully
vested, and no additional shares shall be subject to purchase under the 2005
Option.

      


      (b) Cash
Compensation.  Subject to the Company having sufficient capital
resources if and when it obtains financing from one or more individuals or
entities, the Company shall pay to SG a sum of $95,000, which represents amounts
the Company originally intended to pay to SG but is not able to at this
time.

       

      
        
           

        

        
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      (c) Reimbursement of
Expenses.  Subject to the availability of sufficient capital
resources, the Company shall reimburse SG for all reasonable out-of-pocket
expenses incurred and approved by the Company provided that such reimbursement
amount will be reduced by $5,000, which represents an existing obligation of SG
owing to the Company.

      


      (d) The
parties hereto agree to enter into the consulting agreement in the form attached
hereto as Exhibit
A.

      


      2. Release of Claims.
For and in consideration of the consideration herein and execution of this
Agreement, each party on behalf of himself, itself or assigns, hereby fully and
forever releases the other party and its officers, directors, employees, agents,
shareholders, administrators, affiliates, divisions, subsidiaries, successor
corporations, and assigns, if any, from any and all claims, duties, obligations,
or causes of action relating to SG’s prior services provided to the Company, as
an officer and director of the Company, whether presently known or unknown,
suspected or unsuspected, that either party may possess arising from any
omissions, acts, or facts that have occurred up to and including the date of
this release, including without limitation the following:

      


      


      (a) any and all
claims relating to amounts owed, or promised to be paid, to SG for bonuses,
reimbursement of expenses, or otherwise;

       

      (b) any
and all claims relating to, or arising from, SG’s right or option to purchase,
or actual purchase of, shares of Company stock, including, but not limited to,
any claims for fraud, misrepresentation, breach of fiduciary duty, breach of
duty under applicable state corporate law, and securities fraud under any state
or federal law;

       

      (c) any
and all claims under the law of any jurisdiction, including, but not limited to,
wrongful discharge of employment; constructive discharge from employment;
termination in violation of public policy; discrimination; breach of contract,
both express and implied; breach of a covenant of good faith and fair dealing,
both express and implied; promissory estoppel; negligent or intentional
infliction of emotional distress; negligent or intentional misrepresentation;
negligent or intentional interference with contract or prospective economic
advantage; unfair business practices; defamation; libel; slander; negligence;
personal injury; assault; battery; invasion of privacy; false imprisonment; and
conversion;

       

      (d) any
and all claims for violation of any federal, state or municipal statute,
including, but not limited to, Title VII of the Civil Rights Act of 1964; the
Civil Rights Act of 1991; the Age Discrimination in Employment Act of 1967; the
Americans with Disabilities Act of 1990; the Fair Labor Standards Act; the
Executive Retirement Income Security Act of 1974; the Worker Adjustment and
Retraining Notification Act; the Older Workers Benefit Protection Act; the
Family and Medical Leave Act; the Fair Credit Reporting Act; the California
Family Rights Act; the California Fair Employment and Housing Act; and the
California Labor Code;

       

      
        
           

        

        
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      (e) any
and all claims for violation of the federal, or any state,
constitution;

       

      (f) any
and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

       

      (g) any
claim for any loss, cost, damage, or expense arising out of any dispute over the
non-withholding or other tax treatment of any of the proceeds received by SG as
a result of this Agreement; and

       

      (h) any
and all claims for attorney fees and costs.

       

      The
Company and SG agree that the release set forth in this section shall be and
remain in effect in all respects as a complete general release as to the matters
released.  This release does not extend to any obligations incurred
under this Agreement.

      


      3. Civil Code Section
1542. Each party represents that he or it is not aware of any claim by
him or it other than the claims that are released by this
Agreement.  Each party acknowledges that he or it has been advised by
legal counsel and is familiar with the provisions of California Civil Code
Section 1542, which provides as follows:

       

      A GENERAL
RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN ITS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY IT
MUST HAVE MATERIALLY AFFECTED ITS SETTLEMENT WITH THE DEBTOR.

      


      Each
party, being aware of said code section, agrees to expressly waive any rights he
or it may have thereunder, as well as under any other statute or common law
principles of similar force or effect.

      


      4. No Pending or Future
Lawsuits. Each party represents and warrants that there are no lawsuits,
claims, or actions pending in any collective or class action, or on behalf of
any other person or entity, against the other party.  Each party also
represents and warrants that there is no intent to bring any claims on behalf of
any other person or entity against the other party relating to any acts, events,
or transactions occurring before the Effective Date.

      


      5. No Admission of
Liability. Each party understands and acknowledges that this Agreement
constitutes a compromise and settlement of disputed claims.  No action
taken by either party, either previously or in connection with this Agreement,
shall be deemed or construed as (a) an admission of the truth or falsity of any
claims heretofore made or (b) an acknowledgment or admission by the other party
of any fault or liability whatsoever to said party or to any third
party.

      


      6. Costs.  The
Company and SG shall each bear their own costs, attorneys' fees and other fees
incurred in connection with their dispute, in entering into this Agreement and
in connection with the matters contained herein.

       

      
        
           

        

        
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      7. Arbitration.

      


       (a) Any
controversy between the parties hereto involving any claim arising out of or
relating to this Agreement shall be finally settled by arbitration in Santa
Clara County, California, in accordance with the then current Commercial
Arbitration Rules of the American Arbitration Association, and judgment upon the
award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.


      


       (b) THE PARTIES
HERETO HAVE READ AND UNDERSTAND THIS SECTION 7, WHICH DISCUSSES ARBITRATION. SG
UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EACH PARTY AGREES TO SUBMIT, UNLESS
OTHERWISE REQUIRED BY LAW, ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN
CONNECTION WITH THIS AGREEMENT, THE INTERPRETATION, VALIDITY, CONSTRUCTION,
PERFORMANCE, BREACH OR TERMINATION HEREOF, OR ANY OF THE MATTERS HEREIN TO
BINDING ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF
EACH PARTY’S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES
RELATING TO ALL ASPECTS OF THIS AGREEMENT AND RELEASE OF ALL
CLAIMS.


      


      8. Authority.  The
Company and SG represent and warrant that (a) the persons signing this Agreement
have the authority to bind the person or entity entering into this Agreement and
all who may claim through he, she or it to the terms and conditions of this
Agreement; and (b) there are no liens or claims of lien or assignments in law or
equity or otherwise of or against any of the claims or causes of action released
herein.

      


      9. No
Representations.  Each party to this Agreement represents that
he or it has had the opportunity to consult with an attorney, and has carefully
read and understands the scope and effect of the provisions of this
Agreement.  No party has relied upon any representations or statements
made by any other party hereto which are not specifically set forth in this
Agreement.

      


      10. Tax
Consequences.  The Company makes no representations or
warranties with respect to the tax consequences of the payment of any
consideration to SG under the terms of this Agreement. SG understands that he is
responsible for payment, if any, of local, state and/or federal taxes on any
consideration paid hereunder by the Company and any penalties or assessments
thereon.

      


      11. Severability.  In
the event that any provision of this Agreement becomes or is declared by a court
of competent jurisdiction to be illegal, unenforceable, or void, this Agreement
shall continue in full force and effect without said provision.

      


      12. Successors.  This
Agreement shall be binding upon and inure to the benefit of, and shall be
enforceable by SG and the Company, their respective heirs, executors,
administrators, successors and assigns.  In the event the Company is
merged, consolidated, liquidated by a parent corporation, or otherwise combined
into one or more corporations, the provisions of this Agreement shall be binding
upon and inure to the benefit of the parent corporation or the corporation
resulting from such merger or to which the assets shall be sold or transferred,
which corporation from and after the date of such merger, consolidation, sale or
transfer shall be deemed to be the Company for purposes of this
Agreement.

       

       

      
        
           

        

        
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      13. Entire
Agreement.  This Agreement represents the entire agreement
between SG and the Company and supersedes and replaces any and all
understandings or agreements, whether written or oral, concerning the subject
matter herein.

      


      14. No Oral
Modification.  This Agreement may only be modified by a writing
signed by the Company and SG.

      


      15. Governing
Law.  This Agreement shall be governed by the laws of the State
of California, without reference to conflict of law provisions.

      


      16. Counterparts.  This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, and when taken together, shall constitute one and the same
instrument.

      


      17. Voluntary Execution of
Agreement.  This Agreement is executed voluntarily and without
duress or undue influence on the part or behalf of the Company or SG, with the
full intent of releasing all claims.  The Company and SG acknowledge
that:

      


      (a) They have
read this Agreement;

      


      (b) They have
been represented in the preparation, negotiation and execution of this Agreement
by legal counsel of their own choice or have knowingly declined to have such
representation;

      


      (c) They
understand the terms and consequences of the Agreement and the release set forth
herein; and

      


      (d) They are
fully aware of the legal and binding effect of this Agreement.

       

       

      
        
           

        

        
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       IN
WITNESS WHEREOF, the parties hereto have executed this Agreement on October
____, 2006.

      


       

      
        
          	 	NEWCARDIO,
      INC.    	 
	 	 	 	 
	
                   

                	
                  By:
      

                	/s/ Branislav
      Vajdic, Ph.D.	 
	 	 	Branislav
      Vajdic, Ph.D, Chief Executive Officer and Director	 
	 	 	    	 
	 	 	 	 
	 	 	/s/
      Samuel E. George, M.D.	 
	 	 	SAMUEL
      E. GEORGE, M.D.	 


        

      

      
 

      
        
           

        

        
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      EXHIBIT
A

      


      Consulting
Agreement

      


       

      [see attached]

       

       

       

       

       

       

      7