exv10w1







EXHIBIT 10.1




SETTLEMENT AND RELEASE AGREEMENT



     This Settlement Agreement (“Agreement”) is made on May 15, 2009 by and between Bruce Culver
and Donna Culver, husband and wife, (“Claimants”) and TASER International, Inc., a Delaware
corporation (“TASER”). Claimants and TASER are collectively referred to as the “Parties” and at
times each is individually referred to as a “Party.”



BACKGROUND




     In or around July 2000, Claimants loaned TASER the sum of $1,500,000 and in exchange received
a promissory note from TASER (the “Loan”) for an equivalent amount plus warrants for the purchase
of 136,364 shares of TASER common stock at an exercise price of $0.55 per share (the “Warrants”).



     In October 2004, Claimants exercised the Warrants and TASER issued Claimants a Form 1099,
which included the in-the-money value of the Warrants as stock compensation to Claimants based upon
advice of TASER’s outside tax advisors in 2004.



     In 2007, the Claimants informed TASER that their tax advisors determined that the Form 1099
was issued in error since the warrants were granted as part of the Loan and not for services
rendered. TASER issued Claimants an amended Form 1099 to exclude the income relating to the
exercise of the Warrants (the “Amended Form 1099”).



     Claimants have filed an amended 2004 tax return with the Internal Revenue Service (“IRS”)
based on the Amended Form 1099 excluding the income arising by reason of the exercise of the
Warrants and have a refund request pending with the IRS for approximately $2,000,000 as a result of
the amended 2004 tax return.



     Upon advice of Claimants’ advisors, Claimants have made a claim against TASER for the state
and federal tax liability they incurred in 2004 as a result of the Form 1099 issued in 2004 to
Claimants by TASER (“Claimants 2004 Tax Liability”).



     The Parties desire to enter into this Agreement to resolve and settle all claims and disputes
between them arising out of, or in any way related to, Claimants’ 2004 Tax Liability.



     Therefore, the Parties therefore agree as follows:



TERMS AND CONDITIONS




     1 Release. Claimants, on behalf of themselves and any person claiming by or through,
otherwise acting on behalf or under the direction or control of Claimants (collectively the
“Claimants Parties”) fully and forever relieve, release, acquit and discharge TASER, and its
officers, employees, directors, agents, attorneys, successors and all other persons, firms,
entities or corporations related to or in any way affiliated with, claiming by or through,
otherwise acting on behalf or under the direction or control of the foregoing (collectively the
“TASER Parties”), and any of them, from any and all claims, causes of action and liability, of any
kind or nature whatsoever, known or unknown, liquidated or unliquidated, suspected or unsuspected,
that the Claimants now have, or have ever had, or ever will have, against each or any of the TASER
Parties, arising out of or connected in any way with or relating in any manner whatsoever, directly
or indirectly, to Claimants’ 2004 Tax Liability or TASER’s issuance of the original Form 1099 to
Claimants (collectively the “Released Matters”).



     2 No Admission of Liability. By executing this Agreement, TASER does not admit any
wrongdoing or liability, nor do the Parties intend this Agreement to be construed as an admission.
This Agreement is executed solely as a compromise of any and all disputed and undisputed claims,
present and possible, which are denied and contested.



     3 Payment. Without admitting liability and subject to Section 5 below, TASER agrees
to pay Claimants the total sum of $350,000 as full and final settlement of the Released Matters.
This payment is inclusive of all claims for attorneys’ fees, costs, expenses, and interest. TASER
will make this payment by wire transfer pursuant to Claimants’ direction after TASER receives a
copy of this Agreement executed by Claimants.



 









 





     4 Pursuit of Tax Refund. Claimants agree to make best faith efforts to continue to
pursue a refund from the IRS arising by reason of the Amended Form 1099 issued by TASER and the
amended 2004 tax return filed by Claimants.



     5 Claw Back. In the event that Claimants are successful in receiving a refund from
the IRS and/or State of California based on Claimants’ amended 2004 income tax return resulting
from the Amended Form 1099, Claimants shall pay to TASER the amount of the refund received up to
the sum of $350,000 within 30 days after receipt of such refund. Claimants shall keep 100% of any
such refund received in excess of the sum of $350,000.



     6 Voluntary Agreement. In entering into this Agreement, Claimants acknowledge and
represent that they reviewed this Agreement with counsel of their choice or had the opportunity to
do so and declined. Therefore, this Agreement will not be construed against the Party or its
representative who drafted this Agreement or any portion thereof. Claimants further represents
that the terms of this Agreement have been completely read by them, and that those terms are fully
understood and voluntarily accepted by them and that they are entering into this Agreement as a
matter of their own free will.



     7 Payment of Applicable Taxes. Claimants are solely responsible for all federal,
state and local taxes that may be owed by Claimants by virtue of the receipt of any portion of the
monetary payment provided under this Agreement. Claimants agrees to indemnify and hold TASER
harmless from any and all liability, including, without limitation, all penalties, interest and
other costs that may be imposed by the IRS or any other governmental agencies regarding any tax
obligations that may arise from the monetary payment made to Claimants under this Agreement.



     8 Miscellaneous.




(a) Each Party will bear its own costs, fees and expenses in any way connected with
the matters which are referenced or covered by this Agreement.




(b) In the event litigation is necessary to enforce a provision or provisions of this
Agreement, all reasonable costs, expenses and reasonable attorney’s fees will be paid
by the non-prevailing Party to the prevailing Party.




(c) This Agreement is binding upon and inures to the benefit of the Parties’
respective legal heirs, successors, and assigns.




(d) This Agreement is governed by the laws of the State of Arizona without regard to
conflict of law principles, and may not be modified or amended except by a writing
signed by all Parties. Each of the Parties irrevocably agrees that the state and
federal courts located in Phoenix, Arizona have exclusive jurisdiction over any suit
or other proceeding arising out of or based upon this Agreement. Each Party waives
any claim that it is not subject personally to the jurisdiction of the state and
federal courts located in Phoenix, Arizona or that any suit or other proceeding is
brought in an inconvenient forum or improper venue.




(e) This Agreement may be executed in multiple counterparts, each of which is
considered an original.




(f) If any provision of this Agreement is held to be invalid or unenforceable, the
remaining terms and conditions will not be affected thereby and will remain in full
force and effect.




11. Entire Agreement. This Agreement constitutes the entire agreement between the
Parties and supersedes all prior and contemporaneous agreements, understandings, negotiations
and discussions, whether oral or written, of the Parties, and there are no warranties,
representations or other agreements between the Parties in connection with the subject matter
of this Agreement other than as set forth in this Agreement.



 









 





IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the day and year
first written above.




	 	 	 	 	 	 	 
	 	 	Claimants	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Bruce Culver	 	 
	 	 	 	 	 
	 	 	Bruce Culver	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Donna Culver	 	 
	 	 	 	 	 
	 	 	Donna Culver	 	 
	 
	 	 	 	 	 	 
	 	 	TASER INTERNATIONAL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Patrick W. Smith
 

	 	 
	 

	 	 	 	Patrick W. Smith	 	 
	 	 	Its: Chief Executive Officer