Document:

AGREEMENT
        OF SETTLEMENT

      

      This
        Agreement of Settlement (the “Agreement”)
        is
        entered into this 27th
        day of
        September 2005 (the “Closing
        Date”),
        by
        and among American United Global, Inc. (the “Company”),
        North
        Sound Legacy International Ltd. (“International”)
        and
        North Sound Legacy Institutional Fund LLC (“Institutional”)
        (International and Institutional collectively, the “Investors”). 

       

      W
        I T N E S S E T H:

       

      WHEREAS,
        the
        Company issued an aggregate $800,000 principal face amount 10% Subordinated
        Convertible Promissory Notes to the Investors (the “Notes”)
        pursuant to Subscription Agreements by and between the Investors and the
        Company, dated June 16, 2003 (the “Subscription
        Agreements”)
        pursuant to which International acquired $350,000 in Notes and Institutional
        acquired $400,000 in Notes;

       

      WHEREAS,
        in
        connection with the purchase of the Notes, the Investors received common
        stock
        purchase warrants (the “Warrants”)
        to
        purchase shares of common stock of the Company;

       

      WHEREAS,
        the
        assets and liabilities of North Sound Legacy Fund LLC, a purchaser of $50,000
        in
        Notes pursuant to a Subscription Agreement, have been assigned to Institutional
        as of April 30, 2005; 

       

      WHEREAS,
        the
        Company defaulted on repayment of the Notes; and

       

      WHEREAS,
        the
        Company and the Investors have agreed to the satisfaction of the Notes with
        a
        payment in the amount of $393,750 to International and $506,250 to Institutional
        for an aggregate payment of $900,000 (the “Settlement
        Amount”).

       

      NOW,
        THEREFORE,
        in
        consideration of the mutual covenants, payments, and agreements set forth
        in
        this Agreement, the Company and the Investors intending to be legally bound
        thereby, and hereby warranting that they each have the capacity and authority
        to
        execute this Agreement, it is agreed by and among the undersigned parties,
        that
        all of the claims asserted (or which could have been asserted) by the Investors
        are hereby settled and compromised on the following terms and conditions,
        to
        wit:

      

      1.  Compromise.
        In
        consideration for entering into the general mutual releases as set forth
        in
        Section 2 to this Agreement and the termination of the Warrants, the Company
        agrees to pay the Investors the Settlement Amount.

       

      2.  Release.
        The
        parties shall execute general mutual releases in favor of each other in the
        form
        annexed hereto as Exhibit A. 

       

      3.  Binding
        Agreement.
        The
        terms of this Agreement are binding upon and inure to the benefit of each
        of the
        parties hereto, their respective successors, assigns, dependents, and all
        other
        related persons, affiliates or associates.

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      4.  Headings.
        The
        captions of the paragraphs and sections of this Agreement are provided solely
        for convenience, and are not intended to, and in fact, shall not affect the
        substance or meaning of this Agreement.

       

      5.  Representation.
        Each of
        the parties hereto represents that each has read and fully understands each
        of
        the provisions as contained herein, and has been afforded the opportunity
        to
        review same with his attorney of choice; and further that each of the parties
        hereto represents that each and every one of the provisions contained in
        this
        Agreement is fair and not unconscionable to either party.

       

      6.  Counterparts/Execution.
        This
        Agreement may be executed in any number of counterparts and by the different
        signatories hereto on separate counterparts, each of which, when so executed,
        shall be deemed an original, but all such counterparts shall constitute but
        one
        and the same instrument. This Agreement may be executed by facsimile signature
        and delivered by facsimile transmission.

       

      7.  Entire
        Agreement; Assignment.
        This
        Agreement and other documents delivered in connection herewith represent
        the
        entire agreement between the parties hereto with respect to the subject matter
        hereof and may be amended only by a writing executed by all parties. Neither
        the
        Company nor the Subscribers have relied on any representations not contained
        or
        referred to in this Agreement and the documents delivered herewith. No right
        or
        obligation of either party shall be assigned by that party without prior
        notice
        to and the written consent of the other party, which will not be unreasonably
        withheld.

       

      8.  Law
        Governing this Agreement.
        This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of New York without regard to principles of conflicts of laws. Any
        action
        brought by either party against the other concerning the transactions
        contemplated by this Agreement shall be brought only in the state courts
        of New
        York or in the federal courts located in the state of New York. The parties
        and
        the individuals executing this Agreement and other agreements referred to
        herein
        or delivered in connection herewith on behalf of the Company agree to submit
        to
        the jurisdiction of such courts and waive trial by jury. The prevailing party
        shall be entitled to recover from the other party its reasonable attorney's
        fees
        and costs. In the event that any provision of this Agreement or any other
        agreement delivered in connection herewith is invalid or unenforceable under
        any
        applicable statute or rule of law, then such provision shall be deemed
        inoperative to the extent that it may conflict therewith and shall be deemed
        modified to conform with such statute or rule of law. Any such provision
        which
        may prove invalid or unenforceable under any law shall not affect the validity
        or enforceability of any other provision of any agreement.

       

      [REMAINDER
        OF PAGE INTENTIONALLY LEFT BLANK]

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      IN
        WITNESS WHEREOF,
        the
        parties have read and executed this Agreement as of the date and year first
        above written.

       

      
        	 	 	 
	 	AMERICAN
                UNITED GLOBAL, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Robert
                Rubin
	 	
                
Robert
                Rubin
	 	Title:
                CEO 

      

       

      
        	 	 	 
	 	
                NORTH
                  SOUND LEGACY INTERNATIONAL LTD.

                BY:
                  NORTH SOUND CAPITAL LLC, ITS INVESTMENT
                  ADVISER

              
	 
 	 
 	 
 
	: 	By:  	/s/ Andrew
                David
	 	
                
Andrew
                David
	 	Title:
                General Counsel

      
        	 	 	 
	 	
                NORTH
                  SOUND LEGACY INSTITUTIONAL FUND LLC

                BY:
                  NORTH SOUND CAPITAL LLC, ITS MANAGER

              
	 
 	 
 	 
 
	 	By:  	/s/ Andrew
                David
	 	
                
Andrew
                David
	 	Title:
                General Counsel 

      

      

      [SIGNATURE
        PAGE TO THE AGREEMENT OF SETTLEMENT DATED SEPTEMBER 27, 2005]

      

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      EXHIBIT
        A

      

      To
        all to whom these Present shall come or may Concern, Know
        That

      

      North
        Sound Legacy Institutional Fund LLC and North Sound Legacy International
        Ltd.
 as
        RELEASOR, 

       

      for
        good
        and valuable consideration, the sufficiency and receipt of which is hereby
        acknowledged

      

      American
        United Global, Inc.       
 as
        RELEASEE, 

       

      receipt
        whereof is hereby acknowledged, releases and discharges

      

      American
        United Global, Inc.

      

      the
        RELEASEE, RELEASEE’S directors,
        officers, partners, past and present employees, agents, administrators, holding
        company, parent company, subsidiaries, successors, insurers, assigns, principals
        and past and present control persons, from
        all
        actions, cause of action, suits, debts, dues, sums of money, accounts,
        reckonings, bonds, bills, specialties, covenants, contracts, controversies,
        agreements, promises, variances, trespasses, damages, judgments, extents,
        executions, claims, and demands whatsoever, in law, admiralty or equity,
        which
        against the RELEASEE(S), the RELEASOR, RELEASOR’S directors,
        officers, partners, past and present employees, agents, administrators, holding
        company, parent company, subsidiaries, successors, insurers, assigns, principals
        and past and present control persons ever
        had,
        now have or hereafter can, shall or may, have for, upon, or by reason of
        any
        matter, cause or thing that has or may have arisen from the beginning of
        the
        world to the day of the date of this RELEASE.

      

      The
        words
        RELEASOR and RELEASEE include all releasors and all releasees under this
        RELEASE.

      

      This
        RELEASE may not be changed orally.

      

      In
        Witness Whereof,
        the
        RELEASOR has hereunto set RELEASOR’S hand and seal on the 27th
        day of
 September,
        2005

       

      
        	 	 	 
	 	North
                Sound Legacy International Ltd. and
	 
 	 
 	 
 
	Date: 	By:  	/s/ Andrew
                David
	 	
                
Andrew
                David
	 	Title:
                General Counsel

      

       

      
        	 	 	 
	 	North
                Sound Legacy Institutional Fund LLC
	 
 	 
 	 
 
	Date: 	By:  	/s/ Andrew
                David
	 	
                
Andrew
                David
	 	Title:
                General Counsel 

      

        

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      To
        all to whom these Present shall come or may Concern, Know
        That

      

      American
        United Global, Inc.       
 as
        RELEASOR,

      

      for
        good
        and valuable consideration, the sufficiency and receipt of which is hereby
        acknowledged

      

      North
        Sound Legacy International Ltd. and North Sound Legacy Institutional Fund
        LLC as
        RELEASEE,

      

      receipt
        whereof is hereby acknowledged, releases and discharges

      

      North
        Sound Legacy International Ltd. and North Sound Legacy Institutional Fund
        LLC

      

      the
        RELEASEE, RELEASEE’S directors,
        officers, partners, past and present employees, agents, administrators, holding
        company, parent company, subsidiaries, successors, insurers, assigns, principals
        and past and present control persons, from
        all
        actions, cause of action, suits, debts, dues, sums of money, accounts,
        reckonings, bonds, bills, specialties, covenants, contracts, controversies,
        agreements, promises, variances, trespasses, damages, judgments, extents,
        executions, claims, and demands whatsoever, in law, admiralty or equity,
        which
        against the RELEASEE(S), the RELEASOR, RELEASOR’S directors,
        officers, partners, past and present employees, agents, administrators, holding
        company, parent company, subsidiaries, successors, insurers, assigns, principals
        and past and present control persons ever
        had,
        now have or hereafter can, shall or may, have for, upon, or by reason of
        any
        matter, cause or thing that has or may have arisen from the beginning of
        the
        world to the day of the date of this RELEASE.

      

      The
        words
        RELEASOR and RELEASEE include all releasors and all releasees under this
        RELEASE.

      

      This
        RELEASE may not be changed orally.

      

      In
        Witness Whereof,
        the
        RELEASOR has hereunto set RELEASOR’S hand and seal on the 27th
        day of
 September,
        2005

       

      
        	 	 	 
	 	American
                United Global, Inc.
	 
 	 
 	 
 
	Date: 	By:  	/s/ Robert
                Rubin
	 	
                
Robert
                Rubin
	 	Title:
                CEO

      

       

      
        
           

        

        
          5SUPPLEMENTAL
        AGREEMENT

       

      THIS
        SUPPLEMENTAL AGREEMENT (this “Agreement”)
        is
        made as of September 22, 2005 (the “Execution Date”), by and among Altitude
        Group, LLC, Birch Associates, Inc., and D.C. Capital LLC (collectively, the
        “Investors”)
        and
        American United Group, Inc. (the “Company”).
        

       

      W
        I T N E
        S S E T H:

       

      WHEREAS,
        the
        Company issued $700,000 principal face amount 10% Subordinated Convertible
        Promissory Notes to the Investors (the “Notes”) pursuant to Subscription
        Agreements by and between the Investors and the Company, dated June 16, 2003
        (the “Subscription Agreements”);

      

      WHEREAS,
        the
        Company defaulted on repayment of the Notes; 

      

      WHEREAS,
        the
        Investors subsequently filed an action against the Company on September 24,
        2004
        in the Supreme Court of New York, County of New York, entitled Altitude
        Group LLC v. American United Global, Inc.,
        Index
        No. 60096/04 (the “Action”), and obtained a judgment against the Company on
        September 24, 2004 in the amount of $840,695.79 (the “Judgment”);

      

      WHEREAS,
        the
        Company was issued in its name a total of 1,222,586 shares of Western Power
        & Equipment Corp. (WPEC.OB) (the “WPEC Stock”); 

      

      WHEREAS,
        a
        certificate representing 1,222,586 shares of Western Power & Equipment Corp.
        (WPEC.OB) (the “WPEC Stock”) in the name of the Company is currently held by
        counsel for the Investors, Arnold & Porter LLP, pursuant to a Confidential
        Settlement Agreement entered June 1, 2005 by and between the Company and
        the
        Investors (the “Settlement Agreement”). 

      

      NOW,
        THEREFORE, in consideration of the covenants and mutual promises contained
        herein and other good and valuable consideration, the receipt and legal
        sufficiency of which are hereby acknowledged and intending to be legally
        bound
        hereby, the parties agree as follows:

       

      1. Within
        30
        days of the Execution Date, the Company shall notify counsel for the Investors
        that it is prepared to wire $1,154,000.00 in cash (the “Amount”) into the
        account at BB&T Bank (Branch Banking & Trust Company), 1909 K Street NW,
        Washington, D.C., account number 5162397569, ABA number 054001547 (the
“Account”). Within 3 business days of this notification: (1) the Company and the
        Investors shall execute general mutual releases (the “Releases”) in favor of
        each other in the form annexed hereto as Exhibit A, and deliver the Releases
        to
        counsel for the Investors to be held in escrow with the WPEC Stock, and (2)
        the
        Releases and the WPEC Stock shall be shown to Stephen M. Fleming of Sichenzia
        Ross Friedman Ference LLP (the “Designated Representative”) for inspection, and
        (3) upon inspection and approval, the Designated Representative shall wire
        the
        Amount into the Account, and (4) upon notification by counsel for the Investors
        that the Amount has been received into the Account, the WPEC Stock shall
        be
        released from escrow to the Designated Representative, and the Releases shall
        be
        released from escrow to the Designated Representative and to the Investors,
        and
        (4) counsel for the Investors shall deduct from the Amount outstanding unpaid
        legal fees, and issue a check in the sum remaining of the Amount to the
        Investors. 

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      3. In
        the
        event that the Amount is not wired to and received by the Account within
        thirty
        (30) days of the Execution Date, this Agreement shall expire by its own terms,
        with no notice required, and all rights, obligations and duties created under
        this Agreement, whether expressed or implied, shall terminate.

      4. Until
        the
        Release executed by the Investors to the Company is released from escrow
        and
        delivered to the Designated Representative pursuant to paragraph 1 of this
        Agreement, nothing in this Agreement shall be construed as a waiver, discharge
        or release of the Investors’ rights at law and in equity, and the Investors
        specifically retain all express and implied rights under the Settlement
        Agreement, and all rights at law or in equity to enforce both the Settlement
        Agreement and the Judgment.

       

      IN
        WITNESS WHEREOF, the parties hereto have executed this Agreement as of date
        first written above.

       

      
        	COMPANY  	 	 	INVESTORS 
	AMERICAN UNITED GLOBAL,
                INC. 	 	 	ALTITUDE GROUP,
                LLC 
	 	 	 	 
	/s/ 	 	 	/s/ 
	
                

              	 	 	
                

              
	Name:
Title:	 	 	Name:
Title:

      

       

      
        	 	 	 	BIRCH ASSOCIATES,
                INC. 
	 	 	 	 
	 	 	 	/s/ 
	
              	 	 	
                

              
		 	 	Name:
Title:

      

       

      
        
          	 	 	 	D.C. CAPITAL,
                  LLC 
	 	 	 	 
	 	 	 	/s/ 
	
                	 	 	
                  

                
		 	 	Name:
Title:

        

         

      

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      EXHIBIT
        A

      

      To
        all to whom these Present shall come or may Concern, Know
        That

      

      Altitude
        Group, LLC, Birch Associates, Inc., and D.C. Capital, LLC as
        RELEASORS

      

      for
        good
        and valuable consideration, the sufficiency and receipt of which is hereby
        acknowledged, hereby releases and discharges:

      

      American
        United Global, Inc. as RELEASEE,

      

      the
        RELEASEE, RELEASEE’S directors, officers, partners, past and present employees,
        agents, administrators, holding company, parent company, subsidiaries,
        successors, insurers, assigns, principals and past and present control persons,
        from all actions, cause of action, suits, debts, dues, sums of money, accounts,
        reckonings, bonds, bills, specialties, covenants, contracts, controversies,
        agreements, promises, variances, trespasses, damages, judgments, extents,
        executions, claims, and demands whatsoever, in law, admiralty or equity,
        which
        against the RELEASEE(S), the RELEASORS’ directors, officers, partners, past and
        present employees, agents, administrators, holding company, parent company,
        subsidiaries, successors, insurers, assigns, principals and past and present
        control persons ever had, now have or hereafter can, shall or may, have for,
        upon, or by reason of any matter, cause or thing that has or may have arisen
        from the beginning of the world to the day of the date of this
        RELEASE.

       

      The
        words
        RELEASOR and RELEASEE include all releasors and all releasees under this
        RELEASE.

      

      This
        RELEASE may not be changed orally.

      

      In
        Witness Whereof,
        the
        RELEASORS has hereunto set RELEASORS’ hand and seal on the  
        day of
        September, 2005

      

      
        	
                BIRCH
                  ASSOCIATES, INC. 

              	 	 	 
	 	 	 	 
	/s/ 	 	 	 
	
                

              	 	 	
              
	Name:
Title:	 	 	 

      

       

      
        
          	ALTITUDE GROUP, LLC
                  	 	 	D.C. CAPITAL,
                  LLC 
	 	 	 	 
	/s/ 	 	 	/s/ 
	
                  

                	 	 	
                  

                
	Name:
Title:	 	 	Name:
Title:

        

      

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

        

      To
        all to whom these Present shall come or may Concern, Know
        That

      

      American
        United Global, Inc. as RELEASOR,

      

      for
        good
        and valuable consideration, the sufficiency and receipt of which is hereby
        acknowledged, hereby
        releases
        and discharges:

      

      Altitude
        Group, LLC, Birch Associates, Inc., and D.C. Capital,LLC as
        RELEASEES,

      

      the
        RELEASEES’ directors, officers, partners, past and present employees, agents,
        administrators, holding company, parent company, subsidiaries, successors,
        insurers, assigns, principals and past and present control persons, from
        all
        actions, cause of action, suits, debts, dues, sums of money, accounts,
        reckonings, bonds, bills, specialties, covenants, contracts, controversies,
        agreements, promises, variances, trespasses, damages, judgments, extents,
        executions, claims, and demands whatsoever, in law, admiralty or equity,
        which
        against the RELEASEES, the RELEASOR, the RELEASOR’S directors, officers,
        partners, past and present employees, agents, administrators, holding company,
        parent company, subsidiaries, successors, insurers, assigns, principals and
        past
        and present control persons ever had, now have or hereafter can, shall or
        may,
        have for, upon, or by reason of any matter, cause or thing that has or may
        have
        arisen from the beginning of the world to the day of the date of this
        RELEASE.

       

      The
        words
        RELEASOR and RELEASEE include all releasors and all releasees under this
        RELEASE.

       

      This
        RELEASE may not be changed orally.

      

      In
        Witness Whereof,
        the
        RELEASOR has hereunto set RELEASOR’S hand and seal on the  
        day of
        September, 2005

      

      
        	 	 	 
	 	
                AMERICAN
                  UNITED GLOBAL, INC.  

              
	 
 	 
 	 
 
	 	By:  	/s/ 
	 	
                

              
	 	Title: 

      
         

        
           

        

        
          4

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