Exhibit 10.1
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DOCUMENTS INCLUDED:
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1) Confidential Settlement Agreement and Mutual Release, dated October 1, 2004
2) Promissory note payable, dated October 1, 2004
3) Lock-out Agreement, dated October 1, 2004
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CONFIDENTIAL SETTLEMENT AGREEMENT AND MUTUAL RELEASE
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ATSI Communications, Inc., a Nevada corporation ("ATSI"), formerly a
Delaware corporation, and Xxxxxxx Xxxxxx Xxxxxxx, an individual residing in
Mexico City, Mexico, ("Xxxxxx") (collectively, the "Parties"), hereby enter into
this Confidential Settlement Agreement and Mutual Release (the "Settlement
Agreement").
RECITALS
WHEREAS, the Parties are AGREED that certain relationships between and
among the Parties should be ended and any and all claims or liabilities between
and among them be held for naught; and
WHEREAS, the Parties entered into an agreement on June 7, 2000 regarding
the sale by Xxxxxx of the 3% stock and the 48% stock as defined in such
Agreement; and
WHEREAS, the Parties amended such Agreement on July 19, 2001; and
WHEREAS, ATSI executed a Promissory Note for $357,000 on November 1, 2001;
and
WHEREAS, ATSI has defaulted in its obligations of the Amended Agreement and
Promissory Note; and
WHEREAS, all Parties wish to reach a full and final settlement of all
matters and all causes and potential causes of action arising from any of their
relationships with
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each other, including any and all disputes or rights or potential rights between
or among the Parties arising from any transactions between or among them prior
to the execution date of this Agreement, and now desire to set forth their
agreement in writing.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements set forth herein, and further good and valuable consideration,
the Parties hereby agree and covenant as follows:
1. PAYMENT. As consideration for all amounts owed up to and including
September 30, 2004 of $1,359,500 including any and all accrued interest, ATSI
shall deliver to Xxxxxx a total of 687,600 shares of ATSI's common stock
post-split (the "Payment"), for $859,500 and a promissory note for $500,000
payable on October 1, 2007. The Shares will be considered issued at $1.25 per
share; however, if on the Measurement Date the price per share is below $1.15,
ATSI shall issue an additional 59,791 shares of ATSI's common stock; if,
however, the share price is at or above $1.15 on the Measurement Date, there
shall be no additional consideration paid and the amount of shares issued
(687,600) shall be considered as final consideration.
Measurement Date shall be defined as the arithmetic mean of the average closing
prices of the Common Shares for the ten (10) trading days immediately preceding
April 1, 2005.
This Payment is subject to the approval of the Board of Directors whose approval
shall be sought as soon as practicable.
2. RELEASE BY XXXXXX. In consideration of the receipt of the Payment,
Xxxxxx, with the intention of binding itself, and its officers, directors,
shareholder, employees, representatives, attorneys-in-fact, predecessors,
successors and assigns, (the "Xxxxxx Releasing Parties") expressly releases,
acquits, and discharges ATSI and its respective officers, directors,
shareholders, representatives, attorneys, successors, and assigns (the "ATSI
Released Parties") from all claims, demands, causes of action and potential
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claims or causes of action, of whatever nature that the Xxxxxx Releasing Parties
may have or claim to have against the ATSI Released Parties arising from or
connected with, directly or indirectly, any and all claims the Xxxxxx Releasing
Parties may have or claim to have against the ATSI Released Parties accruing
before the execution date of this Release. Notwithstanding the foregoing
paragraph, the ATSI Released Parties are not released from the obligations or
indemnities set forth in this Settlement Agreement.
3. RELEASE BY ATSI. In further consideration of the foregoing, ATSI, with
the intention of binding itself and its respective officers, directors,
shareholders, employees, representatives, attorneys-in-fact, predecessors,
successors, assigns, and subsidiaries (the "ATSI Releasing Parties") expressly
release, acquit, and discharge Xxxxxx and its officers, directors, shareholders,
representatives, attorneys, successors, and assigns, (the "Xxxxxx Released
Parties") from all claims, demands, and causes of action or potential claims and
causes of action of whatever nature that the ATSI Releasing Parties may have or
claim to have against the Xxxxxx Released Parties arising from or connected
with, directly or indirectly, any relationship or transaction between or among
the Parties, as well as any and all other or potential claims that the ATSI
Releasing Parties may have or claim to have against the Xxxxxx Released Parties
accruing before the execution date of this Settlement Agreement. Notwithstanding
the foregoing paragraph, the Xxxxxx Released Parties are not released from the
obligations of this Settlement Agreement.
4. NO ADMISSION OF LIABILITY. This settlement and the Payment made hereunder
do not constitute an admission of liability by any Party hereto, and liability
is expressly denied by all Parties.
5. CONFIDENTIALITY. The Parties agree that they will not disclose the terms of
this Settlement Agreement, unless necessary to enforce the terms of this
Settlement Agreement or after receipt of judicial process or lawful discovery
procedures. In the
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event that any Party is served with notice to disclose such information by
subpoena or otherwise, that Party agrees promptly to notify the other Parties in
writing of such notice. The Party or Parties so notified in writing shall
thereafter undertake the cost and obligation to maintain the propriety and
confidentiality of the terms of such information.
6. NON-DISPARAGEMENT. The Parties agree to use reasonable effort not to
disparage or interfere with any other Party's agreements or prospective
agreements with any third party.
7. ENTIRE AGREEMENT. This Settlement Agreement contains the entire
understanding and agreement of the Parties hereto with respect to the subject
matters herein, and may not be amended or modified in any respect other than in
a writing which specifically refers to this Settlement Agreement and which is
signed by all of the Parties hereto.
8. GOVERNING LAW. This Settlement Agreement was negotiated in, and shall be
governed by and construed according to, the laws of the State of Texas. In the
event that any provision herein is deemed not enforceable, the remainder of this
Settlement Agreement will remain unaffected. Venue for any action relating to
the provisions of this Agreement shall be in Bexar County, Texas.
9. NO ASSIGNMENT. By signing this Settlement Agreement, each of the Parties
represents and warrants that it has not assigned or subrogated any of its claims
or potential claims, in whole or in part, to any third party.
10. MODIFICATION AND ATTORNEY'S FEES. This Settlement Agreement shall not be
suspended, amended, or modified in any manner except by an instrument in writing
signed by all Parties to be bound. Should it become necessary to enforce this
Settlement Agreement, or any portion of it, or to declare the effect of any
provision of this Settlement Agreement, the prevailing Party shall be entitled
to recover costs incurred including reasonable attorney's fees.
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11. INFORMED CONSENT. The Parties acknowledge that they have had the
opportunity to consult with their respective attorneys regarding the meaning and
effect of this Settlement Agreement, and that none of the Parties has made any
representations, written or oral, upon which another Party relies in executing
this Settlement Agreement.
12. COUNTERPARTS. This Settlement Agreement may be executed in multiple
counterparts. A set of counterpart copies which collectively contains the
signature and acknowledgment of all Parties shall constitute an original.
EXECUTED by an authorized representative of ATSI Communications, Inc., a
Nevada corporation, on the date written below.
ATSI COMMUNICATIONS, INC.
By: /S/ Xxxxxx X. Xxxxx
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Its: PRESIDENT AND CHIEF EXECUTIVE OFFICER
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Date: October 1, 2004
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EXECUTED by Xxxxxxx Xxxxxx Roqueni on the date written below.
XXXXXXX XXXXXX XXXXX-I
By: /s/ Xxxxxxx Xxxxxx Roqueni
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Its: President
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Date: October 1, 2004
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PROMISSORY NOTE
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PRINCIPAL AMOUNT: $500,000.00
DATED: OCTOBER 1, 2004
This Promissory Note ("Note") is made and entered into as of this 1st day
of October, 2004 by and between ATSI Communications, Inc., a Nevada corporation
("ATSI") with its principal place of business located at 0000 Xxxxxxxx, Xxxxx
000X, Xxx Xxxxxxx, Xxxxx, 00000 and Xx. Xxxxxxx Xxxxxx Xxxxx i, ("Lender") of
Blvd. Xxxxxx Xxxxx Xxxxxxx No. 184, Piso 16, Col. Lomas de San Xxxxxx, Mexico
City, Mexico.
For value received, ATSI promises to pay FIVE HUNDRED THOUSAND U.S. Dollars
($500,000) to the order of Lender at Blvd. Xxxxxx Xxxxx Xxxxxxx No. 184, Piso
16, Col. Lomas de San Xxxxxx, Mexico City, Mexico, or such other location as
Lender may designate in writing, on October 1, 2007.
Interest shall accrue at 6% (six percent) per annum. Lender shall not
impose any penalty for ATSI's pre-payment of this Note.
Upon and at any time after any Default (as defined below) all amounts due
under this Note, at the option of Lender and without demand, notice or legal
process of any kind, may be declared and immediately shall become due and
payable. "Default" shall mean the occurrence or existence of any one or more of
the following events or conditions: (i) ATSI fails to pay when due any amount
due under this Note and fails to cure such late payment within five (5) days
following written receipt of notice of the late payment; or (ii) ATSI makes an
assignment for the benefit of creditors, or any proceeding is filed or commenced
by or against ATSI under any bankruptcy, reorganization, arrangement of debt
insolvency, readjustment of debt or receivership law or statute, and any such
proceeding remains undismissed or unstayed for a period of 30 days, or any of
the actions sought in any such proceeding (including, without limitation, the
entry of an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, ATSI or for any substantial part of its
property) shall occur, or ATSI shall take any action to authorize any of the
actions set forth above in this subsection.
ATSI hereby waives presentment, demand of payment, protest or notice with
respect to the indebtedness evidenced by this Note including, without
limitation, notice that the Note or any portion thereof, is due.
If Lender prevails in any action to collect on or enforce this Note or
claims arising from the execution of this Note, then Lender's reasonable
attorneys' fees and costs will also be payable under this Note.
Neither party may assign this Note without the prior written consent of the
other, which shall not be unreasonably withheld.
This Note may be modified only by a written document that refers
specifically to this Note and is signed by both parties. A party's failure or
delay in enforcing any provision of this Note will not be deemed a waiver of
that party's rights with respect to that provision or any other
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provision of this Note. A party's waiver of any of its rights under this Note is
not a waiver of any of its other rights with respect to a prior, contemporaneous
or future occurrence, whether similar in nature or not. This Note shall be
binding upon and inure to the benefit of the successors and assigns of the
parties hereto.
THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF TEXAS, AND LENDER
AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF TEXAS FOR ALL
PURPOSES. SOLE AND EXCLUSIVE VENUE FOR ANY DISPUTE OR DISAGREEMENT ARISING UNDER
OR RELATING TO THIS NOTE SHALL BE IN A COURT SITTING IN BEXAR COUNTY, SAN
ANTONIO, TEXAS.
MADE this 1st day of October, 2004.
ATSI COMMUNICATIONS, INC. XXXXXXX XXXXXX XXXXX I/XXXXXX XXXXX
By: /s/ Xxxxxx X. Xxxxx By: /s/Xxxxxxx Xxxxxx Xxxxxxx
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XXXXXX X. XXXXX XXXXXXX XXXXXX XXXXXXX
PRESIDENT & CEO
By: /s/ Xxxxxx Xxxxx
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XXXXXX XXXXX
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LOCK-OUT AGREEMENT
ATSI Communications, Inc. October 1, 2004
0000 Xxxxxxxx, Xxxxx 000X
Xxx Xxxxxxx, XX 00000
Re: ATSI Communications, Inc. (the "Company")
Ladies and Gentlemen:
The undersigned stock holder or warrant holder hereby agrees that for a
period of twelve (12) months (such period being a "Restricted Period") the
undersigned may only offer to sell, contract to sell, or otherwise sell, dispose
of, pledge or grant any rights with respect to (collectively, a "Disposition")
up to 5,000 shares of Common Stock per calendar month or a total of 60,000 total
shares, any options or warrants to purchase any shares of Common Stock or any
securities convertible into or exchangeable for shares of, or enter into any
hedging or derivatives transaction related to the Common Stock of the Company
(collectively, "Securities") resulting from the Confidential Settlement
Agreement and Mutual Release dated October 1, 2004 or hereafter acquired
directly by such person or with respect to which such person has or hereafter
acquires the power of disposition. The foregoing restriction has been expressly
agreed to preclude the undersigned during the Restricted Period from engaging in
any hedging or other transaction that is designed to or reasonably expected to
lead to or result in a Disposition of Securities during the Lock-out Period,
even if such Securities would be disposed of by someone other than such holder.
Such prohibited hedging or other transactions would include, without limitation,
any short sale (whether or not against the box) or any purchase, sale or grant
of any right (including, without limitation, any put or call option) with
respect to any Securities or with respect to any security (other than a
broad-based market basket or index) that included, relates to or derives any
significant part of its value from Securities. The undersigned agrees and
consents to the entry of stop transfer instructions with the Company's transfer
agent and registrar against the transfer of shares of Common Stock or Securities
held by the undersigned except in compliance with the foregoing restrictions.
This agreement is irrevocable and will be binding on the undersigned and
the respective successors, heirs, personal representatives, and assigns of the
undersigned.
Dated October 1, 2004
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Xxxxxxx Xxxxxx Xxxxxxx
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Printed Name of Holder
/S/ Xxxxxxx Xxxxxx Roqueni
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Signature
Xxxxxx Xxxxx
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Printed Name of Person Signing
/s/ Xxxxxx Xxxxx
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Signature
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