AGREEMENT OF SETTLEMENT
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.
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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]
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IN
WITNESS WHEREOF,
the
parties have read and executed this Agreement as of the date and year first
above written.
| AMERICAN UNITED GLOBAL, INC. | ||
| |
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| By: | /s/ Xxxxxx Xxxxx | |
|
Xxxxxx Xxxxx |
||
| Title: CEO | ||
|
NORTH
SOUND LEGACY INTERNATIONAL LTD.
BY:
NORTH SOUND CAPITAL LLC, ITS INVESTMENT
ADVISER
|
||
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| : | By: | /s/ Xxxxxx Xxxxx |
|
Xxxxxx Xxxxx |
||
| Title: General Counsel | ||
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NORTH
SOUND LEGACY INSTITUTIONAL FUND LLC
BY:
NORTH SOUND CAPITAL LLC, ITS MANAGER
|
||
| |
|
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| By: | /s/ Xxxxxx Xxxxx | |
|
Xxxxxx Xxxxx |
||
| Title: General Counsel | ||
[SIGNATURE
PAGE TO THE AGREEMENT OF SETTLEMENT DATED SEPTEMBER 27, 2005]
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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/ Xxxxxx Xxxxx |
|
Xxxxxx Xxxxx |
||
| Title: General Counsel | ||
| North Sound Legacy Institutional Fund LLC | ||
| |
|
|
| Date: | By: | /s/ Xxxxxx Xxxxx |
|
Xxxxxx Xxxxx |
||
| Title: General Counsel | ||
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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/ Xxxxxx Xxxxx |
|
Xxxxxx Xxxxx |
||
| Title: CEO | ||
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