EXHIBIT 99.1
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
This Settlement Agreement and Mutual Release ("Agreement"), dated as of
May ___, 2004, is between Xxxxxxx Xxxxx Business Financial Services Inc., a
Delaware corporation ("MLBFS"), and Aspect Systems, Inc., an Arizona corporation
formerly known as Aspect Semiquip International, Inc. ("ASI"), DND Technologies
Corp., a Nevada corporation formerly known as Zurickirch Corp. ("DND"), and
Xxxxxxx X. Xxxxx, an Arizona resident ("Xxxxx" and, together with ASI and DND,
the "ASI Parties"). MLBFS and the ASI Parties are each referred to as a Party
and collectively as the "Parties."
RECITALS
A. MLBFS filed an action in United States District Court for the District
of Arizona, Xxxx Xx. XXX 00 0000 XXX XXX, seeking legal and equitable relief
against the ASI Parties arising out of, inter alia, the ASI Parties' breach of
and failure to perform under that certain Working Capital Management Account
Loan and Security Agreement No. 412-07C04 and that certain Term Loan and
Security Agreement No. 0105551801, each dated as of May 10, 2001, between MLBFS
and ASI (the "Original Loan Agreements").
B. The ASI Parties denied MLBFS's claims and asserted various
counterclaims against MLBFS arising out of the Original Loan Agreements and the
Parties' business dealings. The pending action, including any claims and
counterclaims asserted by the Parties in connection therewith, are collectively
referred to in this Agreement as the "Lawsuit."
C. The Parties desire to resolve the Lawsuit and related disputes and
potential disputes between them amicably.
AGREEMENTS
NOW, THEREFORE, in consideration of the terms, covenants, considerations,
mutual promises and releases contained in this Agreement, and other good and
valuable consideration, the receipt of which is acknowledged, and intending to
be legally bound, the Parties agree as follows:
1. Modified Term Loan. Concurrently with the execution of this Agreement,
MLBFS and ASI have entered into a loan arrangement pursuant to which the loan
facilities evidenced by the Original Loan Agreements have been consolidated into
a single term credit facility (the "Modified Term Loan"). Repayment of the
Modified Term Loan is guaranteed by DND and Xxxxx. The Parties acknowledge and
agree that the loan agreement, note, guaranties, security agreement and other
loan documents attached to this Agreement as Exhibit A represent and evidence
the entire agreement between the Parties regarding the terms and conditions of
the Modified Term Loan and there are no other agreements, oral or written,
between the Parties regarding the terms and conditions of the Modified Term
Loan. The ASI Parties acknowledge the continuing validity of MLBFS's lien on the
assets of ASI and that the Modified Term Loan is an amendment to and
modification of the loan facilities evidenced by the Loan Agreements.
2. Mutual Release. From and upon the execution of this Agreement, each of
the Parties, for and on behalf of themselves and any persons acting by, through,
under, or in concert with either of them, including their heirs, personal
representatives, executors, administrators, successors-in-interest,
predecessors-in-interest, legal representatives, shareholders, members,
directors, officers, managers, employees, agents, attorneys, partners,
subsidiary, parent and affiliated entities and assigns of each of them, hereby
fully and forever releases and discharges the other Party and its predecessors,
successors, present and former officers, directors, managers, shareholders,
partners, principals, employees, agents, attorneys, insurers, parents,
subsidiaries, affiliates, and divisions, and their officers, directors,
managers, employees, agents, attorneys, partners and assigns and their
respective heirs, executors, administrators, personal representatives and
assigns, from any and all claims, demands, judgments, contracts, obligations,
controversies, expenses, liabilities, losses, and causes of action of every kind
and nature whatsoever, whether in law or in equity, contract or tort, known or
unknown, that were or could have been raised in the Lawsuit or that relate in
any way to the subject matter of the Lawsuit. The foregoing release will not
affect or limit the Parties' respective obligations relating to the Modified
Term Loan.
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3. Dismissal with Prejudice. Each of the Parties will dismiss, with
prejudice, the Lawsuit and all causes of action, claims and counterclaims
asserted in the Lawsuit. The Parties will promptly execute and file with the
court a Joint Stipulation to Dismiss with Prejudice in the form of the attached
Exhibit B making clear that the Parties are dismissing with prejudice all causes
of action asserted in the Lawsuit.
4. Costs. Except as otherwise provided in Section 3.7(g) of the Term Loan
and Security Agreement, dated as of May 1, 2004, evidencing the Modified Term
Loan, each Party will bear its own costs, expenses and attorney fees incurred in
connection with the Lawsuit.
5. Defense to Suit. This Agreement may be pleaded as a full and complete
defense to any action, suit, or other proceeding which may be instituted or
prosecuted in respect of any of the claims released hereby. The Parties agree
that any such proceeding would cause irreparable injury to the Party against
whom it is brought and that any court of competent jurisdiction may enter an
injunction restraining prosecution thereof.
6. Legal Fees for Breach of this Agreement. In the event of any breach of
this Agreement, and/or in any legal proceeding arising under or related to this
Agreement, the prevailing party is entitled, in addition to other amounts it
recovers, to have the other party pay all costs and expenses (including
reasonable attorneys' fees) incurred in connection with the enforcement of this
Agreement or in such proceeding.
7. No Rights Assigned. Each Party represents and warrants to the other
that it has not transferred, conveyed, pledged, assigned or made any other
disposition of the claimed rights, interests, demands, actions or causes of
action, obligations, or any other matter covered by this Agreement.
8. Assigns. The terms of this Agreement will inure to the benefit of, and
be binding upon, the Parties and their legal representatives, successors or
assigns.
9. Authority. Each signatory to this Agreement warrants that he has the
authority to execute this Agreement and to bind the Party or Parties for which
he signs.
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10. Entire Agreement. This Agreement states the entire agreement of the
Parties with respect to the matters discussed herein, and supercedes all prior
or contemporaneous oral or written understandings, agreements, statements or
promises.
11. Amendments. This Agreement may not be amended or modified in any
respect except by a written instrument duly executed by all of the Parties to
this Agreement.
12. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be an original, and this Agreement is effective
upon execution of at least one counterpart by each Party to this Agreement.
13. Settlement. If this Agreement does not become effective for any
reason, it will be deemed negotiation for settlement purposes only and will not
be admissible in evidence or usable for any purposes whatsoever.
14. No Presumption Against Drafter. This Agreement has been and will be
construed to have been drafted by all the Parties to it so that any rule
construing ambiguities against the drafter will have no force or effect.
15. No Admission of Liability. The Parties acknowledge that by entering
into this Agreement, they intend only to reach an amicable resolution of their
differences. This Agreement is not an admission of liability by any Party.
16. Final Effect. The Parties each acknowledge to the other that each
understands the final and permanent effect of this instrument.
17. Consultation with Counsel. Each Party has consulted with whatever
consultants, attorneys or other advisors it deems appropriate in connection with
the effect of this Agreement, and each assumes the risk arising from not seeking
further additional consultation with such advisors.
18. Assumption of Risks. Each Party to this Agreement assumes the risk of
any mistake of fact or law with regard to any aspect of this Agreement, the
disputes described herein, or any asserted rights released by this Agreement.
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19. Headings. The headings used in this Agreement are for ease of
reference only, and will not have any bearing on the meaning or interpretation
of this Agreement.
[SIGNATURE PAGE FOLLOWS]
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EXECUTED to be effective as of the date first set forth above.
XXXXXXX XXXXX BUSINESS FINANCIAL
SERVICES INC.
By: /s/ Xxxxxx X. Xxxxxxxx
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Its: Assistant Vice President
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EXECUTED to be effective as of the date first set forth above.
ASPECT SYSTEMS, INC.
By: /s/ Xxxxxx Key
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Its: President/CEO
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EXECUTED to be effective as of the date first set forth above.
DND TECHNOLOGIES CORP.
By: /s/ Xxxxxxx X. Xxxxx
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Its: Chairman/CEO
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EXECUTED to be effective as of the date first set forth above.
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
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