Exhibit 10.1
SETTLEMENT AGREEMENT AND RELEASE OF CLAIMS
This Settlement Agreement and Release of Claims (the "Agreement") is being
entered into on December 29, 2003 (the "Effective Date") between The Titan
Corporation ("Titan") on the one hand, and GlobalNet Systems, Inc. ("GNS"),
Growth Enterprise Fund, S.A. ("GEF"), and GlobalNet Corporation, whose previous
name was iDial Networks, Inc. ("iDial") (collectively referred to as
"Defendants") on the other hand.
WHEREAS, Titan, GlobalNet, Inc. ("GlobalNet"), a wholly-owned subsidiary of
Titan, and GNS entered into a Stock Purchase Agreement dated May 20, 2003 (the
"Stock Purchase Agreement") under which GNS was to acquire from Titan all of the
common stock of GlobalNet; and
WHEREAS, GNS was obligated to close the transaction pursuant to the Stock
Purchase Agreement on July 29, 2003 but failed to do so as required, and as a
result, Titan was required to provide $2,500,000.00 in additional funds to
GlobalNet to meet certain obligations of GlobalNet to a third party and such
obligations would have been paid by GNS if it had closed the transaction in
accordance with the Stock Purchase Agreement, and
WHEREAS, GEF executed a Guarantee on May 20, 2003 to guarantee GNS'
performance and payment according to the terms of the Stock Purchase Agreement
(the "Guarantee"); and
WHEREAS, Titan filed a lawsuit against GNS and GEF captioned The Titan
Corporation v. GlobalNet Systems, Inc., et al., Case No. 03-CV-5657 in the
United States District Court for the Southern District of New York (the
"Litigation"); and
WHEREAS, Titan, GNS, and GEF executed a Settlement Agreement and Mutual
Release of Claims (the "Settlement Agreement") on August 21, 2003 in which,
among other things: GNS and GEF agreed to pay Titan ONE MILLION DOLLARS
($1,000,000.00) and deliver a promissory note to Titan executed by iDial in the
amount of ONE MILLION AND FIVE HUNDRED THOUSAND DOLLARS ($1,500,000.00); Titan
agreed to dismiss the Litigation; and both Titan, on the one hand, and GNS and
GEF, on the other hand, released the other from claims that were raised or could
have been raised in the Litigation; and
WHEREAS, iDial executed and delivered a promissory note to Titan dated
August 25, 2003 in the amount of ONE MILLION AND FIVE HUNDRED THOUSAND DOLLARS
($1,500,000.00) (the "Promissory Note"); and
WHEREAS, Defendants have asserted that they may have certain claims and/or
causes of action against Titan that were not released as part of the Settlement
Agreement; and
WHEREAS, in exchange for Defendants' releasing these asserted claims and
causes of action, Titan agrees to modify Section 2(a)(2) of the Settlement
Agreement and accept an Amended and Restated Promissory Note from Defendants as
set forth below.
NOW, THEREFORE, in consideration of the mutual promises set forth below and
intending to be legally bound, the parties hereto agree as follows:
1. Modification to Settlement Agreement and Issuance of Amended and
Restated Promissory Note.
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(a) The parties agree that Section 2(a)(2) of the Settlement
Agreement shall hereby be modified so that the ONE MILLION DOLLARS
($1,000,000.00) due and payable to Titan on or before December 20,
2003 and the additional TWO HUNDRED AND FIFTY THOUSAND DOLLARS
($250,000.00) set forth in the Amended and Restated Promissory Note
shall be due and payable to Titan on or before March 31, 2004. The
parties further agree that, upon execution of this Agreement,
Defendants shall deliver to Titan an Amended and Restated Promissory
Note from iDial in the amount of ONE MILLION AND TWO HUNDRED AND FIFTY
THOUSAND DOLLARS ($1,250,000.00), which shall be due and payable on or
before March 31, 2004. The form of the Amended and Restated Promissory
Note is attached as Exhibit A hereto.
(b) The parties agree that the Settlement Agreement, the Stock
Purchase Agreement, the Guarantee, the Promissory Note, and any and
all other agreements among or between some or all of them (and all
Exhibits to such agreements) shall remain in full force and effect
according to their terms, except as expressly modified above or as
modified by the Amended and Restated Promissory Note.
2. No Admission. By making this Agreement, the parties each do not admit
any liability to the others or that any of them engaged in any wrongdoing or
unlawful conduct.
3. Release by Defendants. GNS, GEF, and iDial (including GlobalNet
Corporation) on behalf of themselves and their agents, officers, directors,
employees, representatives, attorneys, successors, and assigns, each hereby
releases and discharges forever Titan, and/or its current and former agents,
officers, directors,
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employees, representatives, attorneys, successors, and assigns from any and all
claims, counterclaims, and causes of action arising from or relating to: (a) the
Settlement Agreement; (b) the Litigation; (c) the Stock Purchase Agreement; (d)
the Guarantee; and (e) the Promissory Note (although in the case of GNS and GEF,
only those claims that have arisen since the execution of the Settlement
Agreement or that were otherwise not released and discharged pursuant to the
Settlement Agreement). Defendants understand that the claims and causes of
action released and discharged in this Section 3 include without limitation any
claims for beach of contract, fraud, and/or fraudulent inducement and any claims
pursuant to any federal or state statute relating to unfair and deceptive trade
practices. GNS, GEF, and iDial each agree not to file any claim or lawsuit
seeking damages or other relief or asserting any claims that are lawfully
released in this Section 3. GNS, GEF, and iDial each further hereby irrevocably
and unconditionally waive any and all rights to recover any relief and damages
concerning the claims that are lawfully released in this Section 3. GNS, GEF,
and iDial each represents and warrants that it has not previously filed or
joined in any such claims against Titan, and that it has not given or sold any
portion of any claims released herein to anyone else, and that he/she/it will
indemnify and hold harmless the persons and entities released herein from all
liabilities, claims, demands, costs, expenses and/or attorney's fees incurred as
a result of any such assignment or transfer.
The parties expressly acknowledge that Defendants have not released any
claims arising after the Effective Date of this Agreement, including claims
relating to the enforcement of this Agreement.
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4. Waiver. No waiver by any party of a breach of, or a default under, any
of the provisions of the Agreement, nor one or more failures of any party to
enforce any of the provisions of the Agreement shall thereafter be construed as
a waiver of any subsequent breach or default of a similar nature, or as a waiver
of any provisions, rights, or privileges under the Agreement.
5. No Other Consideration. The parties affirm that the terms stated herein
are the only consideration for their executing the Agreement and that no other
representations, promises, or agreements of any kind have been made by any
person or entity to cause them to execute the Agreement.
6. Entire Agreement. This is the entire agreement between the parties on
the subject matter in the Agreement, and it merges all prior discussions and
negotiations between them on that subject matter.
7. Construction. The language of all parts of the Agreement shall in all
cases be construed as a whole, according to its fair meaning, and not strictly
for or against any of the parties. The parties acknowledge that all of them
participated in the drafting of this Agreement and that no part can be construed
against any party as the drafter of it.
8. Modification. The Agreement may not be changed after its execution
unless the changes are made in writing and signed by all of the parties.
9. Further Assurances. The parties agree to take or cause to be taken such
further actions as may be necessary or as may be reasonably requested in order
to fully effectuate the purposes, terms, and conditions of the Agreement.
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10. Assignment. This Agreement and the rights and obligations hereunder may
not be assigned to any person or entity by any of the parties without the prior
written consent of all of the other parties; provided however that Titan may
assign its rights and obligations under this Agreement to any of its affiliated
companies with or without the parties' consent.
11. Severability/Reformation. Invalidity or unenforceability of any
provision of the Agreement shall not affect the validity or enforceability of
any other provision. In addition, if any provision in this Agreement is found by
any court of competent jurisdiction to be unenforceable or overly broad for any
reason, then such provision shall be reformed and interpreted to extend to the
maximum reach as to which it may be enforceable.
12. Governing Law. The Agreement shall be governed by and construed in
accordance with the laws of the State of New York, excluding the choice of law
rules thereof.
13. Binding Effect. The Agreement shall be binding upon and inure to the
benefit of the parties' successors and permitted assigns.
14. Acknowledgment. In entering into the Agreement, the parties acknowledge
that they are represented by counsel of their choice or had the opportunity to
be represented by counsel of their choice. The parties affirm that they have
read the Agreement in its entirety, have had a full and fair opportunity to
consider and understand its terms, and to be advised by their counsel. The
parties further acknowledge that they execute the Agreement of their own free
will and without coercion.
15. Representation of Authority. The persons signing this Agreement
represent and covenant that they have full legal authority to act on behalf of
the respective parties and to bind the respective parties to the terms of this
Agreement by affixing their signatures hereto.
[Signature page follows]
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date(s)
set forth below.
/s/ XXXXX X. XXXXX
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The Titan Corporation.
By: Xxxxx X. Xxxxx
Date:
/s/ OSCAR DE LA GUARDIA
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GlobalNet Systems, Inc.
By: Oscar de la Guardia, Acting President
Date: December 24, 2003
/s/ XXXXX XXXXXX
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Growth Enterprise Fund, S.A.
By : Xxxxx Xxxxxx
Date:
/s/ XXXX X. XXXX
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GlobalNet Corporation, f/k/a iDial Networks, Inc.
By : Xxxx X. Xxxx/Chairman
Date: December 26, 2003
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Exhibit A
[Omitted]
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