EXHIBIT 10.14
SETTLEMENT AGREEMENT AND FINAL RELEASE
This SETTLEMENT AGREEMENT AND RELEASE (the "Agreement") is made as of this
th day of January, 1998 by and between URSUS TELECOM CORPORATION, a
Florida corporation (the "Company"), LUCA GIUSSANI, an individual ("Giussani"),
and XXX XXXXXXX, an individual ("Xxxxxxx"). The Company and the above
individuals collectively are referred to herein as the "Parties."
In reliance upon the mutual covenants, releases, agreements and conditions
contained herein and subject to the provisions and terms of this Agreement and
for other good and valuable consideration, the receipt and sufficiency of which
hereby are conclusively acknowledged, the Parties, intending to be legally bound
agree as follows:
1. Headings. The headings contained in this agreement are included solely
for convenience of reference and shall not control the meaning or interpretation
of any of the provisions of this Agreement nor affect the rights of the Parties.
2. Effectiveness. This agreement shall become binding and effective as of
its execution by all of the Parties, whether in counterpart or upon single
instrument (the "Effective Date"). A signature by fax shall be as fully
effective as an original signature.
3. Settlement.
a. Ownership Interest. The Company recognizes and acknowledges that
Xxxxxxx is the owner of 406.25 shares (the "Shares") of the Company's Class C
common stock ("Class C") and that such Shares shall be deemed to have been
issued upon the formation of the Company in April 1993. The Company represents
that there are currently 1416.67 issued and outstanding shares of Class C and
4,000 shares of Class A and B for a total of 5416.67 shares of Classes A, B, and
C combined, representing all of the issued and outstanding equity of the Company
as of the Effective Date. Certificates representing Xxxxxxx'x Shares shall bear
no legend, but shall be registered in the name of Fincogest, S.A. ("Fincogest"),
as trustee, and beneficially owned by Xxxxxxx pursuant to a trust agreement
between Xxxxxxx and Fincogest (the "Xxxxxxx Trust") which shall be separate from
the trust agreement between Fincogest and Giussani. The agreement for the
Xxxxxxx Trust shall be finalized and executed, within 30 days of the Effective
Date. The Company's counsel shall have the right to approve the terms of the
Xxxxxxx Trust solely to verify that they include the terms of the restraints on
sale contained in the Lockups, and as imposed by applicable securities laws. The
Company warrants that the Shares will represent 7.5% of the Company's issued and
outstanding shares of common stock, on a fully diluted basis except as set forth
below, immediately prior to the consummation of the Company's presently proposed
initial public offering with Xxxxxx Xxxxxxx & Associates, Inc. as underwriter
(the "Pending IPO"), and will be part of the same class of common stock which is
sold in the Pending IPO ; however, (i) such percentage interest shall exclude
employee stock options and underwriters' warrants to be issued and outstanding
upon consummation of the Pending IPO at exercise prices equal to or higher than
the public offering price in the Pending IPO, and (ii) such percentage interest
shall be subject to dilution upon and after the consummation of the Pending IPO
and after any termination of the Pending IPO for any reason.
b. Consulting Agreement. The Company and Xxxxxxx have entered
into a Consulting Agreement, dated November 1, 1995. On the Effective Date,
the term of the Consulting Agreement shall be extended without lapse so that
such term shall terminate on December 31, 1998, and the compensation provisions
of the Consulting Agreement shall be modified so that Xxxxxxx receives an
additional payment of consulting fees thereunder in the amount of $15,000 upon
consummation of an initial public offering of the Company's securities during
the term of such consulting agreement, payable within two business days of such
consummation. Except as so extended and modified, all other terms and
conditions of the Consulting Agreement will remain unmodified and in full force
and effect; provided, however, that Xxxxxxx shall not serve as an officer, agent
or employee of the Company under the Consulting Agreement, the Consulting
Agreement shall not be terminable pursuant to paragraph 9.3 of its terms, and
the covenants not to compete contained in the Consulting Agreement shall
terminate as of December 31, 1998.
c. Repayment of Existing Debt. As of the Effective Date, Xxxxxxx
is indebted to the Company (the "Debt"). Xxxxxxx agrees and directs the Company
to apply his monthly compensation under the Consulting Agreement towards the
Debt until March 31, 1998, when the principal and interest due on the Debt shall
be repaid in full, with a portion of the March consulting fee, and the balance
of such month's fee shall be paid to Xxxxxxx. Each payment shall be credited
first to accrued but unpaid interest, and then to principal; and interest shall
then cease on the portion of principal credited.
d. SEC Reporting. Xxxxxxx acknowledges and agrees that he shall,
upon the effectiveness of any public offering of the Company's securities,
become responsible to comply with all requirements of the United States Federal
and State securities laws applicable to the holding, acquisition and disposition
of the Company's securities, including but not limited to reporting
requirements. The Company acknowledges that Xxxxxxx shall not be an officer,
director, employee or serve in any other capacity other than as set forth in
the Consulting Agreement of the Company, nor responsible for or privy to actions
taken by the Board in connection with the management of the Company's business.
4. Mutual Releases.
x. Xxxxxxx'x Release. Except as to rights to enforce the provisions
of this Agreement (including the Exhibits hereto) against the Company and
Giussani, Rispoli, on behalf of himself and each of his predecessors,
successors, beneficiaries, assigns, partners, employees, accountants, attorneys,
and agents (each of the foregoing, "Xxxxxxx'x Affiliate"), hereby fully and
forever releases and discharges the Company and Giussani, and each of their
respective predecessors, successors, beneficiaries, assigns, shareholders,
directors, officers, partners, employees, accountants, attorneys and agents
(each of the foregoing, "Affiliate"), from any and all, known or unknown,
anticipated or unanticipated, suspected or unsuspected, or fixed, conditional or
contingent actions or causes of action at law or in equity, suits, debts,
demands, claims, contracts, covenants, liens, liabilities, losses, costs,
expenses (including, without limitation, attorneys' fees) or damages of every
kind, nature and description, arising from the
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beginning of the world through the Effective Date, and covenants and agrees not
to maintain or assert any claim or defense relying on any claim released hereby.
b. The Company's and Giussani's Releases. Except as to rights to
enforce the provisions of this Agreement (including the Exhibits hereto)
against Xxxxxxx, the Company and Giussani and their respective Affiliates
hereby fully and forever release and discharge Xxxxxxx and Xxxxxxx'x Affiliates
from any and all, known or unknown, anticipated or unanticipated, suspected or
unsuspected, or fixed, conditional or contingent actions or causes of action at
law or in equity, suits, debts, demands, claims, contracts, covenants, liens,
liabilities, losses, costs, expenses (including, without limitation, attorneys'
fees) or damages of every kind, nature and description, arising from the
beginning of the world through the Effective Date, and covenants and agrees not
to maintain or assert any claim or defense relying on any claim released hereby.
5. Lock Up Agreements. As a beneficial shareholder of the Company,
Xxxxxxx hereby agrees to execute and deliver lock up agreements restricting
any sale of the Shares without the underwriter's consent that may be required by
any underwriter in connection with any initial public offering of the Company's
securities, to the same extent as the agreement to be signed by Giussani (the
"Lockups"). The Lockups under the Pending IPO shall have a term not to
exceed one year. The Company and Giussani confirm and agree that each of them
has and will interpose no objection to the sale of the Shares or to the waiver
of the Lockups by the underwriters.
6. Entire Understanding; Integrated Instrument. This Agreement
contains and constitutes the entire agreement and understanding of the Parties
concerning the subject matter hereof, and supersedes and replaces all prior
discussions and negotiations, proposed agreements or agreements, written or
oral, pertaining to such subject matters. Each of the Parties acknowledges that
no other party or agent or attorney of any other party has made any promise,
representation or warranty whatsoever, express or implied, written or oral, not
contained herein and concerning the subject matters hereof, to induce he, she or
it to execute this Agreement, and each of the Parties acknowledges that he, she
or it has not executed this Agreement in reliance on any promise, representation
or warranty not contained herein.
7. Representations And Warranties. Each of the Parties represents and
warrants to the other Parties that he, she or it has not assigned or
transferred, or purported to assign or transfer, to any person, entity or
institution any liability, suit, action, cause of action, right, claim, demand,
dispute, obligation, duty, debt, lien, loss, cost, expense, or damage, or any
part or portion thereof, encompassed by, released, involved or referred to in
this Agreement.
8. Supplement, Amendment, Waiver, Etc. This Agreement cannot be
supplemented, modified, amended, waived, released or terminated except by a
writing executed by the party or parties to be bound thereby. In any suit,
action or proceeding arising out of or in connection with this Agreement, the
prevailing party shall be entitled to an award of reasonable attorney's fees
incurred in connection therewith.
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9. Construction. This Agreement in all respects shall be interpreted,
construed, enforced and governed by and under the laws of the State of Florida
without regard to any internal conflicts of law principles in such jurisdiction.
This Agreement shall be deemed to have been prepared by the Parties jointly, and
any uncertainty or ambiguity existing in this Agreement shall not be interpreted
against any of the Parties by reason of such party having been the draftsperson
hereof. The provisions of this Agreement shall be interpreted in a reasonable
manner to effect the intentions of the Parties and of this Agreement.
10. Execution; Counterparts. This Agreement may be executed as a single
original or in any number of counterparts, each of which shall be deemed to be
an original and which taken together shall be deemed to be one and the same
instrument.
IN WITNESS WHEREOF, each of the Parties further states that he, she or it
has carefully read the foregoing Agreement and knows the contents thereof, that
he, she or it signs the same of his, her or its own free act, and that the
Parties have executed this Agreement as of the date set forth above.
LUCA GIUSSANI
_______________________________
URSUS TELECOM CORPORATION
By:____________________________
Its: ____________________________
XXX XXXXXXX
______________________________
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