EXHIBIT 10.i
AGREEMENT
This Agreement, dated September __, 1999, is among Legal Club of
America Corporation (the "Company"), Xxxx Xxxxx ("Xxxxx") and Xxxxx Xxxx
("Xxxx").
PRELIMINARY STATEMENT
The parties have reached certain agreements regarding Xxxxx'x
termination of his employment by the Company and the transfer of certain of his
shares in the Company's stock, all as set forth below
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, and other good and valuable considerations, the receipt and adequacy of
which are hereby acknowledged, the parties, intending to be legally bound, agree
as follows:
1. Xxxxx shall and does hereby sell and deliver to Xxxx a total of 700,000
shares (the "Sold Shares") of his common stock in the Company, consisting of all
400,000 shares encumbered by a stock pledge agreement (the "Pledge") dated
December 16, 1997 and an additional 300,000 that are subject to the Pledge.
Further, Xxxxx shall sell and deliver to Xxxx an additional 100,000 shares of
the Company's stock (the "Additional Shares")if and when the "Condition" (as
defined below) is satisfied. In consideration thereof, Xxxx shall and does
hereby (a) assume and agree to pay Xxxxx'x outstanding obligations to the
Company evidenced by his promissory note dated December 16, 1997 in the original
principal amount of $133,000 (the "Note", which Note is secured by the Pledge),
and (b) generally release Xxxxx from any and all claims that Xxxx may have
against Xxxxx, as set forth in paragraph 5, below.
2. As used herein, "Condition" means the payment of $ 15,000 by the Company to
Xxxxx by January 31, 2000. The Company shall pay Xxxxx 15,000 subject to its
consummation of a capital raise of $1 Million or more, by private placement or
public offering on or before January 31, 2000. In the event that the Condition
is fulfilled by January 31 2000, then Xxxxx shall complete his transfer of the
Additional Shares to Xxxx. In the event that the Condition is not satisfied by
January 31 2000, then Xxxxx shall not be obligated to sell or deliver the
Additional Shares to Xxxx.
3. Xxxxx represents and warrants that he owns the Sold Shares absolutely free
and clear of all liens, encumbrances, voting trusts, proxies and adverse claims
whatsoever, except that 400,000 of the Sold Shares are encumbered by the Pledge.
Xxxxx represent, warrants and covenants that he owns and will maintain ownership
of the 100,000 Additional Shares, absolutely free and clear of all liens,
encumbrances, voting trusts, proxies and adverse claims whatsoever, until
February 1, 2000.
4. Xxxx represents and warrants that (a) he is an accredited investor, as such
term is defined under applicable securities laws and regulations, (b) he is
acquiring the Sold Shares and the Additional Shares as restricted securities,
and (c) he shall not transfer or sell any of the Sold Shares or the Additional
Shares except in compliance with all applicable securities laws and
regulations. Each party has determined to execute, deliver, perform and
consummate this Agreement and the transactions contemplated hereby based solely
on their own independent investigation regarding the same, and not in reliance
upon any statement, representation or warranty of any party except as expressly
set forth in this Agreement.
5. Xxxxx agrees to execute and perform all documents (including without
limitation stock powers and letters of authorization) to effect the transfer of
the Sold Shares promptly after the execution of this Agreement, and the transfer
of the Additional Shares promptly after the timely satisfaction of the
Condition.
6. In consideration of the foregoing, the Company and Xxxxx hereby generally
release each other from all, and all manner of, claims and demands whatsoever,
arising from the beginning of the world to the date of this Agreement, including
all claims and demands relating to the Company, its securities and affairs on to
Xxxxx'x employment by the Company or the termination thereof. Without limiting
the generality of the foregoing, the Company specifically releases Xxxxx from
all claims and liabilities under the Note and the Pledge.
7. In consideration of the foregoing, Xxxx and Xxxxx hereby generally release
each other from all, and all manner of, claims and demands whatsoever, arising
from the beginning of the world to the date of this Agreement, including all
claims and demands relating to the Company, its securities and affairs or to
Xxxxx'x employment by the Company or the termination thereof. Without limiting
the generality of the foregoing, Xxxx (and the Company) specifically release
Xxxxx from all claims as to (a) Xxxxx'x shares in the Company (other than the
Sold Shares and the Additional Shares) and (b) the sales of such other shares by
Xxxxx and the proceeds of such sales.
8. Notwithstanding the foregoing provisions of 6 and 7, above, or any other
provisions of this Agreement, the releases provided for in this Agreement shall
not affect or impair (a) the right of any party to enforce this Agreement
against any other party, (b) Xxxxx'x rights to indemnification from the Company
for the acts and omissions of Xxxxx performed in his capacity as an officer or
director of the Company, to the extent provided in its organizational documents,
on (c) the Company's right to enforce against Xxxxx the provisions of the
Subscription Agreement dated December 16, 1997, to the extent of its provisions
concerning (i) Xxxxx'x representations concerning his status as an Accredited
Investor, and (ii) Xxxxx'x agreement to hold back from sales of his stock in the
Company in connection with certain public offerings.
9. Xxxxx agrees to continue to serve on the Board of Directors of the Company,
subject to his election by the Company's stockholders. So long as he serves in
that capacity, the Company agrees that his stock options shall continue to vest
as scheduled, including the options to buy 67,164 shares of the Company's common
stock granted to Xxxxx as of June 30,1999.
10. The Company will maintain and health and dental insurance coverage for
Xxxxx, as in effect prior to the termination of his employment, through December
31. 1999, subject to the terms and conditions of the applicable plans and
policies therefor.
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11. The Company will pay to its counsel's trust account, Xxxxxx, Xxxxx &
Xxxxxxxxx, PA, the sum of $3000. This amount will be held as security for the
payment of American Express Card charges on credit cards issued on Xxxxx'x
account and held by Xxxx and Xxxxx Xxxxxx. pending joint authorization from the
Company and Xxxxx to disburse the same in payment of such charges, or to return
such sum to the Company if all charges are paid and the credit cards are
returned to Xxxxx.
12. Each party hereto represents and warrants that the execution and performance
of this Amendment has been duly and validly authorized, does not conflict with
or result in a default under any agreement, understanding, order, judgment or
writ applicable to the representing party or its assets, and that this Amendment
is the representing party's' valid and binding agreement, and is enforceable
against the representing party in accordance with its terms. This Amendment may
be executed in counterparts, and facsimile signatures shall be effective as an
original. This Agreement sets forth the parties' complete understanding of
regarding the subject matter hereof, and shall be governed by and construed in
accordance with Florida law. The parties specifically agree to the provisions
below regarding the Escrow Agent.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement on the day and year first above written.
LEGAL CLUB OF AMERICA CORPORATION
By: /s/ XXXXX XXXX
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Authorized Signatory
/s/ XXXXX XXXX
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Xxxxx Xxxx
/s/ XXXX XXXXX
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Xxxx Xxxxx
JOINDER OF ESCROW AGENT
Xxxxxx, Xxxxx & Xxxxxxxxx, P.A. ("Agent") joins this Agreement and
agrees to accept arid hold $3000 (the "Escrow Funds") in its trust account,
subject to the following conditions:
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Re: Amendment to Agreement re Shares of Legal Club
Dear Matt:
As discussed, this will amend our above agreement regarding your transfer of
stock in Legal Club of America Corporation to me (the "Agreement"). The
Agreement is amended to delete all references to the Additional Shares
therefrom. Therefore, your transfers of stock to me are completed with the
transfer of the 700,000 Sold Shares, and you shall not be obligated in any way,
shape or form to transfer an additional 100,000 shares to me, regardless of
whether the "Condition" (as defined in the Agreement") is satisfied. This
amendment does not affect your rights to the payment contemplated by the
Condition, it merely relieves you of any obligation to transfer shares to me
when and if the Condition is satisfied. Since this amendment only adversely
affects me, it is effective upon my execution. Nevertheless, I would appreciate
it if you would sign below and return a signed copy to me.
Very Truly Yours
/s/ Xxxxx Xxxx
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Xxxxx Xxxx
Acknowledged and Agreed:
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Xxxx Xxxxx
