EXHIBIT 2.01
RESCISSION AGREEMENT AND MUTUAL RELEASE
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THIS RESCISSION AGREEMENT AND MUTUAL RELEASE (the "AGREEMENT") is made and
entered into as of July 13, 2000, by and among USWEBAUCTIONS, INC., f/k/a August
Project 1 Corp., a Florida corporation ("AUGUST"), Xxx Xxxxxxxx ("XXXXXXXX") and
Xxxx Xxxxx ("XXXXX") (Xxxxxxxx and Xxxxx are referred to herein individually as
a "SHAREHOLDER" and collectively as the "SHAREHOLDERS").
R E C I T A L S:
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A. August, USWebauctions, Inc., a Florida corporation ("USWA") and the
Shareholders entered into that certain Stock Purchase Agreement dated April 10,
2000 (the "STOCK PURCHASE AGREEMENT") pursuant to which August acquired and the
Shareholders sold to August One Hundred percent (100%) of the capital stock of
USWA in exchange for the Shareholders receiving Nine Million Seven Hundred
Thirty-Four Thousand (9,734,000) shares of common stock of August (the "PURCHASE
PRICE").
B. Simultaneous with the execution of the Stock Purchase Agreement, August
and Xxxxxxxx entered into that certain Executive Employment Agreement dated
April 10, 2000 (the "XXXXXXXX EMPLOYMENT AGREEMENT"), and August and Xxxxx
entered into that certain Executive Employment Agreement dated April 10, 2000
(the "XXXXX EMPLOYMENT AGREEMENT") (the Xxxxxxxx Employment Agreement and the
Xxxxx Employment Agreement are collectively referred to herein as the
"EMPLOYMENT AGREEMENTS."
C. Subsequent to the execution of the Stock Purchase Agreement, August and
USWA entered into that certain Plan of Merger dated April 21, 2000 and filed
those certain Articles of Merger with the Secretary of State of the State of
Florida effective as of May 17, 2000, whereby USWA was merged with and into
August, which was the surviving corporation in the merger, and August changed
its name to USWebauctions, Inc. (For clarity purposes in this Agreement, the
surviving corporation shall be referred to as "AUGUST" and all references to
"USWA" shall mean USWebauctions, Inc. prior to the effective date of the Stock
Purchase Agreement.)
D. August and the Shareholders have decided to rescind the Stock Purchase
Agreement, the Xxxxxxxx Employment Agreement and the Xxxxx Employment Agreement
and terminate any and all business relationships thereunder.
E. August and the Shareholders desire to fully and completely release each
party hereto from any and all liabilities and obligations whatsoever, including,
without limitation, any and all liabilities and obligations arising under or in
connection with the Stock Purchase Agreement and/or the employment of Messrs.
Xxxxxxxx and Xxxxx.
A G R E E M E N T
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NOW, THEREFORE, in consideration of the mutual agreements, covenants and
premises set forth herein for certain other good and valuable consideration, the
receipt and adequacy which are hereby acknowledged, the parties hereto,
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intending to be legally bound, hereby agree as follows:
1. INCORPORATION OF RECITALS. The foregoing recitals are true and correct
and are incorporated herein by this reference.
2. RESCISSION OF STOCK PURCHASE AGREEMENT AND RELATED TRANSACTIONS.
2.1. RESCISSION OF STOCK PURCHASE AGREEMENT. August and the
Shareholders shall rescind the Stock Purchase Agreement as of the date hereof
and all rights of the Shareholders with respect to the Purchase Price issued
pursuant to Section 1.2 of the Stock Purchase Agreement shall terminate.
2.2. RETURN OF STOCK AND ASSETS. As the date hereof the Shareholders
shall return to August all stock certificates issued by August representing the
entire Purchase Price in consideration of the return by August of all of the
assets owned by USWA as of the effective date of the Stock Purchase Agreement
(the "USWA ASSETS"), including, without limitation, the right to use the name
USWebauctions, Inc., the intellectual property rights associated with the USWA
software, and the personal property listed on EXHIBIT "A" attached hereto. Each
party hereto understands and agrees that the USWA Assets, including the
intellectual property, currently have only a nominal fair market value.
Accordingly, as of the date hereof, the Shareholders will not own any of the
issued and outstanding shares of common stock of August, and August will not own
any of the assets previously owned by USWA.
3. TERMINATION OF EMPLOYMENT AGREEMENTS AND OTHER MATTERS.
3.1. XXXXXXXX'X EMPLOYMENT. August and Xxxxxxxx shall terminate the
Xxxxxxxx Employment Agreement as of the date hereof and all rights of Xxxxxxxx
with respect to his employment with August pursuant to the Xxxxxxxx Employment
Agreement shall terminate.
3.2. XXXXX'X EMPLOYMENT. August and Xxxxx shall terminate the Xxxxx
Employment Agreement as of the date hereof and all rights of Xxxxx with respect
to his employment with August pursuant to the Xxxxx Employment Agreement shall
terminate.
3.3. Xxxxxxxx, Xxxxx and August agree that Xxxxxxxx and Xxxxx are not
entitled to any additional salary, benefits, compensation or other consideration
of any nature whatsoever.
3.4. Xxxxxxxx, Xxxxx and August agree that Section 9 (CONFIDENTIALITY)
of the Employment Agreements shall survive the termination of such Employment
Agreements.
4. GENERAL RELEASES.
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4.1. RELEASE OF AUGUST. Except with respect to the covenants and
agreements of August set forth in this Agreement, each Shareholder, on behalf of
himself, respectively, his successors, heirs, and assigns, hereby agrees to
completely and irrevocably discharge and release August, its officers,
directors, employees, agents, counsel and shareholders from any and all claims,
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demands, actions, damages, lawsuits, obligations, promises, administrative
actions, charges and causes of action, and/or liability whatsoever, both known
and unknown, in law or in equity, involving any matter arising out of or in any
way related, directly or indirectly, to any and all obligations, duties and
liabilities under the Stock Purchase Agreement and/or the Employment Agreements
and the rescission and termination of same, respectively, including, but not
limited to, any claim of breach of contract, wrongful discharge, and/or
employment discrimination in violation of or arising out of, under, or in
relation to the rescission of the Stock Purchase Agreement, the return of the
Purchase Price to August, the return of the USWA Assets to the Shareholders, the
Shareholders' employment with August, the termination of the Employment
Agreements, the Civil Rights Act of 1871, the Labor Management Relations Act of
1947, the Equal Pay Act of 1963, Title VII of the Civil Rights Act of 1964, the
Occupational Safety and Health Act of 1973, the Employee Retirement Income
Security Act of 1974, the Immigration Reform and Control Act of 1986, the Civil
Rights Act of 1991, the Shareholders Orders 11141, 11246 and 11375, Chapter 760
of the Florida Statutes, the Florida Civil Rights Act of 1992, and/or any other
state, federal or local Fair Employment Practice law, employment law, or
statute.
4.2. RELEASE OF THE SHAREHOLDERS. Except with respect to the covenants
and agreements of the Shareholders set forth in this Agreement, August, on
behalf of itself, and its directors, officers, employees, agents, subsidiaries,
and affiliated entities, hereby agrees to completely and irrevocably discharge
and release each Shareholder, respectively, his heirs, executors, and
administrators, successors, assigns, agents, counsel and representatives, from
any and all claims, demands, actions, damages, lawsuits, obligations, promises,
administrative actions, charges and causes of action, and/or liability
whatsoever, both known and unknown, in law or in equity, involving any matter
arising out of or in any way related, directly or indirectly, to any and all
obligations, duties and liabilities under the Stock Purchase Agreement and/or
the Employment Agreements and the rescission and termination of same,
respectively, and/or any Shareholder's employment or affiliation with August.
4.3. RELEASE AMONGST SHAREHOLDERS. Except with respect to the covenants
and agreements set forth in this Agreement, each Shareholder, on behalf of
himself, respectively, his successors, heirs, and assigns, hereby agrees to
completely and irrevocably discharge and release the other Shareholder, his
heirs, executors, and administrators, successors, assigns, agents, counsel and
representatives from any and all claims, demands, actions, damages, lawsuits
obligations, promises, administrative actions, charges and causes of action,
and/or liability whatsoever, both known and unknown, in law or in equity,
involving any matter arising out of or in any way related, directly or
indirectly, to this transaction, USWA, or the development of the USWA software.
Each Shareholder agrees to equally split the tangible USWA Assets after payment
of any existing liabilities. Additionally, each Shareholder shall have a copy of
the current version of the USWA software which may be used for any purpose. No
Shareholder shall have any responsibility with regard to providing instructions,
documentation, or other help on any aspect of the software, including, without
limitation, set-up, general organization, or source code.
5. COVENANTS OF THE SHAREHOLDERS.
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5.1. CONFIDENTIALITY. The Shareholders covenant and agree that this
Agreement and its terms and conditions are, collectively and individually,
totally confidential, and that from the date of this Agreement forward shall
forever be kept totally confidential and shall not in any manner or for any
reason be disclosed by the Shareholders without the express written consent of
August except (a) to their attorneys, accountants, and family members on a "need
to know" basis, all of whom shall be informed of and be bound by the provisions
of this paragraph; (b) as may be required by government agencies, such as the
Internal Revenue Service and the SEC; (c) pursuant to court order or subpoena
compelling such disclosure. Should the Shareholders or their representatives
receive any such subpoena or court order compelling disclosure, the Shareholders
shall immediately notify August so that it may have the opportunity to interpose
an objection. The provisions of this Section 8 shall not apply in any action
brought by the Shareholders to enforce any provisions of this Agreement.
5.2. NON-DISPARAGEMENT. The Shareholders shall refrain from making any
written or oral statement or taking any action, directly or indirectly, which
either Shareholder reasonably knows or reasonably should know to be a
disparaging or negative comment concerning August or its officers, directors,
employees, shareholders and agents with the intent to injure or damage August or
its officers, directors, employees, shareholders and agents, and shall refrain
from suggesting that any such disparaging or negative comment concerning August
or its officers, directors, employees, shareholders and agents be made except as
may be compelled by a court of competent jurisdiction. August, on behalf of
itself, and its directors, officers, employees, agents, subsidiaries and
affiliated entities shall refrain from making any written or oral statement or
taking any action, directly or indirectly, which it knows or reasonably should
know to be a disparaging or negative comment concerning the Shareholders with
the intent to injure or damage the Shareholders, and shall refrain from
suggesting that any such disparaging or negative comment concerning the
Shareholders be made except as may be compelled by a court of competent
jurisdiction.
6. MISCELLANEOUS.
6.1. INDEPENDENT REPRESENTATION. Xxxxxxxx, Xxxxx and August each
represent and warrant that they have had the opportunity to review and consider
the terms of this Agreement with their respective legal counsel (the costs of
such counsel having been, and continuing to be, borne exclusively by August with
respect to August's legal counsel, and by the Shareholders with respect to the
Shareholders' respective counsel), and that none of them have made any
representations concerning the terms or effects of this Agreement other than
those contained in this Agreement, it being clearly understood that this
Agreement and the sections of the Stock Purchase Agreement which survive its
termination pursuant to Section 4.1 hereof are the only agreements between the
parties and they may not be modified or terminated orally, but only in a writing
signed by both of them.
6.2. SPECIFIC PERFORMANCE. Xxxxxxxx, Xxxxx and August each acknowledge
that the others' breach of the terms of this Agreement would make difficult the
assessment of monetary damages that would be sustained from such breach, and it
would be difficult, if not impossible, to compensate fully for damages for any
such breach, specifically including, but not limited to, breach of the
provisions relating to confidentiality and non-disparagement. Accordingly, each
party specifically agrees that the other shall be entitled to temporary and
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permanent injunctive relief and/or specific performance to enforce this
Agreement or to enjoin any unauthorized disclosure of confidential information,
and the party in breach shall expressly waive the defense that a remedy in
damages would be adequate and any requirement for the security or posting of any
bond in connection with any such injunctive relief. This provision with respect
to injunctive relief and/or specific performance shall not, however, diminish
the right of the non-breaching party to claim and recover damages in addition to
or in lieu of injunctive relief and/or specific performance.
6.3. BINDING NATURE. All of the terms and provisions of this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
parties and their respective legal representatives, successors and permitted
assigns, whether so expressed or not.
6.4. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument. Confirmation of execution
by electronic transmission of a facsimile signature page shall be binding upon
any party so confirming.
6.5. ATTORNEYS' FEES. If any legal proceeding is brought for the
enforcement of this Agreement, or because of an alleged dispute, breach or
threatened breach, default or misrepresentation in connection with any provision
of this Agreement, the successful or prevailing party shall be entitled to
recover reasonable attorneys' fees, sales and use taxes, court costs and all
expenses even if not taxable as court costs (including, without limitation, all
such fees, taxes, costs and expenses incident to arbitration, appellate,
bankruptcy and post-judgment proceedings), incurred in that legal proceeding, in
addition to any other relief to which such party may be entitled. Attorneys'
fees shall include, without limitation, paralegal fees, investigative fees,
administrative costs, sales and use taxes and all other charges billed by the
attorney to the prevailing party.
6.6. GOVERNING LAW. Any civil action or legal proceeding arising out of
or relating to this Agreement shall be brought in the courts of record of the
State of Florida in Sarasota County or the United States District Court sitting
in Sarasota, Florida. Each party consents to the jurisdiction of such court in
any such proceeding and waives any objection to the laying of venue of any such
proceeding in such court.
6.7. PARTIAL LIABILITY AND SEVERABILITY. If any provision of this
Agreement is invalidated by a court of competent jurisdiction, then all of the
remaining provisions of this Agreement shall remain in full force and effect,
provided that both parties may still effectively realize the complete benefit of
the promises and considerations conferred hereby.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
set forth above.
SHAREHOLDERS:
/S/ XXX XXXXXXXX
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XXX XXXXXXXX
/S/ XXXX XXXXX
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XXXX XXXXX
USWEBAUCTIONS, INC.,
F/K/A AUGUST PROJECT 1 CORP.:
By: /s/ XXXX X. XXXXXXXXXX
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Name:/s/ XXXX X. XXXXXXXXXX
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Title: PRESIDENT
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EXHIBIT A
Known Assets with estimate of current Mkt. value:(Total Mkt. Value
= approximately $6,522)
3 AMD K7 PCs - $4000
1 Printer - $200
2 Copies of Win98 - $330
1 Copy Works Suite - $80
1 Copy of Linux - $40
1 Copy Photoshop - $310
1 Copy Frontpage - $100
1 Copy WebPosition Gold - $150
3 Surge Protectors - $100
2 Phones - $200
Misc. Blank CDs and Zip Disks - $150
Misc Office Supplies - $50
Rebates from Equipment - $175
Uswebauctions Software and intellectual rights - nominal
registered name "usgolfauction" - nominal
registered name "uswebauction" - nominal
registered name "uswebauctions" - nominal
Bank Account - $237
Liabilities:
Xxxx - $85
WebServer Monthly Fee - $30
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