THIS FIRST AMENDED SETTLEMENT AGREEMENT AND RELEASE ("Agreement") has been
entered into effective as of March 31, 1999, by and between InnovaCom, Inc., on
the one hand ("InnovaCom"), and Xxxxx Xxxxxxxxx, on the other hand ("Thorogood")
(collectively "the Parties.")
RECITALS
A. On or about July 1, 1996, the Parties entered into a Consulting
Agreement and Nonstatutory Stock Option Agreement (hereinafter "Contracts").
X. Xxxxxxxxx thereafter performed certain services under the Consulting
Agreement and terminated his relationship as a consultant on or about May 5,
1997.
C. A dispute has arisen concerning Thorogood's rights under the
Contracts, and Thorogood has made demand upon InnovaCom for unpaid compensation,
for refusal to honor his stock option rights, and for possible tort claims and
causes of action.
D. InnovaCom has asserted claims against certain former officers,
directors and shareholders of InnovaCom in an action filed on November 10, 1997
in San Francisco Superior Court entitled InnovaCom, Inc. X. Xxxxxx, et al.,
Civil 990965, and has threatened to name Thorogood as a defendant in that case,
and/or other cases it has initiated against certain third parties (hereinafter
collectively "the Actions").
E. The Parties each deny any wrongdoing, but wish to resolve all
disputes existing between them, including all claims under the Contracts, the
Actions or otherwise.
NOW, THEREFORE, in consideration of the above Recitals (which are hereby
incorporated as part of this Agreement, and in consideration for their mutual
agreements expressed herein, and intending to be legally bound thereby, EACH OF
THE PARTIES HEREBY AGREES AS FOLLOWS:
1. SETTLEMENT CONSIDERATION
1.1
a) No later than May 15, 1999 ("Payment Date"), InnovaCom shall pay to
Thorogood the sum of $8,000 in a cashiers check or other ready funds, with
interest of 1% per month accruing from and after the Payment Date; b) InnovaCom
shall register 40,000 shares of common stock in the Company's pending S-8
registration statement, which shares shall be registered in the name of Xx.
Xxxxxxxxx and shall be freely tradeable upon the effective date of the S-8
registration statement.c) If the S-8 registration statement does not become
effective in a reasonable time period, then at Thorogood's option InnovaCom
shall issue to Thorogood a certificate for 40,000 shares of InnovaCom stock,.
and shall xxxxx Xxxxxxxxx piggyback registration rights for such shares.
InnovaCom shall cause such shares to be included in the next registration of
shares undertaken by InnovaCom or any successor, affiliate, or controlling
persons. The registration rights shall be in the
form of Exhibit A attached hereto, and made a part of this Agreement. In the
event that InnovaCom enters into a merger or acquisition with another entity,
whereby the InnovaCom shareholders do not have a controlling interest in the
surviving entity, the surviving entity shall have the responsibility to register
the options governed by this agreement within a reasonable time frame subsequent
to the completion of the transaction.
1.2 The parties acknowledge that the settlement consideration paid herein
is to fully resolve tort claims that Thorogood believes he has, including claims
for emotional distress.
1.3 Each party shall be responsible for their own fees and costs in
connection with the disputes being released hereunder.
2. GENERAL RELEASES
2.1 "Business Relationship". The term "Business Relationship," as used in
this Agreement, shall mean all prior business dealings between the Parties,
including without limitation, (a) any matters relating to the negotiation,
execution and delivery of the Contracts, and all documents and communications
ancillary thereto; (b) all conduct, actions, performance, and any alleged
failure to act or non-performance, of any of the Parties hereto under, pursuant
to, or in connection with the Contracts; (c) any alleged oral understanding,
implied agreement, course of conduct, commitment, or other legally enforceable
obligation under or relating to the Contracts, or the transactions
contemplated thereby, and (d) any discussions, negotiations or alleged
agreements purporting to compromise, release or settle an claims or disputes
between the parties hereto.
2.2 Release of InnovaCom by Thorogood. Effective upon receipt of the
consideration in Section 1.1, Thorogood, on behalf of himself and each of his
agents, attorneys, successors, and assigns, hereby acknowledges and agrees;
(a) that InnovaCom and each of its present or former directors, officers,
employees, shareholders, partners, managers, successors, affiliates, agents,
attorneys, successors and assigns, are hereby released from all claims, demands,
actions, causes of action, costs, fines, obligations, guaranties, losses or
damages (including punitive damages) arising from, relating to, or in any way
connected with the Business Relationship, and
(b) that each of Thorogood's agents and attorneys, successors and assigns,
are hereby released from all Claims arising from, relating to, or in any way
connected with the Business Relationship or the Actions but only to the extent
that such Claims are derivative of
2.3 Release of Thorogood by InnovaCom.
InnovaCom, on behalf of itself and each of its present or former directors,
officers, employees, shareholders, partners, managers,, affiliates, agents,
attorneys, successors, and assigns, hereby acknowledges and agrees
(a) that Thorogood and each of his agents and attorneys, successors and
assigns, are hereby released from all Claims arising from, relating to, or in
any way connected with the Business Relationship or the Actions, and
(b) that each of Thorogood's agents and attorneys, successors and assigns,
are hereby released from all Claims arising from, relating to, or in any way
connected with the Business Relationship or the Actions but only to the extent
that such Claims are derivative of Claims against Thorogood that are released in
2.3(a). For purposes of this section, a Claim against a party is "derivative" if
it arises from the party's relationship with Thorogood as to the Claims released
in 2.3(a), and does not arise from conduct or obligations of the party that is
independent of Thorogood or the Claims against Thorogood released herein.
For purposes of this section, "Claims" shall mean claims, demands, actions,
causes of action, costs, fines, obligations, guaranties, losses or damages
(including punitive damages);
2.4 Release of Unknown Claims. Each Party hereby waives any and all rights
and benefits which he or it now has or in the future may have conferred upon him
or it by virtue of the provisions of Section 1542 of the Civil Code of the State
of California, or any similar or comparable provision of law of any jurisdiction
which may now exist or hereafter be enacted and which may be applicable to the
subject matter of this Agreement. Said Section 1542 provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING
THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR.
3. OTHER PROVISIONS
3.1 Representations Concerning Authority and Binding Effect. By executing
and delivering this Agreement, each Party represents and warrants to each other
Party that (a) if such Party is a corporate or other entity, such representing
Party has taken all necessary action to authorize the execution and delivery of
this Agreement; (b) this Agreement has been executed and delivered by such
Party, or on such Party's behalf by such Party's duly authorized
representative(s); (c) this Agreement constitutes a valid and binding obligation
of such Party, enforceable against such Party in accordance with its terms; and
(d) such Party has not assigned any rights or claims released by such Party
herein to any other person or entity.
3.2 Further Assurances. Each Party agrees to execute and to deliver all
such other and additional agreements, instruments, releases, advice and
documents, and to take all such other actions, as any other Party hereto may
reasonably request, more fully to carry out the agreements and releases
contained herein.
3.3 Attorney's Fees and Costs. In the event that any Party, or any person
asserting claims, or who may in the future assert claims derivatively, or
otherwise through such Party, asserts a right or claim against a Party or
Parties that is determined by a court of competent
jurisdiction to have been released by this Agreement, the Party or Parties
against whom such claim is made shall have the right to recover from such
asserting Party, or from such Party through whom or which such claimant has
asserted such right or claim, all of such responding Party's or Parties'
reasonable attorneys' fees and costs incurred in defending against any such
claim. Any other dispute between the Parties under this Agreement shall entitle
the prevailing party to an award of its reasonable attorneys fees and costs.
3.4 No Other Agreements. This Agreement supersedes any and all prior
agreements between the parties, including without limitation any compromise,
settlement, release, employment, stock option, or consulting agreement, all of
which are hereby rendered null and void. This Agreement embodies the entire
agreement of the Parties relating to the subject matter hereof and there are no
other agreements or understandings relating to this matter other than as stated
in this Agreement. Each Party acknowledges that this Agreement is fully
integrated and not in need of parole evidence in order to reflect the intentions
of the Parties, and that such Party intends that the literal words of this
Agreement shall govern the transactions described herein and that all prior
negotiations, drafts and other extraneous communications have no significance or
evidentiary effect whatsoever.
3.5 No Waiver. This Agreement may not be modified, amended, terminated, or
waived except by a writing signed by each of the Parties. No course of conduct
shall have the effect of modifying, amending, terminating or waiving the terms
of this Agreement absent a writing signed by the Parties hereto.
3.6 Execution in Counterparts. This Agreement may be executed in any number
of counterparts, each of which, when so executed and delivered, shall be deemed
to be an original and all of which counterparts taken together shall constitute
but one and the same instrument.
3.7 Successors and Assigns. The terms of this Agreement shall inure to the
benefit of and shall be binding upon, the successors and assigns of each Party
hereto.
2.8 Severability. If any term or other provision of this Agreement is
rendered invalid, illegal or incapable of being enforced by any rule of law, or
public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any Party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the Parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the Parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the extent possible.
2.9 Governing Law. This Agreement shall be governed in all respects,
including validity, interpretation and effect, by the laws of the State of
California (excluding the choice-of-law rules thereof).
IN WITNESS WHEREOF, this Agreement has been executed and delivered by or
on behalf of each of the undersigned.
INNOVACOM APPROVED AS TO FORM:
By: __________________________ HELLER, EHRMAN, WHITE
& XxXXXXXXX
Its: __________________________ By: _____________________________
X.X. Xxxxx Xxxxxxxxx
Attorneys for InnovaCom, Inc.
XXXXX XXXXXXXXX APPROVED AS TO FORM:
XXXXXX, XXXX & XXXXXXXX LLP
By: _____________________________
Xxxxxxxx X. Xxxxxx
Attorneys for Xxxxx Xxxxxxxxx
