EXHIBIT 10.21
Mutual Release between Teleca and Geoworks dated February 1, 2003
Parties
The parties to this Release are
Geoworks Corporation, a Delaware USA corporation, with its principal place of
business as 0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000, and
Teleca Ltd, a UK registered company with its principal place of business as 000
Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxx X00 0XX, XX
1. Background
Teleca and Geoworks have signed a non-disclosure agreement dated May 2002 (the
"NDA") prior to Teleca and Geoworks entering discussions on the sale of
Geoworks' UK subsidiary. These discussions concluded in an Agreement to Purchase
Shares dated September 23, 2002 (the September Agreement). As Geoworks was not
able to attain a quorate number of shareholder votes to approve the transaction,
the September Agreement expired. Included in these prior agreements are
confidentiality provisions and mutual non-solicitation clause preventing either
party hiring the staff of the other.
The current situation has resulted in considerable uncertainty for the UK
Geoworks staff. Given the combination of Geoworks unstable financial situation,
protracted uncertainty over shareholder approval of the September Agreement and
known aggressive staff poaching activities by third party companies interested
in the telecoms skills of Geoworks staff, it is likely that the UK staff will
very quickly find alternative employment and the UK business will become
unsustainable.
In an effort to minimize its potential liability to employees, creditors and
customers of the UK operation, Geoworks plans to terminate its UK operations,
This agreement therefore allows Teleca the right to hire the UK employees and
deal with customers on the terms described below.
2. Right to offer employment and hire
Teleca will offer immediate employment to all of the UK employees, and may pay
signing on bonuses to the employees to encourage their transfer in addition to
the sums covered in this agreement. . The parties will use their best efforts to
transition employment coincident with this Release or as soon thereafter as is
practical. By so doing, for all practical purposes, Geoworks Ltd. will be
relieved of substantial contractual and statutory severance liability assuming
general acceptance by employees.
3. Release
Geoworks will waive all claims against Teleca for breach of the NDA, including
(but not limited to) terms with respect to hiring and soliciting staff, and the
use of confidential information in connection with hiring or soliciting staff.
Geoworks further waives the right to claim compensation (other than set out in
this agreement) that might be due as a result of Teleca soliciting or hiring
Geoworks staff from any other agreements in force (including but not limited to
the September Agreement.), and any implied, unwritten or verbal agreements, or
general duty's and obligations under law. This release applies to staff at
Geoworks and all Geoworks wholly owned subsidiaries. By signing this release,
Geoworks agrees that the payment described in this agreement is full and fair
payment for waiving its accrued rights to date in this matter, and allowing
Teleca to obtain whatever business benefits it may by this release. This release
does not release Teleca from any obligations created by this release, however.
4. Customers
Geoworks will not assign or subcontract any customer contracts to Teleca,
however, Teleca is free to offer to complete existing project orders through
March 31, 2003 on existing terms by separate agreement with customers or at
Geoworks' direction. Teleca is also free to solicit such other business with
customers other than Toshiba as it deems desirable. Teleca will not solicit
Toshiba's business without Geoworks' prior written approval. . In no event will
Teleca disclose or use any customer confidential information except as
authorized by the customer.
5. Compensation
Teleca will pay Geoworks Corporation the sum of (pound)320,000 as consideration
for the benefits they may receive from Geoworks' releases, payable one half
coincident with this release by wire transfer and the balance on the ninety
first day after such date, all without offset or deduction. Late payments bear
interest at the rate of one percent per month or any lower legal maximum.
6. Release of Geoworks
Teleca and its affilates release Geoworks, its affiliates, officers, directors,
employees, shareholders, agents and attorneys (collectively Geoworks' Related
Parties) from all claims related to the NDA and the September Agreement. This
Release does not apply to the express obligations created by this release,
however .
7. Other terms
Neither party is providing any representations or warranties in connection with
this release, and this release is the parties entire agreement with respect to
its subject matter. Geoworks is not guarantying that any number of employees are
going to go to work for Teleca for any period of time, nor is Teleca guarantying
that any number of employees are going to work for Teleca for any period of
time. Despite the foregoing, Teleca will indemnify, defend and hold Geworks and
its Related Parties harmless from all loss, liability, claims and expense
(collectively "Claims") related to the UK lease (with Orbit Investment
[Properties] Limited dated November 22, 1996) and the use of disposition of the
leased premises and all personal property located there, despite any provision
of the Exchange Agreement between Teleca and Geoworks subsidiary, Geoworks Ltd.
No intellectual property, accounts receivable or payable (or other liabilities)
or contracts are being transferred or assumed. Each party agrees to cooperate
with the other party's reasonable requests to prepare and execute such
additional documentation or assurances as may be required to implement the
provisions of this release in a manner that lawfully minimizes each party's
liability to third parties. Lawful and adequate consideration is acknowledged.
The contract shall be interpreted under English law and each party hereby
submits to the non-exclusive jurisdiction of the English Courts. .
Signed................................................
For and on behalf of Teleca Ltd
Signed................................................
For and on behalf of Geoworks Corporation
