SETTLEMENT AND AMENDMENT AGREEMENT
EXHIBIT
10.8
|
SETTLEMENT
AND AMENDMENT
AGREEMENT
|
and
OXFORDSVI,
INC.
and
SVI
HEALTHCARE, INC.
and
XXXXXX
X. AND XXX X. XXXXXX
and
THE
MARITAL TRUST UNDER THE XXXXXXX X. XXXXX
TRUST
DATED NOVEMBER 24, 1992
and
XXXXXX
XXXXXXXXXX
_____________,
2007
I
PARTIES
THIS
SETTLEMENT AND AMENDMENT AGREEMENT (the “Agreement”) is entered into as
of the day of ____________, 2007 (the “Effective Date”), by and between OXFORD
MEDIA, INC., a Nevada corporation (“OXMI”); and, OXFORDSVI, INC. (formerly known
as SVI HOTEL CORPORATION), an Illinois corporation (“OxfordSVI”);
and, SVI HEALTHCARE, INC. (formerly known as SVI
SYSTEMS, INC.), an Illinois corporation (“Healthcare”); XXXXXX X. and XXX X.
XXXXXX (collectively “Xxxxxx”); THE MARITAL TRUST UNDER THE XXXXXXX X. XXXXX
TRUST DATED NOVEMBER 24, 1992 (“Xxxxx Trust”); and XXXXXX XXXXXXXXXX
(“Xxxxxxxxxx”). Xxxxxx, Xxxxx Trust, and Xxxxxxxxxx are sometimes collectively
referred to herein as the “SVI Sellers”, and each individually as an “SVI
Seller”. The SVI Sellers and Healthcare are sometimes collectively referred
to
herein as the “SVI Parties”, and each individually as an “SVI Party”. OXMI and
OxfordSVI are sometimes collectively referred to herein as the “Oxford Parties”,
and each individually as an “Oxford Party”. The Oxford Parties and the SVI
Parties are sometimes referred to collectively herein as the “Parties”, and each
individually as a “Party”.
II
RECITALS
A.
OXMI and Healthcare previously entered into that
certain Stock Purchase Agreement dated July 19, 2006 (the “Stock Purchase
Agreement”), under which OXMI acquired all of the issued and outstanding shares
of stock of OxfordSVI.
B.
In connection with the Stock Purchase Agreement, OXMI issued a
series of promissory notes in favor of the SVI Sellers, collectively
represented
by six (6) promissory notes in the total original principal balance of
$2,450,000 (collectively, the “SVI Notes”).
C.
Pursuant to and in satisfaction of a condition of the Stock Purchase
Agreement, OxfordSVI and Healthcare entered into that certain Services
and
Support Agreement dated July 20, 2006 (the “Services Agreement”).
D.
Pursuant to and in satisfaction of a condition of the Stock Purchase
Agreement, OxfordSVI and Healthcare entered into that certain Sublease
Agreement
dated July 20, 2006 (the “Sublease”).
E.
Pursuant to and in satisfaction of a condition of the Stock Purchase
Agreement,
the SVI Sellers were granted warrants to acquire a total of one million
(1,000,000) shares of OXMI common stock (collectively, the
“Warrants”).
F.
All capitalized terms used herein and not otherwise defined shall have
the
meanings assigned to such terms in the Stock Purchase Agreement, the
Services
Agreement, and the Sublease, as applicable.
1
G.
The Oxford Parties believe that OXMI
is entitled to certain offsets under the Stock Purchase Agreement and
that OXMI
does not owe any monies under any of the SVI Notes. The SVI Parties believe
that
no such offsets are available and that monies are currently due and owing
under
the SVI Notes.
H.
The Oxford Parties believe that OxfordSVI is
entitled to certain offsets under the Services Agreement and the Sublease.
The
SVI Parties believe that no such offsets are available under the Services
Agreement or the Sublease.
I.
This Agreement is to specifically encompass all of the
claims and related factual and legal circumstances noted above (collectively
referred to as the “Disputes”), as well as to reflect certain aspects of the
Parties’ relationship relating to a pending recapitalization of the Oxford
Parties.
J.
All Parties are desirous of settling the Disputes and
releasing each other from all liability related to the Disputes provided
the
terms and conditions outlined below are satisfied.
K.
NOW, THEREFORE, in
consideration of the promises and the mutual covenants contained herein,
and for
other good and valuable consideration, the receipt and sufficiency of
which are
hereby acknowledged, the Parties, intending to be legally bound, hereby
agree as
follows:
III
RELEASE
3.1 Mutual
Release. In consideration of the execution of this Agreement, the
satisfaction of the terms and conditions of this Agreement, and other
good and
valuable consideration, the receipt and value of which is hereby confirmed,
effective as of the Effective Date, the Oxford Parties, and each of them,
hereby
fully, finally, and forever settle and release the SVI Parties and their
respective directors, officers, shareholders, affiliates, attorneys,
agents,
successors and assigns, and the SVI Parties, and each of them, hereby
fully,
finally, and forever settle and release the Oxford Parties and their
respective
directors, officers, shareholders, affiliates, attorneys, agents, successors
and
assigns, from any and all claims, losses, fines, penalties, damages,
demands,
judgments, debts, obligations, interests, liabilities, causes of action,
breaches of duty, costs, expenses, judgments and injunctions of any nature
whatsoever, whether known or unknown, from all relationships between
the
Parties, specifically including, but not limited to, the Disputes as
of the
Effective Date and specifically including, but not limited to, any claims
or
defenses arising out of the Stock Purchase Agreement as of the Effective
Date
(cumulatively referred to as the “Released Claims”). The Released Claims shall
expressly not include any matters arising out of facts and circumstances
arising
or accruing after the Effective Date, and shall not include any matters
arising
out of this Agreement.
3.2 Oxford
Hold Harmless. Each of the Oxford Parties, for himself, herself,
itself, their heirs, executors, administrators, successors, and assigns,
hereby
agrees to indemnify and hold harmless each of the SVI Parties, and their
respective directors, officers, shareholders, affiliates, attorneys,
agents,
successors and assigns, from and against any and all claims of every
nature and
kind whatsoever relating to or arising out of the business of OxfordSVI,
including any claims which any third party might have or might conceivably
assert against any of the SVI Parties as result of the Stock Purchase
Agreement
or the conduct of the business of OxfordSVI and its predecessor SVI Hotel
Corporation prior to the Effective Date (whether prior to or after the
Closing
under the Stock Purchase Agreement).
2
3.3 After
Acquired Information. The Parties acknowledge that they may
hereafter discover information, facts, or circumstances different from
or in
addition to those which they now know or believe to be true. This Agreement
shall remain in full force and effect in all respects notwithstanding
such
discovery, and the Parties expressly accept and assume the risk of such
possible
additions to or differences from those facts now known or believed to
be
true.
3.4 Assignment
of Released Claims. The Parties hereby covenant that none of the
Released Claims has been assigned to any other person, and that no other
person
has any interest in any of the Released Claims. In the event any other
person
asserts any interest with respect to the Released Claims, then the Party
breaching this covenant shall indemnify the Party against whom such claim
is
asserted for any and all damages, costs, and fees.
3.5 No
Admission of Liability. Notwithstanding the terms and conditions of
this Agreement, execution hereof shall in no manner or form constitute
the
admission of liability or responsibility of either Party in respect to
the
Disputes.
3.6 Independent
Legal Counsel. The Parties to this Agreement warrant, represent,
and agree that in executing this Agreement, they do so with full knowledge
of
the rights each may have with respect to the other Parties, and that
each has
received, or has had the opportunity to receive, independent legal advice
as to
these rights. Each of the Parties has executed this Agreement with full
knowledge of these rights, and under no fraud, duress, or undue
influence.
IV
TREATMENT
OF SVI NOTES, WARRANTS, AND RELATED RIGHTS
4.1 Exchange
Agreement. Concurrent with the execution of this Agreement, the SVI
Sellers shall execute that certain Securities Exchange Agreement, attached
hereto as Exhibit 4.1 and incorporated herein by reference (the “Exchange
Agreement”).
4.1.1. Application.
The SVI Sellers hereby agree to be bound by all applicable terms and
conditions
of the Exchange Agreement.
4.1.2. Conflicts.
In the event of any conflict between this Agreement and the Exchange
Agreement,
the terms and conditions of the Exchange Agreement shall expressly
control.
4.1.3. Breach.
A material breach of the Exchange Agreement by OXMI shall be deemed a
material
breach of this Agreement as well up to and until such breach is cured,
if at
all, by OXMI.
4.2 SVI
Notes. Each and all of the SVI Notes shall be converted as provided
under the Exchange Agreement. Thereafter, the SVI Notes shall be deemed
to have
been “converted”, as that term is commonly defined in a business context, and of
no further force and effect.
3
4.3 Warrants.
Each and all of the Warrants shall be exercised as provided under the
Exchange
Agreement, which shall be on a “cash-less” basis, as that term is commonly
defined in a business context. Thereafter, the Warrants shall be deemed
to have
been “exercised”, and of no further force and effect.
4.4 Board
Observer Rights. The Board Observer rights granted to Healthcare
under the Section 15.5 of the Stock Purchase Agreement shall remain in
full
force and effect through 31 December 2009. In all other respects, the
provisions
of Section 15.5 of the Stock Purchase Agreement shall remain
unchanged.
V
AMENDMENT
OF SERVICES AGREEMENT
5.1 Agreed
Upon Changes and Terms. With regard to the Services Agreement, the
Parties hereby agree to the following amendments and provisions:
(a) As of
July 1, 2007, the Parties agree that neither Party owes the other Party any
amounts in regard to the Credit set forth in Section 5.6 of the Services
Agreement or any other amounts under the Services Agreement, except to
the
extent of the Credit set forth in subsection (b) below.
(b) From and
after July 1, 2007, the available Credit under Section 5.6 shall be Seven
Hundred Fifty Thousand Dollars ($750,000), which may be used as
follows:
(i)
A maximum of One Hundred Fifty Hundred Thousand Dollars
($150,000) of the Credit may be applied after the Effective Date up to
and until
December 31, 2007.
(ii) A
maximum of Two Hundred Fifty Hundred Thousand Dollars ($250,000) of the
Credit
may be applied during calendar year 2008.
(iii) A
maximum of Two Hundred Fifty Hundred Thousand Dollars ($250,000) of the
Credit
may be applied during calendar year 2009.
(iv) The
remainder, including rollover amounts pursuant to clause (v), below, (but
not to exceed Two Hundred Fifty Thousand Dollars ($250,000)) of the Credit
may
be applied during calendar year 2010.
(v) To
the extent that any portion of the available Credit for a specific calendar
year
is not exhausted in that calendar year, the unused portion shall “roll-over” to
future calendar years, although the amount of Credit used in any successive
year
shall not exceed Two Hundred Fifty Thousand Dollars ($250,000).
(vi Any
portion of the Credit remaining after December 31, 2010 may be applied
in the
same fashion under the Services Agreement through and until December
31, 2012,
and again subject to the same yearly limitation of Two Hundred Fifty
Thousand
Dollars ($250,000).
4
(vii) To
the extent that the full amount of the Credit is not exhausted by December
31,
2012, there shall be no further carry-over and no further payment or
Credit
available or due.
(c) The
cost for all Field Services provided under the Services Agreement pursuant
to
the Field Service Support Agreement, which is attached as an Exhibit
to the
Services Agreement, shall be determined on a “most favored nation status”; the
prices charged for Field Service Support will be no less favorable in
any
material respect than the fees or prices charged to any other customer
entering into an agreement with the Oxford Parties with respect to Field
Service
Support, such that the price charged to SVI Parties will be the lower
of the
prices set forth in the Field Service Support Agreement (if applicable)
and the
prices charged to any other customer. Should the Oxford Parties enter
into an
agreement with another customer (other than an Affiliate of the Oxford
Parties)
providing more favorable prices for some or all of said services, then
the price
charged Healthcare will be automatically amended to provide the same
more
favorable prices. The Oxford Parties shall give Healthcare at least
sixty (60) days’ notice of any price increases to be effective after
December 31, 2008.
(d) Subject
to the limitations set forth above and in the Sublease, the Credit may
be used
against any amounts due from Healthcare under the Services Agreement,
except
that the Credit may not be used against any purchases of new tangible
assets
purchased specifically at the request of Healthcare.
(e) The
dispute resolution and notice provisions of the Services Agreement shall
be
modified as set forth in Sections 7.5, 7.13 and 7.15 of this
Agreement.
5.2 Remaining
Terms and Conditions. Except as specifically amended by this
Agreement, each and every term, covenant, and condition contained in
the
original Services Agreement shall persist and remain in full force and
effect.
VI
AMENDMENT
OF SUBLEASE
6.1 Agreed
Upon Changes and Provisions. With regard to the Sublease, the
Parties hereby agree to the following amendments and provisions:
(a) Pursuant
to Section 5.5 of the Sublease, the Credit may be used for the payment
of all
amounts due under the Sublease, except that no more than Five Thousand
Dollars
($5,000) per month may be applied from the Credit against the payment
of
utilities, common area maintenance expenses, and maintenance supplies.
The
availability of the Credit to be applied under the Sublease shall survive
the
termination of the Services Agreement, but in no event later than December
31,
2012.
(b) The
Term of the Sublease shall be contemporaneous with the occupancy of the
Premises
by any of the Oxford Parties, terminable at any time by Healthcare upon
90-days
advance written notice, unless the Sublease is terminated earlier due
to the
breach of the Agreement by Healthcare.
5
(c) The
dispute resolution and notice provisions of the Sublease shall be modified
as
set forth in Sections 7.5, 7.13 and 7.15 of this Agreement.
6.2 Remaining
Terms and Conditions. Except as specifically amended by this
Agreement, each and every term, covenant, and condition contained in
the
original Sublease shall persist and remain in full force and
effect.
VII
ADDITIONAL
PROVISIONS
7.1 Executed
Counterparts. This Agreement may be executed in any number of
counterparts, all of which when taken together shall be considered one
and the
same agreement, it being understood that all Parties need not sign the
same
counterpart. In the event that any signature is delivered by fax or by
e-mail
delivery of a “.pdf” or comparable format data file, such signature shall create
a valid and binding obligation of the Party executing (or on whose behalf
such
signature is executed) with the same force and effect as if such facsimile
or
“.pdf” signature page were an original thereof. Each of the Parties hereby
expressly forever waives any and all rights to raise the use of a fax
machine or
e-mail to deliver a signature, or the fact that any signature or agreement
or
instrument was transmitted or communicated through the use of a fax machine
or
e-mail, as a defense to the formation of a contract.
7.2 Successors
and Assigns. Except as expressly provided in this Agreement, each
and all of the covenants, terms, provisions, conditions and agreements
herein
contained shall be binding upon and shall inure to the benefit of the
successors
and assigns of the Parties hereto.
7.3 Article
and Section Headings. The article and section headings used in this
Agreement are inserted for convenience and identification only and are
not to be
used in any manner to interpret this Agreement.
7.4 Severability.
Each and every provision of this Agreement is severable and independent
of any
other term or provision of this Agreement. If any term or provision hereof
is
held void or invalid for any reason by a court of competent jurisdiction,
such
invalidity shall not affect the remainder of this Agreement.
7.5 Governing
Law. This Agreement shall be governed by the laws of the State
of
New York, without giving effect to any choice or conflict of law provision
or
rule (whether of the State of New York or any other jurisdiction) that
would
cause the application of the laws of any jurisdiction other than the
State of
New York.
7.6 Entire
Agreement. This Agreement, and all references, documents, or
instruments referred to herein, contains the entire agreement and understanding
of the Parties hereto in respect to the subject matter contained herein.
The
Parties have expressly not relied upon any promises, representations,
warranties, agreements, covenants, or undertakings, other than those
expressly
set forth or referred to herein. This Agreement supersedes any and all
prior
written or oral agreements, understandings, and negotiations between
the Parties
with respect to the subject matter contained herein.
6
7.7 Additional
Documentation. The Parties hereto agree to execute, acknowledge,
and cause to be filed and recorded, if necessary, any and all documents,
amendments, notices, and certificates which may be necessary or convenient
under
the laws of the State of Illinois.
7.8 Attorney’s
Fees. If any legal action (including arbitration) is necessary
to
enforce the terms and conditions of this Agreement, the prevailing Party
shall
be entitled to costs and reasonable attorney’s fees.
7.9 Amendment.
This Agreement may be amended or modified only by a writing signed by
all
Parties.
7.10 Remedies. The
remedies of the Parties under this Agreement are cumulative and shall
not
exclude any other remedies to which any person may be lawfully
entitled.
7.11 Waiver.
No failure by any Party to insist on the strict performance of any covenant,
duty, agreement, or condition of this Agreement or to exercise any right
or
remedy on a breach shall constitute a waiver of any such breach or of
any other
covenant, duty, agreement, or condition.
7.12 Assignability.
This Agreement is not assignable by either Party without the expressed
written
consent of all Parties.
7.13 Notices.
All notices, requests and demands hereunder shall be in writing and delivered
by
hand, by facsimile transmission, by e-mail, or by recognized commercial
over-night delivery service (such as Federal Express, UPS, or DHL), and
shall be
deemed given as of the time and date reflected on the delivery receipt
customary
for such means of transmission, if one exists.
7.14 Time.
All Parties agree that time is of the essence as to this Agreement.
7.15 Disputes.
The Parties agree that the dispute resolution procedures (INCLUDING VENUE
PROVISIONS AND WAIVERS OF JURY TRIAL, EACH OF WHICH IS SPECIFICALLY REAFFIRMED)
set forth in Section 5.9 of the Exchange Agreement shall govern in the
event of any disputes or controversies arising under this Agreement,
the
Exchange Agreement, the Services Agreement, the Sublease, or any other
document
executed in connection with the transactions contemplated hereby.
7.16 Provision
Not Construed Against Party Drafting Agreement. This Agreement is
the result of negotiations by and between the Parties, and each Party
has had
the opportunity to be represented by independent legal counsel of its
choice.
This Agreement is the product of the work and efforts of all Parties,
and shall
be deemed to have been drafted by all Parties. In the event of a dispute,
no
Party hereto shall be entitled to claim that any provision should be
construed
against any other Party by reason of the fact that it was drafted by
one
particular Party.
7.17 Incorporation
of Exhibits and Schedules. The Exhibits and Schedules identified in
this Agreement are incorporated herein by reference and made a part hereof
as if
set out in full herein.
7.18 Recitals.
The facts recited in Article II, above, are hereby conclusively presumed
to be
true as between and affecting the Parties.
7
7.19 Consents,
Approvals, and Discretion. Except as herein expressly provided to
the contrary, whenever this Agreement requires consent or approval to
be given
by a Party, or a Party must or may exercise discretion, the Parties agree
that
such consent or approval shall not be unreasonably withheld, conditioned,
or
delayed, and such discretion shall be reasonably exercised. Except as
otherwise provided herein, if no response to a consent or request for
approval
is provided within ten (10) days from the receipt of the request, then
the
consent or approval shall be presumed to have been given.
7.20 No
Third Party Beneficiaries. This Agreement has been
entered into solely by and between the Parties, solely for their benefit.
There
is no intent by either Party to create or establish a third party beneficiary
to
this Agreement, and no such third party shall have any right to enforce
any
right, claim, or cause of action created or established under this
Agreement.
7.21 Best
Efforts. The Parties shall use and exercise their best efforts,
taking all reasonable, ordinary and necessary measures to ensure an orderly
and
smooth relationship under this Agreement, and further agree to work together
and
negotiate in good faith to resolve any differences or problems which
may arise
in the future.
7.22 Definitional
Provisions. For purposes of this Agreement, (i) those words, names,
or terms which are specifically defined herein shall have the meaning
specifically ascribed to them; (ii) wherever from the context it appears
appropriate, each term stated either in the singular or plural shall
include the
singular and plural; (iii) wherever from the context it appears appropriate,
the
masculine, feminine, or neuter gender, shall each include the others;
(iv) the
words “hereof”, “herein”, “hereunder”, and words of similar import, when used in
this Agreement, shall refer to this Agreement as a whole, and not to
any
particular provision of this Agreement; (v) all references to designated
“Articles”, “Sections”, and to other subdivisions are to the designated
Articles, Sections, and other subdivisions of this Agreement as originally
executed; (vi) all references to “Dollars” or “$” shall be construed as being
United States dollars; (vii) the term “including” is not limiting and means
“including without limitation”; and, (viii) all references to all statutes,
statutory provisions, regulations, or similar administrative provisions
shall be
construed as a reference to such statute, statutory provision, regulation,
or
similar administrative provision as in force at the date of this Agreement
and
as may be subsequently amended.
[Signature
Page Follows]
8
V
EXECUTION
IN
WITNESS WHEREOF, this SETTLEMENT AND AMENDMENT AGREEMENT has been duly
executed by the Parties and shall be effective as of and on the Effective
Date
set forth in Article I of this Agreement. Each of the undersigned Parties
hereby
represents and warrants that it (i) has the requisite power and authority
to
enter into and carry out the terms and conditions of this Agreement,
as well as
all transactions contemplated hereunder; and, (ii) it is duly authorized
and
empowered to execute and deliver this Agreement.
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OXMI:
|
OXFORDSVI:
|
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OXFORDSVI,
INC.,
|
|
|
a
Nevada corporation
|
an
Illinois corporation
|
|
BY: __________________________
|
BY: __________________________
|
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NAME: _______________________
|
NAME: _______________________
|
|
TITLE:
_______________________
|
TITLE:
_______________________
|
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DATED: ______________________
|
DATED: ______________________
|
|
HEALTHCARE:
|
XXXXXX:
|
|
SVI
HEALTHCARE, INC.,
|
|
|
an
Illinois corporation
|
__________________________
|
|
XXX
X. XXXXXX
|
|
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DATED: ______________________
|
|
|
BY: __________________________
|
|
|
NAME: _______________________
|
|
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TITLE:
_______________________
|
__________________________
|
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DATED: ______________________
|
XXXXXX
X. XXXXXX
|
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DATED: ______________________
|
|
|
XXXXX
TRUST:
|
XXXXXXXXXX:
|
|
THE
MARITAL TRUST UNDER THE
|
|
|
XXXXXXX
X. XXXXX TRUST DATED
|
__________________________
|
|
NOVEMBER
24, 1992
|
XXXXXX
XXXXXXXXXX
|
|
DATED: ______________________
|
|
|
BY: __________________________
|
|
|
NAME: _______________________
|
|
|
TITLE:
_______________________
|
|
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DATED: ______________________
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