EXHIBIT 2.1
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SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
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This Settlement Agreement and Mutual General Release (the "Settlement
Agreement") is made as of May 14, 2003, by and between SEMOTUS SOLUTIONS, INC.
("Semotus") and XXXXXXX.XXX, INC. ("Wizshop"), on the one hand, and EARTHLINK,
INC., as successor in interest to EarthLink Network, Inc. and EarthLink
Operations, Inc. ("EarthLink"), and XXXXXX XXXXXXXXX ("Xxxxxxxxx"), on the
other hand, who are sometimes referred to herein separately as a "Party" or
collectively as the "Parties."
1. RECITALS
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1.1 On or about April 15, 2002, Wizshop filed a Verified Complaint
against EarthLink in the Los Angeles County Superior Court alleging causes of
action for breach of written agreement, promissory fraud, fraudulent
concealment, breach of fiduciary duty, constructive fraud, unfair business
practices, accounting and constructive trust (the "Complaint"). On or about
June 25, 2002, Wizshop filed a Verified First Amended Complaint and named
Xxxxxxxxx as a defendant in the Action. On or about July 30, 2002, EarthLink
filed a Verified Cross-Complaint against Wizshop (the "Cross-Complaint"). The
Complaint and Cross-Complaint are collectively referred to as the "Action."
Each of the Parties generally and specifically denies each of the claims filed
against it by the other Parties in the Action.
1.2 Due to the considerable time and expense that would be involved
in pursuing and defending the Action, each of the Parties desires to settle and
resolve all claims, disputes, issues or matters that exist between them. It is
understood and agreed that this settlement is the compromise of disputed claims
and that payment by EarthLink is not to be construed as an admission of
liability on the part of EarthLink or Xxxxxxxxx and that liability is expressly
denied.
WHEREFORE, for valuable consideration, including the promises as set
forth below, the Parties agree as follows:
2. PAYMENT
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2.1 EarthLink will pay Wizshop a total sum of Two Hundred Ten
Thousand Dollars ($210,000) (the "Settlement Sum"), by check made payable to
"Xxxxxx & Singer Client Trust Account" and delivered to the law firm of Xxxxxx
& Singer, 0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx, XX 00000, Attn:
Xxxxx Xxxx, by no later than 5:00 p.m. on May 19, 2003.
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2.2 Within five (5) days of receipt of the Settlement Sum, the
Parties will dismiss the Action in its entirety with prejudice as to all
Parties and causes of action, and with each Party to bear its own fees and
costs.
3. MUTUAL GENERAL RELEASE
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3.1 Except for the rights and obligations of the Parties set forth
in this Settlement Agreement, Semotus and Wizshop, for themselves and each of
their respective employees, corporations, subsidiaries, officers, directors,
shareholders, agents representatives, predecessors, successors, assigns, heirs,
attorneys and insurers, hereby absolutely and forever release and discharge
EarthLink and Xxxxxxxxx, and each of their respective officers, directors,
shareholders, members, employees, agents, representatives and subsidiaries,
including, but not limited to predecessors, successors, assigns, heirs, and
attorneys, and each of them, of and from any and all claims, demands, damages,
debts, liabilities, accounts, reckonings, obligations, costs (including
attorneys' fees), expenses, liens, promises, agreements, contracts, covenants,
actions and causes of action of every kind and nature whatsoever, from the
beginning of time until the date of this Settlement Agreement, including but
not limited to any and all claims set forth in the Action.
3.2 Except for the rights and obligations of the Parties set forth
in this Settlement Agreement, EarthLink and Xxxxxxxxx, for themselves and each
of their respective employees, corporations, subsidiaries, officers, directors,
shareholders, agents, representatives, predecessors, successors, assigns,
heirs, attorneys and insurers, hereby absolutely and forever release and
discharge Semotus and Wizshop, and each of their respective officers,
directors, shareholders, members, employees, agents, representatives and
subsidiaries, including, but not limited to each of their predecessors,
successors, assigns, heirs, attorneys and insurers, of and from any and all
claims, demands, damages, debts, liabilities, accounts, reckonings,
obligations, costs (including attorneys' fees), expenses, liens, promises,
agreements, contracts, covenants, actions and causes of action of every kind
and nature whatsoever, arising from, the beginning of time until the date of
this Settlement Agreement, including but not limited to any and all claims set
forth in the Action.
3.3 It is the intention of the Parties that this Settlement
Agreement shall be effective as a full and final accord and satisfaction and
release of all claims. In furtherance of this intention, the Parties, and each
of them, acknowledge familiarity
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with Section 1542 of the Civil Code of the State of California, which 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."
The Parties hereby waive and relinquish all rights and benefits which
any of them may have under Section 1542 of the Civil Code of the State of
California or the similar law of any other state or jurisdiction, to the full
extent that they may lawfully waive all such rights and benefits pertaining to
the matters released in this Settlement Agreement. The Parties are each aware
that any of them may hereafter discover facts in addition to, or different from,
those which he/it now knows or believes to be true with respect to the matters
released in this Settlement Agreement. The Parties hereby confirm that it is
their intention to hereby fully, finally, and forever settle and release any and
all released matters, disputes, and differences, known and unknown, suspected
and unsuspected, past and future, which now exist, may exist, or heretofore have
existed between them, and that, in furtherance of such intention, each of the
Releases herein given shall be and remain in effect as a full and complete
General Release of the matters released in this Settlement Agreement,
notwithstanding the discovery or existence of any such additional or different
facts.
6. NOTICES
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6.1 Any written notice, demand, request or communication that any
Party desires or is required to give to or serve on the other Party or any other
person pursuant to the Settlement Agreement shall be in writing and delivered
via facsimile AND one of the following methods:
6.1.1 Served or delivered directly to said Party or person
by handing a copy to him/it (conclusively deemed received on the day they are
served or delivered);
6.1.2 Sent by prepaid one-day early morning Express Mail,
Federal Express, or similar next-day morning delivery service and by facsimile
(conclusively deemed received one (1) business day after transmitted); or
6.1.3 Sent by prepaid certified, return receipt requested
mail to the address below and by facsimile (conclusively deemed received five
(5) business days after mailed).
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6.2 The date on which the last addressee is deemed to have received
the notice, demand, request, consent, approval or communications shall be deemed
the date of receipt by the Party to whom it is given to or served.
6.3 Any notice, demand, request, consent, approval or communication
that either Party desires or is required to give to the other Party is ordered
to be addressed and served on or delivered to the other Party at the address(es)
set forth below. Any Party may change his/its address by notifying the other
Parties of their change of address(es).
For Semotus
and Wizshop: Xx. Xxxx XxXxxx
Semotus Solutions, Inc.
00000 Xxxx Xxxxxx, #000
Xxx Xxxxx, Xxxxxxxxxx 00000
Facsimile No. (000) 000-0000
With a copy to: Xxxx X. Xxxxxx, Esq.
Xxxxxx & Singer, P.C.
0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile No. (000) 000-0000
For EarthLink: Xxx XxXxxxxx, Esq.
General Counsel
EarthLink, Inc.
0000 Xxxxxxxxx Xxxxxx XX
Xxxxxxx, Xxxxxxx 00000
Facsimile No. (000) 000-0000
With a copy to: Xxxxxxx Xxxxxxxxxx, Esq.
Xxxxxx, Xxxxxxx & Xxxx LLP
000 X. Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile: (000) 000-0000
For Xxxxxxxxx: Xx. Xxxxxx Xxxxxxxxx
c/o Xxxxx.xxx
0000 Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxx 00000
Facsimile: (000) 000 0000
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With a copy to: Xxxxxxx X. Xxxxxxxxxxxx, Esq.
Xxxxxx, Xxxxx & Xxxxxxxxx LLP
0000 Xxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Facsimile: (000) 000-0000
7. MISCELLANEOUS PROVISIONS
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7.1 NO ADMISSIONS. The Parties agree and acknowledge that this
Settlement Agreement represents a settlement of disputed claims and that, by
entering into this Settlement Agreement no Party admits or acknowledges that
they committed any wrongdoing.
7.2 BINDING EFFECT. This Settlement Agreement and all documents
referred to herein, shall bind and inure to the benefit of each of the Parties
hereto and their respective successors in interest. Except as expressly provided
herein, this Settlement Agreement is not for the benefit of any person not a
Party hereto or specifically identified as a beneficiary herein or specifically
identified herein as a person or entity released hereby, and is not intended to
constitute a third party beneficiary contract. A person or entity shall be
deemed specifically identified as a person or entity released hereby if such
person or entity is identified by name (e.g. "Xxxx Xxxxx") or category (e.g.
"heirs").
7.3 FINAL INTEGRATED AGREEMENT. This Settlement Agreement constitutes
the entire, final and binding understanding between the Parties hereto; that no
other statement or representation, written or oral, express or implied, has been
received or relied upon in the Settlement, and all prior discussions,
statements, and negotiations made or which have occurred prior to the date of
the Settlement Agreement shall be deemed merged into this Settlement Agreement
and the documents referred to herein, and shall not be used for any other
purpose whatsoever. No supplement, modification or amendment of this Settlement
Agreement shall be binding unless executed in writing by all the Parties.
7.4 VOLUNTARY SETTLEMENT. Each Party enters into this Settlement
Agreement knowingly and voluntarily, in the total absence of any fraud, mistake,
duress, coercion, or undue influence and after careful thought and reflection
upon the Settlement. Each Party to this Settlement Agreement represents and
warrants that no other Party, or any agent or attorney of any other Party, has
made any promise, representation or warranty, whether express or implied, not
expressly contained herein, to induce the Parties to enter into and execute this
Agreement.
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7.5 CALIFORNIA LAW. This Settlement Agreement shall be governed by
and construed and interpreted in accordance with, the laws of the State of
California, and the Parties agree to jurisdiction in Los Angeles, California.
Any action to enforce or interpret this Settlement Agreement may be brought only
in the Superior Court of California, County of Los Angeles, Central District. In
the language of this document, the singular and plural numbers, and the
masculine, feminine and neuter genders, shall each be deemed to include all
others, and the word "person" shall be deemed to include corporations and every
other entity, as the context may require.
7.6 MULTIPLE COUNTERPARTS. This Settlement Agreement, and any
document referred to herein, may be executed in any number of counterparts and
by facsimile, each of which may be deemed an original and all of which together
shall constitute a single instrument.
[SIGNATURES FOLLOW.]
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IN WITNESS WHEREOF, the Parties to this Settlement Agreement execute this
Settlement Agreement as of the date first written above.
Date: May 16, 2003 SEMOTUS SOLUTIONS, INC.
By: /s/ Xxxx XxXxxx
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Xxxx XxXxxx
Chief Executive Officer
Date: May 16, 2003 XXXXXXX.XXX, INC.
By: /s/ Xxxx XxXxxx
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Xxxx XxXxxx
Chief Executive Officer
Date: May 15, 2003 EARTHLINK, INC., successor in interest to
EarthLink Network, Inc. and EarthLink Operations,
Inc.
By: /s/ Xxx Xxxxxx
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Xxx Xxxxxx
Chief Financial Officer and
Executive Vice President of Finance and
Administration
Date: May 19, 2003 /s/ Xxxxxx Xxxxxxxxx
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XXXXXX XXXXXXXXX
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