Exhibit 10.1
SETTLEMENT AGREEMENT AND MUTUAL RELEASE
----------------------------------------
This Settlement Agreement and Mutual Release (the "Agreement") is
entered into by and among Canterbury Consulting Group, Inc. ("Canterbury")
and User Technology Services, Inc. ("Usertech") (Canterbury and Usertech
are collectively, "CITI"), and Ceridian Corporation ("Ceridian"). The
Agreement is as follows:
WHEREAS, on or about Xxxxxx 0, 0000, Xxxxxxxxxx made a Demand for
Arbitration against Ceridian with the American Arbitration Association
("AAA");
WHEREAS, AAA assigned that demand Case Xx. 00 X 000 00000 03 (the
"Arbitration");
WHEREAS, in the Arbitration, Canterbury alleged counts against
Ceridian of breach of contract/warranty; fraud; fraudulent concealment,
constructive/equitable fraud; negligent misrepresentation; and
indemnification, ("Canterbury's Claims") all related to a Stock Purchase
Agreement (the "SPA") between Canterbury and Ceridian dated September 28,
2001. Canterbury acquired all the stock in Usertech from Ceridian pursuant
to the SPA;
WHEREAS, Ceridian filed counterclaims in the Arbitration against
Canterbury and Usertech alleging that Canterbury defaulted on payments
under a Promissory Note (the "Note") entered into in connection with the
SPA, and that Usertech defaulted under a Sublease of office space in East
Norwalk, Connecticut (the "Sublease") entered into in connection with the
SPA (the "Counterclaims");
WHEREAS, Ceridian sought damages including principal amounts,
interest, attorneys' fees and costs in the Counterclaims, which at this
time total in aggregate $1,354,000.00;
WHEREAS, on October 1, 2004, Ceridian and CITI agreed to amicably
settle the Counterclaims, Canterbury's Claims and all other claims between
them, and this Agreement documents and sets forth the terms of that
Agreement;
NOW THEREFORE, incorporating the background as set forth above, for
and in consideration of the releases, payments and other valuable
consideration and agreements contained in this Agreement, Ceridian and
CITI, intending to be legally bound, hereby agree as follows:
1. CITI and Ceridian agree that after the parties have signed this
Agreement the arbitration panel shall dismiss this Arbitration without
prejudice. After ninety-one (91) days from the effective date of this
Agreement, the Arbitration shall be dismissed with prejudice provided that
CITI has not filed, or had filed against it, a bankruptcy petition,
assignment for the benefit of creditors or similar proceeding under the
insolvency laws of any state. CITI and Ceridian shall each pay their own
attorneys' fees and costs, and the fees and costs of the arbitrators will
be divided equally.
2. In satisfaction of the Counterclaims, CITI agrees to deliver to
Ceridian by wire transfer, the sum of $912,000.00 (Nine Hundred Twelve
Thousand Dollars) in U.S. funds. CITI made this wire transfer on October
4, 2004, which shall be the effective date of this Agreement, regardless of
when the parties execute it, except as otherwise set forth herein.
3. Except as provided for in this Agreement, in exchange for the
compensation, release and other valuable consideration provided to it
herein, CITI, on behalf of itself and its successors, predecessors,
assigns, agents, representatives, trustees, employees, officers, directors,
parents, shareholders, subsidiaries, attorneys, partners, joint venturers,
servants and affiliates (collectively, the "CITI Parties"), hereby
releases, remises, acquits and forever discharges Ceridian, and each of its
successors, predecessors, assigns, agents, trustees, representatives,
employees, officers, directors, parents, subsidiaries, attorneys, partners,
joint venturers, servants and affiliates (collectively, the "Ceridian
Parties") from any and all currently existing claims, counterclaims,
rights, demands, costs, damages, losses, liabilities, actions and causes of
actions, including, but not limited to, any claim for attorneys' fees,
whether known or unknown, suspected or unsuspected, foreseen or unforeseen,
real or imaginary, actual or potential, arising from any action, omission
or conduct of the Ceridian Parties, as defined above, from the date of this
Agreement back to the beginning of the world including, but not limited to,
those relating to Canterbury's Claims in the Arbitration, except that this
release shall not apply to the performance or enforcement of this Agreement
or any claims CITI may have against E. Xxxx Xxxxx arising out of his
actions as an employee, officer or agent of Canterbury under his Employment
Agreement with CITI dated September 28, 2001 (however, all claims related
to any actions E. Xxxx Xxxxx took or failed to take as an alleged agent,
officer or employee of Ceridian are released hereby).
4. Except as provided for in this Agreement, in exchange for the
compensation, release and other valuable consideration provided to it
herein, the Ceridian Parties, as defined above in paragraph 3, hereby
release, remise, acquit and forever discharge the CITI Parties, as defined
above in paragraph 3, of and from any and all currently existing claims,
counterclaims, cross-claims, rights, demands, costs, damages, losses,
liabilities, actions and causes of actions, including, but not limited to,
any claim for attorneys' fees, whether known or unknown, suspected or
unsuspected, foreseen or unforeseen, real or imaginary, actual or
potential, arising from any action, omission or conduct of the CITI
Parties, as defined above, from the date of this Agreement back to the
beginning of the world, including, but not limited to, those relating to
the allegations of the Counterclaims in the Arbitration, except that this
release shall not apply to the performance or enforcement of this
Agreement. The only other exception to this release is that for a period
of ninety-one (91) days from the effective date of this Agreement as set
forth in paragraph 2 of this Agreement, Ceridian shall not be deemed to
have released the Counterclaims. Upon the expiration of the aforesaid 91-
day period, and provided that no bankruptcy, assignment for the benefit of
creditors or insolvency proceeding has been initiated by or against CITI in
the interim, the release of the Counterclaims shall take effect.
5. By execution of this Agreement, Ceridian and CITI warrant and
represent that (1) each party to this Agreement has the full power and
authority to enter into and to perform its obligations; (2) that each
undersigned officer, director, member, partner, agent and/or attorney has
the full power and authority to execute and deliver this Agreement on
behalf of the party for whom said person executes this Agreement; and (3)
this Agreement represents the valid, binding and enforceable obligation of
each party to it. Separately, and, in addition, CITI hereby also
represents and warrants that neither CITI, nor its officers and/or agents
on its behalf, have filed, or taken any step toward filing on behalf of
Canterbury or any of its subsidiaries, including Usertech, either (1) a
voluntary petition for bankruptcy under the bankruptcy laws of the United
States of America, (2) an assignment for the benefit of creditors, (3) or
any similar action or legal proceeding under the laws related to insolvency
of any state. CITI also covenants and agrees that for a period of ninety-
one (91) days from the effective date of this Agreement, it shall not take
any of the actions described in the preceding sentence. CITI further
represents and warrants that it is not aware of any filing or attempt to
file an involuntary petition under the bankruptcy laws of the United States
of America, or any similar proceeding under the laws of any other state,
against Canterbury or any of its subsidiaries, including Usertech. Each
party to this Agreement acknowledges that the foregoing covenants,
warranties and representations were an inducement to the other party to
enter into this Agreement. By their signature below, each party to this
Agreement hereby acknowledges that it has entered into this Agreement
voluntarily, without coercion, duress or undue influence, with full
knowledge of its obligations and risks and after consulting with their own
counsel.
6. CITI also agrees that it shall, as required by federal law,
promptly make a filing with the Securities and Exchange Commission ("SEC")
describing this Agreement, and, in particular, CITI's agreement not to seek
bankruptcy or insolvency protection as set forth in paragraph 5 for at
least a period of ninety-one (91) days from the effective date of this
Agreement. The language in CITI's SEC filing describing this Agreement
shall be in a form acceptable to Ceridian.
7. All of the terms and provisions of the Agreement, whether so
expressed or not, shall be binding upon, inure to the benefit of, and be
enforceable by and against the parties and the respective legal
representatives, successors, heirs, and permitted assigns, including, but
not limited to any trustee to the bankruptcy estate of a party and to all
entities and individuals defined herein as CITI and Ceridian. There are no
third party beneficiaries to this Agreement.
8. This Agreement represents the entire understanding and
agreement between the parties with respect to the subject matter hereof and
supersedes all other negotiations, understandings and representations (if
any) made by and among such parties, including any prior writings.
9. The parties hereto agree that this Agreement may be executed in
one or more counterparts, each of which will be deemed an original, but all
of which will constitute one and the same instrument, and each of the
parties shall deliver their counterparts to the other parties. Delivery by
facsimile to a parties' counsel is acceptable as long as an original "hard
copy" follows. Each party shall execute two copies of the signature page,
delivering one page with an original signature to the other party and
retaining the second.
10. This Agreement shall be governed by, construed and enforced in
accordance with the laws of New Jersey, without consideration of conflict
of law principles.
11. This Agreement may only be amended, supplemented, waived or
modified by a writing signed and dated by an authorized representative for
each of the parties involved.
12. The parties hereto declare and agree that Ceridian has a claim
for $1,354,000 against CITI, and that the parties entered into this Agreement
only for the purpose of ending litigation.
13. In entering into this Agreement, none of the parties has
relied in any way upon any written or oral representations made by any other
party or its representatives.
IN WITNESS WHEREOF, this Agreement, has been executed by the parties
hereto, on the date or dates set forth below:
CANTERBURY CONSULTING GROUP, INC.
By: /s/ Xxxxx X. XxXxxxxx Dated: October 22, 2004
----------------------- ----------------
Name: Xxxxx X. XxXxxxxx
Title: President
USER TECHNOLOGY SERVICES, INC.
By: /s/ Xxxxx X. XxXxxxxx Dated: October 22, 2004
----------------------- ----------------
Name: Xxxxx X. XxXxxxxx
Title: President
CERIDIAN CORPORATION
By: /s/ Xxx X. Xxxx Dated: October 25, 2004
----------------------- ----------------
Name: Xxx X. Xxxx
Title: Vice President and Associate General Counsel
