EXHIBIT 10.43
MUTUAL SETTLEMENT AND RELEASE
This Mutual Settlement and Release (this "AGREEMENT") is entered into
and is effective as of October 31, 2002 ("EFFECTIVE DATE"), by and among (i)
Game Base of Nevada, Inc., a corporation organized under the laws of Nevada
("GBN"), (ii) Xxxxxx X. Xxxxxxx, an individual ("XXXXXXX"); (GBN, along with
Xxxxxxx are collectively referred to herein as the "GBN ENTITIES"); (ii) SSP
Gaming, LLC, a Nevada limited liability company ("SSPG"); (iii) Xxxxxx Xxxxxxx,
an individual ("XXXXXXX"); (iv) SSP Solutions, Inc., a Delaware corporation
("SSPX"); (SSPG, along with Xxxxxxx and SSPX, are collectively referred to
herein as the "SSP ENTITIES"), and each of the parties' respective officers,
directors, executives, managers, employees, investors, partners, limited
partners, agents, parents, related and subsidiary entities and affiliates,
successors and assigns. The GBN Entities and the SSP Entities are hereinafter
referred to as the "PARTIES."
RECITALS
WHEREAS, SSPG was formed by SSPX for the purpose of, among other
things, entering into, financing and performing the contract with Venetian
Interactive, LLC ("VI") relative to the development of on-line gaming for the
Internet and other media;
WHEREAS, GBN and SSPX entered into the Amended and Restated Operating
Agreement of SSP Gaming, LLC dated May 31, 2002 ("OPERATING AGREEMENT") for the
purpose of admitting GBN as a member of SSPG in consideration of a cash capital
contribution of $2 million by GBN into SSPG according to a contribution schedule
specified in the Operating Agreement;
WHEREAS, GBN has failed to fund the required capital contribution
according to the schedule specified in the Operating Agreement and SSPG and SSPX
have served a notice of default dated August 3, 2002, upon GBN and an Event of
Default notice dated September 26, 2002, thereby causing GBN and the GBN
Entities to become a Defaulting Party as defined in the Operating Agreement;
WHEREAS, as a representative of SSPG, Xxxxxxx was appointed a member of
the VI management committee as specified under the Operating Agreement, and has
since resigned from that position;
WHEREAS, the SSP Entities and the GBN Entities have determined that it
is in each Party's best interests for the membership interest held by GBN and
the GBN Entities to be repurchased from GBN, as a Defaulting Party;
WHEREAS, upon originally executing the Operating Agreement Xxxxxxx was
appointed the Executive Manager of SSPG as defined in the Operating Agreement,
but as part of this Agreement has agreed to resign;
WHEREAS, in light of GBN being a Defaulting Party, the Parties have
negotiated the repurchase of GBN's and the GBN Entities' membership interests in
SSPG, thereby making SSPX the sole member of SSPG with power to appoint the
Executive Manager;
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WHEREAS, each Party represents and agrees that a release of each other
Party is in its self interest.
NOW, THEREFORE, in consideration of the foregoing premises and mutual
promises contained hereinafter, the Parties agree as follows:
1. CONSIDERATION.
The Parties agree to the release of each other as set forth in
Sections 3 and 4 contained herein:
a. The Parties further agree that their releases of one
another are unconditional, except as set forth in this Section 1.
b. Effective upon execution of this Agreement, Xxxxxxx hereby
resigns as the Executive Manager of SSPG, and shall tender a letter of
resignation to SSPG in the form that may be required by SSPG for its records.
c. SSPG agrees to repurchase GBN's membership interest, which
includes any and all claims of any nature by the GBN Entities, for a total of
Two Hundred Fifty Thousand dollars ($250,000), together with interest on the
unpaid balance at 6% per annum from the date of this Agreement until paid in
full, payable as follows:
(i) $40,000 upon full execution of this Agreement and
Xxxxxxx'x tender of a letter of resignation as
required under Section 1 (c) above;
(ii) $15,000 per month on the first of each month
following the payment in Section 1 (c)(i) above until
the entire balance plus interest, as provided above,
is paid in full;
(iii) Balance plus interest, as provided above, in full
within five days after the SSP Entities provide VI
with $2,000,000 (two million dollars) in cash, in
kind, or other value, as defined below, (the "VI
Contribution") sufficient to satisfy or to obtain
VI's release from or waiver of the obligation to make
the balance of the initial $2,000,000 contribution to
the capital of VI.
(iv) Within five days after the VI Internet gaming site
goes "live," accepts its first wager, or registers
its first user, whichever occurs first.
When used herein, the term "VI Contribution" shall include the aggregate value
of all cash or other forms of value transferred by or on behalf of the SSP
Entities, credited to their account, or received in lieu of, waiver of, or
forgiveness of any obligation, covenant or requirement, including the fair
market value of licensing, marketing, processing or similar agreements or
arrangements; processing, marketing, or other capabilities; industry joint
venture, strategic relationships, or similar participation arrangement; or other
asserts, tangible or intangible property or assets.
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2. PROVISION FOR DEFAULT OF PAYMENT.
In the event of a failure to make any payment as specified in paragraph
1.c. above on the date due or within 30 days after written notice from the payee
to SSPG of failure to receive such payment, the SSP Entities and their
respective subsidiaries, affiliates, successors, assignees, and each and all of
their respective assignees, transferees, principals, partners, limited partners,
officers, directors, stockholders, or employees, shall thereupon be deemed to
have assigned 40% of their ownership rights and privileges in VI to Bear Trax,
LLC, a Utah limited liability company("BEAR TRAX"). Bear Trax shall NOT be
admitted as a substitute member in VI.
3. RELEASE AND COVENANT NOT TO XXX.
a. Each of the SSP Entities hereby fully, finally and unconditionally
releases and forever discharges the GBN Entities and their current or former
parent companies, subsidiaries, affiliates, successors and assigns and each and
all of their respective assignees, transferees, principals, partners, limited
partners, counsel, officers, directors, stockholders, employees, servants,
heirs, predecessors, successors, agents, insurance carriers, licensees,
representatives, jointly and severally, from any and all claims, disputes,
demands, damages, debts, liabilities, obligations, expenses, liens, contracts,
agreements, causes of action, suits, matters, controversies, claims for
attorneys' fees, costs, incidental expenses, increased overhead, emotional
distress damages, consequential damages, punitive damages, and interest existing
on, or at any time prior to the execution of this Agreement by all parties
hereto, of whatever nature, character or description, whether in law, in equity
or otherwise, whether known or unknown, asserted or unasserted, fixed,
liquidated or contingent, anticipated or unanticipated, which it may have or
claim to have against any and all of them, including, but not limited, to those
which are alleged or referred to herein, directly or indirectly arise out of, or
any fact, matter or issue relating thereto;
b. Each of the GBN Entities hereby fully, finally and unconditionally
releases and forever discharges each of the SSP Entities and their current or
former parent companies, subsidiaries, affiliates, successors and assigns and
each and all of their respective assignees, transferees, principals, partners,
limited partners, counsel, officers, directors, stockholders, employees,
servants, heirs, predecessors, successors, agents, insurance carriers,
licensees, representatives and their respective parents, jointly and severally,
from any and all claims, disputes, demands, damages, debts, liabilities,
obligations, expenses, liens, contracts, agreements, causes of action, suits,
matters, controversies, claims for attorneys' fees, costs, incidental expenses,
increased overhead, emotional distress damages, consequential damages, punitive
damages and interest, existing on, or at any time prior to the execution of this
Agreement by all parties hereto, of whatever nature, character or description,
whether in law, in equity or otherwise, whether known or unknown, asserted or
unasserted, fixed, liquidated or contingent, anticipated or unanticipated, which
it may have or claim to have against any and all of them, including but not
limited to those which are alleged herein, or directly or indirectly arise out
of, or any fact, matter or issue relating thereto, save and except only the
covenants and agreements of the SSP Entities set forth herein.
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4. INTENTION OF THE PARTIES TO MAKE A GENERAL RELEASE.
a. EACH SSP ENTITY MAKES A GENERAL RELEASE OF THE GBN
ENTITIES. Each SSP Entity does hereby fully and irrevocably release and
discharge the GBN Entities from, and covenants not to xxx on, any and all
rights, claims, debts, demands, acts, grievances, liabilities, obligations,
damages, costs, fees (including, without limitation, those of attorneys),
expenses, actions and/or causes of action of every nature, character, type and
description, whether known or unknown, suspected or unsuspected, which each may
now own or hold, or have at any time heretofore owned or held, against the GBN
Entities. In entering into this Agreement and the releases set forth in Section
3, each SSP Entity expressly waives any rights or benefits under California
Civil Code section 1542, 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.
In this connection, the SSP Entities acknowledge that claims
and facts in addition to or different from those that are now known or believed
to exist may hereafter be discovered with respect to the subject matter of this
instrument or the other parties hereto. This waiver shall apply with respect to
any and all claims, including but not limited to those relating to matters
alleged or referred to herein, that the SSP Entities may have against the GBN
Entities and shall also apply to the GBN Entities' current or former assignees,
transferees, principals, partners, limited partners, counsel, affiliates,
officers, directors, stockholders, employees, servants, subsidiaries, parents,
heirs, predecessors, successors, agents, insurance carriers, attorneys,
representatives and licensees and parent companies.
B. EACH GBN ENTITY MAKES A GENERAL RELEASE OF THE SSP
ENTITIES. Each GBN Entity does fully and irrevocably release and discharge the
SSP Entities from, and covenants not to xxx on, any and all rights, claims,
debts, demands, acts, grievances, liabilities, obligations, damages, costs, fees
(including, without limitation, those of attorneys), expenses, actions and/or
causes of action of every nature, character, type and description, whether known
or unknown, suspected or unsuspected, which it may now own or hold, or have at
any time heretofore owned or held, against the SSP Entities. In entering into
this Agreement and the releases set forth in Section 3, each GBN Entity
expressly waives any rights or benefits under California Civil Code section
1542, 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.
In this connection, the GBN Entities acknowledge that claims
and facts in addition to or different from those that are now known or believed
to exist may hereafter be discovered with respect to the subject matter of this
instrument or the other parties hereto. This waiver shall apply with respect to
any and all claims, including but not limited to those relating to matters
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alleged or referred to herein that the GBN Entities may have against the SSP
Entities and shall also apply to their current or former assignees, transferees,
principals, partners, limited partners, counsel, affiliates, officers,
directors, stockholders, employees, servants, subsidiaries, parents, heirs,
predecessors, successors, agents, insurance carriers, attorneys, representatives
and licensees.
5. MODIFICATION.
Each of the undersigned Parties understands and agrees that this
Agreement shall not be changed or amended in any respect except by writing and
executed by all the Parties hereto or their authorized representatives. This
Agreement shall not be modified by any of the Parties by oral representation
made before, during or after execution of this Agreement.
6. AGREEMENT IS NOT VOID, NOT VOIDABLE AND IS ENFORCEABLE.
All Parties hereto agree that under no circumstances will any Party
make any contention that the provisions of this Agreement are void, voidable or
unenforceable for any reason. If any such contention is made by any Party, the
court shall reject such contention as being contrary to the intent of the
Parties in accordance with the terms of this Agreement. The court shall construe
this Agreement to be enforceable to the maximum extent provided by law.
7. REPRESENTATION OF AUTHORITY.
Each individual signing this Agreement hereby warrants that the Party
on whose behalf such individual executes this Agreement has authorized such
individual to execute this Agreement on such Party's behalf.
8. ENTIRE AGREEMENT.
This Agreement contains the entire understanding and agreement between
the Parties hereto with respect to the matters referred to herein. No other
representations, warranties, covenants, undertakings or other prior
contemporaneous agreements, oral or written, respecting such matters, which are
not specifically incorporated herein, shall be deemed in any way to exist or
bind any of the Parties hereto. Each Party hereto acknowledges that it has not
executed this Agreement in reliance on any such promise, representation or
warranty, except as specifically contained within this Agreement.
9. BINDING ON SUCCESSORS AND OTHERS.
This Agreement and the covenants and conditions contained herein shall
be binding upon the Parties and applied to and be binding upon their respective
assignees, licensees, sublicensees, transferees, principals, partners, limited
partners, counsel, affiliates, officers, directors, stockholders, employees,
servants, parents, heirs, predecessors, successors, agents, insurance carriers,
attorneys and representatives.
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10. CONSTRUCTION.
The Parties participated jointly in the preparation of this Agreement.
Each Party to this Agreement has had the opportunity to review, comment upon and
redraft this Agreement. It is agreed that no rule of construction shall apply
against any Party or in favor of any Party. This Agreement shall be construed as
if the Parties jointly prepared this Agreement and any uncertainty or ambiguity
shall not be interpreted against any one Party.
11. ADVICE OF COUNSEL.
The Parties acknowledge that they have been represented by counsel of
their own choice in the negotiations leading to their execution of this
Agreement, they have read and understood this Agreement and have had it fully
explained to them by their counsel.
12. APPLICABLE LAW.
The Parties agree that this Agreement shall be governed by the laws of
the state of Utah, without regard to the principles of conflicts of laws
thereof.
13. CHOICE OF FORUM.
The Parties agree that any action maintained to enforce this Agreement
shall be brought in Utah.
14. ASSIGNMENT OF AGREEMENT.
The Parties agree that the rights to this Agreement are assigned to
Bear Trax, 000 Xxxxx 000 Xxxx Xxxxx 000, Xxxxxxxxx Xxxx, 00000. All payments to
be made pursuant to Section 1 shall be made to Bear Trax.
15. SEVERABILITY.
The Parties agree that if any provision of this Agreement is found to
be unenforceable or void, that the void provision shall be stricken from this
Agreement, and the remainder of the Agreement shall be enforced.
16. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, and the
parties agree that facsimile signature pages may be accepted in lieu of original
signature pages. All executed counterparts shall be deemed to be one and the
same Agreement.
17. PLACE/MANNER OF NOTICE.
Any notice regarding this Agreement shall be in writing, sent via both
facsimile and regular U.S. mail to the following:
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If to the GBN Entities: Xxxxxx X. Xxxxxxx
Game Base of Nevada, Inc.
0000 Xxxxxx Xxxxx Xx.
Xxxx Xxxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
With a copy to: Xxxxx, Xxxxx & Xxxxxxx
Eighth Floor Bank Xxx Xxxxx
XX Xxx 00000
Xxxx Xxxx Xxxx XX 00000-0000
Attention: Xxx Xxxxx
If to the SSP Entities: Xxxxxx X. Xxxxxxx
SSP Solutions, Inc.
00000 Xxxxxxxxxx Xxxx
Xxxxxx, XX 00000
Facsimile No.: (000) 000-0000
With a copy to: Xxxxx & Xxxxxx, LLP
000 Xxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxx, Esq.
Telecopier: (000) 000-0000
18. ATTORNEYS' FEES AND COSTS.
The Parties agree that attorneys' fees, costs, expenses and all such
damages shall be awarded to the prevailing Party in any action or proceeding
brought to enforce this Agreement therein.
[THIS SPACE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have signed or caused this
Mutual Release to be signed on the date and year first above written.
SSP Gaming, LLC SSP Solutions, Inc.
By: /S/ Xxxxxx Xxxxxxx
-----------------------------
Its Executive Manager By: /S/ Xxxxxx Xxxxxxx
-------------------------------
Name: Xxxxxx Xxxxxxx
Title: Co-Chairman
/S/ Xxxxxx Xxxxxxx
---------------------------------
Xxxxxx Xxxxxxx
Game Base of Nevada, Inc.
By: /S/ Xxxxxx X. Xxxxxxx
-------------------------------
Name:
Title:
/S/ Xxxxxx X. Xxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxx
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