Settlement and Release Agreement - Prosoft Training.com, Training Resources International Inc., S.T.E.P.S. Inc., NetGateway Inc., Michael Khaled, Scott Beebe and Donald Danks
SETTLEMENT AND RELEASE AGREEMENT
This Settlement and Release Agreement (the "Agreement") is entered
into this 19 day of April, 1999 by and among Prosoft Training.com, a Nevada
corporation, formerly known as Prosoft I-Net Solutions, Inc. ("Prosoft"),
Training Resources International, Inc., a Nevada corporation ("TRI"),
S.T.E.P.S., Inc., a Utah corporation ("STEPS"), NetGateway, Inc., a Nevada
corporation ("NetGateway"), Michael Khaled, an individual ("Khaled"), Scott
Beebe, an individual ("Beebe"), and Donald Danks, an individual ("Danks").
RECITALS
1. STEPS and Prosoft entered into a Courseware Reproduction
License Agreement, dated October 29, 1997, which was amended on November 4, 1997
and August 1, 1998 (as amended, the "STEPS License Agreement"), which granted
STEPS certain rights to Prosoft courseware.
2. TRI and Prosoft entered into a Courseware Reproduction
License Agreement dated January 20, 1998, which was amended on August 1, 1998
(as amended, the "TRI License Agreement"), which granted TRI certain rights to
Prosoft courseware. The STEPS License Agreement and the TRI License Agreement
are sometimes collectively referred to herein as the "License Agreements".
3. Beebe and Prosoft entered into a Guarantee Agreement dated
April 9, 1998 pursuant to which Beebe guaranteed all of STEPS obligations under
the STEPS License Agreement (the "Beebe Guarantee").
4. Khaled and Prosoft entered into a Guarantee Agreement dated
April 9, 19998 pursuant to which Khaled guaranteed all of TRI's obligations
under the TRI License Agreement (the "Khaled Guarantee"). The Beebe Guarantee
and the Khaled Guarantee are sometimes collectively referred to herein as the
"Guarantees".
5. On or about January 25, 1998, TRI sublicensed its rights
under the TRI License Agreement to NetGateway.
6. On or about April 1, 1998, STEPS sublicensed its rights
under the STEPS License Agreement to NetGateway.
7. In December 1998, Prosoft terminated the STEPS License
Agreement and the TRI License Agreement for failure to make agreed upon payments
when due.
8. Certain disputes have arisen among the parties with respect
to the STEPS and TRI License Agreements and the Guarantees. In order to avoid
the burdens, inconveniences and
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expenses of litigation which would be incurred by the parties if a judicial
resolution of the disputes were sought, the parties desire to release, settle
and extinguish, in the manner set forth herein, any and all past, present and
future differences, disputes, claims, liabilities and obligations relating to
the License Agreements and the Guarantees.
AGREEMENT
In consideration of the foregoing and the mutual convenants contained
in this Agreement, the parties agree as follows:
1. PAYMENT TO PROSOFT. Concurrently with the execution of this
Agreement, TRI and STEPS shall pay to Prosoft by certified check or wire
transfer the aggregate amount of $200,000 (the "Settlement Payment"). The
obligations of TRI and STEPS pursuant to this paragraph 1 shall be joint and
several.
2. TERMINATION OF LICENSE AGREEMENT. The parties to this
Agreement agree that each of the TRI License Agreement and the STEPS License
Agreement have been terminated and are of no further force or effect.
3. TERMINATION OF EXISTING GUARANTEES. Effective upon receipt
by Prosoft of the Settlement Payment, the Beebe Guarantee and the Khaled
Guarantee shall terminate and be of no further force and effect.
4. MUTUAL RELEASE OF ALL CLAIMS.
4.1 NO LITIGATION. Each party represents that he or it
has not filed any complaints, charges or lawsuits against any other party with
any governmental agency or any court, or in the event that any such complaint,
charge or lawsuit has been filed, such party hereby agrees to dismiss such
action with prejudice, that he or it will not file any complaint or charge or
lawsuit against any other party at any time hereafter for any event occurring
prior to the date of execution of this Agreement and relating to the License
Agreements or the Guarantees, and that if any agency or court assumes
jurisdiction of any complaint, charge or lawsuit against any party on behalf of
any other party here it will request such agency or court to withdraw from the
matter.
4.2 MUTUAL GENERAL RELEASE. Each of the parties on
behalf of itself, its affiliates, partners, agents, shareholders, employees,
representatives, assigns and successors hereby fully releases and discharges
each other party and each other party's affiliates, partners, agents,
shareholders, employees, representatives, assigns and successors from all
rights, claims and actions, known or unknown, of any kind whatsoever, which each
party and the above-mentioned successors now have or may hereafter have against
the other parties and the above-mentioned successors, arising out of, in
connection with or by reason of any act, omission, cause or thing occurring or
existing at any time heretofore and arising from, in connection with or relating
to the License Agreements or the Guarantees.
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4.3 UNKNOWN CLAIMS. Each party expressly waives and
relinquishes all rights and benefits afforded by Section 1542 of the California
Civil Code which provides:
"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 the
settlement with the debtor."
Each party understands and acknowledges the significance and consequence of
this waiver of Section 1542 and nevertheless elects to, and does, release
those claims described in this Agreement, known or unknown, that it may have
now or in the future arising out of any act, omission, cause or thing,
relating to the License Agreements or the Guarantees.
5. REPRESENTATIONS AND WARRANTIES. Each of the parties to
this Agreement represents and warrants to the others that each of them has
the full power, capacity and authority to enter into this Agreement, that
none of them has sold, assigned or in any manner transferred any claims which
any of them ever had against the others to any third party, and that no other
releases or settlements are necessary from any other person or entity to
release and discharge completely the other parties from the claims specified
herein. Each party agrees to indemnify, defend and hold harmless each of the
other parties from and against any and all claims which may be asserted
against them, based upon, arising out of, or in connection with a breach of
its representations and warranties made herein.
6. EXECUTION NOT AN ADMISSION. This Agreement is the result of
a settlement and compromise of disputed matters as herein set forth. By entering
into this Agreement, no party hereto admits that the claims of any other are
valid or more meritorious and each party hereto agrees that the terms of this
Agreement shall never be used, referred to or considered as an admission of
liability of such claims. The undersigned hereby have in the past denied and
continue to deny the claims, assertions, allegations and contentions of the
others and any and all liability associated therewith.
7. LEGAL REPRESENTATION. Each party acknowledges that it has
had the opportunity to receive the advice of independent legal counsel prior to
the execution of this Agreement and the opportunity to receive an explanation
from legal counsel of the legal nature and effect of the Agreement, and each
party has fully exercised that opportunity to the extent desired and understands
the terms and provisions of this Agreement and its nature and effect. Each party
further represents that it is entering into this Agreement freely and
voluntarily, relying solely upon the advice of its own counsel, and not relying
on the representations of any other party or of the counsel of any other party.
Each party expressly agrees that this Agreement shall not be construed or
interpreted for or against the party drafting the Agreement.
8. GENERAL PROVISIONS.
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8.1 COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
8.2 SUCCESSORS AND ASSIGNS. This Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
heirs, successors and assigns.
8.3 APPLICABLE LAW. This Agreement is made, executed
and entered into and shall be governed by the laws of the State of California.
8.4 NOTICES. Any notice required in connection with
this Agreement shall be given in writing and shall be deemed effective upon
personal delivery or three business days after deposit in the United States
mail, registered or certified, postage prepaid and addressed to the party
entitled to such notice at the address indicated below such party's signature
line on this Agreement or at such other address as such party may designate by
ten (10) days' advance written notice under this Section 8.4 to all other
parties to this Agreement.
8.5 INTEGRATION. This Agreement contains the entire
agreement and understanding concerning the subject matter herein and supersedes
and replaces any prior negotiations and agreements between the parties hereto,
or any of them, whether written or oral.
8.6 ATTORNEYS' FEES. If any party breaches any
obligation under this Agreement, the non-breaching party shall be entitled to
its reasonable expenses, attorneys' fees, and costs incurred in any action
taken, with or without litigation, to enforce the terms of the Agreement, or to
remedy or compensate for such breach.
8.7 SEVERABILITY. In the event that any one or more
of the provisions of this Agreement shall be declared invalid, illegal, or
unenforceable in any respect, the validity, legality and enforceability of
the remaining provisions contained herein shall not be in any way affected or
impaired thereby.
8.8 MODIFICATIONS. Any alterations, changes or
modification of or to this Agreement in order to be effective, shall be made by
written instrument or endorsement thereon and in each such instance shall be
duly signed on behalf of each party hereto.
8.9 CONFIDENTIALITY. The parties hereto shall in no
way publicize to any individual or entity not a party to this Agreement the
terms of the Agreement, except as required by operation of law (including public
reporting requirements under federal securities laws), or except to such
parties' lenders, accountants, agents, officers, shareholders, employees,
representatives or consultants.
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The parties have entered into this Agreement as of the day and year
first written above.
"PROSOFT" "TRI"
PROSOFTTRAINING.COM, a Nevada TRAINING RESOURCES
corporation, formerly known as INTERNATIONAL, INC., a Nevada
Prosoft I-Net Solutions, Inc. corporation
By: /s/ Jerrell M. Baird By: /s/ Michael Khaled
------------------------ ------------------------
Its: CEO Its:
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Address: 3001 Bee Caves Rd., Address: [ILLEGIBLE]
Suite 100 [ILLEGIBLE]
Austin, TX 78746 [ILLEGIBLE]
"STEPS" "NETGATEWAY"
S.T.E.P.S., INC., a Utah NETGATEWAY, INC., a Nevada
corporation corporation
By: /s/ R. Scott Beebe By: /s/ KOF
------------------------ ------------------------
Its: Vice - President Its: CEO
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Address: 1845 Baywood Dr. Address: [ILLEGIBLE]
Salt Lake City,Utah Long Beach CA
84117
"KHALED" "BEEBE"
/s/ Michael Khaled /s/ R. Scott Beebe
----------------------------- -----------------------------
Michael Khaled, an individual Scott Beebe, an individual
Address: [ILLEGIBLE] Address: 1845 Baywood Dr.
[ILLEGIBLE] Salt Lake City, Utah
[ILLEGIBLE] 84117
"DANKS"
/s/ Donald Danks
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Donald Danks, an individual
Address: 1821 Port Stanhope Place
Newport Beach, CA
[ILLEGIBLE]
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