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EXHIBIT 4.7
SETTLEMENT AGREEMENT
This Settlement Agreement ("Agreement") entered into as of this 15th day of
June, 2000, ("Effective Date") by and between INVESTOR AWARENESS, INC., a
_______ corporation ("IA"), TONY SCHOR ("SCHOR"), BRAD FISHMAN ("Fishman") and
HARVEY BARNETT ("Barnett") (collectively "Holders"), and THE VIALINK COMPANY, an
Oklahoma Corporation ("viaLink").
WHEREAS, IA has made certain claims against viaLink as set forth in the
matter of Investor Awareness, Inc. v. The viaLink Company, f/k/a Applied
Intelligence Group, Inc., Case No. 99 L 07909 filed in the Law Division of the
Circuit Court of Cook County, Illinois (hereinafter "Litigation");
WHEREAS, the parties hereto desire to settle the Litigation and all claims
relating thereto under the terms and conditions set forth herein.
WHEREUPON, in consideration of the above premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. Holders shall be entitled to purchase a combined, aggregate total of forty
thousand (40,000) shares of viaLink common stock ("Securities"), twenty
thousand (20,000) of which shall be purchasable by Schor and Fishman
pursuant to and subject to the Amended and Restated Stock Option Agreement
("Restated Options") attached hereto as Exhibit A, viaLink's 1998 Stock
Option Plan and this Agreement; and the remaining twenty thousand (20,000)
of which may be purchased by Schor, Fishman and Barnett pursuant to the
terms, covenants and conditions of this Agreement, including without
limitation Section 1.2 hereof. Subject to the terms of Section 2 of this
Agreement, all of such Securities when issued shall be restricted
securities. The parties to this Agreement agree that the number of shares
and price for the Securities set forth in this Agreement reflect and take
into account the stock splits of viaLink's stock with record dates of
December 21, 1999 and March 17, 2000. Notwithstanding anything to the
contrary in this Agreement or any other instrument relating to the purchase
of any of said Securities, the purchase of all of the Securities shall
further be subject to the following conditions:.
1.1. Preconditions: Each and all of the following events and/or actions
(collectively "Preconditions") must be completed as conditions precedent
to the exercise by Holders of their rights to purchase the Securities:
1.1.1. IA, Schor and Fishman shall have executed the attached Amended
and Restated Stock Option Agreement, Exhibit A hereto. Said
Amended and Restated Stock Option Agreement, together with this
Agreement, shall constitute and reflect Schor's and Fishman's
rights with regard to their options to purchase up to a total of
twenty thousand (20,000) of the Securities. The parties
understand and agree that, of the options set forth in the
Original Agreement referred to in such Amended and Restated Stock
Option Agreement, the options that became exercisable on January
1, 1999 have previously been exercised pursuant to such Original
Agreement.
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1.1.2. IA shall have delivered to viaLink an executed original of the
Dismissal with Prejudice attached hereto as Exhibit B.
1.1.3. Each of the Holders shall have executed the Lock-Up Agreement
attached hereto as Exhibit C and delivered the same to viaLink;
provided however, it is agreed and understood that the options
granted pursuant to said Amended and Restated Stock Option
Agreement shall not be subject to the Lock-up Agreement.
Moreover, the parties further agree and understand that to the
extent there is any inconsistency between such Lock-up Agreement
and this Settlement Agreement, the terms and conditions of this
Settlement Agreement shall control.
1.2. Individual Purchases: In addition to the Securities purchasable pursuant
to the Restated Options, and upon satisfaction of all of the
Preconditions; (a) Tony Schor shall be entitled to purchase six thousand
(6,000) of the remaining Securities, (b) Brad Fishman shall be entitled
to purchase six thousand (6,000) of the remaining Securities, and (c)
Harvey Barnett shall be entitled to purchase eight thousand (8,000) of
the remaining Securities. The purchase price of each share of common
stock of viaLink purchased pursuant to this Section 1.2 shall be 25/32's
dollars ($0.78125) ("Purchase Price"), which Purchase Price must be paid
prior to or contemporaneously with the delivery of said Securities.
Schor, Fishman and Barnett shall at all times be required to comply with
such applicable laws and regulations regarding the Securities
(including, without limitation, any restrictions on the sale of said
Securities).
1.3. Taxes. The conveyance of the Securities shall be, in any event, subject
to any applicable federal, state and local income tax and/or withholding
and any and all other taxes or similar requirements applicable to the
Holders with regard to the Securities and as an additional precondition
to the delivery of any of the Securities all such withholding
obligations must be satisfied.
1.4. Holders agree and acknowledge that all of the Securities issued pursuant
to this Agreement (including, without limitation, the Securities issued
according to the Restated Options) will be restricted and will contain
the following statement:
THESE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY APPLICABLE STATE
SECURITIES LAWS AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
CONVEYED WITHOUT REGISTRATION OR AN OPINION OF COUNSEL IN FORM AND
SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH
REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 UNDER
THE SECURITIES ACT.
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2. Registration. Registration of the Securities shall be subject to the
following terms and conditions:
2.1. viaLink does hereby confirm that it is now qualified to file a
registration statement on Form S-3 or similar short form registration
(herein "Registration Statement"). Upon the execution hereof, Holders of
the Securities may by written notice to viaLink, require viaLink to file
a Registration Statement so as to effectuate registration of Holders's
Securities by the expiration of the Lock-Up Agreement (the "Lock-Up
Agreement") attached hereto as Exhibit A, which is being done pursuant
to the Offering referred to therein (herein the "Offering"). viaLink
does hereby confirm that it has the requisite authority and/or consent
and/or will obtain the requisite authority and/or consent to file any
such requested Registration Statement. viaLink may be required to file
one (1) Registration Statement pursuant to this Section. Notwithstanding
the foregoing, The right of Holders to request registration pursuant to
this Section 2.1 shall terminate at such time as all the Securities held
by Holders (or any transferee) may be sold pursuant to Rule 144 under
the Securities Act during any 90-day period.
2.2. Right to Delay Registration. Notwithstanding the provisions of Section
2.1, viaLink shall have the right, exercisable by written notice to the
initiating Holders within ten (10) days after viaLink in good faith
determines to delay such registration until such time as viaLink
believes that it would be practicable to effect such registration
pursuant to Section 2.1.
2.3. Registration Procedures. In the case of a Registration Statement filed
by viaLink pursuant to this Agreement, viaLink will, at its expense, do
the following for the benefit of the Holders:
2.3.1. Use its reasonable best efforts to keep such Registration
Statement effective for a period of 90 days or until the Holders
have completed the distribution described in the Registration
Statement relating thereto, and amend or supplement such
Registration Statement and any prospectus contained therein from
time to time to the extent necessary to comply with the
Securities Act and applicable federal and state securities laws;
2.3.2. Use its reasonable best efforts to register or qualify the
securities to be sold by the Holders under such registration
under the applicable securities or "blue sky" laws of such
jurisdictions as viaLink or any underwriter of such offering
shall reasonably deem necessary in order to ensure a successful
offering; provided, that viaLink shall not be obligated to
qualify to do business in any jurisdiction where it is not then
so qualified or otherwise required to be so qualified or to take
any action which would subject it to the service of process in
suits other than those arising out of such registration;
2.3.3. Furnish such number of prospectuses, including a preliminary
prospectus, in conformity with the requirements of the Securities
Act, and such other documents incident thereto as a Holder from
time to time may reasonably request in order to facilitate the
disposition of the Securities;
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2.4. Expenses of Registration. In the event of a registration pursuant to
this Agreement, viaLink shall pay all registration expenses, but shall
not be required to pay or otherwise assume responsibility for selling
expenses, which shall be the sole responsibility of the selling
shareholders.
2.5. Indemnification. In the event any Securities are included in a
registration statement under this Agreement:
2.5.1. To the extent permitted by law, viaLink will indemnify, defend
and hold harmless each Holder, any underwriter (as defined in the
Securities Act) for such Holder and each person, if any, who
controls such Holder or underwriter within the meaning of the
Securities Act or the Exchange Act, against any losses, claims,
damages, or liabilities (joint or several) to which they may
become subject under the Securities Act or other federal or state
law, insofar as such losses, claims, damages, or liabilities (or
actions in respect thereof) arise out of or are based upon any of
the following statements, omissions or violations (collectively,
a "Violation"): (i) any untrue statement or alleged untrue
statement of a material fact contained in such Registration
Statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements
thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make
the statements therein not misleading, or (iii) any violation or
alleged violation by viaLink of the Securities Act or other
federal or state securities law or regulation; and viaLink will
pay to each such Holder, underwriter or controlling person, as
incurred, any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this subsection 2.5.1 shall not
apply to amounts paid in settlement of any such loss, claim,
damage, liability, or action if such settlement is effected
without the consent of viaLink (which consent shall not be
unreasonably withheld), nor shall viaLink be liable in any such
case for any such loss, claim, damage, liability, or action to
the extent that it arises out of or is based upon a Violation
which occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such
registration by any such Holder, underwriter or controlling
person.
2.5.2. To the extent permitted by law, each selling Holder will
indemnify, defend and hold harmless viaLink, each of its
directors, each of its officers who has signed the registration
statement, each person, if any, who controls viaLink within the
meaning of the Securities Act, any underwriter, any other Holder
selling securities in such registration statement and any
controlling person of any such underwriter or other Holder,
against any losses, claims, damages, or liabilities (joint or
several) to which any of the foregoing persons may become
subject, under the Securities Act, the Exchange Act or other
federal or state law, insofar
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as such losses, claims, damages, or liabilities (or actions in
respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written
information furnished by such Holder expressly for use in
connection with such registration; and each such Holder, will
pay, as incurred, any legal or other expenses reasonably incurred
by any person intended to be indemnified pursuant to this
subsection 2.5.2, in connection with investigating or defending
any such loss, claim, damage, liability, or action; provided,
however, that the indemnity agreement contained in this
subsection 2.5.2 shall not apply to amounts paid in settlement of
any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder which
consent shall not be unreasonably withheld; provided, that, in no
event shall any indemnity under this subsection 2.5.2 exceed the
net proceeds from the offering received by such Holder.
2.5.3. Promptly after receipt by an indemnified party under this Section
2.5 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party
under this Section 2.5, deliver to the indemnifying party a
written notice of the commencement thereof and the indemnifying
party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense
thereof with counsel mutually satisfactory to the parties;
provided, however, that an indemnified party (together with all
other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one
separate counsel, with the fees and expenses to be paid by the
indemnifying party, if representation of such indemnified party
by the counsel retained by the indemnifying party would be
inappropriate due to actual or potential differing interests
between such indemnified party and any other party represented by
such counsel in such proceeding. The failure to deliver written
notice to the indemnifying party within a reasonable time of the
commencement of any such action, if prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any
liability to the indemnified party under this Section 2.5, but
the omission so to deliver written notice to the indemnifying
party will not relieve it of any liability that it may have to
any indemnified party otherwise than under this Section 2.5.
2.5.4. If the indemnification provided for in this Section 2.5 is held
by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim,
damage, or expense referred to therein, then the indemnifying
party, in lieu of indemnifying such indemnified party hereunder,
shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim,
damage, or expense in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with
the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other
relevant equitable considerations. The relative fault of the
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indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied
by the indemnifying party or by the indemnified party and the
parties' relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.
2.5.5. Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public
offering are in conflict with the foregoing provisions, the
provisions in the underwriting agreement shall control.
2.5.6. The obligations of viaLink and Holders under this Section 2.5
shall survive the completion of any offering of Securities in a
registration statement under this Agreement.
2.6. viaLink may, in its sole discretion, include the registration of other
securities held or granted to third parties on any Registration
Statement undertaken pursuant to this Agreement.
2.7. viaLink will immediately notify Holders as to the effective date of the
Registration Statement that is the subject matter of the Offering, and
will notify Holders in writing as to the expected date when the 120 day
lock-up period ends. In the event the Offering is withdrawn, terminates
or aborts, viaLink shall immediately notify Holders who will then be
immediately free to sell the Securities referenced in Paragraphs 1 and
1.2 herein, provided the same have been registered. Under no
circumstance shall Holders be restricted from the sale of their
Securities beyond December 31, 2000.
3. Release. Upon the execution of this Agreement, IA, Holders, and each of
them, on behalf of each of said party and its respective officers,
directors, shareholders, employees, agents, representatives, attorneys,
heirs, successors and assigns, releases, acquits, and forever discharges
viaLink and its officers, directors, shareholders, employees, agents,
representatives, attorneys, heirs, successors and assigns (the "Releasees")
from all loss, damages, penalties, obligations, actions, suits, judgments,
costs, expenses, claims, and liabilities of every kind or character
whatsoever, known or unknown, in contract or in tort, at law or in equity,
which IA, the Holders, or any of them, ever had, now has or may hereafter
have against said Releasees, jointly or severally, for any matter arising
out of or related to the Litigation, any claim or allegation therein, and
any other claim, whether known or unknown, which could have been brought in
or joined with said Litigation.
3.1. Upon the execution of this Agreement, viaLink, on behalf of itself and
its respective officers, directors, shareholders, employees, agents,
representatives, attorneys, heirs, successors and assigns, releases,
acquits, and forever discharges IA, Holders, and each of them, and their
respective officers, directors, shareholders, employees, agents,
representatives, attorneys, heirs, successors and
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assigns (the "Releasees") from all loss, damages, penalties,
obligations, actions, suits, judgments, costs, expenses, claims, and
liabilities of every kind or character whatsoever, known or unknown, in
contract or in tort, at law or in equity, which viaLink ever had, now
has or may hereafter have against said Releasees, jointly or severally,
for any matter arising out of or related to the Litigation, any claim or
allegation therein, and any other claim, whether known or unknown, which
could have been brought in or joined with said Litigation.
3.2. Each party hereto shall bear its own costs and fees related to the
Litigation and to this Agreement, including, without limitation, any
attorneys' fees incurred.
4. Warranties and Representations. The undersigned parties and each of them
warrant and represent as follows:
4.1. That the consideration to be received by the parties hereto, both
directly and indirectly, as a result of this Agreement, is sufficient
and reasonably worth the detriment, if any, to them.
4.2. That the recitals contained in this Agreement are true and correct in
all material aspects.
4.3. That the person executing this Agreement on behalf of a party hereto has
full power and authority to execute, deliver and perform this Agreement
in accordance with its terms.
5. GENERAL TERMS
5.1. Complete Agreement. This Agreement and the documents incorporated
therein by reference constitute the entire agreement among the parties
hereto pertaining to the subject matter of this Agreement and supersedes
all prior agreements and understandings with regard to its subject
matter. No party has made any representations with respect to the
settlement of these claims of the parties other than those contained
herein.
5.2. Governing Law. This Agreement shall be governed by the laws of the State
of Oklahoma and the United States, as the case may be.
5.3. Binding Effect Of Agreement. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective
legal representatives, successors and assigns.
5.4. Notice. All notices required or permitted to be given or made under this
Agreement may be affected in writing by certified mail, postage prepaid,
return receipt requested and shall be deemed communicated three days
from the mailing thereof. Mailed notices shall be addressed to the
parties at the following addresses, but each party may change his
address by written notice in accordance with this paragraph:
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If to viaLink:
J. Andrew Kerner, Chief Financial Officer
The viaLink Company
13800 Benson Road
Edmond, OK 73013-6417
with a copy to:
Richard M. Klinge, Esq.
Richard M. Klinge & Associates, P.C.
510 E. Memorial Road, Suite C-1
Oklahoma City, Oklahoma, 73114
If to IA: Investor Awareness, Inc.
1141 Lake Cook Road, Suite C-1
Deerfield, Illinois 60015
If to Schor: Tony Schor
c/o Investor Awareness, Inc.
1181 Lake Cook Road, Suite A
Deerfield, Illinois 60015
If to Fishman: Brad Fishman
c/o Investor Awareness, Inc.
1181 Lake Cook Road, Suite A
Deerfield, Illinois 60015
If to Barnett: Harvey J. Barnett
Much Shelist Freed Denenberg
Ament & Rubenstein, P.C.
200 North LaSalle St., Suite 2100
Chicago, IL 60601-1095
5.5. Counterparts. This Agreement may be executed in identical counterparts
with the same force and effect as if all parties had executed the same
original document. Facsimile copies of signatures and acknowledgements
will have the same force and effect as an original signature and
acknowledgement.
5.6. Further Assurances. The parties hereto agree to sign and execute such
other and further documents or take such additional actions as may be
reasonably necessary to carry out the terms and conditions of this
agreement.
5.7. Disclaimer of Liability. It is expressly understood and agreed the
parties to this Agreement that viaLink disputes and denies the claims
and allegations of IA as described in the Litigation, and that nothing
contained in this Agreement or any other related documents is, may or
shall be construed or used to prove any
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admission of any factual recital or any liability with regard to any of
the claims released herein. This Agreement is being entered into because
the parties hereto desire to amicably resolve their differences and the
parties believe that the terms of this Agreement are reasonable and fair
in view of all known facts and circumstances.
5.8. Confidentiality. Except to the extent that such information is required
to be disclosed to government, taxing or securities regulatory entities
according to applicable laws or regulations, or in order to obtain the
advice of attorneys, accountants and/or tax advisors, IA and each of the
Holders shall not disclose the terms of this Agreement, including,
without limitation, the number of Securities or Purchase Price, to any
third party. Any Protective Order entered in the course of the
Litigation with regard to confidentiality shall remain in full force and
effect as the binding agreement of each party hereto with respect to the
subject matter of such Protective Order.
5.9. Advice. The parties hereto acknowledge and agree that they have been
advised by their respective attorneys of the facts and legal
consequences related to the subject matter of this Agreement and that
this Agreement is entered into voluntarily and without duress of any
kind.
IN WITNESS WHEREOF, the parties hereto have caused this Settlement Agreement to
be duly executed and delivered, all as of the day and year first above written;
provided, however, that this Agreement shall not become binding or effective
until such time as each and all of the parties have executed this Agreement by
duly authorized signature.
The viaLink Company:
By: /s/ J. ANDREW KERNER date: / /
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Its: Senior Vice President
and Chief Financial Officer
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Investor Awareness, Inc.:
By: /s/ TONY SCHOR date: 6 / 9 / 00
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Its: President
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Tony Schor
/s/ TONY SCHOR date: 6 / 9 / 00
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Brad Fishman
/s/ BRAD FISHMAN date: 6 / 9 / 00
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Harvey Barnett
/s/ HARVEY BARNETT date: / /
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