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Exhibit 10.8
SETTLEMENT AGREEMENT
SETTLEMENT AGREEMENT, dated the 27th day of June, 2000, by and
between Nina L. Cannon ("NLC"), and Omega Funding, Inc., a corporation
wholly-owned by NLC ("Omega"), both with offices at 5331 NW 26th Circle, Boca
Raton, FL 33496, and Enterprises Solutions, Inc., a Nevada ESI, with offices at
140 Wood Road, Suite 200, Braintree, MA 02184 ("ESI").
WHEREAS, NLC is a director of ESI; and
WHEREAS, Omega has outstanding loans to ESI in the amount of One
Hundred Twenty Seven Five Hundred Dollars ($127,500), with unpaid interest
thereon of Five Thousand Two Hundred Forty Three Dollars ($5,243.00) (the
"Loan"); and
WHEREAS, NLC wishes to resign as a director of ESI, with an appropriate
indemnification agreement from ESI for any liabilities that may arise in the
future due to her having acted as a director of ESI; and
WHEREAS, each of the parties could attempt to assert claims against the
other party; and
WHEREAS, the parties desire to resolve all potential disputes with this
Settlement Agreement.
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NOW, THEREFORE, in consideration of the agreements and covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is agreed by and between the
parties as follows:
1. Settlement of Obligations. The parties shall make full settlement of
outstanding obligations under the Agreement as follows:
A. Loan. Concurrently with the execution of this Settlement Agreement,
ESI shall pay the amount of One Hundred Thirty Two Thousand Seven Hundred Forty
Three, ($132,743.00), to Omega in full settlement of the Loan, by wire transfer
as shall be directed by NLC in writing to ESI.
B. Resignation from Board of Directors. NLC resigns effective
immediately with the execution of this Settlement Agreement as a member of the
Board of Directors of ESI.
C. Indemnification. (i). Definitions. As used in this Settlement
Agreement:
(a) The term "Proceeding" shall include any threatened, pending or
completed action, suit or proceeding, whether brought in the name of ESI or
otherwise and whether of a civil, criminal or administrative or investigative
nature, by reason of the fact that NLC is or was an officer and/or director of
ESI, or is or was serving at the request of ESI as an officer and/or director,
employee or agent of another enterprise, whether or not she is serving in such
capacity at the time and liability or expense is incurred for which
indemnification or reimbursement is to be provided under this Agreement.
(b) The term "Expenses" includes, without limitation, attorneys'
fees, disbursements and retainers, accounting and witness fees, travel and
deposition costs, expenses of investigations, judicial or administrative
proceedings or appeals, amounts paid in settlement by or on behalf of NLC, and
any expenses of establishing a right to indemnification pursuant to this
Agreement or otherwise including reasonable compensation for time spent by NLC
in connection with the investigation, defense or appeal of a Proceeding or
action for indemnification for which she is not otherwise compensated by ESI or
any third party. The term "Expenses"does not include the amount of judgments,
fines, penalties or ERISA excise taxes actually levied against NLC.
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(ii) Indemnification in Third Party Actions. ESI shall indemnify NLC in
accordance with the provisions of this section if NLC is a party to or
threatened to be made a party to or otherwise involved in any Proceeding (other
than a Proceeding by or in the name of ESI to procure a judgment in its favor),
by reason of the fact that NLC is or was an officer and/or director of ESI, or
is or was serving at the request of ESI as an officer and/or director, employee
or agent of another enterprise against all expenses, judgments, fines, penalties
and ERISA excise taxes actually and reasonably incurred by NLC in connection
with the defense or settlement of such Proceeding, to the fullest extent
permitted by Nevada law; provided that any settlement be approved in writing by
ESI.
(iii) Indemnification in Proceedings or by or in the name of ESI. ESI
shall indemnify NLC in accordance with the provisions of this section if NLC is
a party to or threatened to be made a party to or otherwise involved in any
Proceeding by or in the name of ESI to procure a judgment in its favor by reason
of the fact that NLC was or is in officer and/or director of ESI, or is or was
serving at the request of ESI as an officer and/or director, employee or agent
of another enterprise, against all Expenses actually and reasonably incurred by
NLC in connection with the defense or settlement of such Proceeding, to the
fullest extent permitted by Nevada law.
(iv) Conclusive Presumption Regarding Standard of Conduct. NLC shall be
conclusively presumed to have met the relevant standards of conduct as defined
by Nevada law for indemnification pursuant to this Agreement, unless a
determination is made that NLC has not met such standards by (1) the Board of
Directors of ESI by a majority vote of a quorum thereof consisting of directors
who were not parties to the Proceeding which gives rise to claim made under this
Agreement, (2) by the stockholders of ESI by majority vote of a quorum thereof
consisting of stockholders who are not parties to the Proceeding which gives
rise to claim made under this Agreement, or (3) in a written opinion by
independent legal counsel.
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(v) Indemnification of Expenses of Successful Party. Notwithstanding
any other provisions of this Agreement, to the extent that NLC has been
successful in defense of any Proceeding or in defense of any claim, issue or
matter therein, on the merits or otherwise, including the dismissal of a
Proceeding without prejudice, NLC shall be indemnified against all Expenses
incurred in connection therewith to the fullest extent permitted by Nevada law.
(vi) Advances of Expenses. The Expenses incurred by NLC in any
Proceeding shall be paid promptly by ESI in advance of the final disposition of
the Proceeding at the written request of NLC to the fullest extent permitted by
Nevada law; provided that as long as Nevada law requires such an undertaking,
NLC shall undertake in writing to repay such amount to the extent that it is
ultimately determined that NLC is not entitled to indemnification.
Notwithstanding the foregoing or any other provision of this Agreement, no
advance shall be made by ESI if a determination is reasonably and promptly made
by the Board of Directors by a majority vote of a quorum thereof consisting of
directors who are not parties to the Proceeding, based upon the facts known to
the Board at the time such determination is made, that NLC acted in bad faith or
deliberately breached her duty to ESI and the stockholders, and as a result of
such action by NLC, it is more likely than not it will ultimately be determined
that NLC is not entitled to indemnification under the terms of this Agreement.
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(vii) Partial Indemnification. If NLC is entitled under any provision
of this Agreement to indemnification by ESI for some or a portion of the
Expenses, judgments, fines, penalties or ERISA excise taxes actually and
reasonably incurred by her in the investigation, defense, appeal or settlement
of any Proceeding but not, however, for the total amount thereof, ESI shall
nevertheless indemnify NLC for the portion of such Expenses, judgment, fines,
penalties or ERISA excise taxes to which NLC is entitled.
(viii) Indemnification Procedure; Determination of Right to
Indemnification.
(a) Promptly after receipt by NLC of notice of the commencement of any
Proceeding, NLC will, if a claim in respect thereof is to be made against ESI
under this Agreement, notify ESI of the commencement thereof. The omission so to
notify ESI will not relieve it from any liability which it may have to NLC
otherwise than under this Agreement.
(b) If a claim under this Agreement is not paid by ESI within thirty
(30) days of receipt of written notice, the right to indemnification as provided
by this Agreement shall be enforceable by NLC in any court of competent
jurisdiction.
(c) NLC's Expenses incurred in connection with any Proceeding
concerning her right to indemnification or advances in whole or in part pursuant
to this Agreement shall also be indemnified by ESI regardless of the outcome of
such Proceeding, unless a court of competent jurisdiction determines that each
of the material assertions made by NLC in such Proceeding was not made in good
faith or was frivolous.
(d) With respect to any Proceeding for which indemnification is
requested, ESI will be entitled to participate therein at its own expense and,
except as otherwise provided below, to the extent that it may wish, ESI may
assume the defense thereof, with counsel reasonably satisfactory to NLC. After
notice from ESI to NLC of its election to assume the defense of a Proceeding,
ESI will not be liable to NLC under this Agreement for any legal or other
expenses subsequently incurred by NLC in connection with the defense thereof,
other than reasonable costs of investigation or as otherwise provided below. ESI
shall not settle any Proceeding in any manner which would impose any penalty or
limitation on NLC without NLC's written consent. NLC shall have the right to
employ her own counsel in any Proceeding but the fees and expenses of such
counsel incurred after notice from ESI of its assumption of the defense thereof
shall be at the expense of NLC, unless (1) the employment of counsel by NLC has
been authorized by ESI, (2) NLC shall have reasonably concluded that there may
be a conflict of interest between ESI and NLC in the conduct of the defense of a
Proceeding (and such conclusion is concurred in by independent counsel selected
by ESI); or (3) ESI shall not in fact have employed counsel to assume the
defense of a Proceeding, in each of which cases the fees and expenses of NLC's
counsel shall be at the expense of ESI.
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(ix) Limitations on Indemnification. No payments pursuant to this
Settlement Agreement shall be made by ESI:
(a) To indemnify or advance Expenses to NLC with respect to
Proceedings initiated or brought voluntarily by NLC and not by way of defense,
except with respect to Proceedings brought to establish or enforce a right to
indemnification under this Agreement or any other statute or law or otherwise as
required under Nevada law, but such indemnification or advancement of Expenses
may be provided by ESI in specific cases if the Board of Directors finds it to
be appropriate;
(b) To indemnify NLC for any Expenses, judgments, fines, penalties or
ERISA excise taxes for which payment is actually made to NLC under a valid and
collectible insurance policy, except in respect of any excess beyond the amount
of payment under such policy;
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(c) To indemnify NLC for any Expenses, judgments, fines or penalties
sustained in any Proceeding for an accounting of profits made from the purchase
or sale by NLC of securities of ESI pursuant to the provisions of Section 16(b)
of the Securities Exchange Act of 1934, the rules and regulations promulgated
thereunder and amendments thereto, or similar provisions of any federal, state
or local statutory law;
(d) To indemnify NLC for any Expenses, judgments, fines, penalties or
ERISA excise taxes resulting from NLC's conduct which is finally adjudged to
have been willful misconduct, knowingly fraudulent or deliberately dishonest; or
(e) If a court of competent jurisdiction shall finally determine that
any indemnification hereunder is lawful.
2. Release by NLC. In consideration for repayment of the Loan and the
indemnification agreement as provided hereinabove and the agreements of ESI made
as provided herein, NLC, as releasor, remises, releases and forever discharges
ESI, its respective agents, representatives, directors, officers, counsel, and
successors and assigns, jointly and severally, from any and all debts, demands,
actions, causes of action, suits, damages, claims and liabilities based on
matters of whatever kind or nature, known or unknown, suspected or unsuspected,
accrued or unaccrued, whether in law, equity or otherwise, and whether under
contract, warranty, tort or otherwise, which NLC ever had, now has or may have,
claim or assert from the beginning of the world to the date of this Settlement
Agreement, excepting for the obligations of ESI under this Settlement Agreement
and except for options covering 35,000 shares of ESI Common Stock granted to
NLC.
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3. Release by ESI. In consideration of the agreements of NLC made as
provided herein, ESI, as releasor, remises, releases and forever discharges NLC,
her respective agents, representatives, successors and assigns, jointly and
severally, from any and all debts, demands, actions, causes of action, suits,
damages, claims and liabilities based on matters relating to the Agreement of
whatever kind or nature, known or unknown, suspected or unsuspected, accrued or
unaccrued, whether in law, equity or otherwise, and whether under contract,
warranty, tort or otherwise, which ESI ever had, now has or may have, claim or
assert from the beginning of the world to the date of this Settlement Agreement,
excepting for the obligations of NLC under this Settlement Agreement.
4. Confidential Treatment. Except as required by law or applicable
regulation, including applicable disclosure requirements under the Securities
Exchange Act of 1934, as amended, or the Securities Act of 1933, as amended,
this Settlement Agreement, and the terms hereof, shall be maintained in
confidence by the parties and shall not be disclosed to any third party. Neither
NLC nor ESI shall discuss this Settlement Agreement nor any of the transactions
leading up to this Settlement Agreement with any other person, other than their
respective counsel.
4. Agreement Represents Compromise. This Settlement Agreement
represents a compromise of disputed claims and is not to be deemed or construed
to be an admission of liability or of the truth of any fact on the part of any
party. By this Settlement Agreement, the parties intend merely to avoid the
potential for protracted dispute.
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5. Governing Law. This Settlement Agreement shall be construed under
the laws of the State of Nevada pertaining to contracts made and to be performed
in Nevada.
6. Entire Agreement. This Settlement Agreement embodies the entire
agreement of the parties on the subject matter hereof and supersedes and
replaces all prior agreements between the parties regarding these matters. It
may not be changed or modified orally, but only by a writing signed by each of
the parties to be bound by such changes or modification.
7. Counterparts. This Settlement Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which taken together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have set their hands and seals to this
Settlement Agreement which is effective as of the day and year first above
written.
ENTERPRISES SOLUTIONS, INC.
By: /s/ John A. Solomon
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Title: President and CEO
OMEGA FUNDING, INC.
By: __________________________
Title:
_______________________________
Nina L. Cannon
