MUTUAL RELEASE AND SETTLEMENT AGREEMENT
I.
PARTIES
This
Mutual Release and Settlement Agreement ("Agreement") is made by and
between PARKER MILLS & PATEL LLP, ("PMP") and VERTICAL
COMPUTER SYSTEMS, INC.
"VERTICAL"). The effective date of this Agreement is October 19,
2005
II. RECITALS
A. On or
about January 21,
2005, PMP filed a lawsuit in the Los
Angeles
County Superior Court,
entitled Parker Mills & Patel LLP vs. Vertical Computer
Systems, Inc. Case No.
BC327609 (the
"Action").
PMP alleged causes of
action
for: (1) Breach of Written Contract; (2) Account Stated; (3) Reasonable Value
for Services Rendered; and (4) Breach of Promissory Note.
B. On
April 20, 2005,
VERTICAL answered
PMP'S Complaint in the Action,
denying any liability and disputing its obligation to pay the
amounts alleged.
C. It is
now the desire of PMP and VERTICAL to fully and finally
resolve
and settle their differences and disputes pertaining to the
Action.
III. TERMS AND
CONDITIONS
NOW,
THEREFORE,
in consideration of
the promises and covenants contained
herein, it is agreed by and between the parties as follows:
A.
CONSIDERATION.
VERTICAL agrees execute and deliver to PMP a fully
executed Promissory
Note ("Note") in the
form attached hereto
as Exhibit "A."
Concurrently with
VERTICAL'S
delivery to PMP of the
fully executed Note,
PMP
will deliver to VERTICAL a fully executed Request for Dismissal,
with prejudice,
of the Action.
C. MUTUAL
GENERAL RELEASE.
For
valuable consideration stated herein and above, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree to
mutually
release one another
with respect to the Action,
as set forth
herein below;
PROVIDED HOWEVER,
that no provision of this Mutual Release and Settlement
Agreement shall,
or be otherwise
interpreted
to, extend to the
terms of this
Agreement and/or of the Note.
(1) Plaintiff PMP, on behalf itself, its agents, employees,
partners
and
attorneys of record in the Action hereby fully and forever,
generally
and
specifically,
releases and
discharges VERTICAL,
and its respective
past and
present agents, employees, officers, directors, shareholders and
attorneys
(the "Vertical
Releasees")
from any and all
claims, demands,
actions,
rights, causes of action, obligations, liens, damages,
judgments,
indemnities, subrogations, duties, controversies or any liability
or claim
of any
nature, character or description, whether at law or in equity,
whether or
not now known,
suspected or claimed,
that PMP has ever had or
now have
or might in the future have, against the Vertical Releasees by
reason of
any act, failure to act, cause, matter or event arising out
of,
or in any
way relating
to the subject matter of and/or the facts and
transactions alleged
in the Action or any and all other damages or injury
of any
nature whatsoever,
past, present and future, in any way related to
the
Action;
MUTUAL RELEASE AND SETTLEMENT AGREEMENT
PMP v. Vertical
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(2) The Vertical
Releasees, hereby
fully and forever, generally and
specifically, release
and discharge PMP and its respective past and
present
agents, employees, partners, and attorneys of record in the
Action
(the "PMP
Releasees") from any and all claims, demands, actions, rights,
causes of
action, obligations,
liens, damages,
judgments,
indemnities,
duties,
controversies or any
liability or claim of any nature, character
or
description,
whether at law or in
equity, whether or not now known,
suspected
or claimed, that have ever had or now have or might in
the
future
have, against the PMP
Releasees by reason of
any act, failure
to
act,
cause, matter or event
arising out of, or in any way relating to the
subject
matter of and/or the facts and transactions alleged in the Action
or any and
all other damages
or injury of any
nature whatsoever,
past,
present
and future, in any way related to the Action.
D. WAIVER OF CALIFORNIA CIVIL CODE SECTION 1542. Each Party fully
understands that he,
she or it may have
additional unknown
claims or may have
suffered injuries or damages that are presently unknown to them,
which arise out
of or relate to the Action and that unknown complications of presently known
injuries may
arise, develop or be discovered in the future. The Parties
acknowledge, however,
that this Mutual
Release and Settlement
Agreement is a
full and final release of all unknown and unanticipated injuries, damages and
claims arising out of
or pertaining to the
Action as relates to them, and the
matters released in this Agreement, as well as to those now known or
disclosed,
and all parties hereto
waive all rights or benefits which they now have, or in
the future may have,
under the terms of Section 1542 of the California Civil
Code, with regard to the Action and the matters released in this
Agreement.
California
Civil Code, Section 1542, reads as follows:
A GENERAL RELEASE DOES
NOT EXTEND TO THE CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR
SUSPECT TO EXIST IN
HIS OR HER FAVOR AT THE TIME
OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST
HAVE
MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.
MUTUAL RELEASE AND SETTLEMENT AGREEMENT
PMP v. Vertical
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E. WAIVER
OF MISTAKE OF FACT OR LAW. In entering into this Agreement,
the
Parties assume
the risk of any mistake. If any party should subsequently
discover that any fact relied upon in entering into this Agreement was untrue,
or that their understanding of the facts or of the law was
incorrect, that party
shall not be entitled to any relief in connection therewith,
including, without
limitation, on the
generality of the
foregoing, any alleged
right or claim to
set aside or rescind
this Agreement.
This Agreement is intended to be and
is
final and binding upon each of the Parties regardless of any mistake of fact
or
law or any other circumstance whatsoever.
F.
REPRESENTATIONS
AND WARRANTIES BY ALL PARTIES HERETO. All Parties
represent and warrant that: (1) They are authorized to compromise
and settle all
of the claims which are the subject of this Agreement; (2) They have not sold,
transferred, conveyed,
signed, hypothecated, or otherwise disposed of any
claims, rights,
demands, actions and
causes of action which are the subject of
the Action,
or the Agreement; and (3) They agree to indemnify the other
releasing parties and
hold them harmless
against any future claims brought by
anyone claiming an interest in the Action, including any lien
claimant.
G. ENTIRE
AGREEMENT. This Agreement contains the sole, complete and
entire
understanding of the Parties and may not be altered, modified, or
changed in any
manner except
by a writing
duly executed by said parties. No statements,
promises or representations have been made by any settling
party to another, or
relied upon, and no consideration has been, or is, offered,
promised, expected
or held out, other than as stated in this Agreement. No party is relying on any
representations other
than those expressly set forth herein. There are no oral
or written collateral
agreements other than the Note. All prior discussions and
negotiations have been
and are, merged and integrated into, and superseded by,
this Agreement.
H. FEES
AND COSTS. Each party shall bear its own costs and attorneys'
fees
related to the Action and any matters released herein. If any action at law or
in equity, including
an action for declarator
