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EXHIBIT 99.2
SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
This
Settlement Agreement and Mutual General Release (hereinafter,
the
"Agreement") is made and entered into as of August , 2007 by and
between La
Jolla Cove Investors, Inc., a California corporation ("LJCI") and
One Voice
Technologies, Inc., a Nevada corporation ("One Voice"). LJCI and
One Voice will
sometimes be referred to individually as a "Party" and collectively
as the
"Parties" throughout this Agreement.
RECITALS
A.
WHEREAS,
LJCI brought an action against One Voice in the San Diego
County Superior Court, Case No. GIC850038, entitled La Jolla Cove
Investors,
Inc. vs. One Voice Technologies (the "Action");
B.
WHEREAS,
LJCI received a Judgment in its favor against One Voice in
connection with the Action (the "Judgment");
C.
WHERAS,
One Voice owes LJCI an amount equal to $379,582 under the
Judgment, plus accrued interest and fees (with such interest
continuing to
accrue at a rate of 8% per annum on any unpaid amount in the event
that One
Voice fails to make payment in full of all amounts to be paid under
Section 2
hereof), including all keeper fees, totaling $408,594.48 (the "Owed
Amount"),
with such sum currently due and payable to LJCI in full; and
D.
WHEREAS,
the Parties now wish to reach a final resolution of the
disputes between them.
NOW, THEREFORE, in consideration of the mutual promises made
herein,
the Parties agree as follows:
AGREEMENT
1.
Recitals: The Recitals set forth above are an integral part of
this Agreement, and shall be used in any interpretation of this
Agreement.
2.
Payment: In lieu of making a present payment to LJCI on the
date hereof of the Owed Amount, as set forth in the Judgment, One
Voice shall
make the following payments to LJCI:
(a)
Within fifteen
days of the execution of this Agreement, One Voice
shall pay an amount equal to $195,000 in cash to LJCI via wire
transfer; and
(b)
Concurrently
with the execution of this Agreement, in partial
satisfaction of the terms of this Agreement, One Voice shall
transfer into the
Escrow Account (as defined below), on behalf of LJCI, all right,
title and
interest to 30,000,000 shares of the Common Stock of One Voice,
represented by
30 stock certificates, each in the name of LJCI, each representing
1,000,000
shares of the Common Stock of One Voice (the "Original Escrow
Shares", together
with the Additional Escrow Shares, if any, the "Escrow Shares"),
and such
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Original Escrow Shares shall be placed into an escrow account (the
"Escrow
Account"), pursuant to terms of the Escrow Agreement attached
hereto as Exhibit
A. One Voice shall transfer and deposit into the Escrow Account on
behalf of
LJCI such additional shares of the Common Stock of One Voice as to
account for
any stock split, dividends or the like that are declared by One
Voice and occur
during the term that any of the Original Escrow Shares remain in
the Escrow
Account, and such additional shares, if any, shall be deemed
Original Escrow
Shares for the purposes of this Agreement. LJC1 shall agree to the
transfer out
of the Escrow Account to One Voice such shares of the Original
Escrow Shares as
may be necessary to account for any reverse stock split,
combination or the like
that are declared by One Voice and occur during the term that any
of the
Original Escrow Shares remain in the Escrow Account Upon the date
that is one
year from the date of this Agreement, one stock certificate
representing
1,000,000 shares of the Common Stock of One Voice (as adjusted for
any stock
split, combination, dividend, or the like) shall be released by the
Escrow Agent
out of the Escrow Shares to LJCI, provided however, that at no time
shall the
Escrow Agent release that number of Escrow Shares that would
otherwise result in
LJCI beneficially owning more than 4.99% of the then Outstanding
shares of
Common Stock of One Voice, as further described in Section 3 of
this Agreement.
Upon receipt of such shares of the Common Stock of One Voice, LJCI
may sell such
released Escrow Shares via transactions on the American Stock
Exchange, the
Nasdaq Capital Market, the Nasdaq National Market, the New York
Stock Exchange,
the OTC Bulletin Board service of the National Association of
Securities
Dealers, Inc. and/or the Pink Sheets published by the Pink Sheets,
LLC (or a
similar organization or agency succeeding to its functions of
reporting prices)
(collectively, the "Trading Market") daily in an amount equal to
not more than
14% of the corresponding daily volume of shares of Common Stock of
One Voice
that are sold on the Trading Market, provided that such amounts of
the Common
Stock of One Voice that LJCI may sell under the provisions of this
Agreement may
be cumulated. Upon the sale by LJCI of such released escrow shares,
LJCI shall
provide the Escrow Agent with a report detailing the daily volume
that such
sales by LJCI represented in the Common Stock of One Voice, along
with the total
proceeds (less any reasonable brokerage fees and commissions)
realized by LJCI
from such sales. Upon the Escrow Agent's reasonable satisfaction
that such sales
by LJCI cumulatively accounted for less than 14% of the daily
volume of the
sales of the Common Stock of One Voice on the Trading Market, the
Escrow Agent
shall deliver out of the Escrow Shares held in the Escrow Account,
an additional
stock certificate representing 1,000,000 shares of the Common Stock
of One
Voice. Upon the Escrow Agent's reasonable satisfaction that the
sales by LJCI
complied with the above described volume limitations, the Escrow
Agent shall
continue the above described release of the Escrow Shares until the
net proceeds
(less any reasonable brokerage fees and commissions) realized by
LJCI through
the sale of the Escrow Shares equals the Minimum Escrow Proceeds
(as defined
below). In the event that the market value of the Escrow Shares
(calculated
based upon the average of the five most recent consecutive closing
prices of
Common Stock of One Voice on the Trading Market) (the "Market Value
of the
Escrow Shares") equals an amount less than two times the remaining
amount of
Minimum Escrow Proceeds that has not yet been realized by LJCI
through the sale
of the Escrow Shares (the "Threshold Amount"), One Voice shall
transfer to LJCI
such additional shares (the "Additional Escrow Shares") of the
Common Stock of
One Voice and the Additional Escrow Shares shall be placed into the
Escrow
Account for release to LJCI in accordance with the terms of the
Escrow
Agreement, such that the Market Value of the Escrow Shares then
held in the
Escrow Account is at least equal to the Threshold Amount, provided
that at all
times One Voice shall cause the transfer into the Escrow Account on
behalf of
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LJCI such Additional Escrow Shares such that the number of Escrow
Shares in the
Escrow Account is equal to at least 15,000,000 shares of the Common
Stock of One
Voice, as adjusted for any stock split, dividends, combinations or
the like that
are declared by One Voice. LJCI shall not be required to pay any
additional
consideration in connection with the transfer to LJCI of the
Additional Escrow
Shares, if any. Upon notice from LJCI to One Voice and Alpha
Capital Anstalt
("ACA") that the net proceeds realized by LJCI from the sale of the
Escrow
Shares equals the Minimum Escrow Proceeds (with the date of such
notice referred
to herein as the "Satisfaction Date"), ACA shall have the right to
purchase from
LJCI the number of Escrow Shares that remain in the Escrow Account,
if any, at a
purchase price equal to the number of Escrow Shares that remain in
the Escrow
Account multiplied by an amount equal to 20% of the then current
market value of
the Common Stock of One Voice (based on the applicable price per
share of the
Common Stock of One Voice, as quoted on the Trading Market). ACA
shall have the
right to assign to a third party such right to purchase the
remaining Escrow
Shares. Upon ACA's, or its assignee's, purchase of the remaining
Escrow Shares,
such remaining Escrow Shares shall be immediately released from the
Escrow
Account to ACA or its assignee, as applicable. Notwithstanding the
foregoing,
ACA's, or its assignee's, delivery of the purchase price to LJCI in
connection
with the purchase of the remaining Escrow Shares, if any, must
occur within
fifteen days of notice to ACA of the occurrence of the Satisfaction
Date, or
neither ACA nor any other party, other than One Voice, shall have
the further
right to acquire such remaining Escrow Shares from LJCI. If ACA, or
its
assignee, does not so purchase the remaining Escrow Shares as
provided for in
the immediately preceding sentence, One Voice shall redeem such
remaining Escrow
Shares immediately for an aggregate redemption price of $100 to be
paid to LJCI
and the Escrow Shares shall be released and transferred from the
Escrow Account
to One Voice. "Minimum Escrow Proceeds" shall mean the amount equal
to the Owed
Amount minus the $195,000 paid to LJCI pursuant to Section
2(a).
Commencing
with the first month in which LJCI sells any of the Escrow
Shares in the Trading Market and terminating upon the date in which
LJCI no
longer owns any of the Escrow Shares, LJCI shall provide a monthly
written
report to each of One Voice and ACA reconciling the sale of such
Escrow Shares
on a monthly basis, with such report detailing the percentage of
the daily
volume that LJCI's sale, if any, of the Escrow Shares represented
with respect
to the daily trading volumes of One Voice's Common Stock on the
Trading Market.
(c)
Notwithstanding
the foregoing, at any time that any amount of the
payment of the Minimum Escrow Proceeds to LJCI remains outstanding,
either One
Voice or ACA, or ACA's assignee, may pay in cash to LJCI an amount
equal to the
Minimum Escrow Proceeds minus any net sums previously realized by
LJCI from the
sale of the Escrow Shares, and within fifteen business days after
such payment
(the "Purchase Period"), ACA, or ACA's assignee, as applicable,
shall have the
right to purchase from LJCI the number of Escrow Shares that remain
in the
Escrow Account, if any, at a purchase price equal to the number of
Escrow Shares
that remain in the Escrow Account multiplied by an amount equal to
20% of the
then current market value of the Common Stock of One Voice (based
on the
applicable price per share of the Common Stock of One Voice, as
quoted on the
Trading Market as of the date of that One Voice, ACA, or ACA's
assignee, as
applicable, made the cash payment to LJCI equal to the Minimum
Escrow Proceeds
minus any net sums previously realized by LJCI from the sale of the
Escrow
Shares) and upon ACA's, or its assignee's, purchase of the
remaining Escrow
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Shares, such remaining Escrow Shares shall be immediately released
from the
Escrow Account to ACA, or ACA's assignee, as applicable, provided,
however, that
if neither ACA nor ACA's assignee so purchase such Escrow Shares
that remain in
the Escrow Account during the Purchase Period, One Voice shall have
the right
within five business days of the expiration of the Purchase Period
to redeem
such Escrow Shares remaining in the Escrow Account immediate
