EXHIBIT 99.1
SETTLEMENT AGREEMENT
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THIS IS A SETTLEMENT AGREEMENT made as of March 4, 2001 (the
"Settlement Date"), among Xxxxxx Xxxxxx, individually ("Xxxxxx'), Xxxxxx Xxxxxx,
Inc. ("the Company"), and American Nortel Communications, Inc. ("ANC"),
The Parties to this Settlement Agreement ("the agreement") agree as
follows:
WHEREAS, the parties have certain disputes relating to the ownership,
operation and continued business of the Company,
WHEREAS, the parties believe it is in their respective best interests
to resolve their disputes,
NOW THEREFORE, the undersigned parties hereby, on the following
terms, conditions, mutual covenants and promises, agree as follows:
1. Concurrent with the closing of this agreement:
(a) Xxxxxx shall appoint X.X. Xxxxxxxx to the Company's Board of
Directors ("the Board");
(b) Xxxxxx and all other present Board members shall resign
their positions on the Board;
(c) Xxxxxx shall resign his position as Chief Executive Officer
and all other positions with the Company;
(d) ANC shall immediately cause the Board to appoint a Chief
Executive Officer.
2. It being represented by Xxxxxx that he and Xxxxxx Xxxxxx (together
"the Coopers") own or control approximately 6,900,000 shares of stock in the
Company, and ANC relying on that representation in exchange for a payment from
and on behalf of ANC of $125,000, shall sell ANC all but 500, 000 of any shares
of Company stock that the Coopers own or control clear of all liens and
encumbrances. ANC shall make the payment at closing and the Coopers shall
transfer all shares at that time. Xxxxxx shall have all rights and powers to
transfer any of his remaining shares as permitted under Rule 144 of the
Securities and Exchange Commission, and the Company will instruct the transfer
agent to remove any restrictive legend on share certificates for Xxxxxx'x
remaining shares consistent with the provisions of Rule 144.
3. Xxxxxx agrees that, from and after the closing, he will reasonably
cooperate with the Company with respect to any and all matters relating to all
federal, state and local governments and governmental agencies, including the
Internal Revenue Service, the Securities and Exchange Commission. In addition,
he shall also cooperate in any litigation brought by or against~ the Company,
including any efforts to recover amounts from Messrs- Xxxxxx, Xxxxx and Xxxxx
and/or any entities that they may control or with which they have been
affiliated.
4. ANC and the Company agree that the Coopers shall be entitled to
retain various samples from the Company's ladies' division, the office furniture
at the Company's office and a personal computer in the Company's office.
5. At closing, the Company will transfer and assign to Xxxxxx all
right, title and interest and associated good will in the name "Xxxxxx Xxxxxx"
and all variations and derivations thereof.
6. At or after closing, the Company will change its name at the
earliest time possible within the laws, regulations and procedures of the state
of the Company's incorporation and the Company's by-laws.
7. The Coopers shall have no limitations on their right to directly
or indirectly engage or participate in, assist, advice or be connected with any
business or enterprise, whether or not competitive with the Company, except they
will not compete with the Company with respect to any specific projects that the
Company is actively pursing as of the date of the execution and closing of this
agreement, including the potential venture in American Samoa. The parties
acknowledge that, on or after thirty days after the closing, the Coopers shall
be free without limitation to pursue the ventures in American Samoa.
8. At least five days before closing, Xxxxxx and the Company shall
provide to ANC a list of all accounts payable as of the date of the execution of
this agreement. Closing of this agreement shall be contingent upon the
production of this information, and upon review of that information, ANC shall
have the right and power, at its sole discretion, to invalidate this agreement.
The closing shall occur five days after Xxxxxx and the Company provides the
information contained in this paragraph.
9. At closing, Xxxxxx and the Company shall deliver to ANC all
documents of the Company, in their possession, care, custody or control,
including: (1) all books, records, accounts, checks and other related documents;
and (2) any stock certificates, transfer books, minute books and other related
records (3) Delivery of these documents shall take place at the Company's
offices in New York. The documents that Xxxxxx and the Company shall deliver to
ANC shall be true in all material respects. ANC acknowledges that, due to recent
events at the Company, certain records are may not have been posted and
processed and may not be up to date as of the closing date and will need to be
completed after closing. However, Xxxxxx arid the Company represent that the
Company has retained and maintained all relevant documents received during this
period, and upon completion of the bookkeeping, review and filing processes,
such records shall be true and correct in all material respects. In the event
that Xxxxxx discovers any documents that have been inadvertently separated from
the above documents (to the best of his knowledge, information and belief on the
date he entered this agreement, he believes that none exist), but in no event
later than 30 days after closing Xxxxxx shall immediately advise ANC and the
Company and shall immediately provide the originals (and copies if requested) to
ANC and the Company.
10. It being the assertion of Xxxxxx that the Company owes him
various amounts as a result of loans and other transactions with the Company,
and the Company having insufficient information on which to evaluate that
assertion, the Company will conduct an audit within I80 go days after closing
and shall, as a result of that audit, produce an accounting of the amounts due
and owing between the Coopers and the Company. In the event that the audit shows
that the Company owes the Coopers money, the Company shall negotiate the payment
on a payout basis. In the event that the audit shows that Xxxxxx owes the
Company money, the Company and Xxxxxx shall likewise negotiate a payout of the
amount due.
11. ANC will use its best efforts to resolve any alleged violations
against the Company under federal and state tax and securities laws and to
satisfy the Company's outstanding accounts payable.
12. Except as necessary for either party to enforce the provisions of
paragraph 10 of this agreement, in consideration of the promises contained in
this agreement, the parties hereby release and give up any and all claims and
rights that they have against each other to the extent permitted by law,
including without limitation the claims of ANC against the Coopers and the
Company. This releases all claims and rights1 including those of which they are
not aware and those not mentioned in this release. This release applies to
claims and rights resulting from anything that has happened up to now. At the
closing, the Company will have its new Chief Executive Officer or its designated
representative duly authorized to do so execute releases in favor of Xxxxxx and
Xxxxxx Xxxxxx giving effect to the provisions of this paragraph.
13. Any representations and covenants of the parties contained in
this agreement shall survive any termination of this agreement, the consummation
of the transactions contemplated by this agreement and any examination or
investigation by the parties. in each case for a period of two years from the
date of closing.
14. Except as specifically stated in this agreement, the parties
agree that, by entering into this agreement, no party admits or acknowledges the
validity of any of the claims and/or assertions made during the course of the
negotiations of this agreement.
15. The parties agree that the terms and language of this agreement
were the result of negotiations between the parties and, as a result, there
shall be no presumption that any ambiguities in the agreement shall be resolved
against any party. Any controversy over the construction of this agreement shall
be decided without regard to events of authorship
16. This agreement represents all of the terms and conditions of the
agreement among the parties and supersedes all prior and contemporaneous
negotiations, understandings and agreements, written or oral, among the parties
with respect to the subject matter hereof. There have been no representations,
warranties, promises, inducements or considerations of any kind given with
respect to the settlement herein except as are expressly memorialized in this
agreement.
17. Any provision that is or may be found to be in violation of any
state or federal law shall be stricken. In that event, all other terms shall
remain in full force and effect.
18. Notices given pursuant to this Settlement Agreement must be in
writing. Notices shall be deemed to have been duly given: (i) upon delivery or
refusal to accept delivery, if hand-delivered; (ii) when transmitted, if sent by
fax with confirmed receipt, fo1lowed by a "hard" copy delivered by any other
method specified in this agreement; or (iii) one (1) business day after being
deposited for next-business-day delivery with Federal Express or other national
overnight courier service providing delivery confirmation. In each case, notice
shall be addressed as follows to:
Xxxxxx Xxxxxx
000 Xxxxxxx Xxxxxx, Xxx. 000
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No. (000) 000-0000
American Nortel Communications, Inc.
0000 Xxxx Xxxx0xxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Facsimile No. (000) 000-0000
