EXHIBIT 10.28
SETTLEMENT AGREEMENT
This Agreement is entered into on the day and year subscribed below, by and
between Xx. Xxxxx X. Xxxxx
("Xxxxx") and QualMark Corporation, a Colorado corporation,
hereinafter collectively referred to as the "Parties".
In consideration of the monies agreed to be paid hereunder and the
other promises and obligations contained herein, the parties agree as follows:
1. The Final Award entered by the Arbitrator on November 17, 2003,
shall be confirmed and Judgement will enter immediately in favor of Xxxxx and
against QualMark for the total amount of the final award, $410,729.30, less
$2,021.04 previously collected as of October 1, 2003, from Xxxxx Fargo Bank, for
a total Judgement of $408,708.26, plus interest at the statutory rate of 8% per
annum, compounded annually, from and after 6-20-03. Interest on the total amount
of $410,729.30 shall accrue only from June 20 to October 1, 2003. In the event
of default as described herein, the interest rate would become 18% per annum,
compounded monthly, from and after 6-20-03. The parties agree that their counsel
shall execute and file with Denver District Court the Stipulated Motion for
Entry of Judgement attached hereto no later than February 18, 2004.
2. Execution on such Judgement shall be stayed for so long as all
payments described below are made on time. Time is of the essence. In the event
that any such payment is not timely made, and default hereunder shall be deemed
to have occurred hereunder in the event that any payment is not timely made,
then Xxxxx shall be entitled to immediate execution on the Judgement, less any
amounts previously paid, plus all interest and other additions referred to
herein. QualMark shall withdraw all objections and motions directed at
challenging the confirmation of the award.
3. The Judgement shall be as follows:
A. The sum of $264,109.00 shall be paid on or before 5:00 PM,
Tuesday, February 17, 2004.
B. The balance remaining after the payment due February 17,
2004, is made, including interest earned up until that date is $166,323.22,
which shall be paid in monthly installments with the first payment of
$19,539.28, including interest from February 17, 2004, through March 31, 2004,
being due March 31, 2004, and continuing in equal monthly installments of
$19,101.83 due before 5:00 PM on the last day of the next 8 months with the last
payment being due on November 30, 2004.
4. There is no grace period for making any of the payments described
above. Xxxxx is not required to send out anything in the form of a notice of
default. All payments must be physically received in the office of counsel for
Xxxxx, (C/O Xxxxx X. Xxxxxx, Xx., or Xxxx X. Xxxxxxxx, 000 Xxxx 00xx Xxxxxx,
Xxxxx 000, Xxxxxx, XX 80203) on or before their due date, and shall be in the
form of cash, cashier's check written on a bank in the Denver metro area, or a
check drawn on QualMark's attorney's COLTAF account. In the alternative,
QualMark may make such payments by wire transfer to the COLTAF account of one of
the above attorneys for Xxxxx, as long as such payment is credited to such
account before its due date and time. Any payment attempted to be made by
QualMark by any other means shall be deemed to be no payment at all. It shall be
the sole responsibility of QualMark to ensure that all payments are made on time
and it shall be solely responsible for whatever means it deems necessary to make
timely delivery and receipt of such payments.
Wire transfers to Xxxx X. Xxxxxxxx' firm should be directed as follows:
XXXXX, WALL XXXXX AND XXXXXXX, P.C.
COLTAF Trust Account
Account No. 40-81565
Colorado State Bank and Trust
ABA No. 1020 00607
5. In the event QualMark defaults on any of the payments referred to
herein, the obligation amount shall immediately increase by an additional
$30,000.00,which would bear interest at the default rate stated above, from and
after the date of default. In
addition, QualMark, in the event of such default, agrees to direct its attorneys
to immediately enter into a Stipulated Motion with Xxxxx' counsel to increase
the amount remaining on the Judgement entered pursuant to this Agreement by that
$30,000.00.
6. Xxxxx agrees to immediately withdraw his objections to the release
to QualMark of all garnished funds now held by U.S. Bank pursuant to
garnishments served on it by him, as long as those funds necessary for the
initial payment of $264,109.00 described above are simultaneously paid to him.
7. Xxxxx and QualMark are free to file whatever motions they deem
necessary in the Denver District Court to recover reasonable attorneys fees and
costs incurred after June 20, 2003, and prior to the date hereof.
8. In the event that Xxxxx engages in further legal proceedings in
order to collect on his Judgement, the prevailing party such proceedings shall
be entitled to recover his or its reasonable attorneys fees and costs incurred
in such collection efforts or in opposition thereto.
9. The parties state that they have sought legal advice with regard to
this Agreement and they are signing it in reliance on the advice of their legal
counsel.
10. The person signing on behalf of QualMark below hereby represents
that he has the authority of QualMark to execute this Agreement. This Agreement
shall inure to the benefit of and be binding upon the parties and their
respective heirs, successors and assigns.
11. This Agreement may be signed in counterparts which taken together
shall have the effect of one Agreement executed by all parties. It is further
agreed that facsimile signatures are acceptable from all parties and shall have
the same binding effect as original signatures.
Date: 13 February /s/ Xxxxx X. Xxxxx
---------------------------------------
Xxxxx X. Xxxxx
QualMark Corporation
Date: February 13, 2004 By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Xxxxxxx Xxxxxxxx, its President
ACKNOWLEDGEMENT
State of Colorado
County of Xxxxx
This will acknowledge that Xxxxx X. Xxxxx personally appeared before me
and acknowledged that he executed the above document on this 13 day of February
2004.
/s/ Xxxxxx Xxxx
---------------------------------------
Notary Public
My Commission Expires: 5/19/07
State of Colorado
County of Denver
This will acknowledge that Xxxxxxx Xxxxxxxx, as President of QualMark
Corporation, personally appeared before me and acknowledged that he executed the
above document on this 13 day of February 2004.
/s/ Xxxxxxx Xxxxxxx
---------------------------------------
Notary Public
My Commission Expires: 3/1/06
