Mutual settlement agreement THIS MUTUAL SETTLEMENT AGREEMENT CONTAINS A COVENANT OF CONFIDENTIALITY
THIS
MUTUAL SETTLEMENT AGREEMENT CONTAINS
A
COVENANT OF CONFIDENTIALITY
This Mutual Settlement Agreement is
entered into and effective the 9th day
of May 2009 by and between Xxxxxxx Xxxx (“Xxxx”); Xxxx Xxxxxxx, (“Aelmore”); St.
Xxxxxx, Inc. (“St. Xxxxxx”), Xxxxxx XxXxxxxxxx (“XxXxxxxxxx”), individually and
as President and CEO of St. Xxxxxx; Xxxxxxx X. Xxxxxxx (“Xxxxxxx”), individually
and as Secretary, Treasurer and Director of St. Xxxxxx; Xxxxx Xxxxxxxxx
(“Xxxxxxxxx”), individually and as Director of St. Xxxxxx; Xxxxxx Xxxx (“Ford”),
individually and as Director of St. Xxxxxx; and Xxxxxxx X’Xxxxx (“X’Xxxxx”),
individually and as Director of St. Xxxxxx.
This Mutual Settlement Agreement is the
result of the Civil Action filed by Xxxx and Aelmore in the United States
District Court for the Northern District of Oklahoma identified as case number
08-CV-470 (the “Suit”). The Suit was filed claiming breach of
contract and failure to pay dividends. The terms of this Mutual
Settlement Agreement are as follows:
I.
PAYMENTS
1.
St. Xxxxxx will agree to pay to all Preferred A shareholders, collectively, the
sum of approximately $2,700 per month, retroactive to January 1,
2009, until such time as the entire amount owed ($117,312.00) is
retired.
2. Monthly
payments will be made pro rata to all Preferred A shareholders entitled to
payment. Specific monthly payments will be made to Xxxx and Aelmore
as follows: Xxxx - $2,295.00 and Aelmore - $176.50.
3. St.
Xxxxxx shall tender the sum of eleven thousand, four hundred seventy-five
dollars ($11,475.00) to Xxxx by way of check(s) or draft(s) payable to Xxxxxxx
Xxxx and Xxxxxxxxxx, Xxxxxxxxxx & Xxxxxxxxx, 0000 Xxxxx Xxxxx, Xxxxx 000,
Xxxxx, Xxxxxxxx 00000, within ten (10) days of the effective date of this Mutual
Settlement Agreement. Regular monthly payments in the amount of two
thousand two hundred ninety-five dollars ($2,295.00) will be paid to Xxxx and
Xxxxxxxxxx, Xxxxxxxxxx & Xxxxxxxxx, 0000 Xxxxx Xxxxx, Xxxxx 000, Xxxxx,
Xxxxxxxx 00000, on the first day of each month thereafter until the amount due
is fully paid beginning June 1, 2009.
4. A
promissory note issued in favor of Xxxx and signed by St. Xxxxxx shall accompany
this executed agreement.
5. St.
Xxxxxx shall tender the sum of eight hundred eighty-two dollars and fifty cents
($882.50) to Aelmore by way of check(s) or draft(s) payable to Xxxx Xxxxxxx and
Xxxxxxxxxx, Xxxxxxxxxx & Xxxxxxxxx, 0000 Xxxxx Xxxxx, Xxxxx 000, Xxxxx,
Xxxxxxxx 00000, within ten (10) days of the effective date of this
Mutual Settlement Agreement. Regular monthly payments will be
made to Aelmore and Xxxxxxxxxx, Xxxxxxxxxx & Xxxxxxxxx, 0000 Xxxxx Xxxxx,
Xxxxx 000, Xxxxx, Xxxxxxxx 00000, in the amount of one hundred seventy-six
dollars and fifty cents ($176.50) on the first day of each month thereafter
until the amount due is fully paid beginning June 1, 2009.
6. A
promissory note issued in favor of Aelmore and signed by St. Xxxxxx shall
accompany this executed agreement.
7. The
payments required herein are for dividend payments due only.
II. ADDITIONAL
TERMS
8. Exclusive Authority to
Settle. Xxxx and Aelmore represent and warrant that they are
aware of no other persons or entities who or which may be entitled to receive
any portion of any recovery or any of the proceeds of the settlement under
applicable Oklahoma statutes or otherwise, based upon the claims asserted in the
Suit. Xxxx and Aelmore represent and warrant they have the authority
to pursue the claims in the Suit and that such authority or right has not been
assigned or otherwise transferred or conveyed to any other person or entity, and
that they also have the sole and exclusive authority to compromise the claims
addressed herein and to execute this Mutual Settlement Agreement.
9. Dismissal Without
Prejudice. Xxxx and Aelmore will file a Stipulation of
Dismissal without Prejudice as to all claims in the Suit within ten (10) days of
the effective date of this Mutual Settlement Agreement. Xxxx and
Aelmore agree that this Suit will not be re-filed until and unless St. Xxxxxx
fails to make payment as outlined above for a period of not less than sixty (60)
days.
10. Certain Other
Claims. Xxxx and Aelmore agree that no other causes of action
for failure to pay the above amounts will be filed until and unless St. Xxxxxx
fails to make payment as outlined above for a period of not less than sixty (60)
days.
11. Release. Xxxx
and Aelmore, in consideration of the sums identified in Paragraph 2 above, to be
paid by St. Xxxxxx, the sufficiency of which is hereby acknowledged by Xxxx and
Aelmore, individually and on behalf of their heirs, administrators,
representatives, and assigns, shall, upon receipt of the final payment of the
debt identified in Paragraph 1 above, release, remise, and forever discharge St.
Xxxxxx, McIlhargey, Johnson, Schreiner, Ford, and O’Brien, their respective
heirs, employees, agents, affiliates, parents, subsidiaries, officers,
directors, shareholders, successors, assigns, legal representatives, insurers,
and administrators from any and all claims asserted or which might have been
asserted against St. Xxxxxx, McIlhargey, Johnson, Schreiner, Ford, and O’Brien
in the Suit.
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MUTUAL
SETTLEMENT AGREEMENT
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The Release is meant to fully and
finally settle and terminate all controversies among Bell, Aelmore, St. Xxxxxx,
McIlhargey, Johnson, Schreiner, Ford, and O’Brien in the Suit. Xxxx
and Aelmore shall covenant and agree not to commence or assist with respect to
any other litigation or claim against St. Xxxxxx, McIlhargey, Johnson,
Schreiner, Ford, and O’Brien, concerning the matters referenced herein that gave
rise to the Suit. The Release shall be irrevocable. Xxxx
and Aelmore agree that no fact, event, or transaction occurring before the date
of this Mutual Settlement Agreement, which is currently unknown, but which may
hereafter become known, shall affect the final nature of this Mutual Settlement
Agreement except for non-payment by St. Xxxxxx, as set forth herein, of the
above-mentioned payments.
12. Statutory Limitations on
Payment of Dividends. XXXX and AELMORE acknowledge and recognize that as
a Colorado corporation, ST. XXXXXX is subject to restrictions on the payment of
dividends imposed by Colorado law. In particular, Section 0-000-000 of the
Colorado Revised Statutes generally prohibits the payment of dividends if, after
giving effect to such payment, a company would be unable to pay its debts as
they become due in the due course of business or if the company’’s total assets
would be less than the sum of its total liabilities plus any amount that would
needed to satisfy any preferential rights on dissolution. XXXX and AELMORE
further acknowledge that in the event ST. XXXXXX is barred by Colorado law from
making any payment required by this Agreement at the time required herein, ST.
XXXXXX shall not be default of this Agreement so long as ST. XXXXXX promptly
remits payment at such time as ST. XXXXXX may legally do so.
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MUTUAL
SETTLEMENT AGREEMENT
PAGE 5
13. Attorney Fees and
Costs. Bell, Aelmore, St. Xxxxxx, McIlhargey, Johnson,
Schreiner, Ford, and O’Brien understand, acknowledge, and agree that they will
each be responsible for their own respective attorney fees and costs of the
Suit, and all other costs and expenses relating to the controversy among the
parties.
14. Representations and
Warranties. Xxxx and Aelmore hereby declare, represent, and
warrant that no promise, inducement, or representation has been made to them by
St. Xxxxxx, their respective counsel, or anyone else acting on behalf of St.
Xxxxxx, to induce this Mutual Settlement Agreement, save only those promises
which are expressly set forth in this Mutual Settlement
Agreement. Xxxx and Aelmore are represented by the Xxxxxxxxxx Law
Firm and have obtained the advice and counsel of their attorney in entering into
this Mutual Settlement Agreement. St. Xxxxxx, McIlhargey, Johnson,
Schreiner, Ford, and O’Brien are represented by the law firm of Xxxxxxxx &
Xxxxxx and have obtained the advice and counsel of their attorneys in entering
into this Mutual Settlement Agreement. Bell, Aelmore, St. Xxxxxx,
McIlhargey, Johnson, Schreiner, Ford, and O’Brien state that they
have not been coerced or forced to settle the claims through economic duress or
otherwise, but do so voluntarily because they believe the settlement is
reasonable and to avoid the risks and uncertainties of future
litigation.
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MUTUAL
SETTLEMENT AGREEMENT
PAGE 6
15. Integration. Bell,
Aelmore, St. Xxxxxx, McIlhargey, Johnson, Schreiner, Ford, and O’Brien agree
that with respect to the subject matter of this Mutual Settlement Agreement,
this Mutual Settlement Agreement embodies the entire understanding and contract
between the parties, and supersedes all prior understandings and contracts,
verbal or written, and/or any offers and acceptances of such offers (whether or
not valid, binding, or enforceable) made by any party to the other; and further
that there are no understandings, contracts, agreements, outstanding offers,
restrictions, representations, or warranties between the parties relating to the
subject matter hereof other than those set forth herein.
16. No Admission of
Liability. It is expressly understood and agreed that this
Mutual Settlement Agreement and the consideration called for hereunder are given
solely as a compromise to avoid the expense and inconvenience of the Suit and to
terminate the Suit. Bell, Aelmore, St. Xxxxxx, McIlhargey, Johnson, Schreiner,
Ford, and O’Brien agree that this instrument is not intended to be and shall not
be construed as an admission of liability on the part of any party.
III. GENERAL
PROVISIONS
17. Taxes. Xxxx
and Aelmore acknowledge that they are solely responsible for the payment of all
taxes, if any, which may be due based on receipt of the payments consideration
set forth herein, and that there are no representations being made as to the tax
consequences to Xxxx and Aelmore of receipt of the consideration set
forth herein.
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SETTLEMENT AGREEMENT
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/s/ Xxxxxxx Xxxx
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/s/ Xxxx X. Xxxxxxx
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Xxxxxxx
Xxxx
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Xxxx
Xxxxxxx
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/s/ Xxxxxx XxXxxxxxxx
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/s/ Xxxxxx XxXxxxxxxx
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St.
Xxxxxx
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Xxxxxx
XxXxxxxxxx
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by:
Xxxxxx XxXxxxxxxx, President and CEO
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/s/ Xxxxxxx Xxxxxxx
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/s/ Xxxxx Xxxxxxxxx
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Xxxxxxx
Xxxxxxx
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Xxxxx
Xxxxxxxxx
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/s/ Xxxxx X. Xxxx
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/s/ Xxxxxxx X’Xxxxx
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Xxxxxx
Xxxx
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Xxxxxxx
X’Xxxxx
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