SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE
This Settlement Agreement and Mutual General Release (this "Settlement
and Release") is made and entered into this 2nd day of April, 2000 by and
between Xxxxxx X. Xxxxxxx individually and d/b/a Xxxxxxx & Xxxxxxx ("Xxxxxxx"),
the Xxxxxx X. Xxxxxxx Pension Plan & Trust (the "PSP") and their respective
officers, directors, shareholders, partners, members, employees, agents,
attorneys, representatives, predecessors, successors and assigns (collectively,
the "Xxxxxxx Group") and SHC Corp. (f/k/a VictorMaxx Technologies, Inc.) an
Illinois corporation ("VMTI"); Sonoma Holding Corp., an Illinois corporation
("Sonoma"); and any Sonoma related, affiliated or subsidiary companies; Xxxxxxxx
X. Xxxxxx ("Xxxxx"); Xxxxx Xxxxxxxx ("Xxxxx"); and their respective officers,
directors, shareholders, partners, members, employees, agents, attorneys,
representatives, predecessors, successors and assigns (collectively, the "VMTI
Group").
WHEREAS, on May 15, 1998, Xxxxx X. Xxx ("Xxxxx"), Xxxxxxx X. Xxx
("Xxxxxxx" and Kevin's mother); Chicago Mortgage and Financial Services, Inc.
a/k/a Chicago Mortgage Company, Inc. a/k/a Chicago Mortgage Company or such
similar name ("CMFSI"); Chicago Mortgage and Financial Services, Inc. Profit
Sharing Plan & Trust "CMFSI Profit Sharing Plan"); Cambridge Financial Services,
Inc. a/k/a Cambridge Financial or such similar name "Cambridge Financial");
CorCapital Financial Partners L.L.C. a/k/a CorCapital Financial Corp or such
similar name ("CorCapital"); or any other entity, pseudonym, nominee or other
name used by Xxxxx, his attorneys, agents, heirs, representatives and assigns
(collectively, the Koy Group") and the VMTI Group entered into a Settlement
Agreement (the "Koy Settlement Agreement") for the stated purpose of
compromising and settling all allegations and disputed issues and any other
potential claims, allegations and disputes between them;
WHEREAS, prior to the execution of the Koy Settlement Agreement,
litigation was commenced in the Circuit Court of Xxxx County by Xxxxx against
certain of the VMTI Group to collect an alleged $25,000 promissory note; Case
Xx. 00 XX 000000 (the "State Litigation");
WHEREAS, also prior to the execution of the Koy Settlement Agreement,
some members of the VMTI Group filed a lawsuit in the United States District
Court for the Northern District of Illinois, seeking injunctive relief against
Xxxxx, case No. 98 C 1697 (the "Federal Litigation");
WHEREAS, in connection with and as part of the Koy Settlement
Agreement, and concurrently with the execution of the Koy Settlement Agreement,
the Koy Group and the VMTI Group entered into an Escrow Agreement and Voting
Trust (The "Voting Trust") pursuant to which Xxxxxxx was appointed the Trustee
and Escrowee;
WHEREAS, disputes have arisen between Xxxxxxx and the VMTI Group in
connection with Xxxxxxx'x prior representation of the VMTI Group and his actions
as Escrowee and Trustee under the Voting Trust and fees and amounts allegedly
due the Xxxxxxx Group by the VMTI Group and amounts allegedly due the VMTI Group
by the Xxxxxxx Group; and
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WHEREAS, in order to avoid the cost of continuing litigation and
without admitting any liability, the Xxxxxxx Group and the VMTI Group have
agreed to settle and compromise, on the terms set forth herein, all claims,
disputes and issues between them.
NOW THEREFORE, in consideration of the foregoing and of the mutual
promises set forth herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. OBLIGATIONS OF THE XXXXXXX GROUP. Concurrently with the
execution of this Settlement and Release, the Xxxxxxx Group agrees:
a. to return and deliver to the VMTI Group a stock certificate
evidencing 1,000,000 shares of VMTI common stock of the
Company having a par value of $0.001 issued in the name of the
Xxxxxx X. Xxxxxxx Profit Sharing Plan (the "Settlement
Shares"); together with a duly executed, medallion guaranteed
stock power in the form of the stock power attached hereto as
EXHIBIT A and any other documents or instruments requested by
the VMTI Group or its counsel which may be necessary or
appropriate, in the discretion of the VMTI Group, in order to
transfer title of the Settlement Shares;
b. to deliver to the VMTI Group his resignation as Trustee and as
Escrowee under the Voting Trust, together with any and all
stock certificates, documents, instruments and other items
held by Xxxxxxx in his capacity as Trustee or Escrowee under
the Voting Trust;
c. to deliver to VMTI or, at VMTI's option, its counsel all
records, files and documents held by or under the control of
Xxxxxxx, if any, relating to Xxxxxxx'x prior representation of
VMTI as counsel to VMTI (the VMTI Group acknowledges that
Xxxxxxx has previously delivered to the VMTI Group certain
materials which Xxxxxxx has represented constitutes all such
records, files and documents); and
d. to immediately file a withdrawal of Xxxxxxx'x appearance on
behalf of VMTI in the Federal Litigation and in any other
litigation, if any, in which Xxxxxxx has filed an appearance
on behalf of the VMTI Group or any of its members.
2. OBLIGATIONS OF THE VMTI GROUP. Concurrently with the execution
of this Settlement and Release, the VMTI Group agrees to deliver to Xxxxxxx
$20,000 in the form of a certified check or, at the option of Xxxxxxx, by wire
transfer.
3. MUTUAL OBLIGATIONS OF THE XXXXXXX GROUP AND THE VMTI GROUP.
Concurrently with the execution of this Settlement and Release, the Xxxxxxx
Group and the VMTI Group agree to present, as soon as is practicable, an agreed
order, in the form attached hereto as EXHIBIT B and made a part hereof, to the
Court hearing the Federal Litigation which:
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a. enters a withdrawal of Xxxxxxx'x (and if applicable Xxxxxxx &
Xxxxxxx'x) appearance on behalf of VMTI;
b. dismisses with prejudice Xxxxxxx'x Fee petition currently
pending before the court; and
c. strikes the evidentiary hearing relating to Xxxxxxx'x fee
petition currently scheduled to take place on April 10, 2000.
3. REPRESENTATIONS AND WARRANTIES OF THE VMTI GROUP. Each of the
members of the VMTI Group represents and warrants to the Xxxxxxx Group as
follows:
a. ORGANIZATION, GOOD STANDING. VMTI is a corporation duly
organized, validly existing and in good standing under the
laws of the State of Illinois and has all requisite corporate
and other power and all necessary permits, certificates,
licenses, approvals and other authorizations required to carry
on and conduct its business and to own, lease, use and operate
its properties at the locations where VMTI does business and
in the manner in which such business is presently carried on
and conducted or where the lack thereof would have a material
adverse effect on VMTI.
b. AUTHORITY. Each of the VMTI Group has full power and authority
to execute, deliver and perform this Settlement and Release
and any other documents and instruments to be executed by the
any of VMTI Group pursuant to this Settlement and Release
without the consent of any other person. This Settlement and
Release, and the transactions contemplated by it, have been
validly approved and authorized by the Board of Directors of
VMTI and its officer or officers executing this Settlement and
Release have been duly authorized for that purpose.
c. VALID AND BINDING AGREEMENT. This Settlement and Release
constitutes a valid and binding agreement of each of the VMTI
Group, enforceable against them in accordance with its terms.
Neither the execution and delivery of this Settlement and
Release or the performance by the VMTI Group hereunder (i)
violates or will violate any statute or law or any rule,
regulation or order of any court or governmental authority
applicable to the VMTI Group, or (ii) violates or will
violate, or conflicts with or will conflict with, or
constitutes a default under or will constitute a default
under, any contract, commitment or agreement to which any of
the VMTI Group is a party or by which any of the VMTI Group is
bound.
4. REPRESENTATIONS AND WARRANTIES OF THE XXXXXXX GROUP. Each of
the Xxxxxxx Group represents to the VMTI Group as follows:
a. [INTENTIONALLY DELETED]
b. AUTHORITY. Each of the Xxxxxxx Group has full power and
authority to execute, deliver and perform this Settlement and
Release and all other documents and
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instruments to be executed by any of the Xxxxxxx Group
pursuant to this Settlement and Release without the consent of
any other person. This Settlement and Release, and the
transactions contemplated by it, have been validly approved
and authorized by the Board of Directors of Xxxxxxx & Xxxxxxx
and its officer or officers executing this Settlement and
Release have been duly authorized for that purpose.
c. VALID AND BINDING AGREEMENT. This Settlement and Release
constitutes a valid and binding agreement of each of the
Xxxxxxx Group, enforceable against them in accordance with its
terms. Neither the execution and delivery of this Settlement
and Release or the performance by any of the Xxxxxxx Group
hereunder (i) violates or will violate any statute or law or
any rule, regulation or order of any court or governmental
authority applicable to any of the Xxxxxxx Group, or (ii)
violates or will violate, or conflicts with or will conflict
with, or constitutes a default under or will constitute a
default under, any contract, commitment or agreement to which
any of the Xxxxxxx Group is a party or by which any of the
Xxxxxxx Group is bound.
d. DELIVERY OF RECORDS. Xxxxxxx has previously delivered to VMTI
or its attorneys all records, files and documents relating his
representation of VMTI and upon execution hereof Xxxxxxx will
no longer be in possession of any such materials (excepting
copies he may have made).
5. RELEASE OF CLAIMS.
a. In consideration of the promises of the VMTI Group under this
Settlement and Release, each of the Xxxxxxx Group hereby
unconditionally releases and forever discharges each of the
VMTI Group, their successors and assigns, and their respective
officers, directors, shareholders, partners, members,
employees, agents, and attorneys, past and present, ("Released
VMTI Parties," individually each is a "Released VMTI Party"),
from each and every action, charge, claim, right, liability or
demand of any kind or nature, known or unknown, that any of
the Xxxxxxx Group had, now has or may through the effective
date of this Settlement and Release have against Contaldo,
Xxxxxx or VMTI or any other Released VMTI Party based on
actions or events prior to the effective date of this
Settlement and Release. Without limiting the generality of the
foregoing, specifically included in this release and discharge
are each and every action, charge, claim, right, liability or
demand of any kind or nature, known or unknown, any of the
Xxxxxxx Group had, now has, or may have through the effective
date of this Settlement and Release, arising under any law,
constitution, rule, regulation, statute, or common law theory,
whether in tort, contract, equity, or otherwise, including
without limitation any fees for services performed by any of
the Xxxxxxx Group as attorneys, Trustee or Escrowee for the
VMTI Group. Any action, charge, claim, right, liability,
demand or other legal proceeding released and discharged under
this Section is hereinafter referred to as a "Claim".
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Each of the Xxxxxxx Group further agrees that it will not
instigate, advise or encourage any other person, group of
persons, or any entity to file suit against any of the VMTI
Group or any other Released VMTI Party, and that it will not
assist in any action against any of the VMTI Group or any
other Released VMTI Party, except in response to any court
issued subpoena, notice of deposition or inquiry from a
governmental agency, and it further represents and warrants
that it has not filed any legal or administrative action of
any kind against any of the VMTI Group or any other Released
VMTI Party.
b. In consideration of the promises of the Xxxxxxx Group under
this Settlement and Release, each of the VMTI Group hereby
unconditionally releases and forever discharges each of the
Xxxxxxx Group, their successors and assigns, and their
respective officers, directors, shareholders, partners,
members, employees, agents, and attorneys, past and present,
("Released Xxxxxxx Parties," individually each is a "Released
Xxxxxxx Party"), from each and every action, charge, claim,
right, liability or demand of any kind or nature, known or
unknown, that any of the VMTI Group had, now has or may
through the effective date of this Settlement and Release have
against any of the Xxxxxxx Group or any other Released Xxxxxxx
Party based on actions or events prior to the effective date
of this Settlement and Release. Without limiting the
generality of the foregoing, specifically included in this
release and discharge are each and every action, charge,
claim, right, liability or demand of any kind or nature, known
or unknown, any of the VMTI Group had, now has, or may have
through the effective date of this Settlement and Release,
arising under any law, constitution, rule, regulation,
statute, or common law theory, whether in tort, contract,
equity, or otherwise, including without limitation any shares
of stock of VMTI previously delivered to Xxxxxxx (other than
the Settlement Shares). Any action, charge, claim, right,
liability, demand or other legal proceeding released and
discharged under this Section is hereinafter referred to as a
"Claim".
Each of the VMTI Group further agrees that it will not
instigate, advise or encourage any other person, group of
persons, or any entity to file suit against any of the Xxxxxxx
Group or any other Released Xxxxxxx Party, and that it will
not assist in any action against any of the Xxxxxxx Group or
any other Released Xxxxxxx Party, except in response to any
court issued subpoena, notice of deposition or inquiry from a
governmental agency, and it further represents and warrants
that it has not filed any legal or administrative action of
any kind against any of the Xxxxxxx Group or any other
Released Xxxxxxx Party.
6. AGREEMENT NOT TO XXX.
a. In consideration of the promises of the parties under this
Settlement and Release, the VMTI Group agrees on behalf of
itself and its owners, beneficiaries, partners, successors and
assigns never to institute, directly or indirectly, any action
or proceeding of any kind against any of the Xxxxxxx Group or
any other Released Xxxxxxx Party to enforce a Claim, except
for an action or proceeding specifically
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and expressly not released by this Settlement and Release
or to enforce this Settlement and Release.
b. In consideration of the promises of the parties under this
Settlement and Release, the Xxxxxxx Group agrees on behalf of
itself and its owners, beneficiaries, partners, successors and
assigns never to institute, directly or indirectly, any action
or proceeding of any kind against any of the VMTI Group or any
other Released VMTI Party to enforce a Claim, except for an
action or proceeding specifically and expressly not released
by this Settlement and Release or to enforce this Settlement
and Release.
7. AGREEMENT AS COMPLETE DEFENSE. In consideration of the
promises of the parties under this Settlement and Release, the parties hereby
agree that if any party files a Claim or a Claim is filed on a party's behalf,
except for an action or proceeding specifically and expressly not released by
this Settlement and Release, this Settlement and Release shall constitute a
complete defense to such Claim.
9. COSTS AND ATTORNEYS' FEES. The Xxxxxxx Group and the VMTI
Group agree that each shall bear its own costs and attorneys' fees in connection
with entering into this Settlement and Release and the circumstances underlying
this Settlement and Release. In the event of litigation to enforce the terms of
this Settlement and Release, the prevailing party shall be entitled to recover
from the non-prevailing party reasonable attorneys' fees and court costs
incurred.
10. NO ADDITIONAL CLAIMS. Each of the Xxxxxxx Group understands
and agrees that it has no additional claims against Contaldo, Donati, any of the
VMTI Group or any other Released VMTI Party other than those specified herein.
Each of the VMTI Group understands and agrees that they have no additional
claims against Xxxxxxx or any of the Xxxxxxx Group other than those specified
herein.
11. DISCLAIMER OF LIABILITY. The parties understand and agree that
this Settlement and Release does not constitute and shall not be construed as an
admission of liability or wrongdoing by any party or any other Released Party
with respect to any claims asserted by any party, and that each party and the
other Released Parties expressly denies that they collectively have, that more
than one of them have, or that any one of them has done anything wrong or
unlawful regarding the other parties.
12. COVENANTS OF THE XXXXXXX GROUP AND THE VMTI GROUP.
x. Xxxxxxx covenants and agrees that following the execution of
this Settlement and Release, he will provide reasonable
cooperation to the VMTI Group (at no cost to the VMTI Group)
in connection with any actions required to terminate the
Voting Trust Agreement, if any, and agrees to execute such
documents as may be reasonably requested by the VMTI Group in
order to carry out the purposes of this Settlement and
Release, and any other matters requiring Xxxxxxx'x
cooperation, if any.
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b. VMTI acknowledges that following the return of the Settlement
Shares, the Xxxxxxx Group will remain the owner of 1,000,000
shares of VMTI common stock (the "Retained Shares") and that
it is contemplated that the Xxxxxxx Group will submit the
certificate evidencing Retained Shares to VMTI's stock
transfer agent for removal of the restrictive legend. Provided
that Xxxxxxx provides to the VMTI Group and its counsel
appropriate documentation as requested by VMTI and/or its
counsel, VMTI shall cause its counsel to deliver to VMTI's
stock transfer agent an opinion authorizing the removal of the
restrictive legend on the Retained Shares.
13. APPLICABLE LAW. This Settlement and Release shall be governed
and construed in accordance with the laws of the State of Illinois to the extent
state law is applicable.
14. BINDING EFFECT. This Settlement and Release shall be binding
upon the heirs, administrators, executors, successors and assigns of the VMTI
Group and the Xxxxxxx Group.
15. NO RELIANCE ON OUTSIDE PROMISES. The parties acknowledge that
they have not relied upon any promises made by any party or by any other
Released Party, other than those specifically contained herein, as an inducement
to execute this Settlement and Release.
16. ENFORCEABILITY. If any term or provision, or any part of any
term or provision of this Settlement and Release is held unenforceable, it shall
be severed as narrowly as possible and the remaining terms and provisions shall
be enforced in accordance with the tenor of this Settlement and Release.
17. COMPLETE AGREEMENT. This Settlement and Release contains the
entire understanding between the VMTI Group and the Xxxxxxx Group and supersedes
all prior agreements and understandings relating to the subject matter hereof.
18. COUNTERPARTS. This Settlement and Release may be executed in
counterparts, each of which shall be deemed an original and shall, when taken
together, be deemed to be one and the same Settlement Agreement.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties have executed this Settlement and
Release this 2nd day of April, 2000.
XXXXXX XXXXXXX,
individually and d/b/a XXXXXXX & XXXXXXX : [SEAL]
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxxxx X. Xxxxxx
--------------------------------------- ----------------------
Notary Public
XXXXXX X. XXXXXXX PENSION PLAN & TRUST:
[SEAL]
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxxxxx X. Xxxxxx
------------------------------------- ----------------------
Its: TTEE Notary Public
------------------------------------
SHC CORP. (a/k/a Sonoma Holding Corp.)(f/k/a Victormaxx Technologies,
Inc.)
By: /s/ Xxxxxxxx X. Xxxxxx [SEAL]
------------------------------------- /s/ Xxxxx X. Xxxx
Its: President ----------------------
------------------------------------ Notary Public
XXXXX X. XXXXXXXX, individually: [SEAL]
/s/ Xxxxx X. Xxxxxxxx /s/ Xxxx Xxxxxxxxxxxxx
--------------------------------------- ----------------------
Notary Public
XXXXXXXX X. XXXXXX, individually: [SEAL]
/s/ Xxxxxxxx X. Xxxxxx /s/ Xxxxx X. Xxxx
--------------------------------------- ----------------------
Notary Public
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EXHIBIT A
TO
SETTLEMENT AND RELEASE
STOCK POWER
FOR VALUE RECEIVED, ______________________________ hereby sells, assigns and
transfers unto __________________________________ , One Million (1,000,000)
Shares of the Common Stock of SHC Corp. (f/k/a VictorMaxx Technologies, Inc.),
an Illinois corporation, standing in his name on the books of said Company and
represented by Certificate No(s). _______________________ herewith and does
hereby irrevocably constitute and appoint ________________________ his/its
attorney to transfer said stock on the books of the Company with full power of
substitution in the premises.
Dated: ___________________________
------------------------------------
signature -- must match exactly the
name on the stock certificate
------------------------------------
print name - must match exactly the
name on the stock certificate
MEDALLION GUARANTEE:
-------------------------------------
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