SETTLEMENT AGREEMENT AND GENERAL RELEASE
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THIS SETTLEMENT AGREEMENT AND GENERAL RELEASE (the "Agreement") is
entered into by and between the following parties: BILTMORE VACATION VILLAGE,
INC., an Arizona Corporation; BILTMORE VACATION RESORTS, INC., a Nevada
Corporation (formerly CYBER INFORMATION, INC.); and XXXXXX WAUGNEUX, an
Individual (hereinafter jointly referred to as the "Releasor"); and XXXXX X.
XXXXXXX, an Individual (hereinafter referred to as the "Releaseee"). Releasor
and Releasee are sometimes referred to as the "Settling Parties".
RECITALS
1. On February 18, 1998, BILTMORE VACATION VILLAGE, INC. ("BVVI") entered
into a Stock Purchase Agreement (the "Stock Purchase Agreement") to
acquire a majority shareholder interest in CYBER INFORMATION, INC., a
Nevada Corporation (hereinafter "CYBER"). BVVI entered into the Stock
Purchase Agreement with Xx. Xxxxx X. Xxxxxxx, as President of CYBER,
and Xx. Xxxxxx Xxxxx, an Individual, who was not an officer or
director of CYBER at this time;
2. On February 25, 1998, BVVI closed the Stock Purchase Agreement (the
"Closing") and, therefore, acquired a majority shareholder interest
equal to approximately sixty percent (60%) of all issued and
outstanding Shares of Voting Common Stock of CYBER. There were no
other classes of stock issued and outstanding at Closing, CYBER
immediately changed its name to BILTMORE VACATION RESORTS, INC.
("BVRI"), and changed its business purpose to a Real Estate
Development Company;
3. The Settling Parties agree that the Stock Purchase Agreement (Sections
6.08 and 6.09 therein) provides that Xx. Xxxxxxx warranted that he, or
Xx. Xxxxxx Xxxxx, would arrange a loan (the "Loan") to BVRI in the
amount of Seven Hundred Fifty Thousand Dollars ($750,000), at simple
interest of ten percent (10%); payable quarterly and fully amortized
over eighteen (18) months.
4. The Settling Parties further agree that the Stock Purchase Agreement
specifically provided that the Loan was "the most important component"
of the Stock Purchase Agreement.
5. The Settling Parties further agree that if the Loan was not made, the
entire Stock Purchase Agreement would be rescinded and the Parties
"restored to their prior status".
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6. The Settling Parties further agree that BVVI relied upon this warranty
by Xx. Xxxxxxx, as President of CYBER, and as a result, transferred the
Arizona real property "appraised at $6,850,000" to BVRI (formerly
CYBER) on March 1, 1998.
7. The Settling Parties further agree that Xx. Xxxxxxx and Xx. Xxxxx
failed to arrange the Loan (See EXHIBIT "A", Section 6.08 and Section
6.09 of the Stock Purchase Agreement, attached hereto and incorporated
herein by reference as though set forth in full herein.)
8. Xx. Xxxxxxx acknowledges and accepts the allegation by BVVI that the
Loan was the "most important component" of the Stock Purchase Agreement
and that the Loan was not made. Furthermore, Xx. Xxxxxxx acknowledges
and accepts the allegation that BVVI has incurred substantial damages
as a result of the Loan not being made.
9. There are other various disputes which BVVI and Xx. Xxxxxxx claim
against each other, all of which the Settling Parties, including BVVI
and Xx. Xxxxxxx, do not treat as material disputes. Furthermore, the
full description of these various disputes are beyond the intent and
scope of this Agreement. However, all such various disputes, including
failure to make the aforementioned Loan, shall be included in this
Agreement as part of the Agreement (hereinafter referred to as the
"Claims").
10. All Settling Parties, including, but not limited to, BVVI and Xx.
Xxxxxxx, intend to settle and resolve all Claims against each other by
entering into this Agreement.
NOW, THEREFORE, the Settling Parties agree as follows:
1. MUTUAL RELEASE BETWEEN THE SETTLING PARTIES. Concurrent with the execution of
this Agreement, Releaser and Releases, being the Settling Parties, do hereby
agree to release, discharge, cancel, waive, covenant not to xxx, and acquit each
other in full reciprocity as to all of their rights and liabilities, or claims
against each other, arising under the Stock Purchase Agreement (the "Claims").
The Settling Parties agree that this mutual release shall apply; as well to
their respective partners, employees, principals, agents, servants, heirs,
administrators, executors, successors, predecessors in interest, shareholders,
directors, officers, representatives, attorneys, and assigns (hereinafter
sometimes jointly referred to as the "Affiliates" of each Settling Party). The
Settling Parties also agree to hold each other, and their respective Affiliates,
free and harmless for, from and against any and all claims and judgments,
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appeals, rights, demands, costs, expenses, liabilities, obligations, actions,
and causes of action of any kind or character whatsoever, whether known or
unknown, suspected or unsuspected, existing prior to or on the date of this
Agreement. Also, the Settling Parties agree, warrant, and represent that they
will not hereafter file any civil action of any kind whatsoever concerning their
Claims against each other under the Stock Purchase Agreement.
2. DEFINITION OF RELEASED CLAIMS. All Claims are defined by the Settling Parties
collectively as the "Released Claims". The Released Claims shall include,
without limitation, any and all Claims each party has against each other, as
described in greater detail in Section 1 hereinabove, and shall include the
specific Claims described hereinbelow:
2.1 SPECIFIC CLAIMS RELEASED BY RELEASOR: Releaser hereby assumes
any and all liabilities in connection with the lease of
certain personal property from, or involving, AT&T Capital
Corp.; COPELCO Capital; HRS (Mitsubishi); Sprint (SA); and
Sprint North Supply Leasing. Releaser shall also agree to
indemnify and hold harmless Releasee from any and all
liabilities in connection with the aforementioned leases.
2.2 SPECIFIC CLAIMS RELEASED BY RELEASEE: Releasee hereby assumes
any and all liabilities in connection with the following:
(a) All credit card debt, including but not limited to,
AT&T Universal Gold Card; BankAmeriCard (Visa);
CitiBank Visa; Discover Card; GM Gold Card; Xxxxx
Fargo Business Line; Ford CitiBank Visa; and any
other debt resulting from credit card expenditures;
(b) Effective as of December 31, 1997, there were two (2)
loans payable by Releaser as "Payer" as follows: The
first note payable was to Xx. Xxxxxxx as "Holder" in
the amount of Fifteen Thousand Six Hundred Seventeen
Dollars and Thirteen Cents ($15,617.13). The second
note payable was to Wall Street News Productions,
Inc., in the amount of Thirteen Thousand Five Hundred
Sixty-seven Dollars ($13,567.00); and
(c) Xxxxx Fargo Bank Line of Credit in the amount of Five
Thousand Dollars ($5,000), or any other amount,
whereby Releasee is the Payer and Xxxxx Fargo (or
assignee) is the Holder.
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Releasee shall also agree to indemnify and hold
harmless Releasor from any and all liabilities in
connection with the aforementioned liabilities as set
forth in Subsections 2.2(a), 2.2(b) and 2.2(c).
3. CONSIDERATION. In addition to other good and valuable consideration, the
Parties hereby agree the following shall constitute additional consideration in
furtherance of this Agreement:
3.1 RELEASOR: Releaser shall assume the Loan obligation of
Releasee. Releasor shall indemnify and hold harmless Releasee
for failure to make the Loan. In exchange, Releasee hereby
agrees with Releasor that BVVI shall be issued Fifteen Million
(15,000,000) additional Shares of Common Stock in BVRI in
order to compensate BVVI for the damages it incurred as a
result of Releasee's failure to make the Loan. The Additional
Shares (the "Additional Shares") shall be issued on or before
December 31, 1998, subject to Rule 144 of the Securities Act
of 1933, as amended. (See Exhibit "B"), attached hereto and
incorporated herein by reference as though set forth in full
herein, for a full description of the Stock Certificates which
evidence the corresponding Shares per Certificate and other
relevant information pertaining to the issuance of the
Additional Shares.)
3.2 RELEASEE: Releasee shall retain beneficial ownership of One
Hundred Seven Thousand (107,000) Shares ("Xxxxxxx Shares") of
Common Stock in BVRI, to be held in his name or another name
as his nominee. In addition, Releasee agrees that he shall
voluntarily enter into a Restrictive Covenant imposed upon
Eighty Thousand (80,000) Shares of the Xxxxxxx Shares, whereby
Eighty Thousand (80,000) Shares shall be restricted from
assignment to any party for a period of two (2) years from the
Execution Date of this Agreement. After the expiration of two
years, the Company shall provide a written release to
Releasee, or to Releasee's respective attorney, in order to
remove this Restrictive Legend from the Xxxxxxx Shares. (See
EXHIBIT "C", attached hereto and incorporated herein by
reference as though set forth in full herein, for a full
description of the Restrictive Covenant.) The remaining
Xxxxxxx Shares equal to Twenty-seven Thousand (27,000) Shares
shall be subject to Rule 144 of the Securities Act
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of 1933, as amended (the "Act"). Furthermore, all of the
Xxxxxxx Shares shall be subject to the Company's Reverse Split
which was effective on or about December 31, 1999, which shall
reduce the number of the aforementioned Xxxxxxx Shares to Ten
Thousand Seven Hundred (10,700) Shares, of which Eight
Thousand (8,000) Shares would be subject to the aforementioned
two-year restriction and Two Thousand Seven Hundred (2,700)
Shares would be subject to Rule 144 of the Act.
4. CLARIFICATION OF STOCK PURCHASE AGREEMENT - SECTION 6.08. The Settling
Parties mutually agree that when CYBER received title from BVVI on the real
property, referred to as the "Arizona Property", CYBER also "assumed", or took
"subject to" the corresponding debt on the real property. The debt on the real
property at the time CYBER received title from BVVI was One Million Three
Hundred Thousand Dollars ($1,300,000). . To be certain, Section 6.08 of the
Stock Purchase Agreement is hereby clarified in that the debt on the real
property followed title from BVVI to CYBER.
5. CIVIL CODE SECTION 1542. It is understood and agreed that the Released Claims
include all claims of every nature and kind whatsoever, known or unknown,
suspected or unsuspected, and all rights under Section 1542 of the Civil Code of
California are hereby expressly waived. Section 1542 provides as follows:
"A GENERAL RELEASE DOES NTO EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE
TIME OF EXECUTING THE RELEASE, WHICH, IF KNOWN BY HIM, MUST
HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR."
The Settling Parties acknowledge that they may hereafter discover facts
different from, or in addition to, those which they now know or believe to be
true with respect to the Released Claims, and agree that this Agreement and the
releases contained herein shall be and remain effective in all respects
notwithstanding such different or additional facts or the discovery thereof.
6. INDEMNITY REGARDING ASSIGNMENT OF CLAIMS. The Settling Parties hereby
represent that they have not heretofore assigned or transferred, or purported to
assign or transfer to any person, or legal entity of any kind whatsoever, any of
the Released Claims. The Settling Parties agree to indemnify and hold each other
and all persons or entities herein described harmless for, from, and against any
judgment, claim, appeal, demand, debt, obligation, liability, cost, expense,
right of action, or cause of action based on, arising out of, or in connection
with, any such transfer or assignment or purported transfer or assignment.
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7. REPRESENTATIONS AND WARRANTIES. The Settling Parties represent and warrant
to, and agree with, each other as follows:
7.1 Each Settling Party has been advised to seek the advice of
independent legal counsel with respect to the advisability of
entering into this Agreement and the mutual releases provided
herein. Each of them has knowingly waived the right to seek
Independent Legal Counsel, or has received the advice of
Independent Legal Counsel, with respect to entering into this
Agreement. (See Section 24, INDEPENDENT LEGAL COUNSEL
hereinbelow.)
7.2 There are no other agreements or understandings between them
relating to the matters and material releases referred to in
this Agreement.
7.3 Each Settling Party and their respective legal counsel (if
applicable) have made such investigation of the facts
pertaining to the releases contained herein as they deem
necessary and appropriate.
7.4 Each Settling Party is entering into this Agreement solely in
reliance on such party's own investigation, and analysis and
not in reliance on any representation by any other party to
this Agreement as to the facts pertaining to the releases
contained herein, or as to such other party's lack of
knowledge, or failure to disclose such fact.
7.5 The terms of this Agreement are contractual and are the result
of xxxxxxx and deliberate negotiation among the Settling
Parties.
7.6 This Agreement has been carefully read by each of the Settling
Parties and the contents thereof are known and understood by
each of them. This Agreement is signed freely and voluntarily
by each party executing it without any influence of any kind
whatsoever by either Settling Party.
7.7 This Agreement shall inure to the benefit of and be binding
upon the predecessors, successors, heirs, assigns,
representatives, agents, servants, employees, and shareholders
of the Settling Parties.
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8. NO ADMISSION OF LIABILITY. Except for the failure to complete the Loan to
BVRI, as stated in Sections 6.08 and 6.09 of the Stock Purchase Agreement, the
Settling Parties explicitly acknowledge that this Agreement represents
settlement of doubtful and disputed claims, and that this Agreement is not to be
construed as an admission of liability on the part of the persons, firms and
corporations released herein, by whom liability is expressly denied.
9. FURTHER ACTIONS. The Settling Parties agree to execute any additional
documents or take any further action which reasonably may be required by their
respective counsel in order to consummate or otherwise fulfill the intent of
this Agreement.
10. AUTHORITY TO ENTER INTO AGREEMENT. The Settling Parties represent and
warrant that they are each duly authorized and empowered to enter into this
Agreement, and that they have not heretofore assigned any of the rights, claims
or actions released or to be assigned herein.
11. MODIFICATIONS, AMENDMENTS AND WAIVERS. No provision of this Agreement may be
altered, amended, canceled, revoked, or otherwise modified, and no addition to
this Agreement may be made, unless in writing signed by all of the parties
hereto. There can be no waiver with respect to this Agreement of any provision
contained herein unless the same is in writing and executed by the party to be
charged. No waiver of any provision of this Agreement by any party shall be, nor
shall it be deemed to be, a waiver of the right of any other party hereto to
enforce strict compliance with the provisions hereof.
12. SEVERABILITY. In the event any provision of this Agreement shall be held to
be void, voidable, or unenforceable, the remaining provisions shall remain in
full force and effect.
13. GOVERNING LAW. This Agreement shall be construed in accordance with and be
governed by the laws of the State of California.
14. VENUE AND JURISDICTION. Venue and Jurisdiction shall be Superior Court, Las
Vegas, Nevada.
15. HEADINGS. The headings contained in this Agreement have been inserted for
convenience only and in no way define or limit the scope or interpretation of
this Agreement or any provision hereof.
16. COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which when executed and delivered shall be an original, and all of which
when executed shall constitute one and the same instrument.
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17. NOTICES. Any and all notices, demands, requests, or other communication
required or permitted by this Agreement, or by law to be served on, given to, or
delivered to any party hereto by any other party to this Agreement shall be in
writing and shall be deemed duly served, given, or delivered when personally
delivered to any party hereto, or in lieu of such personal delivery, when
deposited in the United States mail, registered or certified mail, addressed to
any party hereto, at the address of the party appearing for it or him on the
books and records of BVRI. Any party hereto may change the address of its
principal office in the manner required by law for purposes of this paragraph by
giving notice of the change, in the manner required by this paragraph, to the
respective parties.
TO BVVI & BVRI: XXXXXX XXXXXXXX, PRESIDENT
0000 Xxxx Xxxxxxxx Xxxx
Xxxxx 000
Xxx Xxxxx, XX 00000
with a copy to: Xxxxxx X. XXXXXX, III, ESQ.
XXXXXX & ASSOCIATES
0000 Xxxxx Xxxxxx, Xxx 000
Xxxxxxx Xxxxx, XX 00000
TO XX. XXXXXXX: XXXXX X. XXXXXXX
0000 Xxxxxxxx
Xxxxxxx Xxxxx, XX 00000-0000
with a copy to: _______________________
_______________________
_______________________
18. AMENDMENT. This Agreement may not be modified, changed, amended, or altered
except in writing signed by all parties, or their duly authorized
representative.
19. ATTORNEY'S FEES. Should any dispute be commenced between the parties to this
Agreement concerning any provision of this Agreement, the party prevailing in
such litigation shall be entitled, in addition to such other relief as may be
granted, to a reasonable sum for attorney's fees in such action, which shall be
determined by the Court in such action, or in a separate action brought for that
purpose.
20. SUCCESSORS AND ASSIGNS. This Agreement shall bind the parties, their
successors, heirs, personal representative, and assigns. Nothing herein
contained shall affect any restrictions on transfers or assignments set forth
elsewhere in this Agreement.
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21. GENDER AND NUMBER. As used in this Agreement, the masculine gender shall
include the feminine and neuter, and singular number shall include the plural,
and vice versa.
22. TIME. Time is of the essence with respect to this Agreement.
23. EFFECTIVE DATE. The Effective Date of this Agreement commences on May 4,
1998.
24. EXECUTION DATE. The Execution Date of this Agreement shall be January 19,
2000.
25. ENTIRE AGREEMENT. This Agreement and the exhibits attached hereto, embrace
and include the entire transaction between the parties hereto and shall not be
deemed modified, altered, changed or amended in any respect unless done in
writing and signed by the Settling Parties.
26. INDEPENDENT LEGAL COUNSEL. Each party and their successors, assigns, and
transferees, hereby represent that he/it has consulted its own legal and tax
counsel, accountants, or advisors concerning the tax and legal consequences of
the transactions contemplated by this Agreement. Each party represents that it
has relied solely upon the advice of its own advisors and not on any
representations or warranties of the drafter of this Agreement in connection
with such consequences. The parties further represent that the attorney(s)
drafting this Agreement have disclosed the inherent conflict of interest that
exists when one individual or law firm acts as the draftsman of an agreement
affecting more than one party, and have further disclosed that they may have
represented in a legal capacity or otherwise, or have been associated with, some
or all of the parties at other times, whether on related or unrelated matters.
All parties have been advised to seek independent counsel, and by their
signature below hereby so affirm the receipt of such advice. If separate counsel
are not obtained, each party, together with all officers, principals,
shareholders, partners, members, mangers, assigns, transferees, and successors
in any manner, hereby knowingly waive any right or claim against the attorney(s)
preparing this Agreement based on a conflict of interest or similar claim.
27. INCORPORATION BY REFERENCE. The Recitals in this Agreement and all Exhibits
are incorporated herein by reference as though set forth in full herein.
[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the Settling Parties have executed this Agreement
as of the date listed below each party.
RELEASOR: RELEASEE:
1. BILTMORE VACATION VILLAGE, INDIVIDUAL:
INC., A ARIZONA CORPORATION
By /S/ Xxxxxx Xxxxxxxx By /S/ Xxxxx Xxxxxxx
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Dated: 1/19, 2000 Dated: 1/19, 2000
2. BILTMORE VACATION RESORTS, INC.,
A NEVADA CORPORATION
By /S/ Xxxxxx Xxxxxxxx
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Dated: 1/19, 2000
3. INDIVIDUAL
By /S/ Xxxxxx Xxxxxxxx
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Dated: 1/19, 2000
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EXHIBIT "A"
SECTION 6.08 AND SECTION 6.09 OF THE STOCK PURCHASE AGREEMENT
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EXHIBIT "B"
STOCK CERTIFICATES
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EXHIBIT "C"
RESTRICTIVE COVENANT
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