SETTLEMENT AGREEMENT
AND
MUTUAL GENERAL RELEASE
This Settlement Agreement and Mutual General Release ("Agreement")
is entered into by and between Xxxxxx Xxx ("Xxx") and Xxxxxx X. Xxx
(collectively "Yees"), Capital Reserve Corporation, a Colorado Corporation
and its subsidiaries (the "Corporation"); and Xxxxx Xxxxxx ("Xxxxxx")
collectively the "Parties".
WHEREAS, Xxx has entered into certain transactions involving
the Corporation, its subsidiaries and Xxxxx Xxxxxx, including but not limited
to a stock exchange agreement; loans; promissory notes and Termination
Agreement, and;
WHEREAS, Xxx served at various times as an officer, director and
employee of the Corporation, and was a party to a Termination Agreement of
December 1992, and;
WHEREAS, Xxx has made demand upon the Corporation and
Xxxxxx concerning certain disputes and claims, and;
WHEREAS, the Parties have, through settlement negotiations, determined
that it is not in the Parties' best interest to adjudicate the matters which
gave rise to the differences between them, and wish to enter into a full and
final settlement of all matters which could have been adjudicated by them
without further cost or expense and without any findings of fact
or conclusions of law.
NOW THEREFORE, in consideration of the promises, mutual general release,
relinquishment of certain legal rights, payment of the sums set forth in
herein and other good and valuable consideration which is hereby
acknowledged, the Parties hereby agree as follows:
1. It is stipulated and agreed by the Parties that this matter shall be
fully and finally settled upon the following terms:
A. Yees shall be paid a total of $128,000 by way of two (2) checks
drawn on the trust account of Alexander Law Firm, P.C. in the amount of
$117,000.00 and $11,000.00 respectively, in full and complete settlement
of all of Yees' claims. Such monies shall be paid on or before the 25th
day of August, 1995.
i. Yees shall be paid $117,000.00 as sole and complete payment for
any and all claims released by Yees under paragraph 2 herein
relating to the Stock Exchange Agreement, Addenda and Supple-
ments thereto, notes or other
related agreements of whatever kind and nature.
ii. Xxxxxx Xxx shall be paid $11,000.00 as sole and complete
payment for any and all claims released by Xxx, under
paragraph 2 herein, relating in any way to his employment by
the Corporation or the December 1992 Termination Agreement.
B. Each party shall be and remain responsible for its own costs and
attorney's fees.
C. Yees agree to return to the treasury of the Corporation 333,334
shares of stock of Capital Reserve Corporation at the time of the
payment of $128,000.00 and hereby warrant that they do not own any
other shares of stock in the Corporation.
D. The Parties agree that this Agreement is for the purpose of
effecting an amicable end to all disputes between the Parties and
that this Agreement may not be construed in any manner as an
admission of liability or wrongdoing on the part of any Parties to
this Agreement, which wrongdoing all Parties specifically deny.
X. Xxx agrees to and has executed, as demonstrated by EXHIBIT A
attached hereto, an affidavit swearing and affirming to the
authenticity and veracity of the statements contained therein
concerning certain transactions surrounding the 1988 Stock Exchange
Agreement which gave rise to certain of the disagreements between
the Parties.
F. The Parties agree that all tax consequences arising from this
Agreement shall be the sole responsibility of the party paying and
the party receiving any benefit or proceeds by any act of this
Agreement which may be deemed by the Internal Revenue Service to be
a taxable event and no party has made any representation to the
other regarding the taxation consequences of this Agreement.
2. In consideration of the release contained herein and the total sum of
$128,000.00, the receipt and sufficiency of which is hereby acknowledged,
Yees, for themselves and their successors and assigns, hereby fully and
forever release and discharge the Corporation and Xxxxxx, their
successors, assigns, heirs, personal representatives, employees, officers,
directors, agents and their counsel ("Releasees") from any and all claims,
demands, obligations, actions, liabilities and damages of every kind and
nature whatsoever, in law or in equity, whether known or unknown to them,
which they may have against Releasees, by reason of any act or omission by
them in any capacity, from January 1, 1988, including, without limitation,
those arising from or based upon any transaction arising from a Stock
Exchange Agreement dated April 28, 1988, its amendments, supplements, and
addenda thereto, any loan agreements or trust agreements, Termination
Agreement or other contractual or fiduciary relationships between the parties
hereto, for any claims for damages asserted or which could have been asserted
by Yees against Releasees as well as any acts which any Releasees, may
have performed or failed to perform in their capacity as counsel to the
Corporation and its subsidiaries or as members of the Board of Directors
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of the Corporation and its subsidiaries, and arising from or based upon any
activities in connection with the Corporation and its subsidiaries.
3. In consideration of the release contained herein, and the return to the
corporate treasury of 33,334 shares of Corporation stock, the sufficiency of
which is hereby acknowledged, the Corporation and Xxxxxx for themselves, their
employees, officers, directors, agents, counsel, heirs, personal
representatives, successors and assigns, hereby fully and forever release and
discharge Yees and their heirs and personal representatives, successors and
assigns from any and all claims, demands, obligations, actions,
liabilities, and damages of any kind and nature whatsoever in law or equity
whether known or unknown to them which they may have against Yees by any act
or omission by Yees in any capacity from January 1, 1988, including without
limitation those arising from or based upon the Stock Exchange Agreement
dated April 28, 1988, its Amendments, Supplements or Addenda thereto, or based
upon Xxx'x employment by the Corporation and by his acting as an officer and
director of the Corporation and its subsidiaries.
4. The Parties warrant that no assignment or transfer of any claim released
herein has occurred and agree to indemnify and hold harmless the other from
any released claim brought by any third party whether by way of assignment,
transfer or otherwise.
5. The Parties agree that the terms and conditions of this Agreement are
contractual in nature and shall be enforceable in an action at law. Any
proceedings necessary to enforce the terms of this Agreement shall be
resolved by way of binding arbitration. The final resolution of the
arbitrator(s) shall be binding on all Parties to this Agreement. In the event
that any Party is required to enforce any of the terms or provisions of this
Agreement, the prevailing Party shall be entitled to recover all costs and
reasonable attorney's fees related to such action.
6. If any judicial body determines that any provision, paragraph, sentence
or sub part of this Agreement is invalid, that provision, paragraph, sentence
or sub part shall be severable from the remainder of this Agreement and shall
not affect the validity of the remaining portions of this Agreement.
7. This Agreement constitutes the entire agreement between the Parties and
may not be amended unless in writing and signed by all parties hereto.
8. All Parties confirm that they have fully read and understand this
Agreement and enter into same voluntarily and have consulted with legal
counsel of their own choosing as they deem necessary.
9. This Agreement may be signed in counterparts which shall collectively
represent the agreement of all the Parties.
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IN WITNESS WHEREOF, this instrument was executed this 21st day of
August, 1995.
/s/ Xxxxxx Xxx /s/ Xxxxx Xxxxxx
__________________________________ __________________________________
Xxxxxx Xxx Xxxxx Xxxxxx
/s/ Xxxxxx X. Xxx CAPITAL RESERVE CORPORATION
__________________________________
Xxxxxx X. Xxx By: /s/ Xxxxx Xxxxxx
_______________________________
Its: President
______________________________
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