SETTLEMENT AGREEMENT
This
Settlement Agreement ("Agreement")
is
made and entered into as of this 10th day of April, 2007 (the "Effective
Date"),
by
and between Admiralty Holding Company, Inc., a Colorado Corporation
("ADMH"),
by
Admiralty Corporation, a Georgia Corporation (“Admiralty”),
and
by Admiralty Marine Operations, Ltd., a Bahamas, West Indies Corporation
("AMO"),
on
the one hand; and, Xxxxxx X. Xxxxxxx, an individual resident of River Rouge,
Michigan ("Xxxxxxx"),
and,
G. Xxxxxx Xxxxxxxxxxx, a resident of Irmo, South Carolina (“GHC”),
on
the other hand. ADMH, Admiralty, and AMO, Cytacki, and, GHC are collectively
referred to as the "Parties".
R E C I T A L S:
A. Whereas,
Admiralty Holding Company and subsidiaries (the “Company”) desire to avoid an
imminent, clear, and present danger to the safety and security of personnel
and
the public from, and property damage to, the ship the New
World Legacy, IMO No. 9203978, Port of registry, Montego Bay, Jamaica, West
Indies, Official No. and call sign, 6YRC2 (the
“Ship”),
a
Wasting Asset, caused
by
the Company’s running out of funds and being unable to protect and preserve the
Ship and operation thereof; and
Whereas,
all
systems and personnel aboard the New
World Legacy may
be in
harm’s way and otherwise at risk due to a shortage of food, fuel and the
capacity to have electrical service when the generator ceases to be operational;
and
Whereas,
the
Company has loans outstanding to certain individuals who have liens against
the
Ship (the “Liens”) to secure the repayment of said loans (Xxxxxx
X. Xxxxxxx, et al),
including the Company’s CEO, G.
Xxxxxx Xxxxxxxxxxx;
and
Whereas,
the
Company has specifically excluded the Liens from those certain agreements
with
the investors known collectively as The
N.I.R. Group of Funds, LLC
of
Roslyn, N.Y., pursuant to which agreements the Company has pledged all other
assets; and
Whereas,
to
avoid
possible legal risks, maritime and environmental pollution fines, liens,
seizures, and foreclosures; and
Whereas,
certain
demands, concerns and controversies as a proper course of action to avoid
litigation have arisen between the Parties;
Whereas:
On
March 29, 2007, Xxxxxxx was given notice, because of his Security Interest
in
the Ship, from Xxxxx Insurance Agency. Inc. that the Ship’s hull insurance
policy number H 1016198 was subject to be cancelled on April 9, 2007 and,
in
response, Xxxxxxx and GHC contacted ADMH’s CFO to be sure of the facts causing
the nonpayment of the policy; and
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Whereas
Xxxxxxx
and GHC were informed of the non-funding of ADMH in order to continue operations
and pay for the ship’s operations (as of now continued promises for funding from
The N.I.R. Group of Funds, LLC of Roslyn, NY which have not materialized);
and
Whereas
concern
and Ship difficulties, along with the threat to property and life, have
continued to mount since notice from the insurance agency was received, the
crisis continues, and the lead creditor of ADMH, The N.I.R. Group of Funds,
LLC
of Roslyn, NY, indicated late Tuesday afternoon, that they will not provide
emergency funding; and
Whereas,
in
order
to avoid additional liabilities to the parties, to resolve the controversy
over
what action(s) to take, including forestalling and precluding the filing
of
claims and counter-claims (referred to herein as the “Action"), to wit and more
specifically, the dispute between the parties concerns the liens, loans,
rights
to possession, title to, and ownership of the ship, the New
World Legacy, IMO No. 9203978, Port of registry, Montego Bay, Jamaica, West
Indies, Official No. and call sign, 6YRC2 (collectively
referred to as the “Disputed Ship”); and
Whereas, the
Parties desire to settle their disputes regarding the Action and the Disputed
Ship on the terms and conditions set forth below due to the matters set forth
hereinabove and the fact that the Disputed Ship is a Wasting Asset;
and
Whereas,
the
Parties do not intend to release any other claims unless specifically set
forth
below, and the Parties recognize each has standing as concerns the Disputed
Ship; and
Whereas,
the
Parties agree that Admiralty and AMO are still bound by the Ship’s loan
agreements of March 31, 2004 (the $128,950.83 "Promissory Note with GHC"),
March
31, 2004 (the $150,000 “Promissory Note with Xxxxxxx”), October 26, 2004 (the
$50,000 “Promissory Note #2004-4 with Xxxxxxx”), which, unless specifically
modified herein, remain in full force and effect;
NOW,
THEREFORE,
in
consideration of mutual covenants and agreements contained herein, the Parties
hereto, intending to be legally bound, do hereby covenant and agree as follows:
| 1. |
Dismissals
with Prejudice.
Xxxxxxx and GHC hereby agree to dismiss with prejudice any and
all claims
in or pertaining to the Action. ADMH, Admiralty, and AMO hereby
agree to
dismiss with prejudice any and all counterclaims in or pertaining
to the
Action. ADMH, Admiralty, and AMO, and, Xxxxxxx and GHC each agree
to sign
a forgiveness of all notes between the parties and attached hereto
as
Exhibit
"A"
within 24 hours after Xxxxxxx 's receipt of the Ship’s title, in lieu
of judicial foreclosure, as required by Paragraph 3(c)
below.
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Payment
by ADMH, Admiralty, and AMO.
ADMH,
Admiralty, and AMO, by giving this Ship’s Quitclaim
Title,
agree
to settlement of the following notes, plus all accrued interest thereon:
the
$128,950.83 Promissory Note with GHC, the $150,000 Promissory Note with Xxxxxxx,
and the $50,000 Promissory Note #2004-4 with Xxxxxxx.
| 2. |
Delivery
of Quitclaim Title to the Ship.
AMO agrees to transfer to Xxxxxxx title to and possession of the
Ship as
described below:
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(a) ADMH,
Admiralty, and AMO represent and warrant that Schedule B is the list of
Promissory Notes given by ADMH (formerly Ruby Mining Company) in favor Xxxxxxx
and GHC as of the Effective Date of ratification by the Board of Directors
of
ADMH, including but not limited to, all rights of Security Interest in,
possession of and ownership to have and to hold the Disputed Ship as they
see
fit.
(b) Simultaneously
with the execution of this Agreement, Xxxxxxx and GHC agree that Xxxxxxx
shall
be the lead creditor to the Action and the Quitclaim Title to the Ship shall
be
in Xxxxxxx’x name only. Xxxxxxx and GHC further agree that they will settle
between themselves the disposition of the Ship as Affiliates and both stipulate
receipt of the Ship as though both received same to settle this Action and
the
notes referenced above shall be deemed satisfied by transfer to said title
to
the Ship.
(c) Within
five (5) days of the filing of the execution of this Agreement, AMO shall
issue and deliver to Xxxxxxx the Quitclaim Title to the Ship as of the effective
date of this Agreement, such Title to be evidenced by such documentation
as shll
be commercially reasonable for transfers of oceangoing vessels.
(d) Xxxxxxx
and GHC agree to give ADMH a receipt that all Promissory Notes recited in
Section 1. have been paid in full along with all past and present accrued
interest as of the effective date of this Agreement.
(e) Definitions:
i. "Affiliate"
shall mean a person or entity that directly or indirectly through one or
more
intermediaries, controls, or is controlled by, or is under common control
with,
the person or entity specified.
ii.
“Standing”. The
ability of a person to assert an interest in seized or forfeited property.
A
legal concept that a person has an ownership or possessory interest in property
so as to exercise dominion and control over it. A person with standing may
contest a forfeiture action.
iii. “Wasting
Asset”. Property
whose value may diminish after the time of its seizure so that an interlocutory
sale may be justified, or that has so diminished in value that forfeiture
is no
longer practicable. For example, realty in general; livestock; a business
operating under state or local licensing requirements where seizure may result
in suspension or revocation of the license; and cars, planes, or boats that
are
expensive to maintain.
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| 3. |
Security
Interest:
This is to acknowledge that, in the event the transfer of title
contemplated herein shall be decalred null and void for any reason,
then
the security interest in the Ship of Xxxxxxx and GHC shall in all
respects
be reinstated and they shall have a first priority lien and security
interest in the Ship.
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| 4. |
Ownership
of Ship.
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(a). ADMH,
Admiralty, and AMO hereby acknowledge and agree that Xxxxxxx now and henceforth
owns all right, title and interest in and to, and controls and is entitled
to
possession of the Ship and any goodwill in connection therewith.
(b). After
the Effective date of this Agreement, ADMH, Admiralty, and AMO shall not
take
any action with respect to the Ship that interferes in any respect with any
licensing or similar agreement entered into Xxxxxxx or a work contract of
the
Ship from ADMH, Admiralty, and AMO, either on, before or after the date hereof.
(c). ADMH,
Admiralty, and AMO hereby waive any and all rights to make any claim of any
type
whatsoever with respect to the Ship.
(d). ADMH,
Admiralty, and AMO shall withdraw and terminate any existing oppositions,
revocations, and nullity actions and any other legal actions, if any, and
shall
not take any future actions challenging the validity of the ownership of
the
Ship by Xxxxxxx and GHC.
| 5. |
Limited
Covenant Not to Xxx.
Xxxxxxx and Affiliates, and its successors-in-interest to the
Ship, agree
to not seek to enforce their rights under the loans referenced
above
against ADMH, Admiralty, and AMO, or its successors-in-interest,
or to not
seek damages from ADMH, Admiralty, and AMO, successors-in-interest
for
past, present or future rights to the Ship, other than for any
activities
involving agreements which may be entered into in the future
between the
Parties.
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| 6. |
Release
of Claims and Reservation of Rights.
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(a). ADMH,
Admiralty, and AMO, for themselves and their agents, successors, assigns,
representatives, officers, directors, shareholders, employees, agents,
Affiliates, partners, predecessors, successors, heirs, executors, and attorneys,
hereby release and discharge Xxxxxxx and Affiliates, and agents, successors,
assigns, representatives, officers, directors, shareholders, employees, agents,
Affiliates, partners, predecessors, successors, heirs, executors, and attorneys,
from any and all from any and all known and unknown claims, demands, sums
of
money, actions, rights, causes of action, debts, obligations, costs, expenses,
attorney's fees, damages, and liabilities whatsoever, relating to the Ship
and
giving rise to the Action
(b). Xxxxxxx
and Affiliate, for itself and agents, successors, assigns, representatives,
officers, directors, shareholders, employees, agents, Affiliates, partners,
predecessors, successors, heirs, executors, and attorneys, hereby release
and
discharge ADMH, Admiralty, and AMO, and their respective agents, successors,
assigns, representatives, officers, directors, shareholders, employees,
agents, Affiliates,
partners, predecessors, successors, heirs, executors, and attorneys, from
any
and all known and unknown claims, demands, sums of money, actions, rights,
causes of action, debts, obligations, costs, expenses, attorney's fees, damages,
and liabilities whatsoever relating to the Ship and giving rise to the
Action.
(c). Notwithstanding
anything in this Agreement to the contrary, no other waivers, releases, or
licenses (either expressed or implied), to other Ship’s rights (other than Ship)
are provided herein. The parties further agree that they are reserving their
rights to assert their own business interest and or intellectual property
against each other (other than as provided in the Releases and the Covenant
Not
to Xxx)
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| 7. |
Risk
of Liquidation.
The Parties acknowledge that, in agreeing as part of the settlement
and
dismissal of the Action to dismiss its Action with prejudice,
Xxxxxxx and
Affiliate are taking the risk that ADMH, Admiralty, and AMO will
(i) liquidate, wind up or dissolve (or suffer any liquidation, windup
or dissolution), (ii) suspend operations other than in the ordinary
course of business, (iii) be unable to generally pay its debts
(including its payrolls) as such debts become due, (iv) make a
general assignment for the benefit of creditors; (v) file a
voluntary petition in bankruptcy or a petition or answer seeking
reorganization, to effect a plan or other arrangement with creditors
or
any other relief under the Bankruptcy Code or under any other
state or
federal law relating to bankruptcy or reorganization granting
relief to
debtors, or (vi) be adjudicated a bankrupt, or shall make an
assignment for the benefit of creditors, or shall apply for or
consent to
the appointment of any custodian, receiver or trustee for all
or any
substantial part of ADMH, Admiralty, and AMO property. In the
event that
ADMH, Admiralty, and AMO challenge the applicability of this
provision or
if this provision is held to be void and unenforceable for any
reason,
Xxxxxxx and Affiliate shall be entitled to any and all other
damages and
remedies otherwise provided at law, including attorneys' fees.
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| 8. |
Consideration.
This Agreement, and the releases given herein, and the dismissals
referenced herein, are supported by the mutual promises and
covenants
contained in this Agreement, and in the other agreements
referenced
herein, which the Parties agree constitute good and valuable
consideration.
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| 9. |
Own
Costs.
Each party shall bear its own costs and expenses, including
attorney's
fees, in connection with the Action and the negotiation
and execution of
this Agreement.
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| 10. |
Entire
Agreement.
This Agreement and the agreements referenced herein are the entire
agreements among the parties here/thereto with respect to the
subject
matter(s) here/thereof, and they supersede all prior and contemporaneous
oral and written agreements and discussions between/among such
parties
with respect to such matter(s). Agreement, the terms of this
Agreement
shall apply. This Agreement may be amended only by an agreement
in
writing, signed by each of the signatories to this Agreement.
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| 11. |
Not
Severable.
The terms and conditions of this Agreement are not severable.
However, if
any provision of this Agreement is held by a court of competent
jurisdiction to be unenforceable or contrary to law, it shall
be modified
where practicable to the extent necessary so as to be enforceable
(giving
effect to the intention of the Parties) and the remaining
provisions of
this Agreement shall not be affected.
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| 12. |
Warranties.
As a condition of this Agreement, each of the Parties represents
and
warrants to each of the other Parties hereto that there has
been no
assignment, conveyance or transfer or purported assignment,
transfer or
conveyance by it of any interest in any of the Released Claims.
Further,
each of the Parties represents and warrants that it is the
sole owner and
party-in-interest regarding its respective released claims.
In the event
that any claim or demand should be made or litigation instituted
against
any Party or Parties arising out of or with respect to the
Released
Claims, the Party or Parties in breach of the foregoing representation
and
warranty shall indemnify and hold the other Party or Parties
harmless from
and against such claim, demand or litigation, including all
attorneys'
fees and costs incurred with respect to such matters.
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| 13. |
Transfer
of Ship.
Any transfer of ownership (other than by maritime licenses)
of the Ship by
AMO shall be subject to ADMH, Admiralty, and AMO obligations
to Xxxxxxx
and Affiliate set forth in this Agreement.
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| 14. |
Settlement
Not an Admission.
Settlement of the Action, including all negotiations
leading to the
settlement, the payment of consideration therefore,
the contents of this
Agreement and any documents executed in connection
herewith are not
intended to constitute and shall not constitute
any admission or
concession of any kind.
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| 15. |
Attorney's
Fees.
Should any dispute arise between the
parties hereto or their legal
representatives, successors and assigns
concerning any provision of this
Agreement or the rights and duties
of any person in relation thereto,
the
party prevailing in such dispute shall
be entitled, in addition to any
other relief that may be granted, to
recover attorneys' fees and legal
costs in connection with such dispute.
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| 16. |
Successors
and Assigns.
This Agreement shall be binding upon and inure to the
benefit of the
respective successors, assigns and legal representatives
of the Parties
hereto. Nothing in this Agreement, express or implied,
is intended to
confer upon any person other than the Parties hereto,
or their respective
successors, heirs and assigns, any rights or benefits
under or by reason
of this Agreement.
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| 17. |
Governing
Law.
This Agreement shall be governed and
construed under applicable federal
law, including the law of admiralty
and maritime, as applicable, and the
laws of the State of Georgia, excluding
any conflict of law provisions.
Each party irrevocably consents to
the exclusive personal jurisdiction
of
the federal and state courts located
in Douglasville or Xxxxxxx County,
Georgia, as applicable, for any matter
arising out of or relating to this
Settlement Agreement.
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| 18. |
Execution
and Counterparts.
This Agreement may
be executed in any
number of original
counterparts. Any
such counterpart,
when executed, shall
constitute an original
of this
Agreement, and all
such counterparts
together shall constitute
one and the
same Agreement. However,
this Agreement will
not be deemed effective
until
each Party has executed
at least one original
counterpart of this
Agreement. True and
correct copies may
be used in lieu of
the original. A
facsimile signature
shall be deemed to
constitute an effective
signature
hereunder, provided
that any Party submitting
a facsimile signature
shall
immediately provide
each other Party
with an original
signature via
overnight delivery.
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| 19. |
Further
Assurances.
The
Parties
hereby
agree
to
execute
such
further
documents
or
instruments
as
may
be
reasonably
necessary
or
appropriate
to
carry
out
the
intention
of
this
Agreement.
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IN
WITNESS WHEREOF,
the
parties hereto have duly executed this Agreement as of the date first above
written.
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XXXXXX
X. XXXXXXX
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By:
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Name:
Xxxxxx X. Xxxxxxx
Title:
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ADMIRALTY
MARINE OPERATIONS, LTD.
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By:
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Name:
Xxxxxx X. Xxxxxxx, Xx.
Title:
President
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ADMIRALTY
CORPORATION
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By:
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Name:
Xxxxxx X. Xxxxxxx, Xx.
Title:
Sr. V.P., Secretary and Treasurer
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ADMIRALTY
HOLDING COMPANY
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By:
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Name:
Xxxxxx X. Xxxxxxx, Xx.
Title:
Secretary and CFO
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G.
XXXXXX XXXXXXXXXXX
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By:
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G.
Xxxxxx Xxxxxxxxxxx
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Exhibit
A
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PROMISSORY
NOTE HOLDERS
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$128,950.83
Promissory Note - dated Xxxxx 00, 0000
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X.
Xxxxxx Xxxxxxxxxxx
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404-433-5272
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000
Xxxxxxxxx Xxxxx Xxxx
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Xxxx,
XX 00000
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$150,000
Promissory Note - dated March 31, 2004
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Xxxxxx
X. Xxxxxxx
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313-842-8040
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X.X.
Xxx 00000
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000
Xxxxxx Xxxxxx
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Xxxxx
Xxxxx, XX 00000
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$50,000
Promissory Note - dated September 27, 2004
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Xxxxxx
X. Xxxxxxx
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313-842-8040
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X.X.
Xxx 00000
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000
Xxxxxx Xxxxxx
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Xxxxx
Xxxxx, XX 00000
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QUITCLAIM
TITLE
THIS
QUITCLAIM TITLE, Executed this ____ day of __________________,
2007, by
first party, Admiralty
Marine Operations, Limited, whose
post office address is 0000
Xxx. 0, Xx.
000, Xxxxxxxxxxxx, XX 00000-0000,
to
second party, Xxxxxx
X. Xxxxxxx, whose
post office address is X.X.
Xxx 00000, 000 Xxxxxx Xxxxxx; Xxxxx Xxxxx, XX 00000
.
WITNESSETH,
That the said first party, for good consideration
and for the sum of
$10
and the cancellation of certain Promissory Notes
outlined in the
Settlement Agreement between the parties dated April
10,
2006,
paid by the said second party, the receipt whereof
is hereby acknowledged,
does hereby remise, release and quitclaim unto the
said second party
forever, all the right, title, interest and claim
which the said first
party has in and to the following described ship,
New
World Legacy, IMO No. 9203978, Port of registry,
Montego Bay, Jamaica,
West Indies, Official No. and call sign, 6YRC2 and
improvements and appurtenances there o registered
in the Country of
Jamaica, and owed by Admiralty Marine Operations,
Ltd., (a wholly owned
subsidiary of Admiralty Holding Company), whose offices
are located in the
County of Xxxxxxx, State of Georgia , to wit:
IN
WITNESS WHEREOF, The said first party has signed
and sealed these presents
the day and year first above written.
Signed,
sealed and delivered in presence of:
____________________________
______________________________
Witness First
Party:
Admiralty Marine Operations, Ltd.
By:
Xxxxxx X.
Xxxxxxx, Xx., President
____________________________
______________________________
Witness Second
Party:
Xxxxxx X. Xxxxxxx
STATE
OF
}
COUNTY
OF }
On________________________________before
me,__________________________, personally
appeared___________________________________________________,
personally
known to me (or proved to me on the basis of satisfactory
evidence) to be
the person(s) whose name(s) is/are subscribed to
the within instrument and
acknowledged to me that he/she/they executed the
same in his/her/their
authorized capacity(ies), and that by his/her/their
signature(s) on the
instrument the person(s), or the entity upon behalf
of which the person(s)
acted, executed the instrument.
WITNESS
my hand and official seal.
_____________________________
Signature
Affiant:
_____Known _____Unknown
ID
Produced: __________________________
[Seal]
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