MUTUAL SETTLEMENT AGREEMENT & GENERAL RELEASE
Exhibit 10.5
MUTUAL SETTLEMENT AGREEMENT & GENERAL RELEASE
This Settlement Agreement and General Mutual Release is made this 26th day of November between Confederate Motors, Inc. (Confederate) & Francois-Xxxxxx Xxxxx (Terny).
1. Confederate and Terny are parties to a lawsuit pending in the United States District Court for the District of Massachusetts designated as case number 11-cv-10213-JDG which involves various claims and counter claims arising out of a business transaction between the parties (the "Lawsuit").
2. The parties have negotiated and hereby agree to settle all of their disputes from the beginning of the world to the date of this agreement relating to any dealings that they have had with each other.
3. In consideration of the mutual undertakings recited herein Confederate and Terny agree to dismiss and abandon with prejudice all claims that they have against each other from the beginning of the world to the date of this agreement, including but not limited to, the penalties incurred in connection with the Registration Rights Agreement between Confederate and Terny dated in 2009. Within five (5) business days following the performance of the obligations set forth in ¶7 hereof, Confederate and Terny shall dismiss with prejudice the Lawsuit.
4. In exchange for dismissing their claims against each other the parties agree that Terny shall have no obligations to Confederate other than those recited herein and shall be the owner free and clear of any claims or encumbrances by Confederate of the 505,000 shares of Confederate restricted common stock that he was issued under the Consulting Agreement executed by the parties on or about September 1, 2009.
5. In addition to the 505,000 shares of Confederate restricted common stock referenced in ¶ 4, Terny is also the owner of 300,000 additional shares of unencumbered Confederate Common Stock all of which he desires to sell to Confederate in exchange for $350,000.00.
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6. Confederate desires and agrees to acquire and Terny agrees to sell and deliver to Confederate or its designee his 805,000 shares of Confederate Stock in exchange for the payment of $350,000.00 under the terms set forth herein.
7. Confederate will pay and deliver to Terny immediately upon execution and delivery of this Settlement Agreement $50,000.00 by wire transfer of same day funds to the wire instructions previously provided. Upon confirmation of the $50,000.00 wire transfer Terny shall deliver to his counsel his 805,000 shares which shall be held in escrow by counsel pending receipt of the remaining payments due under this agreement. Confederate will pay or cause to be paid to Terny an additional $25,000.00 on or before December 31, 2102 (the “Tranche 2 Payment”) and pay or cause to be paid to Terny an additional $275,000.00 on or before March 31, 2013 (the “Tranche 3 Payment”). Upon receipt of the final payment, the shares shall be immediately delivered to Confederate or its designee. The parties agree that if Confederate does not make the Tranche 2 Payment by the due date thereof, Terny may file the stipulated judgment attached as Exhibit B with the Court. The attached stipulated judgments shall be signed by counsel to Confederate and delivered to counsel for Terny to be held in escrow until the Tranche 2 Payment and Tranche 3 Payment are made, following which the respective stipulated judgment shall be returned to counsel for Confederate.
8. The performance of the recitals set forth in ¶7 will completely discharge all obligations that the parties have between each other.
9. This Settlement Agreement and Release binds Confederate and Terny and their respective successors and they each acknowledge that by executing this agreement they have given up all of their rights against each other from the beginning of the world to the date of this agreement and that this agreement sets forth the entire agreement between the parties.
10. This Settlement Agreement and Release may be signed in any number of counterparts and delivered by facsimile or electronic counterpart, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.
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Signed as the entire agreement between the parties this 26th day of November 2012.
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/s/ Francois-Xavier Terny
Francois-Xxxxxx Xxxxx
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/s/ Xxxx Chambrers
Name: Xxxx Xxxxxxxx
Title: CEO
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Exhibit A
Stipulated Judgment for Tranche 2 Payment
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Exhibit B
Tranche 3 Payment Stipulated Judgment
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