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SETTLEMENT AGREEMENT
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This Settlement Agreement is made and entered into this 26th day of
January 2006, by and among SUNBORNE XII, LLC, CALEB DEVELOPMENT, LLC, and
WOODMEN JOINT VENTURE, LLP (collectively, "Sunborne") and CIRTRAN CORPORATION,
CIRCUIT TECHNOLOGY CORPORATION, CIRCUIT TECHNOLOGY, INC., IEHAB XXXXXXXX, XXXXX
KOKOSYON, and XXXX XXXXXXXX (collectively, "CTC") (CTC and Sunborne,
collectively the "Parties").
RECITALS
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A. Sunborne is the owner of an office/warehouse building located at
3650-3750 North Nevada Avenue, Colorado Springs, El Paso County, Colorado (the
"Property"), the same having the following legal description: Xxxx 0 xxx 0,
Xxxxx 0, XXX Subdivision No. 2, El Paso County, Colorado.
B. Pursuant to a Net Lease dated January 8, 1998 ("Master Lease"),
Sunborne leased to ETA Technologies Corporation ("ETA") approximately 142,500
square feet of the Property. Subsequently, ETA assigned its leasehold interest
to Colorado Electronics Corporation ("CEC").
C. Pursuant to a Sublease dated November 30, 1998 (the "Sublease"),
CEC sublet to CTC approximately 71,500 square feet of the Property (the
"Leased Premises").
D. On or about December 4, 1998, CTC leased approximately 17,327
rentable square feed of the Leased Premises to Parkway Products, Inc.
("Parkway"). In or about October 1999, Parkway vacated its portion of the Leased
Premises and ceased paying rent to CTC. The Parties claimed that Parkway
breached of its sublease and that they had a concurrent right to assert claims
against Parkway for damages (the "Parkway Claim").
E. In December 1999, Sunborne retook possession of the Leased
Premises. Sunborne thereafter filed suit against CTC in the District Court of El
Paso County, Colorado, Case No. 99 CV 2870 (the "Lawsuit"). Sunborne asserted
various claims against CTC, and CTC asserted a counterclaim against
Sunborne.
F. CTC entered into a settlement agreement with Sunborne with respect
to the Lawsuit in January 2002 (the "First Settlement Agreement").
G. Sunborne thereafter obtained a judgment against CTC in Colorado
District Court in November 2002 (the "Judgment").
H. The Judgment was also filed in Utah District Court in February
2003.
I. CTC and Sunborne desire to settle their dispute upon the terms and
conditions set forth herein.
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NOW THEREFORE, pursuant to these Recitals, and for and in consideration
of the terms and conditions of this settlement agreement (the "Second Settlement
Agreement"), the mutual benefits to be derived herefrom, and other good and
valuable consideration, the Parties agree as follows:
1. Payment by CTC. CTC shall deliver to Sunborne's counsel, Xxxxx X.
Xxxxxxx or Lincoln X. Xxxxx, payment to Sunborne in the amount of TWO HUNDRED
THOUSAND DOLLARS ($200,000.00) no later than ten (10) days following the full
and complete execution of this Second Settlement Agreement by Sunborne.
2. Satisfaction of Payment. Sunborne shall file a Satisfaction of
Judgment in the forms attached hereto as Exhibit A within five (5) business days
after the payment described in paragraph 1 above has been delivered to legal
counsel for Sunborne. The Satisfaction of Judgment shall be filed in the Lawsuit
and all courts or tribunals where any judgment has been filed or lodged. By
executing this Second Settlement Agreement, Sunborne hereby authorizes and
instructs its attorney to execute and file the Satisfaction of Judgment attached
hereto as Exhibit A.
3. Cessation of Collection Efforts. Concurrent with the execution of
this Second Settlement Agreement, Sunborne will execute, through its attorney,
and file with the appropriate courts, a Request for Dismissal in the form
attached hereto as Exhibit B, requesting that the Utah District Court dismiss
the Supplemental Proceedings brought in Utah, with prejudice, and with each
party to bear its own attorneys' fees and costs. Sunborne further covenants to
file a Request for Dismissal in a form similar to that attached hereto as
Exhibit B with respect to every other proceeding, suit, or action (except in the
Lawsuit where a Satisfaction of Judgment will be filed), brought by Sunborne in
any jurisdiction against CTC. Sunborne further covenants to dismiss, cease,
retract, remove, and otherwise cease all efforts to pursue, lis pendens,
garnishment, and liens and like filings and proceedings, and to cease
prosecution of claims against CTC, and efforts to collect on or enforce the
Judgment. By executing this Settlement Agreement, Sunborne hereby authorizes and
instructs its attorney to execute and file the Request for Dismissal attached
hereto as Exhibit B as directed herein.
4. Indemnity by Sunborne. Sunborne agrees to indemnify CTC from any
and all damages, losses, costs, or expenses (including reasonable attorneys'
fees and costs) that CTC incurs after the date hereof as a result of any claim,
suit, cause of action, proceeding, or other attempt to collect on the Judgment.
5. Release by Sunborne. Sunborne, their partners, employees,
predecessors, successors, and assigns, and all persons or entities acting by,
through, under or in concert with them, or on their behalf, hereby irrevocably
and unconditionally release and forever discharge CTC, their successors,
assigns, officers, directors, stockholders, employees, insurers, agents,
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representatives, and attorneys, or any of them, from any and all actions, causes
of action, suits, claims, rights, damages, losses, costs, and expenses
(including attorneys' fees and costs actually incurred) of any nature
whatsoever, known or unknown, suspected or unsuspected, fixed or contingent
which they now have, own ,or hold, or at any time heretofore had, owned or held,
arising out of conduct or matters occurring prior to the date hereof, and
related directly or indirectly to matters at issue in the Lawsuit and set forth
herein.
6. Release by CTC. CTC, their officers, directors, employees,
shareholders, predecessors, successors and assigns, and all persons or entities
acting by, through, under or in concert with them, or on their behalf, hereby
irrevocably and unconditionally release and forever discharge Sunborne, and any
of their successors, assigns, partners, employees, insurers, agents,
representatives, and attorneys, or any of them, from any and all actions, causes
of action, suits, claims, rights, damages, losses, costs, and expenses
(including attorneys' fees and costs actually incurred) of any nature
whatsoever, known or unknown, suspected or unsuspected, fixed or contingent
which they now have, own or hold, or at any time heretofore had, owned or held,
arising out of conduct or matters occurring prior to the date hereof, and
related directly or indirectly to matters at issue in the Lawsuit and set forth
herein.
7. Confidentiality and Non-Disclosure. The parties, individually and
on behalf of their partners, officers, directors, employees, shareholders,
predecessors, successors and assigns, and all persons or entities acting by,
through, under or on their behalf, or any of them, agree that the amount of
payment provided for in this Settlement Agreement, nor any other term contained
herein, shall be disclosed to any third-party absent written consent from the
non-disclosing parties, except as may be required in connection with the
preparation and filing of income tax returns, or other financial or securities
reporting, or as may be required by the order of a court of competent
jurisdiction, or any regulatory or self-regulatory agency or if requested by the
Court at any hearing in an action between the parties to this Agreement . It is
specifically agreed that no disclosure shall be made to the press or other
member of the media regarding the underlying dispute or the terms of this
Settlement Agreement. This is a material term of this Settlement Agreement. Any
non-disclosure provision in this Agreement does not prohibit or restrict the
Parties (or their attorneys) from responding to any inquiry about this
settlement or its underlying facts and circumstances by the Securities and
Exchange Commission (SEC), the National Association of Securities Dealers, Inc.
(NASD) or any other self-regulatory organization.
8. Consideration. The parties hereto acknowledge and agree that good
and valuable consideration has been given for the covenants, releases, and
agreements set forth herein and that each party has been fully advised (to the
extent that they have deemed necessary) regarding this Settlement Agreement and
their respective claims by competent legal counsel of their choosing.
9. No Admission of Liability. The parties hereto agree that this
Settlement Agreement is entered into in settlement of disputed claims, and
execution of this Settlement Agreement shall not be deemed to be an admission of
liability or an admission against interest by any party hereto.
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10. Nonassignment of Claims. The parties each warrant and represent
that there has been no assignment, sale, or transfer of any of the claims being
released hereby and that their execution of this Settlement Agreement
constitutes a full and complete release and discharge of those claims. If there
has been any assignment, the assigning party agrees to fully indemnify the other
parties hereto for all costs, attorneys' fees, and judgments incurred as a
result of such assignment.
11. Full and Independent Knowledge. Each party hereto represents that
it has been represented by an attorney in connection with the preparation and
review of this Settlement Agreement, that its representative has specifically
discussed with its attorney the meaning and effect of this Settlement Agreement
and that its representative has carefully read and understands the scope and
effect of each provision contained herein. Each party hereto further represents
that it does not rely and has not relied upon any representation or statement
made by the other party hereto or any of its representatives with regard to the
subject matter, basis or effect of this Settlement Agreement and has voluntarily
entered into this Settlement Agreement.
12. Successors. This Settlement Agreement shall be binding upon and
inure to the benefit of the heirs, executors, administrators, successors and
assigns of each of the parties.
13. Preparation of Settlement Agreement and Construction of its Terms.
The parties agree that each of them has, through their attorneys, participated
in and contributed to the preparation of this Settlement Agreement. The parties
agree that this Settlement Agreement shall be regarded and deemed as having been
prepared jointly by the parties hereto. Any ambiguity or uncertainty existing
herein shall not be interpreted or construed against any party thereto by virtue
of who may have drafted such provision.
14. Amendment to Settlement Agreement. This Settlement Agreement may
not be altered, amended, modified, or otherwise changed in any respect or
particular whatsoever except by a writing executed by an authorized
representative of each party hereto.
15. Further Assurances. Each of the parties, without further
consideration, agrees to execute and deliver such other documents and take such
other action as may be necessary to consummate more effectively the subject
matter hereof.
16. Execution in Counterparts. The parties hereto agree that this
Settlement Agreement may be executed in counterparts and that it is the intent
of the parties that the copy signed by a party will be fully enforceable against
said party, and all signed counterparts shall be deemed to be an original.
17. Authorization. Any person signing this Settlement Agreement for or
on behalf of an entity other than a natural person does by said signature
warrant that he or she is duly authorized by said entity to undertake such
action on its behalf, and that such signature is the valid and binding act of
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that entity. Each individual executing this Settlement Agreement represents that
he has full mental and physical capacity to enter into this Settlement
Agreement.
18. Governing Law. This Settlement Agreement shall be construed in
accordance with and all disputes hereunder shall be governed by the laws of the
State of Utah.
19. Attorneys' Fees. If any action is brought because of any breach of
or to enforce, interpret, rescind, or terminate any of the provisions of this
Settlement Agreement, the party prevailing in such action shall be entitled to
recover from the other party reasonable attorneys' fees and court costs incurred
in connection with such action, the amount of which shall be fixed by the court
and made a part of any judgment rendered.
20. Severability. Should any part, term, or provision of this
Settlement Agreement be declared or determined by any court to be illegal or
invalid, the validity of the remaining parts, terms, and provisions shall not be
affected thereby and said illegal or invalid part, term, or provision shall be
deemed not to be part of this Settlement Agreement.
21. Entire Agreement. This Settlement Agreement sets forth the entire
agreement between the parties and supersedes any and all prior agreements or
understandings between the parties pertaining to the subject matter hereof.
22. Waiver. Acceptance by either party of any performance less than
required hereby shall not be deemed to be a waiver of the rights of such party
to enforce all of the terms and conditions hereof. No waiver of any such right
hereunder shall be binding unless reduced to writing and signed by the party to
be charged therewith.
IN WITNESS WHEREOF, the parties have executed this Settlement Agreement
as of the date first shown above.
SUNBORNE:
Sunborne XII, LLC
/s/
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Its Manager
Signed this ____ day of January 2006.
[signatures continue on following page]
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Caleb Development, LLC
/s/
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Its Manager
Signed this ____ day of January 2006.
Woodmen Joint Venture, LLP
/s/
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Its General Partner
Signed this ____ day of January 2006.
CTC:
Cirtran Corporation
/s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx, President
Signed this ____ day of January 2006.
Circuit Technology Corporation
/s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx, President
Signed this ____ day of January 2006.
Circuit Technology, Inc.
/s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx, President
Signed this ____ day of January 2006.
/s/ Xxxxx Xxxxxxxx
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Xxxxx Xxxxxxxx
Signed this ____ day of January 2006.
[signatures continue on following page]
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/s/
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Xxxxx Xxxxxxxx
Signed this ____ day of January 2006.
/s/ Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx
Signed this ____ day of January 2006.
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EXHIBIT A
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EXHIBIT B
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