SETTLEMENT AGREEMENT
AND MUTUAL GENERAL RELEASE
--------------------------
This Settlement Agreement and mutual General Release (the "Agreement") is
entered into on the 21st day of May, 2001, by, between, and among United States
Telecommunications, Inc. ("UST"), Captive Administrators, Inc. ("Captive"),
Triangle Management, Inc., a Nevada corporation, formerly known as Triangle
Management Systems, Inc., ("Triangle"), Xxxxxxx Xxxxxxx ("Xxxxxxx"), Xxxxx,
Xxxxxx ("Xxxxxx"), and Xxxxxx Xxxxx ("Xxxxx"), collectively referred to as "the
Parties."
WHEREAS, on or about September 28, 2000, UST filed suit against Captive and
Xxxxx (and other parties) in Hillsborough County, Florida in an action styled
United States Telecommunications, Inc. v. Xxxxxx X. Xxxxx, Xxxxxxx Xxxxx,Xxxxxx
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Thack, Prime Equities Group, Inc., Xxxx Holdings, Ltd., Xxxxxxx Xxxx, and
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Captive Administrators, Inc., Case No.: 00-007248, Division A (the "UST
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Lawsuit"), asserting a number of claims with respect to the issuance and sale of
units of the Tel Com Companies (as defined in the UST Lawsuit) and UST
securities.
WHEREAS, on or about February 16, 2001, Xxxxx filed suit against UST,
Xxxxx, Xxxx Xxx a/k/a "Y", and Xxxx Xxx a/k/a "Y" in HiIlsborough County,
Florida in an action styled Xxxxxx X. Xxxxx v. I United States
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Telecommunications. Inc., Xxxxx Xxxxx, Xxxx Xxx a/k/a "Y" and Xxxx Xxx a/k/a
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"Y", Case No. 01001407, Division E (the "Xxxxx Lawsuit"), alleging that UST,
Xxxxx, and other unnamed defendants defamed Xxxxx.
WHEREAS, the Parties desire finally to resolve and dispose of any and all
claims by and between them.
NOW, THEREFORE, in consideration of the mutual agreements, undertakings and
representations contained in this document and other good and valid
consideration, the receipt and sufficiency of which is hereby acknowledged by
the Parties, the Parties agree as follows:
1. Contemporaneously with the execution of this Agreement, Xxxxx has caused
to be delivered to UST 840,000 shares of UST common stock represented by UST
Stock Certificate Number 2241 and 3,360,000 shares of UST preferred stock
represented by UST Stock Certificate. Number 2241. Xxxxx warrants represents
that to the best of his knowledge and belief, Xxxxxx X. Xxxxx, is the owner of
full authority to transfer them to UST. Xxxxx disavows any own hip interest in
such shares. The effective date for the transfer of shares contemplated by
paragraph 1 of this Agreement shall occur on that date selected, in the sole
discretion of Xxxxxxx Xxxxxxx and Xxx Xxxx, provided however such transfer shall
be deemed to be effective no later than December 30, 2001.
2. Xxxxx and Triangle represent and warrant that Triangle owns 928,000
shares of UST stock. Contemporaneously with the execution of this Agreement,
Triangle hereby agrees to transfer all of its interest in 645,000 shares to UST
and has endorsed and delivered to UST a certificate for 645,000 shares of UST.
The effective date of the transfer of shares contemplated by paragraph 2 of this
Agreement shall occur on that date selected, in the sole discretion of Xxxxxxx
Xxxxxxx and Xxx Xxxx; provided however such transfer shall be deemed to be
effective no later than December 30, 2001. Triangle shall retain full ownership
and control over the remaining 283,00O shares of UST stock. However, Triangle
agrees not to sell or pledge or attempt to sell or pledge any of the remaining
283,000 shares until such time as the registration statement filed by UST with
the United States Securities and Exchange Commission ("SEC") is declared
effective, or November 18, 2002,
whichever occurs first. Xxxxx and Triangle agree that, until such time as the
registration statement filed by UST with the SEC is declared effective or
November 18, 2002, whichever occurs first, they will not directly or indirectly
solicit the sale of the remaining 283,000 shares held by Triangle.
3. Xxxxx, Captive, and Triangle represent, warrant, and agree that they
shall not, until such time as the registration statement filed by UST with the
SEC is declared effective on November 13, 2002, whichever occurs first, directly
or indirectly, participate in any fashion in the purchase or sale of shares of
UST stock owned by any person or entity other than Triangle, including but not
limited to acting as a broker, agent, or finder of or for any person or entity
attempting to purchase or sell shares of UST stock. However, nothing in this
paragraph shall prevent Xxxxx, Captive, or Triangle from acquiring any shares of
UST stock.
4. Notwithstanding the fact that the effective date of the foregoing
transfers may take place after the date of this Agreement, the parties
acknowledge and agree that this Agreement constitutes a final and binding
settlement between the parties as of the date of this agreement.
5. Contemporaneously herewith, Xxxxx has caused Xxxxxx X. Xxxxx, Xx., and
Ttriangle to execute the written consent,attached hereto as Exhibit "A", voting
their stock in UST as set forth therein Xxxxxx X. Xxxxx, Xx., and Triangle have
also executed executed separate Affidavits and an Irrevocable Proxy granting
Xxxxxxx Xxxxxxx and Xxx Xxxx the right to vote the 4,845,000 UST shares being
transferred to UST, in the forms attached hereto as Composite Exhibit "B".
6. The Parties hereto acknowledge and agree that the Affidavit of Current
Owner of the UST stock issued to Xxxx and the Irrevocable Proxy delivered
contemporaneously with the execution of this Agreement contain internal
inconsistencies. Accordingly, Xxxxx agrees to produce, on or before May 25,
2001, a fully-executed Affidavit and fully-executed Irrevocable Proxy in the
forms attached hereto as Composite Exhibit "B". The failure to provide same
shall constitute a material breach of this Agreement.
7. Contemporaneously with the execution of this Agreement, Captive shall
execute and deliver to UST a recourse promissory note in the amount of $50,000.
The note shall be due and payable one (1) year from the date hereof Triangle
shall pledge 50,000 of its remaining 283,000 shares of UST stock to secure the
note. The pledged shares shall be delivered to and held by Akerman, Senterfitt.
Upon timely and full payment of the note, Akerman, Senterfitt shall deliver the
pledged shares to Triangle or its assigns. Upon default under the note, Akerman,
Senterfitt shall deliver the pledged shares to UST. If Akerman, Senterfitt is in
doubt of its obligations hereunder, it shall have the right to file an
interpleader action with respect to the pledged shares, and shall be entitled to
recover its attorneys process fees and costs from either the pledged shares,
Xxxxx, Captive or UST. Default by Captive under the promissory note shall not
constitute a material breach of this Agreement by Captive, Xxxxx, or Triangle.
8. Xxxxx, Captive, and Triangle represent, warrant, and agree that,
effective immediately upon execution of this Agreement, they shall not, directly
or indirectly:
(a) represent Xxxxx to be an employee or officer of UST;
(b) issue or cause to be issued what purports to be UST stock
shares to alleged investors in UST;
(c) withdraw or dissipate UST funds;
(d) broadly disseminate information to or otherwise contact or
attempt to contact any shareholders of UST, except for the
present management of UST, regarding or relating to the
subject matter of the UST Lawsuit, the S-4
Registration Statement with the SEC, or the solicitation of
any proxy to vote the shares of UST stock;
(e) interfere with the consideration of UST's S-4 Registration
Statement with the SEC;
(f) attempt to bind UST in business transactions or contracts;
and/or
(g) make any untrue or defamatory statement regarding UST;
provided, however, Captive and Triangle shall be entitled
to any applicable privileges with respect to such
statements. Xxxxx, Captive, and Triangle shall indemnify,
defend, and hold UST harmless from all damages from any
breach by Xxxxx, Captive, or Triangle respectively under
this Paragraph.
9. Neither UST, Pollara, Graton, or the officers, directors, employees, or
agents of UST shall make any untrue or defamatory statements regarding Xxxxx,
Captive, or Triangle; provided, however, UST, Pollara, Graton, and the officers,
directors, employees, and agents of UST shall be entitled to any applicable
privileges with respect to such statements.
10. Effective immediately upon execution of this Agreement, Xxxxx agrees to
provide UST and its attorneys with all information within his knowledge ralating
to the involvement of individuals and entities in the planning and execution of
the sale of units in the Tel Com Companies or shares of UST, including but not
limited to any information within his knowledge relating to where the proceeds
of any such sale of units in the Tel Com Companies or shares of UST were
transferred or are presently located. Xxxxx further agrees to cooperate with UST
and its lawyers in the prosecution of the UST Lawsuit and other related legal
matters, including, if necessary, providing testimony at trial. Any expenses of
copying or producing records shall be borne by UST.
11. As part of his duty to cooperate with UST, Xxxxx shall upon complete
execution of this Agreement, deliver to UST a list of topics on which he can
testify (the "List of Xxxxx Topics") that may assist UST in the prosecution of
the UST Lawsuit. Xxxxx represents and warrants that he has personal knowledge of
the matters in the list and that all his testimony will be truthful.
12. Also as part of his duty to cooperate with UST, Xxxxx shall,
contemporaneously with the execution of this Agreement, have authority to
release to UST certain documents that may assist UST in the prosecution of the
UST Lawsuit and, through his counsel, shall immediately deliver such documents
to UST. Xxxxx, Captive, and Triangle represent and warrant that they do not have
possession, custody or control of any other documents belonging or relating to
UST, Xxxx Holdings, Ltd., or the subject matter of the UST Lawsuit that have not
previously been produced to UST's attorneys.
13. Upon execution of this Agreement, UST shall cause its attorneys to
promptly execute and file a Notice of Voluntary Dismissal with Prejudice of the
UST Lawsuit as to Xxxxx and Captive.
14. Upon execution of this Agreement, Xxxxx shall cause his attorneys to
promptly execute and file a Notice of Voluntary Dismissal with Prejudice of the
Xxxxx Lawsuit.
15. The Parties hereto, for and on behalf of themselves and their
successors and assigns, hereby release and discharge each other Party hereto and
their attorneys from and against any and a11 actions, obligations, debts,
losses in revenue, damages, costs, dues, claims, choses in action and demands of
every kind or nature, known or unknown, which any party hereto had, now has or
may have based on, arising out of, or relating to any act, omission,
transaction, event or circumstance occurring on or before the date of this
Agreement, including but not limited to those relating to or arising out of the
claims asserted in the UST Lawsuit and the Xxxxx Lawsuit. In addition, Xxxxx
releases UST from any claims relating to his employment agreement with UST.
16. The release provisions of Paragraph 15, above, shall not be construed
as an independent or separate covenant and the Parties hereto agree that those
provisions constitute a material portion of the consideration exchanged as part
of this Agreement.
17. In addition to the release provisions of Paragraph 15, above, Xxxxx,
Captive, and Triangle, for and on behalf of themselves and their successors and
assigns, hereby release and discharge every individual serving as an officer,
director, agent, or employee of UST as of the date of execution of this
Agreement, from and against any and ell actions, obligations, debts, losses in
revenue, damages, costs, dues, claims, choses in action and demands of every
kind of nature, known or unknown, which Xxxxx, Captive and/or Triangle had, now
has, or may have based on, or arising out of, or relating to any act, omission,
transaction, event or circumstance occurring on or before the date of the
Agreement, including but not limited to those relating to or arising out of the
claims asserted in the UST Lawsuit and the Xxxxx Lawsuit.
18. The Parties expressly warrant to each other that they have not
previously assigned, transferred or conveyed the claims disposed of by this
Agreement.
19. his Agreement has been negotiated and drafted by counsel for the
Parties and, therefore, it shall not be construed in favor of or against any of
the Parties hereto.
20. The Parties affirmatively state that no representation, promise, or
agreement relating to this settlement, except for those expressed in this
Agreement and the List of Xxxxx Topics, has been made to any of the Parties, and
that this Agreement contains all o f the terms relating to this settlement,
which are contractual in nature and not merely recitals, and may not be modified
or changed, except in a writing signed by all Parties.
21. This Agreement is entered into by the Parties to resolve disputed
claims, and notwithstanding execution of this Agreement, the Parties deny
liability of all asserted claims.
22. This Agreement shall inure to the benefit of and shall bind each
Party's successors and assigns.
23. The Parties represent and warrant that each signatory of the Agreement
is duly authorized to sign for the purpose and in the capacity in which she, he,
or, it purports to sign.
24. The Parties acknowledge that upon breach of this Agreement, no party
hereto has an adequate remedy at law and therefore any Party not in breach shall
be entitled to either enforce the Agreement by specific performance against any
Party in breach or to rescind the Agreement.
25. This Agreement shall be governed by and construed under the laws of the
State of Florida. The Parties agree that the jurisdiction for the enforcement of
this Agreement or the interpretation of its terms shall be in Hillsborough
County, Florida. In such event, the prevailing party shall be entitled to an
award of costs and attorney's fees, whether incurred at trial, on appeal, or in
any bankruptcy proceeding.
26. The Parties shall each bear their own costs and attorneys'fees incurred
in connection with the UST Lawsuit, the Xxxxx Lawsuit or the preparation of this
Agreement.
27. The undersigned Parties agree that this document can be executed in
counterparts, and will be as effective and binding as if executed as a whole.
IN WITNESS WHEREOF, the Parties have execated this settlement Agreement and
Mutual
Release this 21st of May, 2001
Signed and delivered United States
in the presence of: Telecommunications, Inc.
/s/ Xxxxxx Xxxxxxx III By: /s/ Xxxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx III Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxxx As its President
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Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________ as identification (check one).
_____________________________
Print Name: ___________________
Notary public, State of Florida
My Commission Expires:
Signed and delivered
in the presence of: CAPTIVE ADMINISTRATORS, INC.
/s/ Xxxxxx Xxxxxxx III By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxxxx III Xxxxxx Xxxxx
/s/ Xxxxxx X. Xxxxx As its President
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Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________ as identification (check one).
Signed and delivered
in the presence of: TRIANGLE MANAGEMENT, INC.
/s/ Xxxxxx Xxxxxxx III By: /s/ Xxxxxx Xxxxx
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Xxxxxx Xxxxxxx III Xxxxxx Xxxxx
/s/ Xxxxxx X. Xxxxx As its President
--------------------------- ---------------------
Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________ as identification (check one).
_____________________________
Print Name: ___________________
Notary public, State of Florida
My Commission Expires:
Signed and delivered
in the presence of:
/s/Xxxxxx Xxxxxxx III /s/ Xxxxxx Xxxxx
--------------------------- ----------------------------
Xxxxxx Xxxxxxx III Xxxxxx Xxxxx
/s/ Xxxxxx X. Xxxxx
---------------------------
Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________- as identification (check one).
_____________________________
Print Name: ___________________
Notary public, State of Florida
My Commission Expires:
Signed and delivered
in the presence of:
/s/Xxxxxx Xxxxxxx III /s/ Xxxxxxx Xxxxxxx
--------------------------- ----------------------------
Xxxxxx Xxxxxxx III Xxxxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxxx
---------------------------
Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________- as identification (check one).
_____________________________
Print Name: ___________________
Notary public, State of Florida
My Commission Expires:
Signed and delivered
in the presence of:
/s/Xxxxxx Xxxxxxx III /s/ Xxxxx Xxxxxx
--------------------------- ----------------------------
Xxxxxx Xxxxxxx III Xxxxx Xxxxxx
/s/ Xxxxxx X. Xxxxx
---------------------------
Xxxxxx X. Xxxxx
STATE OF __________________ )
COUNTY OF _________________ )
The foregoing instrument was acknowledged before me this ____day of May,
2001, by ____________________, as _______________________of United States
Telecommunications, Inc., ________ who is personally known to me or ____________
who has produced __________________________- as identification (check one).
_____________________________
Print Name: ___________________
Notary public, State of Florida
My Commission Expires:
