Settlement agreement


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Settlement agreement

  1. 1. SETTLEMENT AGREEMENT This settlement agreement (“Agreement”) is between Hwacheon Machinery America,Inc., an Illinois corporation (“HMA”), and [Entities], a California corporation, also doingbusiness as both [Entities] (collectively referred to as “Company”), as of the last signature dateset forth below with reference to the following facts: A. HMA is in the business of manufacturing machine tools and related products forsale to other manufacturing companies (“Products”). B. HMA delivered Products to Company and Company’s customers based uponsales of the Products consummated by Company in exchange for payment from Company. C. Between January 1, 2007, and through June 30, 2009, Company submitted toHMA purchase orders for the purchase from HMA of Products, including various machines,accessories and spare parts in order to sell and deliver to Company’s customers. HMA causedto be shipped and delivered to Company the various machinery and spare parts. D. As a result of the shipment and delivery by HMA to Company, Company owesand has not paid an outstanding balance of $_______________, which became past due (“Debt”). E. After making several demands for full payment, HMA filed suit against Companyon [Date], in the [County] Superior Court (Case No. [No.]), entitled Hwacheon MachineryAmerica, Inc. v. [Name] (the “Action”) and duly caused service of the summons and complaintupon Company’s registered agent for service of process. F. Company also caused HMA to incur attorney’s fees and costs, as well as in [otheractions] in the amount of $__________________. G. HMA obtained judgment against [Name] on [Date]. H. The parties desire to resolve their differences and to confirm the amount to bepaid by Company to HMA for the Debt. The Company represents to HMA that it is unable topay the Debt in full at this time, but that it could satisfy the Debt through an installment paymentschedule./// Page 1 of 7 Settlement Agreement
  2. 2. The parties therefore agree as follows:1. Confirmation of Obligations and Liabilities. The parties acknowledge the current amount of the Debt is $[Amount]. The Company further acknowledges and agrees that it shall not raise against HMA any defense, offsets, claims, counterclaims, or any other argument with respect to the payment of all monies owed under the Agreement for the Debt.2. Payment of Debt. The Company shall pay HMA the sum of $[Amount], plus interest if applicable, according to the terms below. a. Initial Installment. Company shall make an immediate payment of $[Amount] to HMA. b. Monthly Payments. i. Payment Amount. Commencing in [Date], the Company shall make the following fifteen monthly payments: On or by 2/15/11 - $[Amont] On or by 3/15/11 - $[Amont] On or by 4/15/11 - $[Amont] On or by 5/15/11 - $[Amont] On or by 6/15/11 - $[Amont] On or by 7/15/11 - $[Amont] Final on or by 3/15/12- $607.41 No provision in this Agreement is meant to limit the Company’s right or privilege to prepay any portion of the judgment. Any payment made in excess of the monthly scheduled amount will be credited toward the next consecutive payment. ii. Due Date and Delinquency. Payments are due on the 15th day of each month and are considered delinquent if not received at HMA by the 15th day of each month. All payments must be received by HMA on or before the 15th day of each month to be considered timely made. iii. Form of Payment. All payments must be by check mailed or hand-delivered to HMA at the address set forth in Section 7. iv. Insufficient Funds. If any check is returned for insufficient funds (“NSF Check”), the Company shall pay a $35.00 NSF penalty. The Company shall immediately replace any NSF check with a cashier’s check in the amount of the NSF check plus the NSF penalty plus any delinquency penalty. Page 2 of 7 Settlement Agreement
  3. 3. c. Calculation of Interest. i. Payment Schedule Interest. As long as the Company remains current with monthly payments, as set forth above and in the Summary of Combined Payment Schedule, then no interest on the Debt balance will accrue. If any monthly payment is no received on or by the 15th of every month, interest shall accrue at the annual rate of 5% on the late monthly installment. ii. Default Interest. Upon default of the Agreement, interest will accrue at the legal annual rate of 10% on the Debt balance.3. Delinquency and Default. a. Delinquency. If the full monthly payment is not received by the 15th of the month in which it is due, the Company will be considered delinquent on the Payment Schedule. For each delinquency on the Payment Schedule, the Company shall pay a $50.00 delinquency penalty. b. Notice and Opportunity to Cure. If the Company becomes delinquent on the Payment Schedule, HMA will provide a delinquency notice via fax and first class mail to the Company. The Company may cure the delinquency by paying the full monthly payment amount due plus the penalty charge within 5 days after the transmittal date of the delinquency notice. Failure to pay the penalty charge constitutes a failure to cure. c. Default. Failure by the Company to cure a delinquency within 5 days after notice is sent constitutes default on this Agreement. Upon default, HMA may enforce the judgment, less any credits or payments made by the Company, without any further notice to the Company. Should HMA grant the Company’s request for a brief extension of time to cure any delinquency, the parties acknowledge that an extension of time is not intended to be a waiver of HMA’s right to demand timely payment in the future./// Page 3 of 7 Settlement Agreement
  4. 4. 4. Stipulation and Entry of Judgment. a. Stipulation. The parties stipulate to the entry of judgment in the Action in favor of HMA and against Company. The Stipulation for Entry of Judgment will be in the form of Exhibit A, or another form required by the court and approved by HMA in its reasonable discretion. b. Form of Judgment. The Judgment (“Judgment”) will be in the form of Exhibit B, or another form required by the court. Company shall take all necessary steps; including signing the Stipulation for Entry of Judgment, to ensure that the court enters the Judgment. This Agreement is contingent upon the court’s entry of the Judgment. c. Judgment Final and Binding. The Company agrees that the Judgment will constitute a binding and final adjudication of its monetary liability to HMA in the Action, except that HMA retains all further rights expressly identified elsewhere in this Agreement. The Company fully and forever waives any rights of appeal, to bring post-trial motions, or to bring any other challenge to the Judgment. The Company acknowledges that the Judgment is final, valid, and in full force and effect.5. Enforcement of Judgment and Forbearance. a. HMA’s Right to Enforce. Except as specifically provided below, the Company acknowledges that HMA is entitled to enforce the Judgment by levy, judgment sale, or seizure of assets, filings or recording documents with governmental authorities, including but not limited to any Secretary of State or County Recorder), and may take any other action that a judgment creditor is entitled to take on a Judgment. b. Forbearance. Despite its right to enforce the Judgment, HMA shall not cause writs of execution to be enforced and shall not cause the judgment sale of any asset of the Company as long as the Company is in complete compliance with all provisions of this Agreement (and as long as the representations and warranties of the Company under this Agreement are and continue to be true in all material respects), and the Company remains current on all future obligations, if any, incurred with HMA. However, upon default or breach of this Agreement by the Company, HMA may pursue all of its rights under the Judgment without further notice to the Company or the court. The Company waives all notice of and objections to any action taken by HMA to enforce the Judgment. c. If during the duration of this Agreement, the Company breaches any requirement under this Agreement or becomes delinquent on any payment, then the Company will be deemed to have defaulted on the Agreement and HMA will be entitled to collect the balance of all monies owed to HMA under this Agreement and the judgment. Page 4 of 7 Settlement Agreement
  5. 5. 6. Satisfaction of Judgment. If the Company complies with all provisions of this Agreement, and if all of the Company’s representations are and remain accurate, then upon receipt by HMA of payment of the full amount of the Debt, including any accrued interest and penalties, HMA shall file with the court an Acknowledgment of Satisfaction of Judgment and shall provide a duplicate original to the Company.7. Notices. Failure to provide updated contact information for notice, shall constitute a waiver of any notice requirement. The parties shall provide all notices, correspondence, and payments as follows: To HMA: To Company: Hwacheon Machinery America, Inc. [Address] 50 Lakeview Parkway, Unit #119 Vernon Hills, IL 60061 Attn: Mark Leeser Attn: [Name], [Title] Phone: (847) 573-0100 Phone: (___) ___-____ Fax: (847) 573-9900 Fax: (___) ___-____8. Limited Release. The parties acknowledge and agree that this Agreement resolves and releases only the delinquent Debt, and does not it in any way release, affect, reduce or limit any of the Company’s other obligations or liabilities to HMA.9. Representations and Warranties. Each party represents to the other parties that it is not aware of any other person or entity having an interest (nor has it assigned or otherwise transferred any interest) in the claim that is the subject of this Agreement. Each party shall indemnify and hold harmless the other parties from any and all liabilities, claims, demands, obligations, damages, costs, expenses and attorneys’ fees as a result of anyone asserting such interest, assignment, or transfer. Each party additionally warrants that each person signing this Agreement on behalf of a party is authorized to enter into and execute this Agreement on behalf of the party for which that person is signing.10. General Provisions. a. All parties shall execute any other documents and take any additional actions necessary or appropriate to give full force and effect to the terms and to the intent of this Agreement. b. This Agreement inures to the benefit of, and is binding upon, the respective successors and assigns of each of the parties. c. If HMA undertakes any collection efforts following the Company’s default on this Agreement, then the Company shall pay HMA for all attorneys’ fees and Page 5 of 7 Settlement Agreement
  6. 6. costs HMA incurs to collect the balance of the monies owing on the legal judgment. d. If any legal action or other proceeding is brought for the enforcement or interpretation of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection with this Agreement, the successful or prevailing party or parties shall be entitled to recover reasonable attorneys’ fees and costs incurred in that action or proceeding, in addition to any other relief to which it may be entitled. e. The parties acknowledge that they have been represented by independent counsel of their choice throughout the negotiations that preceded the execution of this Agreement. Each party has participated in negotiating this Agreement, so if an ambiguity or a question of intent or interpretation arises, this Agreement is to be construed as if the parties had drafted it jointly as opposed to being construed against a party because it was responsible for drafting one or more provisions of this Agreement. The parties waive section 1654 of the California Civil Code. f. The laws of the State of California govern all matters arising out of this Agreement. g. The provisions of this Agreement are severable and if any provision or portion of this Agreement is declared illegal or unenforceable, the remainder of this Agreement shall remain effective and binding on the parties. h. This Agreement may be executed in multiple counterparts, any of which may be transmitted by facsimile, each of which shall be deemed an original Agreement, and all of which shall constitute one Agreement./// [The remainder of this page is intentionally left blank.] Page 6 of 7 Settlement Agreement
  7. 7. i. This Agreement constitutes the parties’ entire agreement and supersedes all prior and contemporaneous agreements and understandings of the parties with respect to the Debt; there are no warranties, representations, or other agreements between the parties with respect to the Debt. No supplementation, modification, waiver or termination of this Agreement will be binding unless executed in writing by the party to be bound.Each party is signing this Agreement on the date stated opposite that party’s signature.Dated: _______________________ Hwacheon Machinery America, Inc. _____________________________________ Mark Leeser National Sales ManagerDated: _______________________ [Company Name] _____________________________________ By: _________________________________ Title: ________________________________APPROVED AS TO FORM:Dated: ________________________ Dated: ___________________________________________________________ ___________________________________[Counsel for Debtor] Grant Nigolian[Law firm]. Masuda, Funai, Eifert & Mitchell, LTD.Attorney For [Companies] 19191 South Vermont Avenue, Suite 420 Torrance, CA 90502 Attorneys for Hwacheon Machinery America, Inc. Page 7 of 7 Settlement Agreement