Exhibit 10.1
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RELEASE AND SETTLEMENT AGREEMENT
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This Release and Settlement Agreement (the "Agreement") is entered
into by and among Childs & Childs Granite Co., Inc. and ▇▇▇▇ Acquisition, Inc.
(collectively referred to herein as "Borrower" or "Childs"), Rock of Ages
Corporation ("Lender") and Rock of Ages Memorials, Inc. ("ROAM") (collectively
Borrower, Lender and ROAM are referred to herein as the "Parties") as of
January 26, 2005 (the "Effective Date").
WHEREAS, Borrower and Lender entered into that certain Purchase and
Sale Agreement with an effective date of October 22, 2001, whereby, inter alia,
Borrower agreed to purchase certain real property, equipment and business of
Lender (the "Purchase Agreement");
WHEREAS, on or about October 26, ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ and Borrower
entered into a Supply Agreement whereby, inter alia, Borrower agreed to supply
ROAM with its requirements for monuments that it purchases in Elberton, Georgia
for a term of five (5) years at the prices set forth therein;
WHEREAS, in connection with the Purchase Agreement, Borrower executed
that certain Note to Lender dated October 26, 2001 in the original principal
amount of $800,000.00 (the "Note");
WHEREAS, the Note is secured by that certain Deed to Secure Debt with
Power of Sale dated October 26, 2001 executed by Borrower, conveying a security
interest to Lender in certain real property more particularly described therein
(the "Property"), recorded at Deed Book 361, Page 539, et seq. public records
of ▇▇▇▇▇▇ County, Georgia (the "Security Deed");
WHEREAS, the Note is further secured by that Security Agreement dated
October 26, 2001 encumbering Borrower's, inter alia, inventory, equipment and
general intangibles and all proceeds thereof (the "Collateral");
WHEREAS, the Note is further secured by those certain UCC Financing
Statements Nos. 4123 and ▇▇▇-▇▇▇▇-▇▇▇ as continued, modified and amended (the
"UCCs");
WHEREAS, the Note, Security Deed, Security Agreement, UCCs all other
written loan documents executed in connection therewith, together with any
written renewals, modifications and/or extensions thereof are collectively
referred to as the "Loan Documents" and the Loan Documents, Purchase Agreement
and Supply Agreement and all other written documents executed in connection
therewith are collectively referred to herein as the "Sale Documents";
WHEREAS, the Note referenced above is in default by virtue of
non-payment when due, is fully accelerated and due and payable and remains
unpaid as of this date;
WHEREAS, due to Borrower's default on the Note, Lender is advertising
for a foreclosure sale of the Property scheduled to occur on February 1, 2005;
WHEREAS, Borrower has threatened to file a Petition for Injunctive
Relief and to Compel Arbitration which, inter alia, contests Lender's right to
foreclose under the Security Deed and asserts that certain disputes exist
between the Parties under the Supply Agreement. Lender and ROAM deny that there
is any dispute related to Lender's right to foreclose on the Property and deny
all of Borrower's allegations related to the Supply Agreement;
WHEREAS, the Parties intend to settle and compromise all disputed
claims between them relating to the foregoing; and
NOW, THEREFORE, for and in consideration of the promises, obligations
and agreements contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties agree
as follows:
1. TERMS
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1.1. On or before January 31, 2005, Borrower agrees to pay Lender
in good funds via certified check or wire transfer the total
sum of THREE HUNDRED THOUSAND AND NO/100 DOLLARS
($300,000.00) (the "Note Payment").
1.2. On the Effective Date, as further payment on the Note,
Borrower shall issue a product credit to Lender and/or ROAM
for any product manufactured or sold by Borrower (the
"Product") worth up to $100,000 (the "Credit") against
Borrower's ordinary and standard list prices, which may be
used by Lender and/or ROAM to purchase Product from time to
time and at any time during a period of four (4) years from
the date of execution of this Agreement (the "Credit Term")
by receipt of a 15% discount on Borrower's ordinary and
standard list prices on up to $666,667 of Product purchased
by Lender and/or ROAM during the Credit Term (the
"Discount"). Borrower agrees that its prices on Product
during the Credit Term shall be comparable to prevailing
prices by other manufacturers of similar product in the
Elberton, Georgia area. The Note Payment, Credit and Discount
are collectively referred to herein as the "Settlement
Obligations". Borrower agrees to provide Lender with any and
all documents necessary to acknowledge the Credit and
Discount in Borrower's ordering, invoicing or other business
records.
1.3. Upon timely payment of the Note Payment, Lender agrees to
cancel the Note and return the original Note to Borrower
marked "Paid in Full," and to release the Security Deed and
any other security interests held by Lender in connection
with the Note.
2. RELEASES; LIMITATIONS THERETO
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2.1. Upon the Effective Date of this Agreement, Borrower and its
past, present and future predecessors, successors, assigns,
officers, managers, directors, officers, shareholders,
employees, agents, attorneys, legal representatives,
servants, insurers, parent corporations, subsidiaries and
affiliates hereby RELEASE Lender and ROAM, their
predecessors, successors, assigns, officers, managers,
directors, shareholders, employees, agents, attorneys,
legal representatives, representatives,
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parent corporations, subsidiaries, and affiliates
(collectively referred to as "Affiliates"), jointly and
severally, from any and all claims, counterclaims, demands,
damages, debts, agreements, covenants, suits, contracts,
obligations, liabilities, accounts, offsets, rights, actions
and causes of action of any nature whatsoever, including
without limitation, all claims, demands and causes of action
for contribution and indemnity, whether arising at law or in
equity (including without limitation, claims of fraud, breach
of contract, tort, duress, mistake, tortious interference,
usury, or control), whether presently possessed or possessed
in the future, whether known or unknown, whether liability be
direct or indirect, liquidated or unliquidated, whether
presently accrued or to accrue hereafter, whether absolute or
contingent, foreseen or unforeseen, and whether or not
heretofore asserted, for or because of or as a result of any
act, omission, communication, transaction, occurrence,
representation, promise, damage, breach of contract, fraud,
violation of any statute or law, commission of any tort, or
any other matter whatsoever or thing done, omitted or
suffered to be done by the Lender, ROAM, or any of their
respective Affiliates, which has occurred in whole or in
part, or was initiated at any time from the beginning of time
up to and immediately preceding the moment of the last
parties' execution of this Agreement.
2.2. Upon timely payment of the Note Payment provided in Section
1.1 above, Lender and ROAM, and each of their past, present
and future, successors, assigns, officers, managers,
directors, officers, shareholders, employees, agents,
attorneys, legal representatives, representatives, servants,
insurers, parent corporations, subsidiaries, and affiliates
hereby RELEASE Borrower and its past, present and future,
successors, assigns, officers, managers, directors, officers,
shareholders, employees, agents, attorneys, legal
representatives, representatives, servants, insurers, parent
corporations, subsidiaries, and affiliates (collectively
referred to as "Affiliates"), jointly and severally, from any
and all claims, counterclaims, demands, damages, debts,
agreements, covenants, suits contracts, obligations,
liabilities, accounts, offsets, rights, actions and causes of
action of any nature whatsoever, whether arising at law or in
equity, whether presently possessed or possessed in the
future, whether known or unknown, whether liability be direct
or indirect, liquidated or unliquidated, whether presently
accrued or to accrue hereafter, whether absolute or
contingent, foreseen or unforeseen, and whether or not
heretofore asserted for or because of or as a result of any
act, omission, communication, transaction, occurrence,
representation, promise, damage, breach of contract, fraud,
violation of any statute or law, commission of any tort, or
any other matter whatsoever or thing done, omitted or
suffered to be done by the Borrower or any of its respective
Affiliates, which has occurred in whole or in part, or was
initiated at any time from the beginning of time up to and
immediately preceding the moment of the last parties'
execution of this Agreement.
2.3. The above releases do not extend to the performance and
payment obligations of the Parties stated in this Agreement,
which are specifically reserved.
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3. ACKNOWLEDGMENT OF DEFAULT UNDER NOTE AND AMOUNTS DUE
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Lender and Borrower acknowledge that, prior to giving effect to the
payments specified in this Agreement, the outstanding unpaid balance
of the Note (including outstanding principal and accrued, unpaid
interest) as of January 24, 2005 is $807,846.00, of which $800,00.00
represents outstanding principal and $7846.00 represents accrued
unpaid interest. The Note has been accelerated and is now due and
payable in full without offset or defense and no other notice or cure
rights are available to Borrower. Borrower waives any and all rights
to other notice of payment default or any other default, protest and
notice of protest, cure, dishonor, diligence in collecting and the
bringing of suit or arbitration proceeding against any party, notice
of intention to accelerate, notice of acceleration, demand for payment
and any other notices whatsoever regarding the Note or the other Loan
Documents, and further waives any claims that any notices previously
given are insufficient for any reason.
4. DEFAULT AND REMEDIES
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4.1. The following shall constitute an Event of Default under this
Agreement:
(a) Borrower fails to timely and completely perform any of the
Settlement Obligations set forth in this Agreement;
(b) Borrower files a petition for bankruptcy under any chapter of
the Federal Bankruptcy Code or takes advantage of any other
debtor relief law or an involuntary petition for bankruptcy
under any chapter of the Federal Bankruptcy Code is filed
against Borrower or any other judicial action is taken with
respect to Borrower by any creditor;
(c) An Event of Default occurs under the Loan Documents, other
than those which have been specifically modified hereby;
(d) Lender discovers that any representation or warranty made
herein by Borrower was or is untrue, incorrect or misleading
in any material respect;
(e) Borrower breaches or defaults in the performance of any
covenant or agreement contained in this Agreement.
4.2 Upon the occurrence of an Event of Default, Lender may pursue
any legal or equitable remedies available by law to Lender,
without notice or cure rights.
4.3 Upon timely payment of the Note Payment pursuant to section
1.1 above, Lender and ROAM shall have no further right to
pursue any claim against Borrower pursuant to the Note, and
the only basis for a claim hereunder by Lender against
Borrower shall be based upon Borrower's supply obligations
set forth in section 1.2 hereof.
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5. REPRESENTATIONS AND WARRANTIES
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5.1 The Parties acknowledge, represent, warrant and confirm the
following:
5.1.1 The Parties have carefully read and understand the
effect of this Agreement. The Parties have had the
assistance or the opportunity to seek the assistance
of separate legal counsel in carefully reviewing,
discussing and considering all terms of this
Agreement.
5.1.2 The Parties execution of this Agreement is not based
upon their reliance upon any representation,
understanding or agreement not expressly set forth
herein. The Parties have not made any
representations to each other not expressly set
forth herein.
5.1.3 The Parties execute this Agreement as their own free
and voluntary act, without any duress, coercion or
undue influence exerted by or on behalf of each
other or any other party.
5.1.4 This Agreement and the Sale Documents constitute the
entire agreement between the parties hereto. This
Agreement embodies the entire agreement with respect
to the respective rights, obligations and
liabilities of the Parties hereto and supersedes all
prior agreements and understandings, if any,
relating to the subject matter hereof.
5.1.5 The Parties are the sole owner of the claims or
causes of action being released herein and the
Parties have not conveyed or assigned any interest
in any such claims or causes of action to any person
or entity not a party hereto.
5.1.6 The Parties have full and complete authorization and
power to execute this Agreement in the capacity
herein stated and this Agreement is a valid, binding
and enforceable obligation of the Parties and does
not violate any law, rule, regulation, contract or
agreement otherwise enforceable by or against the
Parties.
6. ATTORNEY FEES
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In the event that Borrower breaches this Agreement and the enforcement
of this Agreement or recovery of damages for breach hereof is obtained
by law or legal proceedings through an attorney at law, all costs of
collection or enforcement, including reasonable attorneys' fees, shall
be paid by the Borrower to Lender.
7. FURTHER ASSURANCES
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Each party hereby agrees to take such other further actions and to
execute such other documentation as may be reasonably required to
carry out the intent and purposes of this Agreement.
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8. INVALIDITY
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If any portion of this Agreement is determined to be invalid or
unenforceable such invalid portion will be severed from this Agreement
and the remainder of this Agreement will remain in full force and
effect.
9. COUNTERPARTS
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This Agreement may be executed in two or more counterparts, each of
which will be deemed an original, and all of which taken together will
constitute one and the same written agreement, which will be binding
and effective as to all parties.
10. CONSTRUCTION OF AGREEMENT
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Each party acknowledges that it has had the opportunity to negotiate
modifications to the language of this Agreement. Accordingly, each
party agrees that in any dispute regarding the interpretation or
construction of this Agreement, no presumption will operate in favor
of or against any party hereto by virtue of its role in drafting or
not drafting the terms and conditions set forth herein.
10.1 This Agreement shall be binding upon each of the parties
hereto, and upon their respective heirs, successors, and
assigns, and shall inure to the benefit of each of the
parties hereto, and their respective heirs, successors, and
assigns.
10.2 This Agreement is entered into in the State of Georgia, and
the interpretation, construction, and enforcement of the
terms of this Agreement shall be governed by the law of
Georgia and Federal law, as applicable.
10.3 Each person executing this Agreement on behalf of a
corporation warrants and represents that he has been fully
authorized to execute this Agreement on behalf of such
corporation and that such corporation is bound by the
signature of such representative.
11. ENTIRE UNDERSTANDING
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This Agreement contains the entire understanding of the parties hereto
with respect to its terms. The parties hereby acknowledge that there
have been no representations, warranties, covenants or understandings
other than those expressly set forth herein. No change, modification
or waiver of any of the provisions of this Agreement will be binding
unless signed by the party against whom the same is sought to be
enforced.
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IN WITNESS WHEREOF the undersigned have executed this Agreement under
seal on the ___ day of January, 2005.
Sworn to and subscribed before me CHILDS & CHILDS GRANITE CO., INC.
this 26th day of January 2005.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ III
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Notary Public ▇▇▇▇▇▇ ▇. ▇▇▇▇ III
(NOTARIAL SEAL)
Its: President
My commission expires:____________
Sworn to and subscribed before me ▇▇▇▇ ACQUISITIONS, INC.
this 26th day of January 2005.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇ III
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Notary Public ▇▇▇▇▇▇ ▇. ▇▇▇▇ III
(NOTARIAL SEAL)
Its: President
My commission expires:____________
Sworn to and subscribed before me ROCK OF AGES CORPORATION
this 26th day of January 2005.
______________________________ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
Notary Public -----------------------------
(NOTARIAL SEAL) ▇▇▇▇▇▇▇ ▇▇▇▇
Its: Vice President/General
My commission expires:____________ Counsel
Sworn to and subscribed before me ROCK OF AGES MEMORIALS, INC.
this 26th day of January 2005.
______________________________ By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇
Notary Public -----------------------------
(NOTARIAL SEAL) ▇▇▇▇▇▇▇ ▇▇▇▇
Its: Vice President/General
My commission expires:____________ Counsel
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