1006-00005 · Crestline Packaging Solutions LLC · Settlement

settlement-agreement-and-mutual-release.docx DOCUMENT Litigation

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SETTLEMENT AGREEMENT AND MUTUAL RELEASE

Effective Date: December 3, 2021

This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of December 3, 2021 (the "Effective Date"), by and between:

CRESTLINE PACKAGING SOLUTIONS LLC, an Ohio limited liability company, with its principal place of business at 4500 Needmore Road, Dayton, OH 45424 ("CPS");

and

RIDGEWAY FREIGHT SERVICES INC., a Texas corporation, with its principal place of business at 7200 East Lancaster Avenue, Fort Worth, TX 76112 ("Ridgeway").

CPS and Ridgeway are each referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS, on April 15, 2019, CPS and Ridgeway entered into that certain Master Transportation Services Agreement (the "MTSA"), pursuant to which Ridgeway agreed to provide full truckload and less-than-truckload freight transportation services to CPS, including intrastate and interstate linehaul, cross-docking, and last-mile delivery services, in accordance with the rates, routes, and service levels specified therein;

WHEREAS, CPS terminated the MTSA effective April 22, 2021, pursuant to Section 9.2 thereof, following CPS's issuance of a thirty (30)-day written termination notice to Ridgeway on March 22, 2021;

WHEREAS, on or about June 7, 2021, CPS filed a lawsuit styled Crestline Packaging Solutions LLC v. Ridgeway Freight Services Inc., Cause No. 342-2021-04871-TX, in the 342nd Judicial District Court of Tarrant County, Texas (the "Lawsuit"), asserting claims for breach of contract, money had and received, common-law fraud, and unjust enrichment, and seeking recovery of One Million Eight Hundred Forty-Seven Thousand Six Hundred Thirty-Two Dollars and Nineteen Cents ($1,847,632.19) in alleged overcharges, together with contractual interest, attorneys' fees, costs of court, and exemplary damages;

WHEREAS, Ridgeway filed a counterclaim in the Lawsuit asserting breach of contract based on CPS's alleged wrongful termination of the MTSA, seeking recovery of Three Hundred Forty Thousand Dollars ($340,000.00) in alleged lost profits and related consequential damages;

WHEREAS, the Parties participated in a mediation before the Honorable Constance Farr, Judge (Ret.), at the Lone Star Dispute Resolution Center, 300 Throckmorton Street, Suite 1200, Fort Worth, TX 76102, on November 18, 2021, and, as a result of that mediation, reached an agreement in principle to resolve all claims and counterclaims asserted in the Lawsuit;

WHEREAS, the Parties desire to fully, finally, and forever resolve all disputes, controversies, claims, and counterclaims between them arising out of or relating to the MTSA, the Lawsuit, and any and all transactions and occurrences described therein, and to avoid the expense, burden, uncertainty, and distraction of further litigation; and

NOW, THEREFORE, in consideration of the mutual promises, covenants, and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party, the Parties agree as follows:

ARTICLE I — SETTLEMENT PAYMENT

Section 1.1 — Settlement Amount

Ridgeway shall pay to CPS the total sum of One Million Five Hundred Seventy-Five Thousand Dollars ($1,575,000.00) (the "Settlement Amount"), subject to and in accordance with the payment schedule set forth below:

(a) First Installment. One Million Dollars ($1,000,000.00) shall be due and payable within thirty (30) calendar days of the Effective Date (i.e., no later than January 2, 2022). Such payment shall be made by wire transfer of immediately available funds to a bank account designated in writing by CPS in accordance with Section 1.3 below.

(b) Second Installment. Five Hundred Seventy-Five Thousand Dollars ($575,000.00) shall be due and payable within ninety (90) calendar days of the Effective Date (i.e., no later than March 3, 2022). Such payment shall be made by wire transfer of immediately available funds to a bank account designated in writing by CPS in accordance with Section 1.3 below.

The Settlement Amount shall be allocated and reported for tax purposes in accordance with applicable law, and each Party shall be solely responsible for its own tax obligations arising from or relating to the receipt or payment of the Settlement Amount. Neither Party makes any representation or warranty to the other regarding the tax treatment or tax consequences of the Settlement Amount or any portion thereof.

Section 1.2 — Late Payment

In the event that Ridgeway fails to make any installment payment when due as set forth in Section 1.1, interest shall accrue on the unpaid amount at the rate of one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) from the applicable due date until such payment, together with all accrued interest thereon, is paid in full. Such interest shall compound monthly on the last calendar day of each month.

Upon any payment default by Ridgeway that remains uncured for ten (10) business days following written notice of such default from CPS to Ridgeway in accordance with Section 7.8, CPS shall be entitled, at its sole option and in addition to any other remedies available at law or in equity, to enter a consent judgment against Ridgeway in the amount of the entire unpaid balance of the Settlement Amount, plus all accrued and unpaid interest thereon, plus CPS's reasonable attorneys' fees and costs incurred in connection with the enforcement of this Agreement (collectively, the "Judgment Amount"). Ridgeway hereby irrevocably consents to the entry of such judgment in the 342nd Judicial District Court of Tarrant County, Texas, and irrevocably waives any objection to personal jurisdiction, subject-matter jurisdiction, or venue in connection therewith. The Parties acknowledge that this consent judgment provision is a material inducement to CPS's agreement to accept installment payments rather than a single lump-sum payment, and that the enforcement rights set forth in this Section 1.2 are reasonable and necessary to protect CPS's legitimate interests under this Agreement.

Section 1.3 — Wire Instructions

CPS shall provide Ridgeway with complete wire transfer instructions, including the name and address of the receiving financial institution, the ABA routing number, account name, and account number, within five (5) business days of the Effective Date. Ridgeway shall be entitled to rely on such instructions until CPS provides updated instructions in writing. Any change to wire transfer instructions must be confirmed by telephone by CPS's General Counsel or his designee prior to Ridgeway acting upon such changed instructions.

ARTICLE II — MUTUAL RELEASES

Section 2.1 — Release by CPS

Effective upon CPS's receipt of the full Settlement Amount (including both the First Installment and the Second Installment as set forth in Section 1.1), CPS, on behalf of itself and its members, managers, officers, directors, employees, agents, representatives, affiliates, successors, and assigns (collectively, the "CPS Releasing Parties"), hereby fully, finally, unconditionally, and irrevocably releases, acquits, and forever discharges Ridgeway and its shareholders, officers, directors, employees, agents, representatives, affiliates, insurers, successors, and assigns (collectively, the "Ridgeway Released Parties") from any and all claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, judgments, executions, obligations, damages, losses, costs, expenses, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether arising under statute, contract, tort, or otherwise, whether known or unknown, suspected or unsuspected, fixed or contingent, matured or unmatured, liquidated or unliquidated, that the CPS Releasing Parties ever had, now have, or hereafter may have against the Ridgeway Released Parties, from the beginning of the world through the Effective Date, arising out of, relating to, or in any way connected with: (i) the MTSA, including all amendments, schedules, and addenda thereto; (ii) the Lawsuit, including all claims, counterclaims, cross-claims, and defenses asserted or that could have been asserted therein; or (iii) the transactions, services, invoices, payments, disputes, negotiations, communications, and events described in or relating to the MTSA or the Lawsuit.

Section 2.2 — Release by Ridgeway

Effective as of the Effective Date, Ridgeway, on behalf of itself and its shareholders, officers, directors, employees, agents, representatives, affiliates, insurers, successors, and assigns (collectively, the "Ridgeway Releasing Parties"), hereby fully, finally, unconditionally, and irrevocably releases, acquits, and forever discharges CPS and its members, managers, officers, directors, employees, agents, representatives, affiliates, successors, and assigns (collectively, the "CPS Released Parties") from any and all claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, judgments, executions, obligations, damages, losses, costs, expenses, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether arising under statute, contract, tort, or otherwise, whether known or unknown, suspected or unsuspected, fixed or contingent, matured or unmatured, liquidated or unliquidated, that the Ridgeway Releasing Parties ever had, now have, or hereafter may have against the CPS Released Parties, from the beginning of the world through the Effective Date, arising out of, relating to, or in any way connected with: (i) the MTSA, including all amendments, schedules, and addenda thereto; (ii) the Lawsuit, including all claims, counterclaims, cross-claims, and defenses asserted or that could have been asserted therein; or (iii) the transactions, services, invoices, payments, disputes, negotiations, communications, and events described in or relating to the MTSA or the Lawsuit. Without limiting the generality of the foregoing, the release set forth in this Section 2.2 specifically encompasses and includes Ridgeway's counterclaim for alleged lost profits of Three Hundred Forty Thousand Dollars ($340,000.00) and any and all other claims for damages, whether direct, indirect, consequential, incidental, special, punitive, or exemplary, arising from or related to CPS's termination of the MTSA.

The Parties acknowledge and agree that Ridgeway's release under this Section 2.2 is effective immediately upon the Effective Date and is not conditioned upon CPS's receipt of the Settlement Amount or any installment thereof.

Section 2.3 — Reservation

Notwithstanding anything to the contrary in Sections 2.1 and 2.2, the releases set forth therein shall not release, waive, or otherwise affect:

(a) the Parties' respective rights, obligations, covenants, and duties under this Agreement, all of which shall survive the execution and delivery of this Agreement in accordance with their terms; or

(b) any claims, demands, actions, or causes of action arising from or related to a breach of this Agreement by either Party.

ARTICLE III — DISMISSAL

Section 3.1 — Dismissal

Within ten (10) business days of the Effective Date, the Parties shall cause their respective counsel to jointly prepare, execute, and file an Agreed Order of Dismissal with Prejudice (the "Dismissal Order") in Cause No. 342-2021-04871-TX, pending in the 342nd Judicial District Court of Tarrant County, Texas. The Dismissal Order shall dismiss all of CPS's claims and all of Ridgeway's counterclaims with prejudice and without costs to either Party, with each Party bearing its own costs and attorneys' fees except as otherwise expressly provided in this Agreement. Counsel for CPS, Calderwood & Harkness LLP, shall prepare the initial draft of the Dismissal Order and shall submit such draft to counsel for Ridgeway, Bartlett, Hogue & Sinclair LLP, for review and approval as to form prior to filing. Counsel for Ridgeway shall provide any comments or indicate approval as to form within five (5) business days of receipt of the draft Dismissal Order. The Parties shall cooperate fully and in good faith to secure entry of the Dismissal Order by the Court as expeditiously as practicable.

ARTICLE IV — CONFIDENTIALITY

Section 4.1 — Confidentiality

The Parties agree that the existence and terms of this Agreement, including without limitation the Settlement Amount and the payment schedule, are and shall remain strictly confidential. Except as expressly provided in this Section 4.1, neither Party shall disclose, publicize, or disseminate, directly or indirectly, the terms, conditions, or substance of this Agreement to any third party. Notwithstanding the foregoing, either Party may disclose the terms of this Agreement:

(a) to such Party's legal, financial, and tax advisors, including outside counsel, accountants, and tax preparers, who shall be informed of and bound by the confidentiality obligations set forth in this Section 4.1 as a condition of such disclosure;

(b) to such Party's auditors, lenders, insurers, or investors, on a need-to-know basis and subject to appropriate confidentiality obligations substantially equivalent to those set forth herein;

(c) to the extent required by applicable law, regulation, governmental order, subpoena, or other compulsory legal process, provided that the disclosing Party shall, to the extent legally permissible, provide the other Party with prompt written notice of such requirement prior to any such disclosure so as to afford the other Party an opportunity to seek a protective order or other appropriate remedy; and

(d) in connection with any proceeding to enforce the terms of this Agreement.

In the event that either Party is required to disclose the existence or terms of this Agreement in response to a compulsory legal process as described in subsection (c) above, such Party shall disclose only such information as is strictly necessary to comply with such legal process and shall use commercially reasonable efforts to obtain confidential treatment of any information so disclosed.

Section 4.2 — Non-Disparagement

Neither Party shall, directly or indirectly, make, publish, or cause to be made or published any disparaging, derogatory, or defamatory statements, whether oral or written, about the other Party, or about any of the other Party's shareholders, members, managers, officers, directors, employees, or agents, in connection with or relating to the Lawsuit, the MTSA, or the events and circumstances giving rise thereto. Nothing in this Section 4.2 shall be construed to prohibit either Party from providing truthful testimony or information in response to a lawful subpoena, court order, or governmental investigation, or from making truthful statements in connection with the enforcement of this Agreement.

ARTICLE V — NO ADMISSION OF LIABILITY

Section 5.1 — No Admission

This Agreement constitutes a compromise and settlement of disputed claims and counterclaims. Neither the execution of this Agreement, the payment of the Settlement Amount, nor any of the terms, provisions, or conditions hereof shall be construed as, or deemed to be, an admission of liability, wrongdoing, fault, or responsibility by either Party with respect to any of the claims, counterclaims, allegations, or defenses asserted or that could have been asserted in the Lawsuit, or with respect to any other matter whatsoever. Each Party has entered into this Agreement solely for the purpose of avoiding the expense, burden, uncertainty, and distraction of continued litigation. This Agreement, the fact of its execution, and the Settlement Amount shall not be offered or received in evidence in any action, suit, or proceeding of any kind as an admission or concession of liability, fault, or wrongdoing by either Party, except that this Agreement may be offered or received in evidence in any proceeding brought to enforce its terms.

ARTICLE VI — REPRESENTATIONS AND WARRANTIES

Section 6.1 — Authority

Each Party hereby represents and warrants to the other Party as follows:

(a) Such Party is duly organized, validly existing, and in good standing under the laws of its state of organization, and has the full corporate or limited liability company power and authority to enter into, execute, deliver, and perform its obligations under this Agreement.

(b) The execution, delivery, and performance of this Agreement by such Party have been duly authorized by all necessary corporate or limited liability company action, and the person executing this Agreement on behalf of such Party has been duly authorized to do so by all requisite corporate or company action, including any required approvals of such Party's board of directors, managers, or members, as applicable.

(c) This Agreement constitutes the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject only to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally, and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

Section 6.2 — No Assignment

Each Party hereby represents and warrants to the other Party that it has not heretofore assigned, transferred, conveyed, pledged, hypothecated, or otherwise encumbered, in whole or in part, any claim, demand, cause of action, right, obligation, or interest that is the subject of the releases set forth in Article II, and that no other person or entity has any interest, by assignment, subrogation, or otherwise, in any such claim, demand, cause of action, right, obligation, or interest.

Section 6.3 — Voluntary Execution

Each Party hereby represents and warrants to the other Party that: (i) it has had a full and fair opportunity to consult with legal counsel of its own choosing regarding the terms, meaning, and effect of this Agreement; (ii) it has in fact consulted with and been advised by its own legal counsel in connection with the negotiation, drafting, and execution of this Agreement; (iii) it has read, understands, and voluntarily accepts each and every provision of this Agreement; and (iv) it is executing this Agreement freely, voluntarily, and without duress, coercion, or undue influence of any kind. Each Party further acknowledges that it is not relying upon any statement, representation, promise, or inducement made by the other Party or the other Party's counsel, agents, or representatives, other than the express terms set forth in this Agreement, in deciding to enter into this Agreement.

ARTICLE VII — GENERAL PROVISIONS

Section 7.1 — Governing Law

This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of the State of Texas, without giving effect to any choice-of-law or conflict-of-laws rules, principles, or provisions (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.

Section 7.2 — Jurisdiction and Venue

Any action, suit, or proceeding arising out of or relating to this Agreement, including any action to enforce the consent judgment provision set forth in Section 1.2, shall be brought exclusively in the 342nd Judicial District Court of Tarrant County, Texas. Each Party hereby irrevocably submits to the exclusive jurisdiction of such court for the purpose of any such action, suit, or proceeding, and irrevocably waives, and agrees not to assert, by way of motion, as a defense, or otherwise, any claim that it is not subject to the jurisdiction of such court, that such action, suit, or proceeding is brought in an inconvenient forum, or that the venue of such action, suit, or proceeding is improper.

Section 7.3 — Entire Agreement

This Agreement, including the Recitals set forth above (which are incorporated herein by reference), constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, discussions, representations, understandings, agreements, and communications, whether oral or written, between the Parties relating to the subject matter hereof, including without limitation any term sheet or agreement in principle reached during the mediation on November 18, 2021. There are no representations, warranties, covenants, promises, or undertakings other than those expressly set forth or referred to in this Agreement.

Section 7.4 — Amendment

This Agreement may not be amended, modified, supplemented, or otherwise altered in any respect except by a written instrument that (a) expressly refers to this Agreement and the specific provision to be amended, and (b) is duly executed by authorized representatives of both Parties. No oral modification of this Agreement shall be effective for any purpose.

Section 7.5 — Waiver

No waiver of any provision of this Agreement, or of any right or remedy hereunder, shall be effective unless made in writing and signed by the Party against whom enforcement of such waiver is sought. The failure of either Party at any time to require performance of any provision of this Agreement shall in no way affect such Party's right to require full performance of such provision at any time thereafter. No waiver by either Party of a breach of any provision of this Agreement shall be taken or held to be a waiver of any subsequent breach of such provision or a waiver of any other provision of this Agreement. No single or partial exercise of any right or remedy under this Agreement shall preclude any other or further exercise of such right or remedy, or the exercise of any other right or remedy.

Section 7.6 — Severability

If any provision of this Agreement, or the application thereof to any person, entity, or circumstance, is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable for any reason, the remaining provisions of this Agreement shall continue in full force and effect, and the application of such provision to other persons, entities, or circumstances shall not be affected thereby. In the event that any provision of this Agreement is so held to be invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to replace such provision with a valid, legal, and enforceable provision that, to the greatest extent possible, achieves the original intent and economic effect of the invalid, illegal, or unenforceable provision.

Section 7.7 — Counterparts

This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000) or by facsimile transmission shall be effective as delivery of a manually executed original counterpart, and signatures delivered by such electronic or facsimile means shall be deemed original signatures for all purposes.

Section 7.8 — Notices

All notices, demands, requests, consents, approvals, and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given: (i) if delivered by hand, upon delivery; (ii) if sent by nationally recognized overnight courier service (such as Severin Partners LLC or Halcyon Partners LLC), on the first business day following deposit with such courier; or (iii) if sent by certified mail, return receipt requested, postage prepaid, on the third business day following deposit in the United States mail. All such notices shall be addressed as follows:

If to CPS:

Crestline Packaging Solutions LLC

Attn: Harold Inman, General Counsel

4500 Needmore Road Dayton, OH 45424

With a copy (which shall not constitute notice) to:

Calderwood & Harkness LLP

Attn: Francesca Morano

250 West Street, Suite 1800 Columbus, OH 43215

If to Ridgeway:

Ridgeway Freight Services Inc.

Attn: Raymond Calder, CEO

7200 East Lancaster Avenue Fort Worth, TX 76112

With a copy (which shall not constitute notice) to:

Bartlett, Hogue & Sinclair LLP

Attn: Marcus T. Hogue

801 Cherry Street, Suite 3400 Fort Worth, TX 76102

Either Party may change its address for notices by giving the other Party written notice of such change in accordance with this Section 7.8, which change shall be effective upon receipt.

Section 7.9 — Construction

This Agreement has been jointly negotiated and drafted by the Parties and their respective legal counsel. In the event of any ambiguity or dispute concerning the interpretation or construction of this Agreement, this Agreement shall be interpreted and construed as if drafted jointly by both Parties, and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship or drafting of any provision hereof.

Section 7.10 — Headings

The article and section headings and captions used in this Agreement are inserted for convenience of reference only and shall not affect the meaning, interpretation, or construction of this Agreement or any provision hereof.

IN WITNESS WHEREOF, the Parties have caused this Settlement Agreement and Mutual Release to be duly executed as of the Effective Date first written above.

[SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND MUTUAL RELEASE]

CRESTLINE PACKAGING SOLUTIONS LLC

By: ________

Name: Margaret Ashford

Title: CEO & President

Date: December 3, 2021

RIDGEWAY FREIGHT SERVICES INC.

By: ________

Name: Raymond Calder

Title: Founder & CEO

Date: December 3, 2021

APPROVED AS TO FORM:

Calderwood & Harkness LLP Counsel for Crestline Packaging Solutions LLC

By: ________

Francesca Morano, Partner

Date: December 3, 2021

APPROVED AS TO FORM:

Bartlett, Hogue & Sinclair LLP Counsel for Ridgeway Freight Services Inc.

By: ________

Marcus T. Hogue, Partner

Date: December 3, 2021

SETTLEMENT AGREEMENT AND MUTUAL RELEASE
Effective Date: December 3, 2021
This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of December 3, 2021 (the "Effective Date"), by and between:
CRESTLINE PACKAGING SOLUTIONS LLC, an Ohio limited liability company, with its principal place of business at 4500 Needmore Road, Dayton, OH 45424 ("CPS");
and
RIDGEWAY FREIGHT SERVICES INC., a Texas corporation, with its principal place of business at 7200 East Lancaster Avenue, Fort Worth, TX 76112 ("Ridgeway").
CPS and Ridgeway are each referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, on April 15, 2019, CPS and Ridgeway entered into that certain Master Transportation Services Agreement (the "MTSA"), pursuant to which Ridgeway agreed to provide full truckload and less-than-truckload freight transportation services to CPS, including intrastate and interstate linehaul, cross-docking, and last-mile delivery services, in accordance with the rates, routes, and service levels specified therein;
WHEREAS, CPS terminated the MTSA effective April 22, 2021, pursuant to Section 9.2 thereof, following CPS's issuance of a thirty (30)-day written termination notice to Ridgeway on March 22, 2021;
WHEREAS, on or about June 7, 2021, CPS filed a lawsuit styled Crestline Packaging Solutions LLC v. Ridgeway Freight Services Inc., Cause No. 342-2021-04871-TX, in the 342nd Judicial District Court of Tarrant County, Texas (the "Lawsuit"), asserting claims for breach of contract, money had and received, common-law fraud, and unjust enrichment, and seeking recovery of One Million Eight Hundred Forty-Seven Thousand Six Hundred Thirty-Two Dollars and Nineteen Cents ($1,847,632.19) in alleged overcharges, together with contractual interest, attorneys' fees, costs of court, and exemplary damages;
WHEREAS, Ridgeway filed a counterclaim in the Lawsuit asserting breach of contract based on CPS's alleged wrongful termination of the MTSA, seeking recovery of Three Hundred Forty Thousand Dollars ($340,000.00) in alleged lost profits and related consequential damages;
WHEREAS, the Parties participated in a mediation before the Honorable Constance Farr, Judge (Ret.), at the Lone Star Dispute Resolution Center, 300 Throckmorton Street, Suite 1200, Fort Worth, TX 76102, on November 18, 2021, and, as a result of that mediation, reached an agreement in principle to resolve all claims and counterclaims asserted in the Lawsuit;
WHEREAS, the Parties desire to fully, finally, and forever resolve all disputes, controversies, claims, and counterclaims between them arising out of or relating to the MTSA, the Lawsuit, and any and all transactions and occurrences described therein, and to avoid the expense, burden, uncertainty, and distraction of further litigation; and
NOW, THEREFORE, in consideration of the mutual promises, covenants, and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Party, the Parties agree as follows:
ARTICLE I — SETTLEMENT PAYMENT
Section 1.1 — Settlement Amount
Ridgeway shall pay to CPS the total sum of One Million Five Hundred Seventy-Five Thousand Dollars ($1,575,000.00) (the "Settlement Amount"), subject to and in accordance with the payment schedule set forth below:
(a) First Installment. One Million Dollars ($1,000,000.00) shall be due and payable within thirty (30) calendar days of the Effective Date (i.e., no later than January 2, 2022). Such payment shall be made by wire transfer of immediately available funds to a bank account designated in writing by CPS in accordance with Section 1.3 below.
(b) Second Installment. Five Hundred Seventy-Five Thousand Dollars ($575,000.00) shall be due and payable within ninety (90) calendar days of the Effective Date (i.e., no later than March 3, 2022). Such payment shall be made by wire transfer of immediately available funds to a bank account designated in writing by CPS in accordance with Section 1.3 below.
The Settlement Amount shall be allocated and reported for tax purposes in accordance with applicable law, and each Party shall be solely responsible for its own tax obligations arising from or relating to the receipt or payment of the Settlement Amount. Neither Party makes any representation or warranty to the other regarding the tax treatment or tax consequences of the Settlement Amount or any portion thereof.
Section 1.2 — Late Payment
In the event that Ridgeway fails to make any installment payment when due as set forth in Section 1.1, interest shall accrue on the unpaid amount at the rate of one and one-half percent (1.5%) per month (eighteen percent (18%) per annum) from the applicable due date until such payment, together with all accrued interest thereon, is paid in full. Such interest shall compound monthly on the last calendar day of each month.
Upon any payment default by Ridgeway that remains uncured for ten (10) business days following written notice of such default from CPS to Ridgeway in accordance with Section 7.8, CPS shall be entitled, at its sole option and in addition to any other remedies available at law or in equity, to enter a consent judgment against Ridgeway in the amount of the entire unpaid balance of the Settlement Amount, plus all accrued and unpaid interest thereon, plus CPS's reasonable attorneys' fees and costs incurred in connection with the enforcement of this Agreement (collectively, the "Judgment Amount"). Ridgeway hereby irrevocably consents to the entry of such judgment in the 342nd Judicial District Court of Tarrant County, Texas, and irrevocably waives any objection to personal jurisdiction, subject-matter jurisdiction, or venue in connection therewith. The Parties acknowledge that this consent judgment provision is a material inducement to CPS's agreement to accept installment payments rather than a single lump-sum payment, and that the enforcement rights set forth in this Section 1.2 are reasonable and necessary to protect CPS's legitimate interests under this Agreement.
Section 1.3 — Wire Instructions
CPS shall provide Ridgeway with complete wire transfer instructions, including the name and address of the receiving financial institution, the ABA routing number, account name, and account number, within five (5) business days of the Effective Date. Ridgeway shall be entitled to rely on such instructions until CPS provides updated instructions in writing. Any change to wire transfer instructions must be confirmed by telephone by CPS's General Counsel or his designee prior to Ridgeway acting upon such changed instructions.
ARTICLE II — MUTUAL RELEASES
Section 2.1 — Release by CPS
Effective upon CPS's receipt of the full Settlement Amount (including both the First Installment and the Second Installment as set forth in Section 1.1), CPS, on behalf of itself and its members, managers, officers, directors, employees, agents, representatives, affiliates, successors, and assigns (collectively, the "CPS Releasing Parties"), hereby fully, finally, unconditionally, and irrevocably releases, acquits, and forever discharges Ridgeway and its shareholders, officers, directors, employees, agents, representatives, affiliates, insurers, successors, and assigns (collectively, the "Ridgeway Released Parties") from any and all claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, judgments, executions, obligations, damages, losses, costs, expenses, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether arising under statute, contract, tort, or otherwise, whether known or unknown, suspected or unsuspected, fixed or contingent, matured or unmatured, liquidated or unliquidated, that the CPS Releasing Parties ever had, now have, or hereafter may have against the Ridgeway Released Parties, from the beginning of the world through the Effective Date, arising out of, relating to, or in any way connected with: (i) the MTSA, including all amendments, schedules, and addenda thereto; (ii) the Lawsuit, including all claims, counterclaims, cross-claims, and defenses asserted or that could have been asserted therein; or (iii) the transactions, services, invoices, payments, disputes, negotiations, communications, and events described in or relating to the MTSA or the Lawsuit.
Section 2.2 — Release by Ridgeway
Effective as of the Effective Date, Ridgeway, on behalf of itself and its shareholders, officers, directors, employees, agents, representatives, affiliates, insurers, successors, and assigns (collectively, the "Ridgeway Releasing Parties"), hereby fully, finally, unconditionally, and irrevocably releases, acquits, and forever discharges CPS and its members, managers, officers, directors, employees, agents, representatives, affiliates, successors, and assigns (collectively, the "CPS Released Parties") from any and all claims, demands, actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, controversies, agreements, promises, variances, trespasses, judgments, executions, obligations, damages, losses, costs, expenses, and liabilities of every kind and nature whatsoever, whether at law or in equity, whether arising under statute, contract, tort, or otherwise, whether known or unknown, suspected or unsuspected, fixed or contingent, matured or unmatured, liquidated or unliquidated, that the Ridgeway Releasing Parties ever had, now have, or hereafter may have against the CPS Released Parties, from the beginning of the world through the Effective Date, arising out of, relating to, or in any way connected with: (i) the MTSA, including all amendments, schedules, and addenda thereto; (ii) the Lawsuit, including all claims, counterclaims, cross-claims, and defenses asserted or that could have been asserted therein; or (iii) the transactions, services, invoices, payments, disputes, negotiations, communications, and events described in or relating to the MTSA or the Lawsuit. Without limiting the generality of the foregoing, the release set forth in this Section 2.2 specifically encompasses and includes Ridgeway's counterclaim for alleged lost profits of Three Hundred Forty Thousand Dollars ($340,000.00) and any and all other claims for damages, whether direct, indirect, consequential, incidental, special, punitive, or exemplary, arising from or related to CPS's termination of the MTSA.
The Parties acknowledge and agree that Ridgeway's release under this Section 2.2 is effective immediately upon the Effective Date and is not conditioned upon CPS's receipt of the Settlement Amount or any installment thereof.
Section 2.3 — Reservation
Notwithstanding anything to the contrary in Sections 2.1 and 2.2, the releases set forth therein shall not release, waive, or otherwise affect:
(a) the Parties' respective rights, obligations, covenants, and duties under this Agreement, all of which shall survive the execution and delivery of this Agreement in accordance with their terms; or
(b) any claims, demands, actions, or causes of action arising from or related to a breach of this Agreement by either Party.
ARTICLE III — DISMISSAL
Section 3.1 — Dismissal
Within ten (10) business days of the Effective Date, the Parties shall cause their respective counsel to jointly prepare, execute, and file an Agreed Order of Dismissal with Prejudice (the "Dismissal Order") in Cause No. 342-2021-04871-TX, pending in the 342nd Judicial District Court of Tarrant County, Texas. The Dismissal Order shall dismiss all of CPS's claims and all of Ridgeway's counterclaims with prejudice and without costs to either Party, with each Party bearing its own costs and attorneys' fees except as otherwise expressly provided in this Agreement. Counsel for CPS, Calderwood & Harkness LLP, shall prepare the initial draft of the Dismissal Order and shall submit such draft to counsel for Ridgeway, Bartlett, Hogue & Sinclair LLP, for review and approval as to form prior to filing. Counsel for Ridgeway shall provide any comments or indicate approval as to form within five (5) business days of receipt of the draft Dismissal Order. The Parties shall cooperate fully and in good faith to secure entry of the Dismissal Order by the Court as expeditiously as practicable.
ARTICLE IV — CONFIDENTIALITY
Section 4.1 — Confidentiality
The Parties agree that the existence and terms of this Agreement, including without limitation the Settlement Amount and the payment schedule, are and shall remain strictly confidential. Except as expressly provided in this Section 4.1, neither Party shall disclose, publicize, or disseminate, directly or indirectly, the terms, conditions, or substance of this Agreement to any third party. Notwithstanding the foregoing, either Party may disclose the terms of this Agreement:
(a) to such Party's legal, financial, and tax advisors, including outside counsel, accountants, and tax preparers, who shall be informed of and bound by the confidentiality obligations set forth in this Section 4.1 as a condition of such disclosure;
(b) to such Party's auditors, lenders, insurers, or investors, on a need-to-know basis and subject to appropriate confidentiality obligations substantially equivalent to those set forth herein;
(c) to the extent required by applicable law, regulation, governmental order, subpoena, or other compulsory legal process, provided that the disclosing Party shall, to the extent legally permissible, provide the other Party with prompt written notice of such requirement prior to any such disclosure so as to afford the other Party an opportunity to seek a protective order or other appropriate remedy; and
(d) in connection with any proceeding to enforce the terms of this Agreement.
In the event that either Party is required to disclose the existence or terms of this Agreement in response to a compulsory legal process as described in subsection (c) above, such Party shall disclose only such information as is strictly necessary to comply with such legal process and shall use commercially reasonable efforts to obtain confidential treatment of any information so disclosed.
Section 4.2 — Non-Disparagement
Neither Party shall, directly or indirectly, make, publish, or cause to be made or published any disparaging, derogatory, or defamatory statements, whether oral or written, about the other Party, or about any of the other Party's shareholders, members, managers, officers, directors, employees, or agents, in connection with or relating to the Lawsuit, the MTSA, or the events and circumstances giving rise thereto. Nothing in this Section 4.2 shall be construed to prohibit either Party from providing truthful testimony or information in response to a lawful subpoena, court order, or governmental investigation, or from making truthful statements in connection with the enforcement of this Agreement.
ARTICLE V — NO ADMISSION OF LIABILITY
Section 5.1 — No Admission
This Agreement constitutes a compromise and settlement of disputed claims and counterclaims. Neither the execution of this Agreement, the payment of the Settlement Amount, nor any of the terms, provisions, or conditions hereof shall be construed as, or deemed to be, an admission of liability, wrongdoing, fault, or responsibility by either Party with respect to any of the claims, counterclaims, allegations, or defenses asserted or that could have been asserted in the Lawsuit, or with respect to any other matter whatsoever. Each Party has entered into this Agreement solely for the purpose of avoiding the expense, burden, uncertainty, and distraction of continued litigation. This Agreement, the fact of its execution, and the Settlement Amount shall not be offered or received in evidence in any action, suit, or proceeding of any kind as an admission or concession of liability, fault, or wrongdoing by either Party, except that this Agreement may be offered or received in evidence in any proceeding brought to enforce its terms.
ARTICLE VI — REPRESENTATIONS AND WARRANTIES
Section 6.1 — Authority
Each Party hereby represents and warrants to the other Party as follows:
(a) Such Party is duly organized, validly existing, and in good standing under the laws of its state of organization, and has the full corporate or limited liability company power and authority to enter into, execute, deliver, and perform its obligations under this Agreement.
(b) The execution, delivery, and performance of this Agreement by such Party have been duly authorized by all necessary corporate or limited liability company action, and the person executing this Agreement on behalf of such Party has been duly authorized to do so by all requisite corporate or company action, including any required approvals of such Party's board of directors, managers, or members, as applicable.
(c) This Agreement constitutes the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject only to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally, and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 6.2 — No Assignment
Each Party hereby represents and warrants to the other Party that it has not heretofore assigned, transferred, conveyed, pledged, hypothecated, or otherwise encumbered, in whole or in part, any claim, demand, cause of action, right, obligation, or interest that is the subject of the releases set forth in Article II, and that no other person or entity has any interest, by assignment, subrogation, or otherwise, in any such claim, demand, cause of action, right, obligation, or interest.
Section 6.3 — Voluntary Execution
Each Party hereby represents and warrants to the other Party that: (i) it has had a full and fair opportunity to consult with legal counsel of its own choosing regarding the terms, meaning, and effect of this Agreement; (ii) it has in fact consulted with and been advised by its own legal counsel in connection with the negotiation, drafting, and execution of this Agreement; (iii) it has read, understands, and voluntarily accepts each and every provision of this Agreement; and (iv) it is executing this Agreement freely, voluntarily, and without duress, coercion, or undue influence of any kind. Each Party further acknowledges that it is not relying upon any statement, representation, promise, or inducement made by the other Party or the other Party's counsel, agents, or representatives, other than the express terms set forth in this Agreement, in deciding to enter into this Agreement.
ARTICLE VII — GENERAL PROVISIONS
Section 7.1 — Governing Law
This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of the State of Texas, without giving effect to any choice-of-law or conflict-of-laws rules, principles, or provisions (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.
Section 7.2 — Jurisdiction and Venue
Any action, suit, or proceeding arising out of or relating to this Agreement, including any action to enforce the consent judgment provision set forth in Section 1.2, shall be brought exclusively in the 342nd Judicial District Court of Tarrant County, Texas. Each Party hereby irrevocably submits to the exclusive jurisdiction of such court for the purpose of any such action, suit, or proceeding, and irrevocably waives, and agrees not to assert, by way of motion, as a defense, or otherwise, any claim that it is not subject to the jurisdiction of such court, that such action, suit, or proceeding is brought in an inconvenient forum, or that the venue of such action, suit, or proceeding is improper.
Section 7.3 — Entire Agreement
This Agreement, including the Recitals set forth above (which are incorporated herein by reference), constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, discussions, representations, understandings, agreements, and communications, whether oral or written, between the Parties relating to the subject matter hereof, including without limitation any term sheet or agreement in principle reached during the mediation on November 18, 2021. There are no representations, warranties, covenants, promises, or undertakings other than those expressly set forth or referred to in this Agreement.
Section 7.4 — Amendment
This Agreement may not be amended, modified, supplemented, or otherwise altered in any respect except by a written instrument that (a) expressly refers to this Agreement and the specific provision to be amended, and (b) is duly executed by authorized representatives of both Parties. No oral modification of this Agreement shall be effective for any purpose.
Section 7.5 — Waiver
No waiver of any provision of this Agreement, or of any right or remedy hereunder, shall be effective unless made in writing and signed by the Party against whom enforcement of such waiver is sought. The failure of either Party at any time to require performance of any provision of this Agreement shall in no way affect such Party's right to require full performance of such provision at any time thereafter. No waiver by either Party of a breach of any provision of this Agreement shall be taken or held to be a waiver of any subsequent breach of such provision or a waiver of any other provision of this Agreement. No single or partial exercise of any right or remedy under this Agreement shall preclude any other or further exercise of such right or remedy, or the exercise of any other right or remedy.
Section 7.6 — Severability
If any provision of this Agreement, or the application thereof to any person, entity, or circumstance, is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable for any reason, the remaining provisions of this Agreement shall continue in full force and effect, and the application of such provision to other persons, entities, or circumstances shall not be affected thereby. In the event that any provision of this Agreement is so held to be invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to replace such provision with a valid, legal, and enforceable provision that, to the greatest extent possible, achieves the original intent and economic effect of the invalid, illegal, or unenforceable provision.
Section 7.7 — Counterparts
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Agreement by electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000) or by facsimile transmission shall be effective as delivery of a manually executed original counterpart, and signatures delivered by such electronic or facsimile means shall be deemed original signatures for all purposes.
Section 7.8 — Notices
All notices, demands, requests, consents, approvals, and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given: (i) if delivered by hand, upon delivery; (ii) if sent by nationally recognized overnight courier service (such as Severin Partners LLC or Halcyon Partners LLC), on the first business day following deposit with such courier; or (iii) if sent by certified mail, return receipt requested, postage prepaid, on the third business day following deposit in the United States mail. All such notices shall be addressed as follows:
If to CPS:
Crestline Packaging Solutions LLC
Attn: Harold Inman, General Counsel
4500 Needmore Road Dayton, OH 45424
With a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP
Attn: Francesca Morano
250 West Street, Suite 1800 Columbus, OH 43215
If to Ridgeway:
Ridgeway Freight Services Inc.
Attn: Raymond Calder, CEO
7200 East Lancaster Avenue Fort Worth, TX 76112
With a copy (which shall not constitute notice) to:
Bartlett, Hogue & Sinclair LLP
Attn: Marcus T. Hogue
801 Cherry Street, Suite 3400 Fort Worth, TX 76102
Either Party may change its address for notices by giving the other Party written notice of such change in accordance with this Section 7.8, which change shall be effective upon receipt.
Section 7.9 — Construction
This Agreement has been jointly negotiated and drafted by the Parties and their respective legal counsel. In the event of any ambiguity or dispute concerning the interpretation or construction of this Agreement, this Agreement shall be interpreted and construed as if drafted jointly by both Parties, and no presumption or burden of proof shall arise favoring or disfavoring either Party by virtue of the authorship or drafting of any provision hereof.
Section 7.10 — Headings
The article and section headings and captions used in this Agreement are inserted for convenience of reference only and shall not affect the meaning, interpretation, or construction of this Agreement or any provision hereof.
IN WITNESS WHEREOF, the Parties have caused this Settlement Agreement and Mutual Release to be duly executed as of the Effective Date first written above.
[SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND MUTUAL RELEASE]
CRESTLINE PACKAGING SOLUTIONS LLC
By: ________
Name: Margaret Ashford
Title: CEO & President
Date: December 3, 2021
RIDGEWAY FREIGHT SERVICES INC.
By: ________
Name: Raymond Calder
Title: Founder & CEO
Date: December 3, 2021
APPROVED AS TO FORM:
Calderwood & Harkness LLP Counsel for Crestline Packaging Solutions LLC
By: ________
Francesca Morano, Partner
Date: December 3, 2021
APPROVED AS TO FORM:
Bartlett, Hogue & Sinclair LLP Counsel for Ridgeway Freight Services Inc.
By: ________
Marcus T. Hogue, Partner
Date: December 3, 2021

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

RECITALS

CRESTLINE PACKAGING SOLUTIONS LLC

RIDGEWAY FREIGHT SERVICES INC.

APPROVED AS TO FORM:

APPROVED AS TO FORM:

Record

Parties

Dates

Amounts