DRAFT — PRIVILEGED AND CONFIDENTIAL — SUBJECT TO FRE 408 / DRE 408
STANDSTILL AND SETTLEMENT AGREEMENT
Third Draft — April 4, 2025
Prepared by Calderwood & Harkness LLP Matter No. 1038-00006
This STANDSTILL AND SETTLEMENT AGREEMENT (this "Agreement") is dated as of ___, 2025 (the "Execution Date"), by and among:
CASCADE RETAIL HOLDINGS INC., a Delaware corporation ("Cascade" or "CRH"), with its principal offices at 2200 Elliott Avenue West, Suite 3400, Seattle, WA 98119;
PRIYA RATHORE, an individual residing at 14 Harbor Ridge Lane, Bellevue, WA 98004 ("Rathore");
DEREK LINDEN, an individual ("Linden");
SONIA KACZMAREK, an individual ("Kaczmarek");
AMARA OSEI, an individual ("Osei");
BRENT HALVORSEN, an individual ("Halvorsen");
LUCIA FERNANDEZ-GILL, an individual ("Fernandez-Gill");
NATHAN TSAO, an individual ("Tsao");
KIRA JOHANSSON, an individual ("Johansson");
(Rathore, Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson are referred to collectively herein as the "Individual Defendants" or the "Rathore Group"); and
VERDANA COMMERCE GROUP, INC., a Delaware corporation ("Verdana" or "VCG"), with its principal offices at 400 Christiana Gateway, Suite 700, Wilmington, DE 19801.
CRH, the Individual Defendants, and Verdana are referred to collectively herein as the "Parties" and each individually as a "Party."
RECITALS
WHEREAS:
A. CRH is a publicly traded omnichannel retail company, the shares of which are listed on the Nasdaq Stock Market LLC under the ticker symbol "CRHL." CRH operates approximately 387 brick-and-mortar retail locations across 34 states and maintains a direct-to-consumer ecommerce platform. For the fiscal year ended January 31, 2025 ("FY2024"), CRH reported annual revenue of approximately $6.82 billion, and CRH's merchandising division accounted for approximately $2.3 billion in gross merchandise value during FY2024. CRH's merchandising division is a core strategic business unit responsible for product sourcing, category management, private-label brand development, vendor relationship management, and seasonal buying activities across all of CRH's retail channels.
B. Each of the Individual Defendants was formerly employed by CRH in the merchandising division. Rathore served as Senior Vice President, Merchandising from March 15, 2021 through February 7, 2025, having been originally hired as Vice President, Merchandising Strategy on June 3, 2019 and promoted to the Senior Vice President role on March 15, 2021. Each Individual Defendant, at the commencement of his or her employment or upon subsequent promotion, entered into an employment agreement with CRH containing restrictive covenant provisions, including non-competition, non-solicitation of employees, non-solicitation of vendors, and confidentiality obligations, each governed by the laws of the State of Delaware (collectively, the "Employment Agreements").
C. Rathore's employment was governed by an Amended and Restated Employment Agreement dated March 15, 2021 (the "Rathore A&R Employment Agreement"), which included, among other provisions: (i) an eighteen (18)-month post-termination non-competition covenant with a geographic scope encompassing the entire United States; (ii) a twenty-four (24)-month post-termination non-solicitation of employees covenant; (iii) a twenty-four (24)-month post-termination non-solicitation of vendors covenant; and (iv) perpetual confidentiality obligations with respect to CRH's proprietary and confidential information. As consideration for entering into the Rathore A&R Employment Agreement, CRH paid Rathore a promotion bonus of One Hundred Fifty Thousand Dollars ($150,000) and granted Rathore a restricted stock unit ("RSU") award valued at Seven Hundred Twenty-Five Thousand Dollars ($725,000), subject to four-year ratable annual vesting commencing on March 15, 2021.
D. The remaining seven Individual Defendants — Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson — each entered into Employment Agreements with CRH containing non-competition periods ranging from twelve (12) to eighteen (18) months and non-solicitation of employees and vendors periods ranging from eighteen (18) to twenty-four (24) months, all of which are governed by the laws of the State of Delaware.
E. Verdana is a Delaware corporation and direct competitor of CRH in the omnichannel retail sector, with estimated FY2024 revenue of approximately $1.9 billion. Verdana is majority-owned by Greystone Capital Partners, LP ("Greystone") through Greystone Capital Fund VII, LP, which acquired a majority stake in Verdana in the third quarter of 2023 at an enterprise value of approximately $2.4 billion. On or about January 15, 2025, Verdana publicly announced a transformational growth initiative targeting $4.0 billion in annual revenue by calendar year 2028, with the initiative specifically targeting expansion into CRH's strongest merchandising categories, including private-label home goods and seasonal décor.
F. On February 7, 2025, at approximately 4:47 PM Pacific Standard Time, all eight Individual Defendants submitted simultaneous resignation letters to CRH via electronic mail, each resignation effective immediately. Following their resignations, Rathore accepted a position as President, Merchandising & Strategy at Verdana, and each of the remaining seven Individual Defendants accepted positions at Verdana in various merchandising and strategy roles. On February 14, 2025, Verdana publicly announced the hiring of all eight Individual Defendants.
G. On or about March 12, 2025, Pinnacle Forensics LLC ("Pinnacle Forensics"), an independent digital forensics firm retained by CRH, completed a forensic analysis confirming that between January 10, 2025 and February 4, 2025, members of the Rathore Group downloaded 14,327 files (approximately 2.8 gigabytes of data) from CRH's Aldermere Systems and Pinnacle Health IT environments to personal cloud storage accounts (the "Exfiltrated Data"). The Exfiltrated Data includes, without limitation, materials relating to CRH's proprietary five-year category expansion roadmap known as "Project Ridgeline," vendor negotiation term sheets, private-label cost models, seasonal buying algorithms, and customer segmentation data.
H. In October 2024, CRH's merchandising division completed "Project Ridgeline," a comprehensive five-year strategic category expansion plan constituting proprietary and confidential trade secret information of CRH. Project Ridgeline encompasses CRH's detailed plans for expansion into new product categories, optimization of existing category assortments, vendor diversification strategies, private-label brand development roadmaps, and customer targeting models. All eight Individual Defendants had full access to Project Ridgeline materials during their employment with CRH.
I. On March 5, 2025, CRH filed a Verified Complaint and Motion for Temporary Restraining Order and Preliminary Injunction in the Delaware Court of Chancery, captioned Cascade Retail Holdings Inc. v. Rathore et al., C.A. No. 2025-0198-MTZ (the "Action"), before Vice Chancellor Margaret T. Zhao. The Verified Complaint asserts claims for: (1) breach of restrictive covenants; (2) breach of confidentiality obligations; (3) misappropriation of trade secrets under the Delaware Uniform Trade Secrets Act, 6 Del. C. § 2001 et seq. ("DUTSA"); (4) tortious interference with contractual relations; and (5) civil conspiracy. On March 7, 2025, Vice Chancellor Zhao granted a temporary restraining order (the "TRO"), requiring CRH to post an injunction bond in the amount of $2,500,000 through Broadview Surety Corp. (Bond No. BSC-2025-TRO-04419) (the "Injunction Bond").
J. On March 18, 2025, the Parties participated in a mediation session before the Honorable Philip Ashford (Ret.) administered through Meridian ADR Services LLC (Reference: Meridian-2025-0318-CRH). On March 20, 2025, following continued negotiations, the Parties reached a framework for settlement of the Action and all related disputes. On March 21, 2025, the preliminary injunction hearing scheduled before Vice Chancellor Zhao was adjourned by stipulation of the Parties, and the Court entered a Consent Interim Order maintaining the status quo during the period required for negotiation and documentation of a definitive settlement agreement.
K. The Parties desire to resolve all claims, controversies, and disputes arising out of or relating to the Action and the events and circumstances giving rise thereto, and to enter into this Standstill and Settlement Agreement on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations, and warranties set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings set forth below:
Section 1.1 "Action" means the civil action captioned Cascade Retail Holdings Inc. v. Rathore et al., C.A. No. 2025-0198-MTZ, pending in the Delaware Court of Chancery before Vice Chancellor Margaret T. Zhao.
Section 1.2 "Aldwyn" means Aldwyn Compliance Solutions LLC, with offices at 1700 Market Street, Suite 2800, Philadelphia, PA 19103.
Section 1.3 "Business Day" means any day other than a Saturday, Sunday, or a day on which banks in the State of Delaware or the State of Washington are required or authorized by law to be closed, including any federal holiday recognized under 5 U.S.C. § 6103.
Section 1.4 "Compliance Monitor" means the independent compliance monitor to be appointed pursuant to Article VII of this Agreement.
Section 1.5 "Compliance Monitor Engagement Letter" means the form of engagement letter between the Parties and Aldwyn substantially in the form attached hereto as Exhibit D and incorporated herein by reference.
Section 1.6 "Consent Order" means the stipulated consent order to be filed with the Court pursuant to Article IX of this Agreement, incorporating the Modified Restrictive Covenants, the data destruction obligations, and the other enforcement provisions contemplated hereby.
Section 1.7 "Court" means the Delaware Court of Chancery.
Section 1.8 "CRH Confidential Information" means all information that is confidential, proprietary, or constitutes a trade secret of CRH, including, without limitation: (a) all materials, data, analyses, reports, projections, plans, and documents constituting or relating to Project Ridgeline; (b) vendor negotiation playbooks, term sheets, pricing matrices, and vendor performance scorecards; (c) seasonal buying algorithms, demand forecasting models, and inventory planning tools; (d) private-label sourcing strategies, cost models, supplier agreements, and product development pipelines; (e) customer segmentation data, customer lifetime value analyses, purchasing behavior models, and targeted marketing strategies; (f) financial projections, budgets, and operating plans of the merchandising division; (g) employee compensation data, organizational charts, and succession planning documents; and (h) all other information that is subject to the confidentiality obligations under any Employment Agreement. CRH Confidential Information shall include all copies, summaries, excerpts, analyses, compilations, and derivative works of the foregoing, regardless of the form or medium in which such information is recorded or stored.
Section 1.9 "Data Destruction Protocol" means the detailed protocol for data identification, return, destruction, certification, and audit procedures set forth in Exhibit B attached hereto and incorporated herein by reference.
Section 1.10 "DUTSA" means the Delaware Uniform Trade Secrets Act, 6 Del. C. § 2001 et seq., as amended from time to time.
Section 1.11 "Effective Date" means the date on which this Agreement has been executed and delivered by all Parties (target: April 14, 2025).
Section 1.12 "Employment Agreements" means, collectively, the employment agreements between CRH and each Individual Defendant, each governed by the laws of the State of Delaware, including the Rathore A&R Employment Agreement.
Section 1.13 "Exfiltrated Data" means the 14,327 files (approximately 2.8 gigabytes) downloaded from CRH's Aldermere Systems and Pinnacle Health IT environments to personal cloud storage accounts by members of the Rathore Group between January 10, 2025 and February 4, 2025, as identified and catalogued by Pinnacle Forensics.
Section 1.14 "Greystone" means Greystone Capital Partners, LP, a Delaware limited partnership, which is not a party to this Agreement but is referenced herein for contextual purposes.
Section 1.15 "Individual Defendants" means Rathore, Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson, collectively.
Section 1.16 "Injunction Bond" means the $2,500,000 bond posted by CRH through Broadview Surety Corp. (Bond No. BSC-2025-TRO-04419) in connection with the TRO.
Section 1.17 "Modified Non-Compete Period" has the meaning set forth in Article III, Section 3.1 of this Agreement, and refers, as the context requires, to the Rathore Modified Non-Compete Period and/or the Other Defendants' Modified Non-Compete Period.
Section 1.18 "Modified Restrictive Covenants" means the modified restrictive covenant terms set forth in Article III of this Agreement and in Exhibit A attached hereto and incorporated herein by reference.
Section 1.19 "Non-Disparagement Obligations" means the mutual non-disparagement provisions set forth in Article VIII of this Agreement and in Exhibit E attached hereto and incorporated herein by reference.
Section 1.20 "Other Individual Defendants" means Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson (i.e., all Individual Defendants other than Rathore).
Section 1.21 "Pinnacle Forensics" means Pinnacle Forensics LLC, with offices at 8700 Georgia Avenue, Suite 300, Silver Spring, MD 20910.
Section 1.22 "Project Ridgeline" means CRH's proprietary five-year strategic category expansion plan completed by CRH's merchandising division in October 2024, including all related analyses, data, reports, projections, presentations, and supporting documentation.
Section 1.23 "Rathore A&R Employment Agreement" means the Amended and Restated Employment Agreement between CRH and Priya Rathore, dated as of March 15, 2021.
Section 1.24 "Restricted Product Categories" has the meaning set forth in Article III, Section 3.1(c) of this Agreement.
Section 1.25 "Settlement Payment" means the payment of Eight Million Seven Hundred Fifty Thousand Dollars ($8,750,000) described in Article V, Section 5.1 of this Agreement.
Section 1.26 "Top 50 Vendors" means CRH's top fifty (50) vendors ranked by aggregate purchase spend during FY2024, as identified on the confidential list attached hereto as Exhibit C and incorporated herein by reference.
Section 1.27 "TRO" means the Temporary Restraining Order entered by the Court on March 7, 2025 in the Action.
ARTICLE II — STANDSTILL AND CESSATION OF HOSTILITIES
Section 2.1 — Standstill Obligations. During the period commencing on the Effective Date and continuing through the later of (a) the expiration of the last Modified Non-Compete Period applicable to any Individual Defendant and (b) the termination or expiration of the Compliance Monitor engagement pursuant to Article VII (such period, the "Standstill Period"), the Parties shall refrain from initiating, filing, prosecuting, or causing to be initiated, filed, or prosecuted any new legal proceedings, claims, actions, suits, complaints, petitions, arbitrations, or administrative proceedings arising out of or related to the subject matter of the Action, the Employment Agreements, the Exfiltrated Data, Project Ridgeline, or any of the events, acts, or omissions described in the Recitals hereto. The Standstill Period shall also apply to any claims that could have been asserted in the Action based on facts known or reasonably discoverable as of the Effective Date.
Section 2.2 — Preservation of Rights Under This Agreement. Notwithstanding Section 2.1, nothing in this Article II shall limit, restrict, or otherwise affect any Party's right to seek enforcement of the terms of this Agreement, the Consent Order, or the Modified Restrictive Covenants through the Court or through any other judicial or equitable remedy expressly contemplated by this Agreement. For the avoidance of doubt, any enforcement action brought pursuant to Article XIII of this Agreement shall not constitute a violation of the standstill obligations set forth in Section 2.1.
Section 2.3 — No Admission of Liability. This Agreement is entered into by the Parties solely for the purpose of resolving disputed claims and avoiding the burden, expense, and uncertainty of continued litigation. This Agreement, and any of the negotiations, discussions, mediations, drafts, or communications relating thereto, shall not constitute, and shall not be construed as, an admission of liability, wrongdoing, fault, or breach of any legal or contractual obligation by any Party. No Party shall offer or seek to admit this Agreement or any term hereof as evidence of liability, wrongdoing, or breach in any proceeding, except as may be necessary to enforce the terms of this Agreement or the Consent Order. This Section 2.3 is intended to be consistent with the protections afforded by Federal Rule of Evidence 408 and Delaware Rule of Evidence 408.
ARTICLE III — MODIFIED RESTRICTIVE COVENANTS
Section 3.1 — Modified Non-Competition Obligations.
(a) Rathore Modified Non-Compete. Rathore agrees that she shall be bound by a modified non-competition obligation for a period of twelve (12) months, commencing on February 7, 2025 (the date of her resignation from CRH) and expiring at 11:59 PM Eastern Time on February 6, 2026 (the "Rathore Modified Non-Compete Period"). The Rathore Modified Non-Compete Period represents a reduction from the original eighteen (18)-month post-termination non-competition period set forth in the Rathore A&R Employment Agreement. During the Rathore Modified Non-Compete Period, Rathore shall not, directly or indirectly, engage in, participate in, manage, supervise, provide strategic direction to, or serve in any role that involves direct responsibility for strategy, planning, sourcing, pricing, vendor negotiation, or merchandising decisions within the Restricted Product Categories (as defined in Section 3.1(c) below) for any Competing Enterprise operating within the geographic scope set forth in Section 3.1(e) below.
(b) Other Individual Defendants' Modified Non-Compete. Each of Linden, Kaczmarek, Osei, Halvorsen, Fernandez-Gill, Tsao, and Johansson (the "Other Individual Defendants") agrees that he or she shall be bound by a modified non-competition obligation for a period of nine (9) months, commencing on February 7, 2025 and expiring at 11:59 PM Eastern Time on November 6, 2025 (the "Other Defendants' Modified Non-Compete Period"). The Other Defendants' Modified Non-Compete Period represents a reduction from the original twelve (12)- to eighteen (18)-month post-termination non-competition periods set forth in the respective Employment Agreements of the Other Individual Defendants. During the Other Defendants' Modified Non-Compete Period, each of the Other Individual Defendants shall not, directly or indirectly, engage in, participate in, manage, supervise, provide strategic direction to, or serve in any role that involves direct responsibility for strategy, planning, sourcing, pricing, vendor negotiation, or merchandising decisions within the Restricted Product Categories for any Competing Enterprise operating within the geographic scope set forth in Section 3.1(e) below.
(c) Restricted Product Categories. The modified non-competition obligations set forth in Sections 3.1(a) and 3.1(b) shall be limited to the following three specific product categories (collectively, the "Restricted Product Categories"), rather than applying to all retail activities as under the original Employment Agreements:
(i) Home Goods — meaning products designed for residential use and household furnishing, including, without limitation, kitchenware (cookware, bakeware, kitchen utensils, small kitchen appliances, and kitchen storage), textiles (bedding, bath linens, table linens, curtains, and decorative pillows), and home furnishings (decorative accessories, wall art, picture frames, candles, lamps, rugs, and accent furniture), but excluding consumer electronics, major appliances, and furniture sets sold as separate product lines;
(ii) Seasonal Décor — meaning merchandise that is designed, marketed, or sold in connection with specific holidays, seasons, or seasonal themes, including, without limitation, holiday-specific decorations (e.g., Christmas, Hanukkah, Easter, Halloween, Thanksgiving, Valentine's Day, Fourth of July), seasonal-themed merchandise (e.g., spring/summer garden décor, autumn harvest décor, winter entertaining accessories), and seasonal outdoor decorative items, but excluding year-round outdoor furniture and permanent landscaping products; and
(iii) Private-Label Apparel — meaning apparel (including clothing, footwear, and fashion accessories) that is designed, manufactured, sourced, or sold under brands that are owned by, or exclusively licensed to, the employer (whether CRH, Verdana, or any other Competing Enterprise), but excluding nationally branded apparel resold through wholesale or retail channels and apparel sold under brands that are neither owned by nor exclusively licensed to the employer.
Detailed definitions and illustrative examples of each Restricted Product Category are set forth in Exhibit A hereto.
(d) Permitted Activities. Notwithstanding the foregoing, during the applicable Modified Non-Compete Period, the Individual Defendants may be employed by Verdana (or any other entity) in roles that do not involve direct responsibility for strategy, planning, sourcing, pricing, vendor negotiation, or merchandising decisions within the Restricted Product Categories. By way of illustration and not limitation, general corporate roles (such as general management, human resources, information technology, legal, finance, and corporate development), operational roles outside of the Restricted Product Categories, and roles focused exclusively on product categories other than the Restricted Product Categories are not restricted by this Section 3.1. Each Individual Defendant shall notify CRH (through counsel) in writing of his or her job title and general responsibilities at Verdana within five (5) Business Days following the Effective Date and shall promptly notify CRH (through counsel) of any material change in his or her role or responsibilities during the applicable Modified Non-Compete Period.
(e) Geographic Scope. The geographic scope of the modified non-competition obligations set forth in this Section 3.1 shall be the United States of America, including all fifty states, the District of Columbia, and all territories and possessions thereof, which is consistent with the geographic scope of the original non-competition provisions in the Employment Agreements.
Section 3.2 — Modified Non-Solicitation of Employees. All eight Individual Defendants agree that, for a period of eighteen (18) months commencing on February 7, 2025 and expiring at 11:59 PM Eastern Time on August 6, 2026, they shall not, directly or indirectly, solicit, recruit, hire, retain, or induce, or attempt to solicit, recruit, hire, retain, or induce, any individual who is then currently employed by CRH or any of its subsidiaries or affiliates to leave the employment of CRH. This non-solicitation obligation shall apply regardless of whether the Individual Defendant initiates the contact or the CRH employee does, and shall include, without limitation, providing names or contact information of CRH employees to recruiters, headhunters, or other third parties for purposes of recruitment. Notwithstanding the foregoing, this Section 3.2 shall not prohibit (a) general public advertisements or postings (including postings on job boards, social media platforms, or corporate websites) that are not specifically targeted at or directed toward CRH employees, or (b) the hiring of any CRH employee who independently responds to such a general public advertisement without any direct or indirect solicitation by an Individual Defendant.
Section 3.3 — Modified Non-Solicitation of Vendors. All eight Individual Defendants agree that, for a period of twelve (12) months commencing on February 7, 2025 and expiring at 11:59 PM Eastern Time on February 6, 2026, they shall not, directly or indirectly, solicit, contact, communicate with, or attempt to solicit, contact, or communicate with any of CRH's Top 50 Vendors for the purpose of (a) inducing such vendor to terminate, reduce, or alter its business relationship with CRH, (b) diverting or redirecting business from CRH to Verdana or any other entity, or (c) obtaining confidential pricing, terms, or other proprietary commercial information about such vendor's relationship with CRH. The list of Top 50 Vendors is set forth in Exhibit C hereto, which shall be filed with the Court under seal. For the avoidance of doubt, this Section 3.3 shall not prohibit Verdana from independently soliciting or conducting business with any vendor, provided that no Individual Defendant participates in, directs, facilitates, or provides CRH Confidential Information in connection with such solicitation or business.
Section 3.4 — Confidentiality Obligations. The perpetual confidentiality obligations set forth in each Individual Defendant's Employment Agreement shall remain in full force and effect and are not modified, superseded, or otherwise altered by this Agreement. Without limiting the generality of the foregoing, no Individual Defendant shall, at any time after the Effective Date, use, disclose, reference, share, reproduce, or retain any CRH Confidential Information, including, without limitation, any materials, data, or information relating to Project Ridgeline. Verdana acknowledges and agrees that it shall not use, disclose, reference, or retain any CRH Confidential Information or Exfiltrated Data for any purpose, and shall comply with the Data Return and Destruction obligations set forth in Article IV.
Section 3.5 — Supersession of Original Covenants. The Modified Restrictive Covenants set forth in this Article III and in Exhibit A hereto supersede and replace, in their entirety, the non-competition and non-solicitation provisions (including non-solicitation of employees and non-solicitation of vendors) of the Employment Agreements, solely with respect to the duration, scope, and product-category limitations of such provisions. All other provisions of the Employment Agreements, including, without limitation, the confidentiality obligations, intellectual property assignment provisions, and any provisions that by their terms survive termination of employment, shall remain in full force and effect to the extent not inconsistent with this Agreement. In the event of any conflict between the terms of this Agreement and the terms of any Employment Agreement, the terms of this Agreement shall control.
Section 3.6 — Incorporation in Consent Order. The Modified Restrictive Covenants set forth in this Article III and in Exhibit A hereto shall be incorporated into the Consent Order to be entered by the Court pursuant to Article IX. The Court shall retain jurisdiction over the Action and the Consent Order for purposes of enforcement, including, without limitation, the authority to impose contempt sanctions, award monetary damages, grant injunctive relief, and order reinstatement of the original restrictive covenant terms as contemplated by Article XIII.
ARTICLE IV — DATA RETURN AND DESTRUCTION
Section 4.1 — Obligation to Return or Destroy Exfiltrated Data. Within ten (10) Business Days following the Effective Date, each Individual Defendant shall either: (a) return to CRH all Exfiltrated Data and CRH Confidential Information in such Individual Defendant's possession, custody, or control, including all copies, summaries, excerpts, analyses, and derivative works thereof, delivered to CRH's General Counsel by secure encrypted transmission or by overnight courier at CRH's address set forth in Section 15.9; or (b) permanently destroy all Exfiltrated Data and CRH Confidential Information in such Individual Defendant's possession, custody, or control, including from all personal computers, laptops, tablets, mobile phones, external hard drives, USB storage devices, personal cloud storage accounts (including, without limitation, Hollowell Health IT, Larkspur Technologies, Meridian Systems, Cobalt Ridge Systems, and any other cloud-based storage service), personal email accounts, and any other electronic or physical media, and certify such destruction in writing in accordance with the Data Destruction Protocol set forth in Exhibit B.
Section 4.2 — Verdana's Data Purge Obligation. Within ten (10) Business Days following the Effective Date, Verdana shall conduct a thorough and diligent search of its information technology systems, servers, workstations, laptops, mobile devices, shared drives, collaboration platforms, email accounts, and all other repositories of electronic data to identify any Exfiltrated Data or CRH Confidential Information that may have been transferred, uploaded, shared, or otherwise made available, directly or indirectly, to Verdana's systems, accounts, or personnel. Upon identification of any such data, Verdana shall immediately delete, purge, and permanently destroy all such Exfiltrated Data and CRH Confidential Information from its systems, or, at CRH's election, sequester such data in a manner approved by Pinnacle Forensics pending the forensic audit described in Section 4.4.
Section 4.3 — Certification of Compliance. Each Individual Defendant and Verdana (through its General Counsel or another authorized officer) shall deliver to CRH and to counsel for CRH (Calderwood & Harkness LLP) written certifications, executed under penalty of perjury pursuant to 28 U.S.C. § 1746 (or the Delaware equivalent), confirming full and complete compliance with the obligations set forth in Sections 4.1 and 4.2, as applicable. Such certifications shall be in the form set forth in the Data Destruction Protocol (Exhibit B) and shall identify, with reasonable specificity, the steps taken to search for, identify, and return or destroy all Exfiltrated Data and CRH Confidential Information.
Section 4.4 — Independent Forensic Audit. To verify compliance with the data return and destruction obligations set forth in this Article IV, Verdana shall permit Pinnacle Forensics LLC (Engagement Lead: Dr. Rajiv Anand) to conduct an independent forensic audit of Verdana's relevant information technology systems, including servers, workstations, laptops, mobile devices, email systems, cloud-based platforms, collaboration tools, shared drives, and backup systems that may have received, processed, or stored Exfiltrated Data or CRH Confidential Information. The forensic audit shall commence within fifteen (15) Business Days following the Effective Date and shall be completed within forty-five (45) calendar days following commencement. Verdana shall bear all costs and expenses of the forensic audit, including the fees and expenses of Pinnacle Forensics, subject to a cost cap of One Hundred Seventy-Five Thousand Dollars ($175,000). In the event the forensic audit cannot be completed within the forty-five (45)-calendar-day period due to the scope or complexity of Verdana's systems, any extension of the audit period shall require the prior written consent of CRH, which consent shall not be unreasonably withheld, conditioned, or delayed.
Section 4.5 — Cooperation. Verdana and each Individual Defendant shall cooperate fully and in good faith with Pinnacle Forensics in connection with the independent forensic audit described in Section 4.4, including: (a) providing Pinnacle Forensics with reasonable access to all relevant systems, devices, accounts, and storage media, during normal business hours and upon reasonable advance notice; (b) making available Verdana's information technology personnel for interviews and technical consultation as reasonably requested by Pinnacle Forensics; (c) providing system access credentials, network architecture documentation, data flow maps, and other technical information reasonably necessary for the conduct of the audit; and (d) refraining from deleting, altering, or modifying any data, logs, or metadata on Verdana's systems during the pendency of the forensic audit, except as expressly directed by Pinnacle Forensics or as required in the ordinary course of Verdana's business operations.
Section 4.6 — Remediation. In the event the forensic audit conducted by Pinnacle Forensics reveals any CRH Confidential Information or Exfiltrated Data that was not returned or destroyed in accordance with Sections 4.1 and 4.2, Verdana and/or the applicable Individual Defendant(s), as the case may be, shall immediately delete, purge, or return to CRH all such materials and shall provide supplemental certifications, under penalty of perjury, confirming the completion of such remediation within five (5) Business Days following written notice from Pinnacle Forensics or CRH identifying such data. Any failure to complete remediation within the five (5)-Business-Day period, or any pattern of incomplete or inaccurate certifications, shall constitute a material breach of this Agreement and shall entitle CRH to the remedies set forth in Article XIII.
Section 4.7 — Data Destruction Protocol. The detailed protocol governing the procedures for data identification, cataloguing, return, destruction, certification, forensic audit, and remediation is set forth in Exhibit B hereto, which is incorporated herein by reference. In the event of any conflict between the provisions of this Article IV and the Data Destruction Protocol, the more restrictive provision shall control.
ARTICLE V — MONETARY TERMS
Section 5.1 — Settlement Payment. Verdana shall pay to CRH the sum of Eight Million Seven Hundred Fifty Thousand Dollars ($8,750,000) (the "Settlement Payment") as a single lump-sum payment, by wire transfer of immediately available funds to an account designated in writing by CRH, within thirty (30) calendar days following the Effective Date. CRH shall provide Verdana with wire transfer instructions within five (5) Business Days following the Effective Date. The Settlement Payment shall be made without setoff, deduction, or counterclaim, except as expressly provided herein.
Section 5.2 — Litigation Cost Reimbursement. In addition to the Settlement Payment, Verdana shall reimburse CRH the sum of Four Hundred Twenty-Five Thousand Dollars ($425,000) toward CRH's litigation costs and expenses incurred in connection with the Action, including, without limitation, attorneys' fees, expert fees, forensic investigation costs, and court costs (the "Litigation Cost Reimbursement"). The Litigation Cost Reimbursement shall be payable by wire transfer of immediately available funds to the account designated by CRH, within thirty (30) calendar days following the Effective Date, and shall be paid concurrently with or separately from the Settlement Payment, at Verdana's election.
Section 5.3 — Equity Forfeitures — Rathore. Rathore hereby agrees to the forfeiture and cancellation of CRH equity awards with a total value of Three Hundred Sixty-Two Thousand Five Hundred Dollars ($362,500), comprised of the following:
(a) One Hundred Eighty-One Thousand Two Hundred Fifty Dollars ($181,250), representing the final unvested tranche (25%) of Rathore's RSU grant of $725,000 under the Rathore A&R Employment Agreement. The RSU grant was subject to four-year ratable annual vesting, commencing March 15, 2021. Three annual tranches, each in the amount of $181,250, vested on March 15, 2022, March 15, 2023, and March 15, 2024, respectively, representing an aggregate vested amount of $543,750 (75% of the total grant). The fourth and final tranche, in the amount of $181,250, had not vested as of Rathore's February 7, 2025 resignation date and is forfeited as unvested equity.
(b) One Hundred Eighty-One Thousand Two Hundred Fifty Dollars ($181,250), representing the clawback of the third vested tranche (which vested on March 15, 2024) pursuant to the for-cause clawback provision set forth in Section 8(d) of the Rathore A&R Employment Agreement. The for-cause clawback was triggered by Rathore's breach of her restrictive covenant obligations, as alleged in the Verified Complaint and as resolved by this Agreement.
CRH shall instruct its transfer agent, Northland Trust Company, to cancel and forfeit the applicable RSU awards in accordance with this Section 5.3 and to make any corresponding adjustments to CRH's equity ledger and share register.
Section 5.4 — Equity Forfeitures — Other Individual Defendants. Each of the Other Individual Defendants hereby agrees to the forfeiture and cancellation of his or her respective unvested equity awards as set forth in Schedule 5.4 attached hereto and incorporated herein by reference. Schedule 5.4 sets forth, for each of the seven Other Individual Defendants, the grant date, grant amount, vesting schedule, amount vested as of February 7, 2025 (the date of resignation), amount unvested and subject to forfeiture, clawback amount (if any), and total forfeiture amount. The aggregate forfeiture for the seven Other Individual Defendants is Four Hundred Eighty-Seven Thousand Dollars ($487,000). CRH shall instruct Northland Trust Company to cancel and forfeit the applicable equity awards in accordance with Schedule 5.4 and to make any corresponding adjustments to CRH's equity ledger and share register.
Section 5.5 — Total Economic Recovery. The Parties acknowledge and agree that the total economic recovery to CRH under this Agreement is Ten Million Twenty-Four Thousand Five Hundred Dollars ($10,024,500), comprised of the following components:
Section 5.6 — Tax Treatment. Each Party shall be solely responsible for its own tax obligations, including the reporting and payment of any federal, state, or local taxes, arising from or in connection with the payments, forfeitures, and other transactions contemplated by this Article V. No Party makes any representation or warranty to any other Party regarding the tax treatment or tax consequences of any payment, forfeiture, or other transaction under this Agreement. Each Party is advised to consult with its own tax advisors regarding the tax implications of this Agreement.
Section 5.7 — Late Payment. Any payment required under this Agreement that is not made when due shall bear interest from the date such payment was due until the date such payment is received, at a rate equal to the lesser of (a) one and one-half percent (1.5%) per month (18% per annum), compounded monthly, or (b) the maximum rate of interest permitted by applicable law. The accrual of interest under this Section 5.7 shall not limit or waive any other rights or remedies of the non-breaching Party under this Agreement, including the right to declare a material breach pursuant to Article XIII.
ARTICLE VI — RELEASES
Section 6.1 — CRH Release of Individual Defendants. Upon the satisfaction of all of the following conditions: (a) receipt by CRH of the Settlement Payment in full; (b) delivery by each Individual Defendant of the written certifications required by Section 4.3; (c) completion of the independent forensic audit by Pinnacle Forensics pursuant to Section 4.4 without identification of any unremediated CRH Confidential Information or Exfiltrated Data; and (d) entry of the Consent Order by the Court, CRH, on behalf of itself and its subsidiaries, affiliates, predecessors, successors, assigns, officers, directors, employees, agents, and representatives, hereby releases and forever discharges each Individual Defendant from any and all claims, demands, actions, causes of action, suits, damages, losses, costs, expenses, liabilities, and obligations of every kind and nature, whether known or unknown, suspected or unsuspected, that CRH has or may have against any Individual Defendant arising out of or relating to the subject matter of the Action, including, without limitation, claims for breach of restrictive covenants, breach of confidentiality obligations, misappropriation of trade secrets under DUTSA, civil conspiracy, aiding and abetting breach of fiduciary duty, and unjust enrichment; provided, however, that this release is expressly contingent upon and subject to: (i) each Individual Defendant's continued compliance with the Modified Restrictive Covenants set forth in Article III; (ii) each Individual Defendant's continued compliance with the Data Return and Destruction obligations set forth in Article IV; and (iii) each Individual Defendant's continued compliance with the Consent Order and all other obligations under this Agreement. In the event any Individual Defendant materially breaches any of the foregoing conditions, the release granted to such Individual Defendant under this Section 6.1 shall be void ab initio with respect to such breaching Individual Defendant, and CRH shall be entitled to assert any and all claims against such Individual Defendant as if this release had not been granted, in addition to any remedies available under Article XIII.
Section 6.2 — CRH Release of Verdana. Upon the satisfaction of all of the following conditions: (a) receipt by CRH of the Settlement Payment and the Litigation Cost Reimbursement in full; (b) completion of the independent forensic audit by Pinnacle Forensics pursuant to Section 4.4 without identification of any unremediated CRH Confidential Information or Exfiltrated Data on Verdana's systems; (c) delivery by Verdana of the written certification required by Section 4.3; and (d) entry of the Consent Order by the Court, CRH, on behalf of itself and its subsidiaries, affiliates, predecessors, successors, assigns, officers, directors, employees, agents, and representatives, hereby releases and forever discharges Verdana and its subsidiaries, affiliates, predecessors, successors, assigns, officers, directors, employees, agents, and representatives from any and all claims, demands, actions, causes of action, suits, damages, losses, costs, expenses, liabilities, and obligations of every kind and nature, whether known or unknown, suspected or unsuspected, that CRH has or may have against Verdana arising out of or relating to the subject matter of the Action, including, without limitation, claims for tortious interference with contractual relations, misappropriation of trade secrets under DUTSA, civil conspiracy, aiding and abetting breach of contract, and unjust enrichment; provided, however, that this release is expressly contingent upon and subject to Verdana's continued compliance with all of its obligations under this Agreement, including, without limitation, the Data Return and Destruction obligations, the Compliance Monitor provisions, and the Non-Disparagement Obligations.
Section 6.3 — Individual Defendants' and Verdana's Release of CRH. Each Individual Defendant and Verdana, on behalf of themselves and their respective heirs, executors, administrators, successors, and assigns (and, in the case of Verdana, its subsidiaries, affiliates, officers, directors, employees, agents, and representatives), hereby release and forever discharge CRH and its subsidiaries, affiliates, predecessors, successors, assigns, officers, directors, employees, agents, and representatives from any and all claims, counterclaims, cross-claims, demands, actions, causes of action, suits, damages, losses, costs, expenses, liabilities, and obligations of every kind and nature, whether known or unknown, suspected or unsuspected, that any Individual Defendant or Verdana has or may have against CRH arising out of or relating to the Action, the TRO, the Injunction Bond, the enforcement or attempted enforcement of the Employment Agreements, any communications by CRH with Verdana's vendors, clients, or business partners relating to the restrictive covenants, and any alleged interference with the employment of the Individual Defendants by Verdana.
Section 6.4 — Carve-Outs from Releases. Notwithstanding anything to the contrary in this Article VI, the releases set forth in Sections 6.1, 6.2, and 6.3 shall not extend to or encompass: (a) any claims arising from a breach of this Agreement or the Consent Order; (b) any claims arising from events, acts, or omissions occurring after the Effective Date that are not related to the subject matter of the Action; (c) any obligations, covenants, or representations that by their express terms survive the termination or expiration of this Agreement; or (d) any rights to enforce the provisions of this Agreement, including the Modified Restrictive Covenants, the Data Return and Destruction obligations, the Non-Disparagement Obligations, and the indemnification obligations.
Section 6.5 — No Release of Greystone. For the avoidance of doubt, this Agreement does not release, discharge, or otherwise affect any claims that CRH has or may have against Greystone Capital Partners, LP or Greystone Capital Fund VII, LP, neither of which is a party to this Agreement. CRH expressly reserves all rights, claims, and remedies against Greystone, subject to the standstill provisions of Article II to the extent applicable. Nothing in this Agreement shall be construed as an admission, waiver, or release by CRH with respect to any claims against Greystone.
ARTICLE VII — COMPLIANCE MONITOR
Section 7.1 — Appointment. The Parties agree to the appointment of Aldwyn Compliance Solutions LLC ("Aldwyn"), located at 1700 Market Street, Suite 2800, Philadelphia, PA 19103, as an independent compliance monitor (the "Compliance Monitor") for a period of twelve (12) months commencing on the Effective Date and expiring on the first anniversary of the Effective Date, unless extended or terminated earlier in accordance with this Article VII. The appointment of Aldwyn as Compliance Monitor reflects the mutual agreement of the Parties following arms-length negotiations and review of Aldwyn's qualifications, experience, and independence.
Section 7.2 — Scope of Monitoring. The Compliance Monitor shall conduct quarterly verification and monitoring of the Parties' compliance with the following obligations:
(a) The Modified Non-Compete obligations set forth in Section 3.1, including verification of the Individual Defendants' job titles, roles, responsibilities, and activities at Verdana to confirm that no Individual Defendant is engaged in activities within the Restricted Product Categories during the applicable Modified Non-Compete Period;
(b) The Non-Solicitation of Employees obligations set forth in Section 3.2, including review of Verdana's hiring records and communications to determine whether any Individual Defendant has solicited, recruited, or induced any CRH employee to leave CRH employment;
(c) The Non-Solicitation of Vendors obligations set forth in Section 3.3, including review of communications between the Individual Defendants and any Top 50 Vendor and review of Verdana's vendor engagement records with respect to the Top 50 Vendors; and
(d) The Data Return and Destruction obligations set forth in Article IV, including periodic verification that no CRH Confidential Information or Exfiltrated Data remains in the possession, custody, or control of any Individual Defendant or Verdana.
Section 7.3 — Compliance Monitor Engagement Terms. The engagement of Aldwyn shall be governed by the Compliance Monitor Engagement Letter substantially in the form attached hereto as Exhibit D and incorporated herein by reference. Detailed monitoring procedures, including the format and content of quarterly reports, the scope and methodology of document review and employee interviews, and escalation procedures for suspected violations, shall be set forth in a Compliance Monitoring Protocol to be annexed to the Compliance Monitor Engagement Letter. With respect to employee interviews, the Compliance Monitor shall have the right to interview Verdana employees and Individual Defendants regarding compliance matters; Verdana and the Individual Defendants shall have the right to have legal counsel present during any such interviews. Verdana retains the right to object to the scope of specific document requests made by the Compliance Monitor on grounds of attorney-client privilege, work product protection, or competitive sensitivity unrelated to CRH. Any objections shall be resolved by the Compliance Monitor in the first instance, with either Party having the right to appeal any disputed ruling to the Court for final resolution.
Section 7.4 — Cost Allocation. The total estimated cost of the Compliance Monitor engagement for the twelve (12)-month monitoring period is Three Hundred Sixty Thousand Dollars ($360,000). Verdana shall bear sixty percent (60%) of such costs, in the amount of Two Hundred Sixteen Thousand Dollars ($216,000), and CRH shall bear forty percent (40%) of such costs, in the amount of One Hundred Forty-Four Thousand Dollars ($144,000). Each Party's share shall be paid to Aldwyn in equal quarterly installments of Fifty-Four Thousand Dollars ($54,000) (for Verdana) and Thirty-Six Thousand Dollars ($36,000) (for CRH), with the first installment due within ten (10) Business Days following the Effective Date. In the event the actual costs of the Compliance Monitor engagement exceed the estimated $360,000, such excess costs shall be allocated between the Parties in the same sixty/forty (60/40) ratio, unless the Parties otherwise agree in writing.
Section 7.5 — Reporting. The Compliance Monitor shall prepare and deliver quarterly written reports summarizing its monitoring activities, findings, and conclusions (the "Quarterly Reports") to counsel for all Parties:
(a) Calderwood & Harkness LLP, 1301 K Street NW, Suite 1200, Washington, DC 20005 (counsel for CRH);
(b) Whitfield, Nygaard & Doyle LLP, 1000 North Market Street, Suite 1500, Wilmington, DE 19801 (counsel for the Individual Defendants); and
(c) Blackhall & Soren LLP, 300 Delaware Avenue, Suite 900, Wilmington, DE 19801 (counsel for Verdana).
Each Quarterly Report shall be delivered within fifteen (15) Business Days following the end of each calendar quarter during the monitoring period. Upon the request of any Party, or upon the Compliance Monitor's own initiative in the event of a suspected material breach, the Compliance Monitor may submit a report or letter to the Court, under seal, summarizing its findings and recommendations.
Section 7.6 — Access and Cooperation. Both CRH and Verdana shall provide the Compliance Monitor with reasonable access to relevant records, documents, systems, and personnel as may be necessary for the Compliance Monitor to perform its monitoring obligations under this Article VII. The information-sharing framework, including protocols for confidential treatment of commercially sensitive information, data security requirements, and limitations on use and disclosure of information obtained during the monitoring process, is set forth in the Letter Agreement among the Parties and Aldwyn, which is attached hereto and incorporated herein by reference.
Section 7.7 — Material Breach Reporting. If, during the course of its monitoring activities, the Compliance Monitor identifies a suspected material breach of the Modified Restrictive Covenants, the Data Return and Destruction obligations, or any other obligation monitored hereunder, the Compliance Monitor shall immediately provide written notice of such suspected breach to counsel for all Parties. The Compliance Monitor may, at the request of any Party or upon its own initiative where the suspected breach poses an imminent risk of irreparable harm to CRH, report such finding to the Court by letter or motion, under seal. The identification of a suspected breach by the Compliance Monitor shall not constitute a final determination of breach; any such determination shall be made by the Court in accordance with Article XIII.
Section 7.8 — Independence. The Compliance Monitor shall be independent of all Parties and shall not have any conflict of interest that would impair its objectivity or independence. Aldwyn has represented and warranted to the Parties that it has no prior client relationships, financial interests, or other affiliations with CRH, Verdana, Greystone, any Individual Defendant, or any of their respective affiliates, officers, directors, or counsel that would create a conflict of interest or impair the appearance of independence. If at any time during the monitoring period, Aldwyn becomes aware of any circumstance that could give rise to a conflict of interest, Aldwyn shall promptly disclose such circumstance to all Parties and to the Court.
ARTICLE VIII — MUTUAL NON-DISPARAGEMENT
Section 8.1 — Non-Disparagement Obligations. Each Party agrees that it shall not, and shall cause its officers, directors, employees, agents, and representatives not to, make, publish, issue, or cause to be made, published, or issued any disparaging, defamatory, derogatory, or otherwise negative statements, whether written or oral, about any other Party, its affiliates, subsidiaries, officers, directors, employees, agents, products, services, business practices, financial condition, or reputation, in any medium, including, without limitation, print media, broadcast media, online media, social media platforms, podcasts, conferences, trade shows, investor presentations, analyst calls, and private communications (other than privileged communications with legal counsel). The non-disparagement obligations set forth in this Section 8.1 shall survive the expiration or termination of this Agreement and shall remain in effect in perpetuity.
Section 8.2 — Scope and Exceptions. The non-disparagement obligations set forth in Section 8.1 shall not prohibit or restrict:
(a) Truthful testimony compelled by law, legal process, subpoena, court order, or governmental investigation;
(b) Truthful statements made in the course of legal proceedings relating to the enforcement of this Agreement, the Consent Order, or any other provision hereof;
(c) Disclosures required by applicable securities laws, regulations, or stock exchange rules, including, without limitation, disclosures required under the Securities Act of 1933, the Securities Exchange Act of 1934, and the rules and regulations of the Nasdaq Stock Market LLC;
(d) Communications with legal counsel made in connection with the seeking or rendering of legal advice; or
(e) Good-faith communications with regulatory authorities, law enforcement agencies, or governmental bodies as may be required or permitted by law.
Section 8.3 — Reference to Exhibit E. The detailed mutual non-disparagement provisions, including specific examples of prohibited conduct, agreed-upon neutral reference language, and remedies for breach of the non-disparagement obligations, are set forth in Exhibit E hereto, which is incorporated herein by reference.
ARTICLE IX — CONSENT ORDER AND COURT FILINGS
Section 9.1 — Filing of Stipulation and Proposed Consent Order. Within five (5) Business Days following the Effective Date, the Parties, through their respective counsel, shall jointly prepare, finalize, and file with the Court a Stipulation of Settlement and Proposed Consent Order in a form mutually agreed upon by the Parties (the "Stipulation"). The Proposed Consent Order shall incorporate the Modified Restrictive Covenants set forth in Article III and Exhibit A, the data destruction obligations set forth in Article IV, the Compliance Monitor provisions set forth in Article VII, and such other terms of this Agreement as the Parties agree are appropriate for incorporation in a court order. The Proposed Consent Order shall provide for the Court's retention of jurisdiction over the Action for purposes of enforcement as set forth in Section 9.4.
Section 9.2 — Dissolution of TRO. Contemporaneously with the filing of the Stipulation and Proposed Consent Order, CRH shall file with the Court a Motion to Dissolve the Temporary Restraining Order entered on March 7, 2025. The TRO shall be dissolved upon entry of the Consent Order by the Court. Pending entry of the Consent Order, the TRO shall remain in full force and effect in accordance with its terms and the Consent Interim Order entered on March 21, 2025.
Section 9.3 — Release of Injunction Bond. Following entry of the Consent Order and dissolution of the TRO, CRH shall promptly request discharge and exoneration of the Injunction Bond (Bond No. BSC-2025-TRO-04419, in the principal amount of $2,500,000) from Broadview Surety Corp., 175 Water Street, Suite 2400, New York, NY 10038. CRH shall take all actions reasonably necessary to effectuate the release of the Injunction Bond, including filing any required motions or stipulations with the Court and delivering any required documentation to Broadview Surety Corp.
Section 9.4 — Retained Jurisdiction. The Consent Order shall provide that the Court shall retain jurisdiction over the Action and over all Parties for the purpose of enforcing the terms of the Consent Order and this Agreement, including, without limitation, the authority to: (a) impose civil or criminal contempt sanctions for violations of the Consent Order; (b) award monetary damages, including compensatory damages, consequential damages, and, where appropriate, exemplary damages; (c) grant temporary, preliminary, or permanent injunctive relief; (d) order reinstatement of the original (unmodified) restrictive covenant terms from the Employment Agreements as contemplated by Section 13.3(c); and (e) enter such other and further orders as may be just and appropriate.
Section 9.5 — Dismissal with Prejudice. At the conclusion of the twelve (12)-month Compliance Monitor period, contingent upon full compliance by all Parties with the terms of the Consent Order and this Agreement, including, without limitation, compliance with all Modified Restrictive Covenants, completion of all data return and destruction obligations, receipt of all monetary payments, and satisfactory completion of all Compliance Monitor reporting, the Parties shall jointly file with the Court a Stipulation for Dismissal with Prejudice, dismissing the Action and all claims asserted therein with prejudice and without costs to any Party, except as otherwise provided in this Agreement.
ARTICLE X — REPRESENTATIONS AND WARRANTIES
Section 10.1 — Mutual Representations. Each Party represents and warrants to each other Party, as of the Effective Date, as follows:
(a) Such Party has full power, authority, and legal capacity to enter into, execute, deliver, and perform its obligations under this Agreement;
(b) The execution, delivery, and performance of this Agreement by such Party does not and will not conflict with, result in a breach of, or constitute a default under, any agreement, instrument, order, judgment, decree, or any other obligation to which such Party is a party or by which such Party is bound;
(c) This Agreement has been duly authorized by all necessary corporate action (in the case of CRH and Verdana) or individual action (in the case of each Individual Defendant), and constitutes the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity; and
(d) Such Party has been represented by legal counsel of its choosi