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SETTLEMENT AGREEMENT AND MUTUAL RELEASE

Execution Date: August 18, 2023

This Agreement resolves all disputes between the Parties in connection with Cardinal Peak Industries v. Nexford Industrial Holdings Inc., Case No. 2022-L-008471, Circuit Court of Cook County, Illinois, County Department, Law Division

This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of August 18, 2023 (the "Effective Date"), by and between:

Nexford Industrial Holdings Inc., a Delaware corporation with its principal place of business at 4200 West Lakeshore Industrial Parkway, Suite 300, Waukegan, Illinois 60085 (EIN: 36-4821097; Delaware Charter No. 7284159) (hereinafter "Nexford" or "NIH");

and

Cardinal Peak Industries, a Colorado limited liability company with its principal place of business at 1580 Ridgeline Boulevard, Pueblo, Colorado 81001 (EIN: 84-3295618) (hereinafter "Cardinal Peak" or "CPI").

Nexford and Cardinal Peak are each referred to individually herein as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS, Nexford and Cardinal Peak are parties to that certain Master Supply Agreement dated January 15, 2020, designated MSA-NIH-CPI-2020-001 (the "MSA"), pursuant to which Cardinal Peak manufactures and supplies hot-rolled coil ("HRC") and cold-rolled coil ("CRC") steel products to Nexford for use in Nexford's downstream fabrication and distribution operations;

WHEREAS, the MSA provides for the pass-through of certain raw-material surcharges, including scrap surcharges, energy surcharges, and alloy surcharges, subject to the terms and conditions set forth in Section 7.4 of the MSA and the methodology prescribed in Exhibit C thereto (the "Surcharge Methodology"), which methodology specifies, among other things, the applicable indices, baseline reference points, calculation periods, and cap-and-collar mechanisms governing the determination of such surcharges;

WHEREAS, a dispute arose between the Parties concerning surcharge invoices issued by Cardinal Peak for the period from March 2021 through May 2022 (the "Disputed Period"), during which Cardinal Peak invoiced total surcharges of approximately Six Million Four Hundred Ten Thousand Dollars ($6,410,000.00), of which Nexford paid One Million Six Hundred Eighty Thousand Dollars ($1,680,000.00), and Cardinal Peak claims an unpaid balance of approximately Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00) (the "Surcharge Dispute");

WHEREAS, at the core of the Surcharge Dispute, Nexford contends that Cardinal Peak deviated from the Surcharge Methodology by, among other things, utilizing incorrect index reference dates, applying surcharges to product categories excluded from the surcharge pass-through framework, and failing to apply the cap-and-collar limitations set forth in Exhibit C, while Cardinal Peak contends that its surcharge calculations were proper and in accordance with the MSA as reasonably interpreted;

WHEREAS, on June 10, 2022, Cardinal Peak, through its counsel Blackwood Stein & Associates LLP, issued a formal demand to Nexford for payment of Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00), which demand included a detailed reconciliation of surcharge invoices for the Disputed Period, and Nexford, through its General Counsel Deborah Whitfield, rejected such demand by letter dated July 5, 2022, setting forth Nexford's position that a substantial portion of the surcharges had been improperly calculated;

WHEREAS, on August 8, 2022, Cardinal Peak filed a Complaint against Nexford in the Circuit Court of Cook County, Illinois, County Department, Law Division, docketed as Case No. 2022-L-008471 (the "Litigation"), asserting claims for breach of contract (Count I), unjust enrichment (Count II), and account stated (Count III), and seeking damages in the amount of $4,730,000.00, plus pre-judgment interest, costs, and attorneys' fees;

WHEREAS, on September 19, 2022, Nexford, through its counsel Calderwood & Harkness LLP, filed an Answer and Affirmative Defenses to the Complaint, raising, among other defenses, failure to comply with contractual conditions precedent, failure to mitigate, estoppel, and the contractual cap-and-collar limitations, and on October 3, 2022, Nexford filed a Counterclaim (the "Counterclaim") asserting breach of contract by Cardinal Peak and seeking declaratory judgment that Cardinal Peak's surcharge calculations were inconsistent with the Surcharge Methodology, as well as recovery of alleged overpayments in the approximate amount of Two Hundred Ten Thousand Dollars ($210,000.00);

WHEREAS, the Parties have engaged in extensive discovery in the Litigation, including the exchange of thousands of pages of documents, interrogatory responses, and requests for admission, as well as depositions of fact witnesses and the exchange of expert reports addressing the proper interpretation and application of the Surcharge Methodology, and have thereby fully informed themselves of the facts and law relating to the Surcharge Dispute;

WHEREAS, the MSA, at Section 14.3, provides for mandatory mediation in Chicago, Illinois, administered by a mutually agreed-upon neutral mediator, as a prerequisite to the continuation of litigation, and on May 22, 2023, the Parties jointly moved to stay the Litigation pending mediation, which motion was granted by the Honorable Judge Raymond P. Callahan on June 5, 2023;

WHEREAS, on August 2, 2023, the Parties participated in a full-day mediation session before the Honorable Catherine Lindström (Ret.) at the Great Lakes Dispute Resolution Center, 150 North Riverside Plaza, Suite 2700, Chicago, Illinois 60606, at which session the Parties, after extensive arms-length negotiation, reached an agreement in principle to resolve the Surcharge Dispute, the material terms of which were memorialized in a term sheet signed by authorized representatives of both Parties on August 2, 2023 (the "Term Sheet");

WHEREAS, the Parties desire to fully and finally resolve and settle the Litigation, including all claims asserted in the Complaint and the Counterclaim, and all other disputes, claims, and controversies between them arising out of or relating to the MSA, the Surcharge Dispute, and the Disputed Period, without any admission of liability, wrongdoing, or fault by either Party, on the terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual 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 hereby agree as follows:

ARTICLE 1 — DEFINITIONS

As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not defined in this Article 1 shall have the meanings given to them elsewhere in this Agreement.

1.1 "Agreement" means this Settlement Agreement and Mutual Release, including all exhibits and schedules attached hereto, as the same may be amended or supplemented from time to time in accordance with Section 9.4 hereof.

1.2 "Cardinal Peak Released Parties" means Cardinal Peak Industries, together with its members, managers, officers, directors, employees, agents, representatives, affiliates, subsidiaries, successors, and assigns, including without limitation the following individuals in their individual and corporate capacities: Frank Delacroix, Natalie Gunderson, Harold Briggs, and Patricia Morrow.

1.3 "Counterclaim" means the Counterclaim filed by Nexford on October 3, 2022 in the Litigation, including all claims for breach of contract, declaratory relief, and recovery of alleged overpayments asserted therein, and any amendments thereto.

1.4 "Disputed Period" means the period commencing March 1, 2021 and ending May 31, 2022, inclusive.

1.5 "Effective Date" means August 18, 2023, the date of execution of this Agreement by both Parties.

1.6 "Litigation" means the lawsuit styled Cardinal Peak Industries v. Nexford Industrial Holdings Inc., Case No. 2022-L-008471, pending in the Circuit Court of Cook County, Illinois, County Department, Law Division, including all claims, counterclaims, cross-claims, third-party claims, motions, and proceedings filed or initiated therein.

1.7 "MSA" means the Master Supply Agreement dated January 15, 2020, reference number MSA-NIH-CPI-2020-001, entered into between Nexford and Cardinal Peak, together with all exhibits, schedules, amendments, and addenda thereto.

1.8 "Nexford Released Parties" means Nexford Industrial Holdings Inc., together with its officers, directors, employees, agents, representatives, affiliates (including without limitation Marlowe Asset Management Bluff Capital Partners, LP and Marlowe Asset Management Bluff Capital Management LLC), subsidiaries, successors, and assigns, including without limitation the following individuals in their individual and corporate capacities: Martin Schaeffer, Lydia Tran, Russell Okonkwo, and Deborah Whitfield.

1.9 "Settlement Amount" means the aggregate sum of One Million Eight Hundred Ninety Thousand Dollars ($1,890,000.00), as further described in Article 2 hereof.

1.10 "Term Sheet" means the term sheet signed by authorized representatives of both Parties on August 2, 2023, at the conclusion of the mediation session before the Honorable Catherine Lindström (Ret.). Upon execution of this Agreement, the Term Sheet is superseded in its entirety by this Agreement and shall have no further force or effect.

ARTICLE 2 — SETTLEMENT PAYMENT

2.1 Settlement Amount. In full and final settlement of all claims, counterclaims, demands, and causes of action asserted or that could have been asserted in the Litigation or otherwise arising out of or relating to the Surcharge Dispute, the MSA (including Section 7.4, Exhibit C, and the Surcharge Methodology), and the Disputed Period, Nexford shall pay to Cardinal Peak the aggregate sum of One Million Eight Hundred Ninety Thousand Dollars ($1,890,000.00) (the "Settlement Amount"). The Parties acknowledge that the Settlement Amount represents approximately forty percent (40%) of the Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00) claimed by Cardinal Peak in the Litigation and has been negotiated at arms' length, through mediation, and reflects a compromise of the Parties' respective claims and defenses. Payment of the Settlement Amount, in accordance with the terms set forth herein, shall constitute full satisfaction of all obligations of Nexford to Cardinal Peak arising out of or relating to the Surcharge Dispute and the Litigation.

2.2 Payment Schedule. The Settlement Amount shall be paid by Nexford to Cardinal Peak in two (2) installments, as follows:

(a) First Installment. One Million One Hundred Thirty-Four Thousand Dollars ($1,134,000.00), representing sixty percent (60%) of the Settlement Amount, shall be due and payable within thirty (30) calendar days of the Effective Date, that is, no later than September 17, 2023.

(b) Second Installment. Seven Hundred Fifty-Six Thousand Dollars ($756,000.00), representing forty percent (40%) of the Settlement Amount, shall be due and payable within ninety (90) calendar days of the Effective Date, that is, no later than November 16, 2023.

2.3 Payment Method. All payments under this Article 2 shall be made by wire transfer of immediately available funds in United States Dollars to a bank account designated by Cardinal Peak in writing. Cardinal Peak shall provide Nexford with complete wire transfer instructions, including the name of the receiving bank, ABA routing number, account number, and account name, within five (5) business days of the Effective Date. Nexford shall not be deemed in default of any payment obligation under this Agreement if Cardinal Peak fails to timely provide such wire transfer instructions, in which case the applicable payment deadline shall be extended by one (1) business day for each business day of delay in providing such instructions.

2.4 Late Payment. If Nexford fails to make any installment payment when due under Section 2.2, interest shall accrue on the unpaid amount at the rate of eight percent (8%) per annum (compounding monthly) from the date such payment was due until the date such payment is received by Cardinal Peak in full. In addition, if any installment payment remains unpaid for more than ten (10) business days following its due date (after giving effect to any extension under Section 2.3), then the entire remaining unpaid balance of the Settlement Amount, together with all accrued and unpaid interest thereon, shall become immediately due and payable upon written notice from Cardinal Peak to Nexford. The acceleration remedy provided in this Section 2.4 shall be in addition to, and not in limitation of, any other rights or remedies available to Cardinal Peak at law or in equity, including the right to enforce this Agreement pursuant to Article 4.

2.5 Tax Treatment. Each Party shall be solely responsible for its own tax obligations arising from or relating to the receipt or payment of the Settlement Amount, including without limitation all federal, state, and local income taxes, and neither Party makes any representation to the other regarding the tax consequences of the Settlement Amount. Cardinal Peak shall provide Nexford with a properly completed and executed Internal Revenue Service Form W-9 (Request for Taxpayer Identification Number and Certification) prior to the date on which the First Installment is due. In the event Cardinal Peak fails to provide a completed Form W-9 in a timely manner, Nexford shall be entitled to withhold from any payment such amounts as may be required by applicable tax law.

ARTICLE 3 — MUTUAL RELEASES

3.1 Release by Cardinal Peak. Effective upon receipt by Cardinal Peak of the First Installment payment described in Section 2.2(a), Cardinal Peak, on behalf of itself and each of the Cardinal Peak Released Parties, hereby irrevocably and unconditionally releases, acquits, and forever discharges each of the Nexford 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, damages, judgments, extents, executions, losses, costs, expenses (including but not limited to attorneys' fees and expert witness fees), liabilities, and obligations of every kind and nature whatsoever, whether known or unknown, suspected or unsuspected, disclosed or undisclosed, fixed or contingent, matured or unmatured, accrued or unaccrued, liquidated or unliquidated, at law, in equity, or otherwise, that Cardinal Peak or any Cardinal Peak Released Party ever had, now has, or may hereafter claim to have against any Nexford Released Party, arising out of or in any way relating to:

(a) the MSA, including without limitation Section 7.4 thereof, Exhibit C thereto, and the Surcharge Methodology, as well as all purchase orders, invoices, delivery schedules, change orders, and other documents issued or exchanged pursuant to or in connection with the MSA during the Disputed Period;

(b) the Surcharge Dispute, including without limitation all surcharge invoices, surcharge calculations, surcharge reconciliations, and surcharge-related communications between the Parties during the Disputed Period (March 2021 through May 2022);

(c) the Litigation, including without limitation all claims asserted in the Complaint filed by Cardinal Peak on August 8, 2022, specifically including the claims for breach of contract (Count I), unjust enrichment (Count II), and account stated (Count III); and

(d) any and all other matters, facts, events, transactions, acts, omissions, or circumstances that were or could have been asserted by Cardinal Peak or any Cardinal Peak Released Party in the Litigation, whether or not actually pled, whether arising under statute, common law, contract, tort, or any other theory of recovery.

3.2 Release by Nexford. Effective upon execution of this Agreement by both Parties, Nexford, on behalf of itself and each of the Nexford Released Parties, hereby irrevocably and unconditionally releases, acquits, and forever discharges each of the Cardinal Peak 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, damages, judgments, extents, executions, losses, costs, expenses (including but not limited to attorneys' fees and expert witness fees), liabilities, and obligations of every kind and nature whatsoever, whether known or unknown, suspected or unsuspected, disclosed or undisclosed, fixed or contingent, matured or unmatured, accrued or unaccrued, liquidated or unliquidated, at law, in equity, or otherwise, that Nexford or any Nexford Released Party ever had, now has, or may hereafter claim to have against any Cardinal Peak Released Party, arising out of or in any way relating to:

(c) the Counterclaim filed by Nexford on October 3, 2022, including without limitation the claim for recovery of alleged overpayments in the approximate amount of Two Hundred Ten Thousand Dollars ($210,000.00), the claim for breach of contract, and the request for declaratory relief; and

(d) any and all other matters, facts, events, transactions, acts, omissions, or circumstances that were or could have been asserted by Nexford or any Nexford Released Party in the Litigation or the Counterclaim, whether or not actually pled, whether arising under statute, common law, contract, tort, or any other theory of recovery.

3.3 Unknown Claims Waiver. Each Party expressly acknowledges and agrees that the releases set forth in Sections 3.1 and 3.2 extend to all claims of every nature and kind whatsoever, whether known or unknown, suspected or unsuspected, and whether or not concealed or hidden, that exist as of the Effective Date and that arise out of or relate to the subject matter of the releases set forth herein. Each Party expressly waives and relinquishes, to the fullest extent permitted by law, any rights or benefits that it may have under Section 1542 of the California Civil Code (or any analogous provision of any other state's law), which provides:

"A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party."

Each Party understands the significance of this waiver of unknown claims and acknowledges that it has been advised by its legal counsel with respect thereto and assumes the risk that facts additional to or different from those that it now knows or believes to be true may later be discovered, and agrees that this Agreement shall be and remain effective in all respects regardless of the discovery of any such additional or different facts.

3.4 No Admission of Liability. This Agreement, and the settlement and releases reflected herein, do not constitute and shall not be construed as an admission of liability, wrongdoing, fault, or responsibility by either Party or any of their respective Released Parties. Neither Party admits that any of the claims, counterclaims, defenses, or affirmative defenses asserted in the Litigation have merit or lack merit. This Agreement is entered into solely for the purpose of settling disputed claims and avoiding the uncertainty, expense, and burden of continued litigation. This Agreement, and any statements made or acts performed in connection with the negotiation or execution hereof, shall not be offered or received in evidence in any action or proceeding of any kind as an admission or concession of liability or wrongdoing of any nature, and shall not be admissible for any purpose other than to enforce the terms of this Agreement.

ARTICLE 4 — DISMISSAL OF LITIGATION

4.1 Stipulation of Dismissal. Within five (5) business days following the Effective Date, counsel for the Parties shall jointly prepare, execute, and file with the Circuit Court of Cook County, Illinois, a Stipulation of Dismissal with Prejudice of all claims and counterclaims pending in the Litigation, Case No. 2022-L-008471, in a form substantially consistent with the requirements of the Illinois Code of Civil Procedure and the local rules of the Circuit Court of Cook County. The Stipulation of Dismissal shall provide that each Party shall bear its own attorneys' fees, costs, and expenses incurred in connection with the Litigation.

4.2 Cooperation. Each Party shall cooperate fully with the other Party, and shall execute and deliver such further documents and instruments as may be reasonably necessary or appropriate, to effectuate the dismissal of the Litigation in accordance with Section 4.1, including without limitation any agreed orders, stipulations, or other filings required by the Court.

4.3 Court Retention of Jurisdiction. Notwithstanding the dismissal of the Litigation with prejudice, the Parties agree that the Stipulation of Dismissal shall expressly provide that the Circuit Court of Cook County, Illinois, shall retain jurisdiction solely for the purpose of enforcing the terms and conditions of this Agreement, including but not limited to the payment obligations set forth in Article 2 and the confidentiality obligations set forth in Article 6. Either Party may apply to the Court for enforcement of this Agreement without the necessity of filing a new action or proceeding.

ARTICLE 5 — TERMINATION OF THE MSA

5.1 MSA Termination. The MSA (MSA-NIH-CPI-2020-001, dated January 15, 2020) shall terminate by mutual agreement of the Parties effective as of August 31, 2023 (the "MSA Termination Date"). Promptly following the execution of this Agreement, and in any event no later than August 25, 2023, the Parties shall negotiate in good faith and execute a separate Mutual Termination Agreement, in form and substance reasonably acceptable to both Parties, to memorialize and effectuate such termination. The Mutual Termination Agreement shall be consistent with, and shall not contradict or modify, the terms of this Agreement.

5.2 Transition Period. Notwithstanding the MSA Termination Date, all outstanding purchase orders that have been duly issued by Nexford and accepted by Cardinal Peak in writing prior to the MSA Termination Date shall continue to be fulfilled by Cardinal Peak, and accepted and paid for by Nexford, in accordance with the terms and conditions of the MSA, through and including October 31, 2023 (the "Transition Period End Date"). During the period from the MSA Termination Date through the Transition Period End Date (the "Transition Period"), the pricing, delivery, quality, inspection, and warranty terms of the MSA shall remain in full force and effect solely with respect to such outstanding purchase orders. For the avoidance of doubt, no surcharge disputes relating to the Transition Period shall be subject to the releases set forth in Article 3; however, the Parties agree that all surcharge calculations during the Transition Period shall be performed strictly in accordance with the Surcharge Methodology set forth in Exhibit C to the MSA, and any disputes regarding such calculations shall be resolved in accordance with the dispute resolution provisions of the MSA.

5.3 No New Orders. Nexford shall not issue, and Cardinal Peak shall have no obligation to accept, any new purchase orders under the MSA on or after the MSA Termination Date. Any purchase order purportedly issued by Nexford under the MSA after August 31, 2023 shall be null and void and of no force or effect.

5.4 Surviving MSA Provisions. Notwithstanding the termination of the MSA as provided in this Article 5, the following provisions of the MSA shall survive such termination and shall continue in full force and effect in accordance with their respective terms: indemnification obligations (Section 11.2 of the MSA), limitation of liability (Section 11.4 of the MSA), and confidentiality (Section 12.1 of the MSA), in each case solely to the extent that such provisions relate to obligations, liabilities, or claims arising out of acts or omissions occurring prior to the MSA Termination Date or during the Transition Period. The survival of such provisions shall not be construed to extend or revive any claims released under Article 3 of this Agreement.

ARTICLE 6 — CONFIDENTIALITY

6.1 Confidential Treatment. The Parties agree that the existence and terms of this Agreement, including without limitation the Settlement Amount, the payment schedule, the nature and scope of the mutual releases, and all related negotiations, mediation proceedings, communications, and documents exchanged in connection therewith, shall be treated as strictly confidential and shall not be disclosed to any third party, except as follows:

(a) as required by applicable federal, state, or local law, rule, regulation, or legal process, including without limitation a subpoena, court order, or regulatory inquiry, provided that the disclosing Party shall, to the extent legally permissible, provide the other Party with prompt written notice of such requirement prior to disclosure, and shall cooperate with the other Party's reasonable efforts to obtain a protective order or other appropriate remedy to limit the scope of such disclosure;

(b) to the Parties' respective legal counsel, auditors, tax advisors, accountants, and insurance carriers, in each case who have a bona fide need to know the terms of this Agreement in connection with the performance of their professional duties, and who shall be bound by obligations of confidentiality no less restrictive than those contained in this Article 6;

(c) by Nexford, to Marlowe Asset Management Bluff Capital Partners, LP (as Nexford's parent entity and private equity sponsor) and to Marlowe Asset Management Bluff Capital Management LLC (as the management company of Nexford's sponsor), and to Ridgecrest National Bank, N.A. (as Nexford's senior secured lender), in each case to the extent such disclosure is required under Nexford's governing documents, limited partnership agreement, operating agreement, or credit agreements, including without limitation Section 6.03(b) of the Credit Agreement dated March 12, 2021, by and among Nexford, as borrower, and Ridgecrest National Bank, N.A., as administrative agent and lender;

(d) by Nexford, to its external auditors, Hargrove Kellner CPAs LLP, to the extent reasonably necessary for the preparation of Nexford's financial statements, tax returns, or other financial reporting obligations;

(e) by Cardinal Peak, to its members, managers, and financial advisors, to the extent reasonably necessary for internal governance, financial planning, and reporting purposes;

(f) as required in connection with any federal, state, or local tax filing or audit by either Party; and

(g) in connection with any action or proceeding brought to enforce the terms of this Agreement.

6.2 No Public Statements. Neither Party shall make, authorize, or cause to be made any public statement, press release, social media posting, or other public disclosure regarding the Surcharge Dispute, the Litigation, the mediation proceedings, or the existence, terms, or conditions of this Agreement, without the prior written consent of the other Party, which consent may be withheld in such Party's sole discretion. In the event that either Party receives an inquiry from any media outlet, trade publication, or other third party regarding the Surcharge Dispute or the Litigation, the receiving Party shall respond only that "the matter has been resolved" and shall make no further comment without the prior written consent of the other Party, except as required by applicable law.

6.3 Remedies for Breach. The Parties acknowledge and agree that a breach or threatened breach of this Article 6 may cause irreparable harm to the non-breaching Party for which monetary damages alone would be an insufficient and inadequate remedy. Accordingly, each Party shall be entitled to seek equitable relief, including injunctive relief and specific performance, in addition to any other remedies available at law or in equity, without the necessity of proving actual damages or posting a bond or other security.

ARTICLE 7 — REPRESENTATIONS AND WARRANTIES

7.1 Representations of Nexford. Nexford hereby represents and warrants to Cardinal Peak, as of the Effective Date, as follows:

(a) Organization and Good Standing. Nexford is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease, and operate its properties and to carry on its business as presently conducted.

(b) Authorization. The execution, delivery, and performance of this Agreement by Nexford have been duly authorized by all necessary corporate action, including any required approvals of Nexford's board of directors, and no further corporate proceedings on the part of Nexford are necessary to authorize this Agreement or the transactions contemplated hereby.

(c) Enforceability. This Agreement constitutes a valid and binding obligation of Nexford, enforceable against Nexford 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.

(d) Financial Capacity. Nexford has the financial capacity and access to sufficient funds to pay the Settlement Amount in full in accordance with the payment schedule set forth in Section 2.2, and knows of no reason why it would be unable to make such payments when due.

(e) No Assignment of Claims. Nexford has not assigned, transferred, conveyed, pledged, or otherwise encumbered any of the claims released by Nexford herein to any third party, and no third party has any interest, legal or equitable, in any such claims.

7.2 Representations of Cardinal Peak. Cardinal Peak hereby represents and warrants to Nexford, as of the Effective Date, as follows:

(a) Organization and Good Standing. Cardinal Peak is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Colorado and has all requisite limited liability company power and authority to own, lease, and operate its properties and to carry on its business as presently conducted.

(b) Authorization. The execution, delivery, and performance of this Agreement by Cardinal Peak have been duly authorized by all necessary action of its members and managers, including any required approvals under Cardinal Peak's operating agreement, and no further proceedings on the part of Cardinal Peak are necessary to authorize this Agreement or the transactions contemplated hereby.

(c) Enforceability. This Agreement constitutes a valid and binding obligation of Cardinal Peak, enforceable against Cardinal Peak 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.

(d) No Assignment of Claims. Cardinal Peak has not assigned, transferred, conveyed, pledged, or otherwise encumbered any of the claims released by Cardinal Peak herein to any third party, and no third party has any interest, legal or equitable, in any such claims.

7.3 Mutual Representations. Each Party represents and warrants to the other Party, as of the Effective Date, as follows:

(a) Understanding and Voluntariness. It has read this Agreement in its entirety, understands all of its terms and conditions, and voluntarily executes this Agreement without duress, coercion, or undue influence.

(b) Legal Counsel. It has been represented by competent legal counsel of its own choosing in connection with the negotiation, drafting, and execution of this Agreement. Nexford has been represented by Calderwood & Harkness LLP, Chicago, Illinois. Cardinal Peak has been represented by Blackwood Stein & Associates LLP, Denver, Colorado.

(c) Opportunity to Investigate. It has had a full and fair opportunity to investigate and evaluate the facts, law, claims, defenses, and arguments relating to the Surcharge Dispute and the Litigation, and has relied upon its own judgment and the advice of its counsel in entering into this Agreement.

ARTICLE 8 — INDEMNIFICATION

8.1 Mutual Indemnification. Each Party (the "Indemnifying Party") shall indemnify, defend, and hold harmless the other Party and its respective Released Parties (each, an "Indemnified Party") from and against any and all losses, claims, damages, liabilities, judgments, settlements, costs, and expenses (including without limitation reasonable attorneys' fees, expert witness fees, and costs of investigation) arising out of or relating to any breach by the Indemnifying Party of any representation, warranty, covenant, or obligation contained in this Agreement. The obligation of indemnification set forth in this Section 8.1 shall survive the execution of this Agreement and the consummation of the transactions contemplated hereby. The Indemnified Party shall provide prompt written notice to the Indemnifying Party of any claim for which indemnification is sought; provided, however, that any delay in providing such notice shall not relieve the Indemnifying Party of its indemnification obligations except to the extent the Indemnifying Party is materially prejudiced by such delay.

ARTICLE 9 — MISCELLANEOUS PROVISIONS

9.1 Governing Law. This Agreement shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of Illinois, without giving effect to any choice-of-law or conflict-of-laws rules or provisions (whether of the State of Illinois or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Illinois.

9.2 Jurisdiction and Venue. The Parties agree that any dispute, controversy, or claim arising out of or relating to this Agreement, or the breach, termination, or validity thereof, shall be brought exclusively in the Circuit Court of Cook County, Illinois, or, where federal subject matter jurisdiction exists, the United States District Court for the Northern District of Illinois, Eastern Division. Each Party hereby irrevocably and unconditionally (a) consents and submits to the exclusive personal jurisdiction and venue of such courts for any such action or proceeding, (b) waives any objection that it may now or hereafter have to the laying of venue of any such action or proceeding in such courts, and (c) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over the Parties.

9.3 Entire Agreement. This Agreement, together with the Mutual Termination Agreement to be executed pursuant to Article 5, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, discussions, representations, and commitments, whether oral or written, between the Parties relating to the subject matter hereof, including without limitation the Term Sheet dated August 2, 2023. No Party has relied upon any statement, representation, warranty, or agreement of any other Party except for those expressly set forth in this Agreement.

9.4 Amendments. This Agreement may not be amended, modified, restated, or supplemented in any respect except by a written instrument duly executed by authorized representatives of both Parties. No oral modification or amendment of this Agreement shall be of any force or effect.

9.5 Waiver. The failure of either Party to enforce any provision of this Agreement at any time or for any period of time shall not constitute a waiver of that Party's right to enforce that provision or any other provision of this Agreement at any future time. No waiver of any provision of this Agreement shall be effective unless made in writing and signed by the waiving Party. No waiver of any breach of this Agreement shall be construed as a waiver of any subsequent or different breach.

9.6 Severability. If any provision of this Agreement (or any portion thereof) is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable under applicable law, such invalidity, illegality, or unenforceability shall not affect the validity, legality, or enforceability of any other provision of this Agreement, and the remaining provisions shall continue in full force and effect. In such event, the Parties shall negotiate in good faith to replace the invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that most closely approximates the intent and economic effect of the original provision.

9.7 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors, assigns, heirs, executors, administrators, and legal representatives. Neither Party may assign, delegate, or transfer any of its rights or obligations under this Agreement to any third party without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned, or delayed. Any purported assignment in violation of this Section 9.7 shall be null and void.

9.8 Counterparts. This Agreement may be executed in one 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 facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall have the same force and effect as delivery of a manually executed original counterpart.

9.9 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 and received (i) upon personal delivery, (ii) one (1) business day after deposit with a nationally recognized overnight courier service (with confirmation of delivery), or (iii) three (3) business days after deposit in the United States mail, certified or registered, return receipt requested, postage prepaid, in each case addressed as follows:

If to Nexford:

Nexford Industrial Holdings Inc. 4200 West Lakeshore Industrial Parkway, Suite 300 Waukegan, Illinois 60085

Attention: Deborah Whitfield, General Counsel

Telephone: (847) 555-2400

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

Calderwood & Harkness LLP 200 South Wacker Drive, Suite 4400 Chicago, Illinois 60606

Attention: Priya Anand, Partner

Telephone: (312) 555-7800

If to Cardinal Peak:

Cardinal Peak Industries 1580 Ridgeline Boulevard Pueblo, Colorado 81001

Attention: Patricia Morrow, General Counsel

Telephone: (719) 555-3100

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

Blackwood Stein & Associates LLP 717 Seventeenth Street, Suite 2200 Denver, Colorado 80202

Attention: Garrett Blackwood, Partner

Telephone: (303) 555-6200

Either Party may change its address for purposes of this Section 9.9 by giving the other Party written notice of such change in accordance with the provisions of this Section.

9.10 Attorneys' Fees. Except as otherwise expressly provided in Section 8.1 (Indemnification) and Section 2.4 (Late Payment), each Party shall bear its own attorneys' fees, costs, and expenses incurred in connection with the Litigation, the mediation, the negotiation and execution of this Agreement, and all matters related thereto.

9.11 Construction. This Agreement has been negotiated at arms' length by the Parties with the benefit of legal representation by their respective counsel, and no provision of this Agreement shall be construed against or interpreted to the disadvantage of either Party by reason of such Party having or being deemed to have drafted, structured, or dictated such provision. The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against either Party.

9.12 Headings. The article and section headings contained in this Agreement are inserted for convenience of reference only and shall not affect in any way the meaning, interpretation, or construction of any provision of this Agreement.

9.13 Further Assurances. Each Party agrees to execute and deliver, from time to time after the Effective Date, such additional documents, instruments, conveyances, and assurances, and to take such further actions, as may be reasonably required to carry out the provisions of this Agreement and to give effect to the transactions and intentions contemplated hereby.

[SIGNATURE PAGE FOLLOWS]

SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND MUTUAL RELEASE

IN WITNESS WHEREOF, the Parties have executed this Settlement Agreement and Mutual Release as of the date first written above.

NEXFORD INDUSTRIAL HOLDINGS INC.

By: ________

Name: Martin Schaeffer

Title: Chief Executive Officer

Date: August 18, 2023

CARDINAL PEAK INDUSTRIES

By: ________

Name: Frank Delacroix

Title: President & Chief Executive Officer

Date: August 18, 2023

ACKNOWLEDGED AND AGREED BY COUNSEL

The undersigned counsel acknowledge that they have reviewed this Agreement with their respective clients, that their clients have authorized the execution of this Agreement, and that this Agreement has been executed voluntarily and with full understanding of its terms.

CALDERWOOD & HARKNESS LLP Counsel for Nexford Industrial Holdings Inc.

By: ________

Name: Priya Anand, Partner

200 South Wacker Drive, Suite 4400 Chicago, Illinois 60606

Date: August 18, 2023

BLACKWOOD STEIN & ASSOCIATES LLP Counsel for Cardinal Peak Industries

By: ________

Name: Garrett Blackwood, Partner

717 Seventeenth Street, Suite 2200 Denver, Colorado 80202

Date: August 18, 2023

CONFIDENTIAL — This Settlement Agreement and Mutual Release is subject to the confidentiality provisions set forth in Article 6 hereof and shall not be disclosed except as expressly permitted therein.

SETTLEMENT AGREEMENT AND MUTUAL RELEASE
Execution Date: August 18, 2023
This Agreement resolves all disputes between the Parties in connection with Cardinal Peak Industries v. Nexford Industrial Holdings Inc., Case No. 2022-L-008471, Circuit Court of Cook County, Illinois, County Department, Law Division
This Settlement Agreement and Mutual Release (this "Agreement") is entered into as of August 18, 2023 (the "Effective Date"), by and between:
Nexford Industrial Holdings Inc., a Delaware corporation with its principal place of business at 4200 West Lakeshore Industrial Parkway, Suite 300, Waukegan, Illinois 60085 (EIN: 36-4821097; Delaware Charter No. 7284159) (hereinafter "Nexford" or "NIH");
and
Cardinal Peak Industries, a Colorado limited liability company with its principal place of business at 1580 Ridgeline Boulevard, Pueblo, Colorado 81001 (EIN: 84-3295618) (hereinafter "Cardinal Peak" or "CPI").
Nexford and Cardinal Peak are each referred to individually herein as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, Nexford and Cardinal Peak are parties to that certain Master Supply Agreement dated January 15, 2020, designated MSA-NIH-CPI-2020-001 (the "MSA"), pursuant to which Cardinal Peak manufactures and supplies hot-rolled coil ("HRC") and cold-rolled coil ("CRC") steel products to Nexford for use in Nexford's downstream fabrication and distribution operations;
WHEREAS, the MSA provides for the pass-through of certain raw-material surcharges, including scrap surcharges, energy surcharges, and alloy surcharges, subject to the terms and conditions set forth in Section 7.4 of the MSA and the methodology prescribed in Exhibit C thereto (the "Surcharge Methodology"), which methodology specifies, among other things, the applicable indices, baseline reference points, calculation periods, and cap-and-collar mechanisms governing the determination of such surcharges;
WHEREAS, a dispute arose between the Parties concerning surcharge invoices issued by Cardinal Peak for the period from March 2021 through May 2022 (the "Disputed Period"), during which Cardinal Peak invoiced total surcharges of approximately Six Million Four Hundred Ten Thousand Dollars ($6,410,000.00), of which Nexford paid One Million Six Hundred Eighty Thousand Dollars ($1,680,000.00), and Cardinal Peak claims an unpaid balance of approximately Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00) (the "Surcharge Dispute");
WHEREAS, at the core of the Surcharge Dispute, Nexford contends that Cardinal Peak deviated from the Surcharge Methodology by, among other things, utilizing incorrect index reference dates, applying surcharges to product categories excluded from the surcharge pass-through framework, and failing to apply the cap-and-collar limitations set forth in Exhibit C, while Cardinal Peak contends that its surcharge calculations were proper and in accordance with the MSA as reasonably interpreted;
WHEREAS, on June 10, 2022, Cardinal Peak, through its counsel Blackwood Stein & Associates LLP, issued a formal demand to Nexford for payment of Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00), which demand included a detailed reconciliation of surcharge invoices for the Disputed Period, and Nexford, through its General Counsel Deborah Whitfield, rejected such demand by letter dated July 5, 2022, setting forth Nexford's position that a substantial portion of the surcharges had been improperly calculated;
WHEREAS, on August 8, 2022, Cardinal Peak filed a Complaint against Nexford in the Circuit Court of Cook County, Illinois, County Department, Law Division, docketed as Case No. 2022-L-008471 (the "Litigation"), asserting claims for breach of contract (Count I), unjust enrichment (Count II), and account stated (Count III), and seeking damages in the amount of $4,730,000.00, plus pre-judgment interest, costs, and attorneys' fees;
WHEREAS, on September 19, 2022, Nexford, through its counsel Calderwood & Harkness LLP, filed an Answer and Affirmative Defenses to the Complaint, raising, among other defenses, failure to comply with contractual conditions precedent, failure to mitigate, estoppel, and the contractual cap-and-collar limitations, and on October 3, 2022, Nexford filed a Counterclaim (the "Counterclaim") asserting breach of contract by Cardinal Peak and seeking declaratory judgment that Cardinal Peak's surcharge calculations were inconsistent with the Surcharge Methodology, as well as recovery of alleged overpayments in the approximate amount of Two Hundred Ten Thousand Dollars ($210,000.00);
WHEREAS, the Parties have engaged in extensive discovery in the Litigation, including the exchange of thousands of pages of documents, interrogatory responses, and requests for admission, as well as depositions of fact witnesses and the exchange of expert reports addressing the proper interpretation and application of the Surcharge Methodology, and have thereby fully informed themselves of the facts and law relating to the Surcharge Dispute;
WHEREAS, the MSA, at Section 14.3, provides for mandatory mediation in Chicago, Illinois, administered by a mutually agreed-upon neutral mediator, as a prerequisite to the continuation of litigation, and on May 22, 2023, the Parties jointly moved to stay the Litigation pending mediation, which motion was granted by the Honorable Judge Raymond P. Callahan on June 5, 2023;
WHEREAS, on August 2, 2023, the Parties participated in a full-day mediation session before the Honorable Catherine Lindström (Ret.) at the Great Lakes Dispute Resolution Center, 150 North Riverside Plaza, Suite 2700, Chicago, Illinois 60606, at which session the Parties, after extensive arms-length negotiation, reached an agreement in principle to resolve the Surcharge Dispute, the material terms of which were memorialized in a term sheet signed by authorized representatives of both Parties on August 2, 2023 (the "Term Sheet");
WHEREAS, the Parties desire to fully and finally resolve and settle the Litigation, including all claims asserted in the Complaint and the Counterclaim, and all other disputes, claims, and controversies between them arising out of or relating to the MSA, the Surcharge Dispute, and the Disputed Period, without any admission of liability, wrongdoing, or fault by either Party, on the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual 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 hereby agree as follows:
ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings ascribed to them below. Capitalized terms used but not defined in this Article 1 shall have the meanings given to them elsewhere in this Agreement.
1.1 "Agreement" means this Settlement Agreement and Mutual Release, including all exhibits and schedules attached hereto, as the same may be amended or supplemented from time to time in accordance with Section 9.4 hereof.
1.2 "Cardinal Peak Released Parties" means Cardinal Peak Industries, together with its members, managers, officers, directors, employees, agents, representatives, affiliates, subsidiaries, successors, and assigns, including without limitation the following individuals in their individual and corporate capacities: Frank Delacroix, Natalie Gunderson, Harold Briggs, and Patricia Morrow.
1.3 "Counterclaim" means the Counterclaim filed by Nexford on October 3, 2022 in the Litigation, including all claims for breach of contract, declaratory relief, and recovery of alleged overpayments asserted therein, and any amendments thereto.
1.4 "Disputed Period" means the period commencing March 1, 2021 and ending May 31, 2022, inclusive.
1.5 "Effective Date" means August 18, 2023, the date of execution of this Agreement by both Parties.
1.6 "Litigation" means the lawsuit styled Cardinal Peak Industries v. Nexford Industrial Holdings Inc., Case No. 2022-L-008471, pending in the Circuit Court of Cook County, Illinois, County Department, Law Division, including all claims, counterclaims, cross-claims, third-party claims, motions, and proceedings filed or initiated therein.
1.7 "MSA" means the Master Supply Agreement dated January 15, 2020, reference number MSA-NIH-CPI-2020-001, entered into between Nexford and Cardinal Peak, together with all exhibits, schedules, amendments, and addenda thereto.
1.8 "Nexford Released Parties" means Nexford Industrial Holdings Inc., together with its officers, directors, employees, agents, representatives, affiliates (including without limitation Marlowe Asset Management Bluff Capital Partners, LP and Marlowe Asset Management Bluff Capital Management LLC), subsidiaries, successors, and assigns, including without limitation the following individuals in their individual and corporate capacities: Martin Schaeffer, Lydia Tran, Russell Okonkwo, and Deborah Whitfield.
1.9 "Settlement Amount" means the aggregate sum of One Million Eight Hundred Ninety Thousand Dollars ($1,890,000.00), as further described in Article 2 hereof.
1.10 "Term Sheet" means the term sheet signed by authorized representatives of both Parties on August 2, 2023, at the conclusion of the mediation session before the Honorable Catherine Lindström (Ret.). Upon execution of this Agreement, the Term Sheet is superseded in its entirety by this Agreement and shall have no further force or effect.
ARTICLE 2 — SETTLEMENT PAYMENT
2.1 Settlement Amount. In full and final settlement of all claims, counterclaims, demands, and causes of action asserted or that could have been asserted in the Litigation or otherwise arising out of or relating to the Surcharge Dispute, the MSA (including Section 7.4, Exhibit C, and the Surcharge Methodology), and the Disputed Period, Nexford shall pay to Cardinal Peak the aggregate sum of One Million Eight Hundred Ninety Thousand Dollars ($1,890,000.00) (the "Settlement Amount"). The Parties acknowledge that the Settlement Amount represents approximately forty percent (40%) of the Four Million Seven Hundred Thirty Thousand Dollars ($4,730,000.00) claimed by Cardinal Peak in the Litigation and has been negotiated at arms' length, through mediation, and reflects a compromise of the Parties' respective claims and defenses. Payment of the Settlement Amount, in accordance with the terms set forth herein, shall constitute full satisfaction of all obligations of Nexford to Cardinal Peak arising out of or relating to the Surcharge Dispute and the Litigation.
2.2 Payment Schedule. The Settlement Amount shall be paid by Nexford to Cardinal Peak in two (2) installments, as follows:
(a) First Installment. One Million One Hundred Thirty-Four Thousand Dollars ($1,134,000.00), representing sixty percent (60%) of the Settlement Amount, shall be due and payable within thirty (30) calendar days of the Effective Date, that is, no later than September 17, 2023.
(b) Second Installment. Seven Hundred Fifty-Six Thousand Dollars ($756,000.00), representing forty percent (40%) of the Settlement Amount, shall be due and payable within ninety (90) calendar days of the Effective Date, that is, no later than November 16, 2023.
2.3 Payment Method. All payments under this Article 2 shall be made by wire transfer of immediately available funds in United States Dollars to a bank account designated by Cardinal Peak in writing. Cardinal Peak shall provide Nexford with complete wire transfer instructions, including the name of the receiving bank, ABA routing number, account number, and account name, within five (5) business days of the Effective Date. Nexford shall not be deemed in default of any payment obligation under this Agreement if Cardinal Peak fails to timely provide such wire transfer instructions, in which case the applicable payment deadline shall be extended by one (1) business day for each business day of delay in providing such instructions.
2.4 Late Payment. If Nexford fails to make any installment payment when due under Section 2.2, interest shall accrue on the unpaid amount at the rate of eight percent (8%) per annum (compounding monthly) from the date such payment was due until the date such payment is received by Cardinal Peak in full. In addition, if any installment payment remains unpaid for more than ten (10) business days following its due date (after giving effect to any extension under Section 2.3), then the entire remaining unpaid balance of the Settlement Amount, together with all accrued and unpaid interest thereon, shall become immediately due and payable upon written notice from Cardinal Peak to Nexford. The acceleration remedy provided in this Section 2.4 shall be in addition to, and not in limitation of, any other rights or remedies available to Cardinal Peak at law or in equity, including the right to enforce this Agreement pursuant to Article 4.
2.5 Tax Treatment. Each Party shall be solely responsible for its own tax obligations arising from or relating to the receipt or payment of the Settlement Amount, including without limitation all federal, state, and local income taxes, and neither Party makes any representation to the other regarding the tax consequences of the Settlement Amount. Cardinal Peak shall provide Nexford with a properly completed and executed Internal Revenue Service Form W-9 (Request for Taxpayer Identification Number and Certification) prior to the date on which the First Installment is due. In the event Cardinal Peak fails to provide a completed Form W-9 in a timely manner, Nexford shall be entitled to withhold from any payment such amounts as may be required by applicable tax law.
ARTICLE 3 — MUTUAL RELEASES
3.1 Release by Cardinal Peak. Effective upon receipt by Cardinal Peak of the First Installment payment described in Section 2.2(a), Cardinal Peak, on behalf of itself and each of the Cardinal Peak Released Parties, hereby irrevocably and unconditionally releases, acquits, and forever discharges each of the Nexford 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, damages, judgments, extents, executions, losses, costs, expenses (including but not limited to attorneys' fees and expert witness fees), liabilities, and obligations of every kind and nature whatsoever, whether known or unknown, suspected or unsuspected, disclosed or undisclosed, fixed or contingent, matured or unmatured, accrued or unaccrued, liquidated or unliquidated, at law, in equity, or otherwise, that Cardinal Peak or any Cardinal Peak Released Party ever had, now has, or may hereafter claim to have against any Nexford Released Party, arising out of or in any way relating to:
(a) the MSA, including without limitation Section 7.4 thereof, Exhibit C thereto, and the Surcharge Methodology, as well as all purchase orders, invoices, delivery schedules, change orders, and other documents issued or exchanged pursuant to or in connection with the MSA during the Disputed Period;
(b) the Surcharge Dispute, including without limitation all surcharge invoices, surcharge calculations, surcharge reconciliations, and surcharge-related communications between the Parties during the Disputed Period (March 2021 through May 2022);
(c) the Litigation, including without limitation all claims asserted in the Complaint filed by Cardinal Peak on August 8, 2022, specifically including the claims for breach of contract (Count I), unjust enrichment (Count II), and account stated (Count III); and
(d) any and all other matters, facts, events, transactions, acts, omissions, or circumstances that were or could have been asserted by Cardinal Peak or any Cardinal Peak Released Party in the Litigation, whether or not actually pled, whether arising under statute, common law, contract, tort, or any other theory of recovery.
3.2 Release by Nexford. Effective upon execution of this Agreement by both Parties, Nexford, on behalf of itself and each of the Nexford Released Parties, hereby irrevocably and unconditionally releases, acquits, and forever discharges each of the Cardinal Peak 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, damages, judgments, extents, executions, losses, costs, expenses (including but not limited to attorneys' fees and expert witness fees), liabilities, and obligations of every kind and nature whatsoever, whether known or unknown, suspected or unsuspected, disclosed or undisclosed, fixed or contingent, matured or unmatured, accrued or unaccrued, liquidated or unliquidated, at law, in equity, or otherwise, that Nexford or any Nexford Released Party ever had, now has, or may hereafter claim to have against any Cardinal Peak Released Party, arising out of or in any way relating to:
(a) the MSA, including without limitation Section 7.4 thereof, Exhibit C thereto, and the Surcharge Methodology, as well as all purchase orders, invoices, delivery schedules, change orders, and other documents issued or exchanged pursuant to or in connection with the MSA during the Disputed Period;
(b) the Surcharge Dispute, including without limitation all surcharge invoices, surcharge calculations, surcharge reconciliations, and surcharge-related communications between the Parties during the Disputed Period;
(c) the Counterclaim filed by Nexford on October 3, 2022, including without limitation the claim for recovery of alleged overpayments in the approximate amount of Two Hundred Ten Thousand Dollars ($210,000.00), the claim for breach of contract, and the request for declaratory relief; and
(d) any and all other matters, facts, events, transactions, acts, omissions, or circumstances that were or could have been asserted by Nexford or any Nexford Released Party in the Litigation or the Counterclaim, whether or not actually pled, whether arising under statute, common law, contract, tort, or any other theory of recovery.
3.3 Unknown Claims Waiver. Each Party expressly acknowledges and agrees that the releases set forth in Sections 3.1 and 3.2 extend to all claims of every nature and kind whatsoever, whether known or unknown, suspected or unsuspected, and whether or not concealed or hidden, that exist as of the Effective Date and that arise out of or relate to the subject matter of the releases set forth herein. Each Party expressly waives and relinquishes, to the fullest extent permitted by law, any rights or benefits that it may have under Section 1542 of the California Civil Code (or any analogous provision of any other state's law), which provides:
"A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party."
Each Party understands the significance of this waiver of unknown claims and acknowledges that it has been advised by its legal counsel with respect thereto and assumes the risk that facts additional to or different from those that it now knows or believes to be true may later be discovered, and agrees that this Agreement shall be and remain effective in all respects regardless of the discovery of any such additional or different facts.
3.4 No Admission of Liability. This Agreement, and the settlement and releases reflected herein, do not constitute and shall not be construed as an admission of liability, wrongdoing, fault, or responsibility by either Party or any of their respective Released Parties. Neither Party admits that any of the claims, counterclaims, defenses, or affirmative defenses asserted in the Litigation have merit or lack merit. This Agreement is entered into solely for the purpose of settling disputed claims and avoiding the uncertainty, expense, and burden of continued litigation. This Agreement, and any statements made or acts performed in connection with the negotiation or execution hereof, shall not be offered or received in evidence in any action or proceeding of any kind as an admission or concession of liability or wrongdoing of any nature, and shall not be admissible for any purpose other than to enforce the terms of this Agreement.
ARTICLE 4 — DISMISSAL OF LITIGATION
4.1 Stipulation of Dismissal. Within five (5) business days following the Effective Date, counsel for the Parties shall jointly prepare, execute, and file with the Circuit Court of Cook County, Illinois, a Stipulation of Dismissal with Prejudice of all claims and counterclaims pending in the Litigation, Case No. 2022-L-008471, in a form substantially consistent with the requirements of the Illinois Code of Civil Procedure and the local rules of the Circuit Court of Cook County. The Stipulation of Dismissal shall provide that each Party shall bear its own attorneys' fees, costs, and expenses incurred in connection with the Litigation.
4.2 Cooperation. Each Party shall cooperate fully with the other Party, and shall execute and deliver such further documents and instruments as may be reasonably necessary or appropriate, to effectuate the dismissal of the Litigation in accordance with Section 4.1, including without limitation any agreed orders, stipulations, or other filings required by the Court.
4.3 Court Retention of Jurisdiction. Notwithstanding the dismissal of the Litigation with prejudice, the Parties agree that the Stipulation of Dismissal shall expressly provide that the Circuit Court of Cook County, Illinois, shall retain jurisdiction solely for the purpose of enforcing the terms and conditions of this Agreement, including but not limited to the payment obligations set forth in Article 2 and the confidentiality obligations set forth in Article 6. Either Party may apply to the Court for enforcement of this Agreement without the necessity of filing a new action or proceeding.
ARTICLE 5 — TERMINATION OF THE MSA
5.1 MSA Termination. The MSA (MSA-NIH-CPI-2020-001, dated January 15, 2020) shall terminate by mutual agreement of the Parties effective as of August 31, 2023 (the "MSA Termination Date"). Promptly following the execution of this Agreement, and in any event no later than August 25, 2023, the Parties shall negotiate in good faith and execute a separate Mutual Termination Agreement, in form and substance reasonably acceptable to both Parties, to memorialize and effectuate such termination. The Mutual Termination Agreement shall be consistent with, and shall not contradict or modify, the terms of this Agreement.
5.2 Transition Period. Notwithstanding the MSA Termination Date, all outstanding purchase orders that have been duly issued by Nexford and accepted by Cardinal Peak in writing prior to the MSA Termination Date shall continue to be fulfilled by Cardinal Peak, and accepted and paid for by Nexford, in accordance with the terms and conditions of the MSA, through and including October 31, 2023 (the "Transition Period End Date"). During the period from the MSA Termination Date through the Transition Period End Date (the "Transition Period"), the pricing, delivery, quality, inspection, and warranty terms of the MSA shall remain in full force and effect solely with respect to such outstanding purchase orders. For the avoidance of doubt, no surcharge disputes relating to the Transition Period shall be subject to the releases set forth in Article 3; however, the Parties agree that all surcharge calculations during the Transition Period shall be performed strictly in accordance with the Surcharge Methodology set forth in Exhibit C to the MSA, and any disputes regarding such calculations shall be resolved in accordance with the dispute resolution provisions of the MSA.
5.3 No New Orders. Nexford shall not issue, and Cardinal Peak shall have no obligation to accept, any new purchase orders under the MSA on or after the MSA Termination Date. Any purchase order purportedly issued by Nexford under the MSA after August 31, 2023 shall be null and void and of no force or effect.
5.4 Surviving MSA Provisions. Notwithstanding the termination of the MSA as provided in this Article 5, the following provisions of the MSA shall survive such termination and shall continue in full force and effect in accordance with their respective terms: indemnification obligations (Section 11.2 of the MSA), limitation of liability (Section 11.4 of the MSA), and confidentiality (Section 12.1 of the MSA), in each case solely to the extent that such provisions relate to obligations, liabilities, or claims arising out of acts or omissions occurring prior to the MSA Termination Date or during the Transition Period. The survival of such provisions shall not be construed to extend or revive any claims released under Article 3 of this Agreement.
ARTICLE 6 — CONFIDENTIALITY
6.1 Confidential Treatment. The Parties agree that the existence and terms of this Agreement, including without limitation the Settlement Amount, the payment schedule, the nature and scope of the mutual releases, and all related negotiations, mediation proceedings, communications, and documents exchanged in connection therewith, shall be treated as strictly confidential and shall not be disclosed to any third party, except as follows:
(a) as required by applicable federal, state, or local law, rule, regulation, or legal process, including without limitation a subpoena, court order, or regulatory inquiry, provided that the disclosing Party shall, to the extent legally permissible, provide the other Party with prompt written notice of such requirement prior to disclosure, and shall cooperate with the other Party's reasonable efforts to obtain a protective order or other appropriate remedy to limit the scope of such disclosure;
(b) to the Parties' respective legal counsel, auditors, tax advisors, accountants, and insurance carriers, in each case who have a bona fide need to know the terms of this Agreement in connection with the performance of their professional duties, and who shall be bound by obligations of confidentiality no less restrictive than those contained in this Article 6;
(c) by Nexford, to Marlowe Asset Management Bluff Capital Partners, LP (as Nexford's parent entity and private equity sponsor) and to Marlowe Asset Management Bluff Capital Management LLC (as the management company of Nexford's sponsor), and to Ridgecrest National Bank, N.A. (as Nexford's senior secured lender), in each case to the extent such disclosure is required under Nexford's governing documents, limited partnership agreement, operating agreement, or credit agreements, including without limitation Section 6.03(b) of the Credit Agreement dated March 12, 2021, by and among Nexford, as borrower, and Ridgecrest National Bank, N.A., as administrative agent and lender;
(d) by Nexford, to its external auditors, Hargrove Kellner CPAs LLP, to the extent reasonably necessary for the preparation of Nexford's financial statements, tax returns, or other financial reporting obligations;
(e) by Cardinal Peak, to its members, managers, and financial advisors, to the extent reasonably necessary for internal governance, financial planning, and reporting purposes;
(f) as required in connection with any federal, state, or local tax filing or audit by either Party; and
(g) in connection with any action or proceeding brought to enforce the terms of this Agreement.
6.2 No Public Statements. Neither Party shall make, authorize, or cause to be made any public statement, press release, social media posting, or other public disclosure regarding the Surcharge Dispute, the Litigation, the mediation proceedings, or the existence, terms, or conditions of this Agreement, without the prior written consent of the other Party, which consent may be withheld in such Party's sole discretion. In the event that either Party receives an inquiry from any media outlet, trade publication, or other third party regarding the Surcharge Dispute or the Litigation, the receiving Party shall respond only that "the matter has been resolved" and shall make no further comment without the prior written consent of the other Party, except as required by applicable law.
6.3 Remedies for Breach. The Parties acknowledge and agree that a breach or threatened breach of this Article 6 may cause irreparable harm to the non-breaching Party for which monetary damages alone would be an insufficient and inadequate remedy. Accordingly, each Party shall be entitled to seek equitable relief, including injunctive relief and specific performance, in addition to any other remedies available at law or in equity, without the necessity of proving actual damages or posting a bond or other security.
ARTICLE 7 — REPRESENTATIONS AND WARRANTIES
7.1 Representations of Nexford. Nexford hereby represents and warrants to Cardinal Peak, as of the Effective Date, as follows:
(a) Organization and Good Standing. Nexford is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to own, lease, and operate its properties and to carry on its business as presently conducted.
(b) Authorization. The execution, delivery, and performance of this Agreement by Nexford have been duly authorized by all necessary corporate action, including any required approvals of Nexford's board of directors, and no further corporate proceedings on the part of Nexford are necessary to authorize this Agreement or the transactions contemplated hereby.
(c) Enforceability. This Agreement constitutes a valid and binding obligation of Nexford, enforceable against Nexford 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.
(d) Financial Capacity. Nexford has the financial capacity and access to sufficient funds to pay the Settlement Amount in full in accordance with the payment schedule set forth in Section 2.2, and knows of no reason why it would be unable to make such payments when due.
(e) No Assignment of Claims. Nexford has not assigned, transferred, conveyed, pledged, or otherwise encumbered any of the claims released by Nexford herein to any third party, and no third party has any interest, legal or equitable, in any such claims.
7.2 Representations of Cardinal Peak. Cardinal Peak hereby represents and warrants to Nexford, as of the Effective Date, as follows:
(a) Organization and Good Standing. Cardinal Peak is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Colorado and has all requisite limited liability company power and authority to own, lease, and operate its properties and to carry on its business as presently conducted.
(b) Authorization. The execution, delivery, and performance of this Agreement by Cardinal Peak have been duly authorized by all necessary action of its members and managers, including any required approvals under Cardinal Peak's operating agreement, and no further proceedings on the part of Cardinal Peak are necessary to authorize this Agreement or the transactions contemplated hereby.
(c) Enforceability. This Agreement constitutes a valid and binding obligation of Cardinal Peak, enforceable against Cardinal Peak 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.
(d) No Assignment of Claims. Cardinal Peak has not assigned, transferred, conveyed, pledged, or otherwise encumbered any of the claims released by Cardinal Peak herein to any third party, and no third party has any interest, legal or equitable, in any such claims.
7.3 Mutual Representations. Each Party represents and warrants to the other Party, as of the Effective Date, as follows:
(a) Understanding and Voluntariness. It has read this Agreement in its entirety, understands all of its terms and conditions, and voluntarily executes this Agreement without duress, coercion, or undue influence.
(b) Legal Counsel. It has been represented by competent legal counsel of its own choosing in connection with the negotiation, drafting, and execution of this Agreement. Nexford has been represented by Calderwood & Harkness LLP, Chicago, Illinois. Cardinal Peak has been represented by Blackwood Stein & Associates LLP, Denver, Colorado.
(c) Opportunity to Investigate. It has had a full and fair opportunity to investigate and evaluate the facts, law, claims, defenses, and arguments relating to the Surcharge Dispute and the Litigation, and has relied upon its own judgment and the advice of its counsel in entering into this Agreement.
ARTICLE 8 — INDEMNIFICATION
8.1 Mutual Indemnification. Each Party (the "Indemnifying Party") shall indemnify, defend, and hold harmless the other Party and its respective Released Parties (each, an "Indemnified Party") from and against any and all losses, claims, damages, liabilities, judgments, settlements, costs, and expenses (including without limitation reasonable attorneys' fees, expert witness fees, and costs of investigation) arising out of or relating to any breach by the Indemnifying Party of any representation, warranty, covenant, or obligation contained in this Agreement. The obligation of indemnification set forth in this Section 8.1 shall survive the execution of this Agreement and the consummation of the transactions contemplated hereby. The Indemnified Party shall provide prompt written notice to the Indemnifying Party of any claim for which indemnification is sought; provided, however, that any delay in providing such notice shall not relieve the Indemnifying Party of its indemnification obligations except to the extent the Indemnifying Party is materially prejudiced by such delay.
ARTICLE 9 — MISCELLANEOUS PROVISIONS
9.1 Governing Law. This Agreement shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of Illinois, without giving effect to any choice-of-law or conflict-of-laws rules or provisions (whether of the State of Illinois or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Illinois.
9.2 Jurisdiction and Venue. The Parties agree that any dispute, controversy, or claim arising out of or relating to this Agreement, or the breach, termination, or validity thereof, shall be brought exclusively in the Circuit Court of Cook County, Illinois, or, where federal subject matter jurisdiction exists, the United States District Court for the Northern District of Illinois, Eastern Division. Each Party hereby irrevocably and unconditionally (a) consents and submits to the exclusive personal jurisdiction and venue of such courts for any such action or proceeding, (b) waives any objection that it may now or hereafter have to the laying of venue of any such action or proceeding in such courts, and (c) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over the Parties.
9.3 Entire Agreement. This Agreement, together with the Mutual Termination Agreement to be executed pursuant to Article 5, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, discussions, representations, and commitments, whether oral or written, between the Parties relating to the subject matter hereof, including without limitation the Term Sheet dated August 2, 2023. No Party has relied upon any statement, representation, warranty, or agreement of any other Party except for those expressly set forth in this Agreement.
9.4 Amendments. This Agreement may not be amended, modified, restated, or supplemented in any respect except by a written instrument duly executed by authorized representatives of both Parties. No oral modification or amendment of this Agreement shall be of any force or effect.
9.5 Waiver. The failure of either Party to enforce any provision of this Agreement at any time or for any period of time shall not constitute a waiver of that Party's right to enforce that provision or any other provision of this Agreement at any future time. No waiver of any provision of this Agreement shall be effective unless made in writing and signed by the waiving Party. No waiver of any breach of this Agreement shall be construed as a waiver of any subsequent or different breach.
9.6 Severability. If any provision of this Agreement (or any portion thereof) is held by a court of competent jurisdiction to be invalid, illegal, or unenforceable under applicable law, such invalidity, illegality, or unenforceability shall not affect the validity, legality, or enforceability of any other provision of this Agreement, and the remaining provisions shall continue in full force and effect. In such event, the Parties shall negotiate in good faith to replace the invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that most closely approximates the intent and economic effect of the original provision.
9.7 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors, assigns, heirs, executors, administrators, and legal representatives. Neither Party may assign, delegate, or transfer any of its rights or obligations under this Agreement to any third party without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned, or delayed. Any purported assignment in violation of this Section 9.7 shall be null and void.
9.8 Counterparts. This Agreement may be executed in one 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 facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall have the same force and effect as delivery of a manually executed original counterpart.
9.9 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 and received (i) upon personal delivery, (ii) one (1) business day after deposit with a nationally recognized overnight courier service (with confirmation of delivery), or (iii) three (3) business days after deposit in the United States mail, certified or registered, return receipt requested, postage prepaid, in each case addressed as follows:
If to Nexford:
Nexford Industrial Holdings Inc. 4200 West Lakeshore Industrial Parkway, Suite 300 Waukegan, Illinois 60085
Attention: Deborah Whitfield, General Counsel
Telephone: (847) 555-2400
With a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP 200 South Wacker Drive, Suite 4400 Chicago, Illinois 60606
Attention: Priya Anand, Partner
Telephone: (312) 555-7800
If to Cardinal Peak:
Cardinal Peak Industries 1580 Ridgeline Boulevard Pueblo, Colorado 81001
Attention: Patricia Morrow, General Counsel
Telephone: (719) 555-3100
With a copy (which shall not constitute notice) to:
Blackwood Stein & Associates LLP 717 Seventeenth Street, Suite 2200 Denver, Colorado 80202
Attention: Garrett Blackwood, Partner
Telephone: (303) 555-6200
Either Party may change its address for purposes of this Section 9.9 by giving the other Party written notice of such change in accordance with the provisions of this Section.
9.10 Attorneys' Fees. Except as otherwise expressly provided in Section 8.1 (Indemnification) and Section 2.4 (Late Payment), each Party shall bear its own attorneys' fees, costs, and expenses incurred in connection with the Litigation, the mediation, the negotiation and execution of this Agreement, and all matters related thereto.
9.11 Construction. This Agreement has been negotiated at arms' length by the Parties with the benefit of legal representation by their respective counsel, and no provision of this Agreement shall be construed against or interpreted to the disadvantage of either Party by reason of such Party having or being deemed to have drafted, structured, or dictated such provision. The language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and no rule of strict construction shall be applied against either Party.
9.12 Headings. The article and section headings contained in this Agreement are inserted for convenience of reference only and shall not affect in any way the meaning, interpretation, or construction of any provision of this Agreement.
9.13 Further Assurances. Each Party agrees to execute and deliver, from time to time after the Effective Date, such additional documents, instruments, conveyances, and assurances, and to take such further actions, as may be reasonably required to carry out the provisions of this Agreement and to give effect to the transactions and intentions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND MUTUAL RELEASE
IN WITNESS WHEREOF, the Parties have executed this Settlement Agreement and Mutual Release as of the date first written above.
NEXFORD INDUSTRIAL HOLDINGS INC.
By: ________
Name: Martin Schaeffer
Title: Chief Executive Officer
Date: August 18, 2023
CARDINAL PEAK INDUSTRIES
By: ________
Name: Frank Delacroix
Title: President & Chief Executive Officer
Date: August 18, 2023
ACKNOWLEDGED AND AGREED BY COUNSEL
The undersigned counsel acknowledge that they have reviewed this Agreement with their respective clients, that their clients have authorized the execution of this Agreement, and that this Agreement has been executed voluntarily and with full understanding of its terms.
CALDERWOOD & HARKNESS LLP Counsel for Nexford Industrial Holdings Inc.
By: ________
Name: Priya Anand, Partner
200 South Wacker Drive, Suite 4400 Chicago, Illinois 60606
Date: August 18, 2023
BLACKWOOD STEIN & ASSOCIATES LLP Counsel for Cardinal Peak Industries
By: ________
Name: Garrett Blackwood, Partner
717 Seventeenth Street, Suite 2200 Denver, Colorado 80202
Date: August 18, 2023
CONFIDENTIAL — This Settlement Agreement and Mutual Release is subject to the confidentiality provisions set forth in Article 6 hereof and shall not be disclosed except as expressly permitted therein.

SETTLEMENT AGREEMENT AND MUTUAL RELEASE

RECITALS

SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND MUTUAL RELEASE

NEXFORD INDUSTRIAL HOLDINGS INC.

CARDINAL PEAK INDUSTRIES

ACKNOWLEDGED AND AGREED BY COUNSEL

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