Joint Motion for Approval of Settlement Agreement - Sikh Dharma ...
Joint Motion for Approval of Settlement Agreement - Sikh Dharma ...
Joint Motion for Approval of Settlement Agreement - Sikh Dharma ...
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2<br />
3<br />
4 IN THE STATE COURT OF THE STATE OF OREGON<br />
5 FOR THE COUNTY OF MUL TNOMAH<br />
6 SARDARNI GURU AMRIT KAUR<br />
KHALSA, et aI.,<br />
7 Case No. 0909-13281<br />
8<br />
9<br />
10<br />
11<br />
12<br />
v.<br />
Plaintiffs,<br />
KARTAR SINGH KHALSA, et aI.,<br />
Defendants.<br />
STATE OF OREGON, by and through<br />
JOHN KROGER,<br />
13 Plaintiff,<br />
14 v.<br />
15<br />
16<br />
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SIRI SINGH SAHIB CORPORATION, et<br />
al.,<br />
Defendants.<br />
JOINT MOTION FOR APPROVAL OF<br />
SETTLEMENT AGREEMENT<br />
Case No. 1010-14518<br />
UTCR 5.050 STATEMENT<br />
The parties to this motion collectively estimate that one hour wil be required to hear any<br />
argument on this motion, or to answer any question this cour may have regarding the proposed<br />
settlement. The parties to this motion respectfully request <strong>of</strong>fcial cour reporting services.<br />
the six members <strong>of</strong><br />
INTRODUCTION<br />
Private Plaintiffs and the Oregon Attorney General have reached a settlement with four <strong>of</strong><br />
Golden Temple Management1: Karam S. Khalsa, Ajeet S. Khalsa, Gurudhan<br />
1 Although Golden Temple Management and Golden Temple <strong>of</strong> Oregon have changed their names, we<br />
wil continue to refer to them as "GTM" and "GTO," respectively.<br />
Page 1 - JOINT MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT<br />
DWT 19641333v3 0089647-000002<br />
DAVIS WRIGHT TREMAE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300
S. Khalsa, and Guru Hari S. Khalsa, (referred to hereafter as "Settling GTM Defendants" or<br />
2 "Settling Defendants"). A copy <strong>of</strong> the <strong>Settlement</strong> <strong>Agreement</strong> is attached hereto as Exhibit 1.<br />
3 Private Plaintiffs and the Oregon Attorney General now move this Cour <strong>for</strong> approval <strong>of</strong> the<br />
4 <strong>Settlement</strong> <strong>Agreement</strong>. The Settling GTM Defendants join in this <strong>Motion</strong>.<br />
5 (1)<br />
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Current Status <strong>of</strong> the Claims Against the Settling Defendants and the Main<br />
Components <strong>of</strong> the Proposed <strong>Settlement</strong>.<br />
The Settling GTM Defendants own 52% <strong>of</strong><br />
the interests <strong>of</strong>GTM, which in tum owns<br />
90% <strong>of</strong>the interests in GTO. The only claims brought against the Settling GTM Defendants in<br />
this case were <strong>for</strong> unjust enrichment. The Court, in its December 12,2011 Findings and<br />
Conclusions (p. 44), found that the Settling GTM Defendants had been unjustly enriched.<br />
Furhermore, the Cour, in its Corrected Remedies Order, ordered that the interests <strong>of</strong><br />
the Settling<br />
GTM Defendants in GTO, as well as all distribution <strong>of</strong> fuds the Cour found to be trust fuds,<br />
be turned over to a Special Fiduciary to be used <strong>for</strong> the benefit <strong>of</strong> the Charitable Trust.<br />
The main components <strong>of</strong> the <strong>Settlement</strong> <strong>Agreement</strong> are as follows:<br />
(1) The Settling GTM Defendants wil transfer custody to the Special<br />
Fiduciary <strong>of</strong> all <strong>of</strong> their interests in GTM, including their balances in<br />
capital accounts <strong>of</strong>$14,965,585.00 (based on estimates <strong>of</strong>201 1 earnings)<br />
as <strong>of</strong> May 26, 2012, and wil relinquish their rights to receive further<br />
distributions and bonuses.<br />
(2) The Settling GTM Defendants wil pay, within 28 days <strong>of</strong> Cour approval,<br />
collectively the additional sum <strong>of</strong> $2.25 milion dollars, which sum shall<br />
be used <strong>for</strong> prior and future legal fees <strong>for</strong> the Private Plaintiffs and<br />
Attorney General in this case, and to provide an advance <strong>for</strong> costs incured<br />
by the Special Fiduciary.<br />
(3) The Settling GTM Defendants wil pay over to the Special Fiduciary tax<br />
refunds they receive as a result <strong>of</strong> the transfer <strong>of</strong> their GTM interests and<br />
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DWT 19641333v3 0089647-000002 DAVIS WRIGHT TREMAE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300
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as the result <strong>of</strong> any payments made under the <strong>Settlement</strong> <strong>Agreement</strong>.<br />
2 (4) The Settling GTM Defendants have agreed to continue to work <strong>for</strong> GTO<br />
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<strong>for</strong> a 60-day period and thereafter to a two-year non-competition<br />
agreement.<br />
5 (5) The Settling Defendants wil <strong>for</strong>go their right to appeal this Court's Orders<br />
6<br />
and Judgment.<br />
7 (2) The Reasons <strong>for</strong> Court <strong>Approval</strong><br />
8 The Private Plaintiffs and the Attorney General ask <strong>for</strong> approval <strong>of</strong> the settlement<br />
9 agreement <strong>for</strong> three reasons. First, pursuant to this court's January 12,2012 Order Regarding<br />
10 Transfer <strong>of</strong> Assets, the Settling GTM Defendants are prohibited from making any expenditures<br />
1 1 outside the normal course <strong>of</strong> business without court approvaL. The <strong>Settlement</strong> contemplates<br />
12 expenditures by the Settling GTM Defendants outside the ordinary course <strong>of</strong><br />
business.<br />
13 Additionally, pursuant to the February 25,2010 Stipulated Order Regarding Plaintiffs <strong>Motion</strong> <strong>for</strong><br />
14 Temporary Restraining Order, GTM may not be restructured. The governing documents <strong>of</strong><br />
15 GTM may have to be changed to allow the transfer <strong>of</strong>the Settling GTM Defendants interests.<br />
16 Finally, since the settlement substantially affects the Charitable Trust's assets, it is appropriate<br />
17 that this Court review the settlement terms. ORS 130.050.<br />
18 (3)<br />
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The <strong>Settlement</strong> <strong>Agreement</strong> is Consistent with the Prior Rulings <strong>of</strong> this Court and in<br />
the Best Interests <strong>of</strong> the Charitable Trust.<br />
The provisions <strong>of</strong><br />
Remedies Order and in the best interests <strong>of</strong><br />
the <strong>Settlement</strong> <strong>Agreement</strong> are both consistent with this Court's<br />
the Charitable Trust. Moreover, the <strong>Settlement</strong><br />
<strong>Agreement</strong> wil result in finality on at least some <strong>of</strong> the claims in this case and result in an<br />
immediate benefit to the Charitable Trust.<br />
24 in GTM.<br />
(a.) The Special Fiduciary wil take custody <strong>of</strong><br />
the Settlng Defendants' Interests<br />
25 This Court has ordered that the Special Fiduciary be vested with custody and control <strong>of</strong><br />
26 GTM's interest in GTO. (Corrected Remedies Order, ir 2 (b)). The <strong>Settlement</strong> <strong>Agreement</strong><br />
Page 3 - JOINT MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT<br />
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DAVIS WRIGHT TREMAE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300<br />
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provides <strong>for</strong> the same result as to the interests <strong>of</strong> Settling GTM Defendants, and it does so with<br />
2 finality. With respect to the interests <strong>of</strong><br />
the Settling GTM Defendants, there wil be no need to<br />
3 further litigate the issue in the Supreme Court and the Banptcy Cour, where non-settling<br />
4 defendants GTM and Kartar are attempting to seek refuge. The Charitable Trust can<br />
5 immediately begin to benefit from the 52% interests in GTM. The 52% interest represents a<br />
6 47% pr<strong>of</strong>it interest in GTO and approximately $15 milion <strong>of</strong>GTO's capital account.<br />
7 (b.) The Settlng Defendants wil pay collectively the sum <strong>of</strong> $2.25 milion dollars.<br />
8 The Attorney General and the Private Plaintiffs acknowledge that the Court's<br />
judgment<br />
9 against the Settling GTM Defendants wil far exceed $2.25 milion. However, the Settling GTM<br />
10 Defendants have provided to the State and Private Plaintiffs confidential written financial<br />
11 statements disclosing their financial conditions as <strong>of</strong> April 30, 2012, verified by the signature <strong>of</strong><br />
12 each Settling GTM Defendant (see, p. 2, Recital H <strong>of</strong> <strong>Settlement</strong> <strong>Agreement</strong>). Private Plaintiffs<br />
13 and the Attorney General have determined that given the amounts that would be available to<br />
14 satisfy judgments, the diffculty <strong>of</strong> collection, and the time and uncertainly <strong>of</strong> an appeal, $2.25<br />
15 milion is a reasonable settlement amount.<br />
16 In addition, the Settling GTM Defendants have agreed to pay over to the Special<br />
17 Fiduciary, <strong>for</strong> the benefit <strong>of</strong><br />
the Charitable Trust, any and all tax refunds they are entitled to as a<br />
18 result <strong>of</strong> their payment pursuant to the <strong>Settlement</strong> <strong>Agreement</strong> Cíl3(b) <strong>of</strong> the <strong>Settlement</strong><br />
19 <strong>Agreement</strong>), moneys which are not explicitly awarded to the Charitable Trust under the<br />
20 Corrected Remedies Order. The settling GTM Defendants have also agreed to relinquish their<br />
21 rights to their scheduled 2011 bonuses, which total approximately $500,000 (p. 4, ir 3(c) <strong>of</strong><br />
22 <strong>Settlement</strong> <strong>Agreement</strong>).<br />
23 It is appropriate that the initial funds being paid be allocated to the attorney fees <strong>of</strong>the<br />
24 Private Plaintiffs and the Attorney General. This litigation has lasted longer and has been far<br />
25 more complicated than anyone initially envisioned, and the <strong>Sikh</strong> <strong>Dharma</strong> community members<br />
26 who have helped finance it are having some diffculty funding the continuation <strong>of</strong> the case. Both<br />
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DAVIS WRIGHT TREMAE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300
Private Plaintiffs and the Attorney General wil be allowed attorney fees in any event in this<br />
2 matter, and what they receive though the <strong>Settlement</strong> wil <strong>of</strong>fset what the other defendants must<br />
3 pay<br />
and thereby ensure that more <strong>of</strong> the money received by the other defendants can be used<br />
4 directly <strong>for</strong> the benefit <strong>of</strong> the Charitable Trust. Likewise, it is appropriate that the money be<br />
5 available to pay costs and fees incurred by the Special Fiduciary, who may otherwise need to<br />
6 wait an unreasonable period <strong>of</strong> time be<strong>for</strong>e being compensated from other trust assets<br />
7 (c.) The Settlng GTM Defendants have agreed to continue to work <strong>for</strong> GTO <strong>for</strong><br />
at least a 60-day period and thereafter to a two year non-competition<br />
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agreement.<br />
9 The <strong>Settlement</strong> <strong>Agreement</strong> provides <strong>for</strong> an orderly transition <strong>of</strong> management. While the<br />
10 Settling GTM Defendants have agreed to stay on <strong>for</strong> 60-days, they and the Special Fiduciary<br />
11 could come to an agreement <strong>for</strong> a longer period. In any event, the business wil be protected<br />
12 through June 30, 2014 by means <strong>of</strong><br />
13 12, i¡10 <strong>of</strong><br />
the <strong>Agreement</strong>).<br />
non-competition provisions <strong>of</strong><br />
14 (d.) The Transfer <strong>of</strong> the Settlng Defendants' Interests in GTM.<br />
the <strong>Settlement</strong> <strong>Agreement</strong>(p.<br />
15 Paragraph 3(a) <strong>of</strong> the <strong>Settlement</strong> <strong>Agreement</strong> provides that the "ownership or custody" <strong>of</strong><br />
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Settling Defendants interests in GTM wil be transferred to the Special Fiduciar. The parties<br />
have determined that temporary "custody" wil go to the Special receiver, and that "ownership"<br />
wil go to the Charitable Trust in the <strong>for</strong>m <strong>of</strong> a new Oregon religious non-pr<strong>of</strong>it corporation. The<br />
new religious corporation wil be subject to oversight by the Oregon Attorney General and wil<br />
20 be governed by directors chosen by the <strong>Sikh</strong> <strong>Dharma</strong> religion through a process that has been<br />
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monitored by the Oregon Attorney General? This religious corporation wil take the Settling<br />
GTM Defendants' interests subject to the Trust and shall administer the assets solely <strong>for</strong> the trust<br />
purposes <strong>for</strong> which the Cour found they were intended.<br />
2 In the Court's letter to counsel <strong>of</strong> May 29, 2012, the Court contemplated such a result in the event the<br />
parties were unable to agree on responsible and appropriate trustees. In this case, despite several days <strong>of</strong><br />
mediation administered by Judge Hogan, the DI defendants, on the one hand, and the Private Plaintiffs<br />
and the State on the other, are unable to reach any agreement on any matter whatsoever.<br />
Page 5 - JOINT MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT<br />
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DAVIS WRIGHT TREMAIE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300
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(4)<br />
The Difference Between the Currently Proposed <strong>Settlement</strong> <strong>Agreement</strong> and the<br />
<strong>Settlement</strong> <strong>Agreement</strong> Previously Rejected by the Court.<br />
As the Cour wil recall, the Settling GTM Defendants and the Attorney General reached<br />
a prior agreement to settle the claims against the Settling GTM Defendants. Private Plaintiffs<br />
objected to the <strong>Settlement</strong>, and the Cour ultimately rejected the settlement. The current<br />
settlement is materially more beneficial than the prior proposed settlement <strong>for</strong> the following<br />
reasons:<br />
(a)<br />
The previous proposed settlement placed the GTM interests right back into UI,<br />
controlled by those whom this Court has found breached their fiduciary duties by transferring the<br />
assets in the first place. The current <strong>Settlement</strong> <strong>Agreement</strong> gives custody to the independent<br />
Special Fiduciary <strong>for</strong> the benefit <strong>of</strong> the Trust.<br />
(b)<br />
The previous proposed settlement provided <strong>for</strong> unlimited indemnity to the Settling<br />
12 GTM Defendants by UI. The current <strong>Settlement</strong> <strong>Agreement</strong> caps indemnity at $250,000,<br />
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matched dollar <strong>for</strong> dollar by the Settling GTM Defendants, up to that amount. Furthermore, the<br />
<strong>Settlement</strong> <strong>Agreement</strong> limits the types <strong>of</strong> liabilities <strong>for</strong> which the indemnity applies (p. 10, i¡9 <strong>of</strong><br />
the <strong>Settlement</strong> <strong>Agreement</strong>).<br />
(c)<br />
Under the previous proposed settlement, the Settling GTM Defendants transferred<br />
all their voting rights and rights to control to a Voting Trust, the holder <strong>of</strong><br />
which was subject to<br />
approval by Kartar Singh Khalsa, the defendant who engineered and gained more than anyone<br />
else from the unlawful transfer <strong>of</strong> GTO to GTM. There is no such provision in the current<br />
<strong>Settlement</strong> <strong>Agreement</strong>. Instead, the Settling GTM Defendants are to make all reasonable and<br />
good faith ef<strong>for</strong>ts to provide the Special Fiduciary with all their management and other non-<br />
economic interests in GTM (p. 4, i¡3 (a)(2)).<br />
(d)<br />
The Settling GTM Defendants made a nominal $50,000 payment under the<br />
previous proposed settlement. As noted above, the current <strong>Settlement</strong> <strong>Agreement</strong> provides <strong>for</strong> a<br />
payment <strong>of</strong> $2.25 milion, the payment <strong>of</strong> tax refunds, and the relinquishment <strong>of</strong> 201 1 bonuses.<br />
Page 6 - JOINT MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT<br />
DWT 19641333v3 0089647-000002<br />
DAVIS WRIGHT TREMAIE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201' (503) 241-2300
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CONCLUSION<br />
For the reasons stated herein, Private Plaintiffs and the Attorney General request approval<br />
<strong>of</strong> the <strong>Settlement</strong> <strong>Agreement</strong>.<br />
DATED this 13th day <strong>of</strong> June, 2012.<br />
5 DA vis WRIGHT TREMAINE LLP<br />
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B -- r.t:J'<br />
~cGo, r: #813115<br />
P. Andrew McStay, Jr., OSB #033997<br />
Paul Southwick, OSB #095141<br />
Phone: 503-241-2300<br />
Fax: 503-778-5299<br />
Email: johncgrory@dwt.com<br />
Email: andrewmcstay@dwt.com<br />
Email: paulsouthwick@dwt.com<br />
Of Attorneys <strong>for</strong> Plaintiffs<br />
Trial Attorney: John F. McGrory, Jr.<br />
Page 7 - JOINT MOTION FOR APPROVAL OF SETTLEMENT AGREEMENT<br />
DWT 19641333v3 0089647-000002 DAVIS WRIGHT TREMAIE LLP<br />
1300 S.W. Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300
PRIILEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
This <strong>Settlement</strong> <strong>Agreement</strong> and General Release ("<strong>Agreement</strong>") is entered into by and<br />
among: (1) Karam S. Khalsa, Ajeet S. Khalsa, Gurudhan S. Khalsa, and GuruHari S. Khalsa<br />
(collectively, the "Settling GTM Defendants" and each individually, a "Settling GTM<br />
Defendant") the State <strong>of</strong> Oregon, by and through John Kroger, Attorney General (the "State");<br />
and the Private Plaintiffs (described below). Collectively, the Settling GTM Defendants, the<br />
State, and the Private Plaintiffs are referred to herein as the Settling Parties.<br />
Oter pares referenced in this <strong>Agreement</strong> are (1) Unto Infinity, LLC, an Oregon limited liability<br />
company (ClUJ"); (2) KIlT Company, Inc., a Nevada corporation ("KIlT"); (3) Karar Singh Khalsa and<br />
Robert 1. Ziehl ("Remaining GlM Defendants") (4) Siri Singh Sahib Corporation (SSSC), (5) Golden<br />
Temple <strong>of</strong> Oregon, LLC, an Oregon limited liabilty company nka East West Tea Company, LLC<br />
(ClGTO") and (6) Golden Temple Management, LLC, an Oregon lirited liability company, nkaEWTC<br />
Management LLC ("GTM"), as more fully described herein.<br />
RECITAL<br />
This <strong>Agreement</strong> is made with reference to the followig facts:<br />
A. WHREAS, the State fied a lawsuit agains GTM, the Settling GlM Defendants, UI, and KIT<br />
(and other defendants not pares to this <strong>Agreement</strong>), which is pendig in Multnomah County<br />
Circuit Cour, Case No. 1010-14518, and asserts claims in connection with the 2007 restrcturing<br />
<strong>of</strong>GTO and its subsequent management l:y GTM, as is more fully alleged in the State's Third<br />
Amended Complaint dated June 29, 2011;<br />
B. WHEREAS, the lawsuit fied by the State was consolidated with a lawsuit previously fied by<br />
Gur Amrt Kaur Khalsa, Avtar Har Singh Khalsa, Guru Raj Kaur Khlsa,<br />
Gur Sangat Kaur<br />
Khalsa, and Gurutej Singh Khalsa, individualy, and as representatives <strong>of</strong>the <strong>Sikh</strong> Dhara<br />
Communty, defined in Paragraph C, below (collectively, the "Private Plaintiffs") against GlM<br />
and UI (and other defendants not paries to this <strong>Agreement</strong>) in Multnomah County Circuit Court,<br />
Case No. 0909-13281 (Case Nos. 0909-1~281and 1010-14518). The lawsuits are collectively and<br />
individually referred to as the "Litigation," and the Court in which the Litigation is pending is<br />
referred to as the Court;<br />
C. WHERES, the Court detennined that Prvate Plaitiffs have special interest standing to<br />
represent all Sik Dhara minters (as identified in the records <strong>of</strong> Sik Dhara International, a<br />
Cali<strong>for</strong>nia not-<strong>for</strong>-pr<strong>of</strong>it religious corporation). To the fuest extent pennitted by law, ths class<br />
<strong>of</strong> ministers in tu represents the interests <strong>of</strong> all individuals, entities and/or organizations that<br />
claim or could claim a right, interest or benefit in the real, personal, investment, busines.s or trust<br />
propert <strong>of</strong> the <strong>Sikh</strong> Dhara faith, SSSC, UI, KIlT and/or <strong>Sikh</strong> Dhara International in<br />
connection with the restructuring <strong>of</strong> GTO, and the operation, and management <strong>of</strong> GTO by and<br />
through GTM ("Community");<br />
D. WHREAS, the State's lawsuit was brought pursuant to ORS 128.680 and ORS 128.710 and its<br />
common law authority to oversee charities and en<strong>for</strong>ce the rights <strong>of</strong> charitable interests, including<br />
those <strong>of</strong> the Community, UI, KIlT and SSSC's chartable interests regarding the restructuring and .<br />
management <strong>of</strong>GTO as well as GTO's decision to cede control to GlM ("Community's<br />
Chartable Interests");<br />
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0:\949000 J \00 i 8 mef final settlement agreement 5-25- 12 DOJ DM3403482--52 J J 2<br />
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PRnEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
E. WHEREAS, the State, in its authorized capacity to oversee charties and en<strong>for</strong>ce the rights <strong>of</strong><br />
chartable interests, believes ths <strong>Agreement</strong> is in the best interests <strong>of</strong><br />
il, KIlT, SSSC, GTO, and<br />
the Community;<br />
F. WHEREAS, on or about April 11,2012, the Cour issued a DRAFT Opinion Regarding<br />
Remedies in the Litigation ("the Remedies Order");<br />
G. WHEREAS, the Setting GTM Defendants, the State, the Private Plaintiffs wish, without resort<br />
to furter .litigation or appeals, to settle their differences in the Litigation and otherwise, with<br />
respect to the State's claims, the claims <strong>of</strong>the Private Plaintiffs, or any <strong>of</strong><br />
them, against the<br />
Settling GTM Defendants; and with respect to any claims held by the Settling GTM Defendants,<br />
or any <strong>of</strong>them, againt the Private Plaintiffs and/or the State;<br />
H. WHEREAS, the Setting GTM Defendants have provided to the State and Private Plaintiffs<br />
confdential written financial statements accurately disclosing their financial condition as <strong>of</strong> April<br />
30,2012, verified as such by the signatue <strong>of</strong> each Settling GTM Defendant, upon which the State<br />
and Private Plaintiffs have materially relied in enterig into this <strong>Settlement</strong> <strong>Agreement</strong>, which<br />
statements are being provided under a confidentiality agreement and/or Confidentiality<br />
Understandig pursuant to Oregon public records laws; .<br />
1. WHEREAS, the Settlig GTM Defendants have provided to the State and Prvate Plaintiffs all <strong>of</strong><br />
the financial inormation referenced in this <strong>Settlement</strong> <strong>Agreement</strong>, including inormation relating<br />
to their compensation and to their capital accounts in GTM, upon which the State and Private<br />
Plaintiffs have materially relied in entering into ths <strong>Settlement</strong> <strong>Agreement</strong>;<br />
J. WHEREAS, on Februar 18,2012, GTM fied a petition in banptcy under Chapter 11 <strong>of</strong>the<br />
Banptcy Code, Case No. 12-6D536-tml1 (Ban1e Ct. <strong>for</strong> Oregon);<br />
K. WHREAS, on Februar 18, 2012, Karar Singh Khalsa fùed a petition in banptcy under<br />
Chapter 11 <strong>of</strong> the Banptcy Code, Case No. 12-60538-fra11 (Ban. Ct. <strong>for</strong> Oregon). The<br />
Courts havig jurisdiction <strong>of</strong> the GTM and Kar Khalsa banptcy petitions are referred to<br />
herein collectively as the Banptcy Court;<br />
L. WHREAS, this <strong>Agreement</strong> may be entered into contemporaneously with certai other<br />
agreements among some or all <strong>of</strong> the par"i.es in the Litigation, which agreements are intended to<br />
faciltate the effectiveness <strong>of</strong> this <strong>Agreement</strong>. Among those agreements is one that memorializes<br />
and effectuates the transfer <strong>of</strong> all <strong>of</strong> the Settling GTM Defendants' fift-two percent <strong>of</strong> the .<br />
membership unts in GTM to a Special Fiduciar appointed by the Cour ("the Special<br />
. Fiduciar"), the purose <strong>of</strong> which transfer is to comply, as best the Settling GTM Defendants can<br />
w'ith the Remedies Order <strong>of</strong> the Court and to rehabiltate Settling GTM Defendants' business<br />
reputation.in the <strong>Sikh</strong> communty;<br />
M. WHEREAS, the Settling Paries acknowledge that this <strong>Agreement</strong> is entered into following the<br />
arbitrator's ruing in Pur; v. Golden Temple <strong>of</strong> Oregon, LLC, Arbitration Service <strong>of</strong><br />
Portland<br />
No. i 006254 (the "Arbitration") in which the arbitrator ruled that GTO does not own the priar<br />
trademarks it uses <strong>for</strong> its products, YOGI and YOGI TEA, and, among other thngs, enjoined<br />
GTO from furher use <strong>of</strong>the marks afer December 31,2011, thereby contrbuting to, among<br />
other things, uncertainty about the value <strong>of</strong> GTO; and<br />
Page 2 OF 20- SETILEMENT AGREEMENT AND GENRAL RELEASE<br />
0:\9490001\00 i 8 meffinal settement agrement 5-25-12 DOl DM3403482-052//2<br />
DWT 19476558vS 0089647..00002<br />
f<br />
i<br />
Î<br />
Exhibit l<br />
Page 2 <strong>of</strong>3?<br />
¡
PRIILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
N. 'WHREAS, Each Settling Par acknowledges and agees that such par enters into this<br />
. <strong>Agreement</strong> <strong>for</strong> good and valuable consideration and such par wil benefit from the resolution <strong>of</strong><br />
claims as contemplated herein without further litigation.<br />
AGREEMENT<br />
NOW THEREFORE, in consideration <strong>of</strong><br />
the <strong>for</strong>egoing Recitals, the mutual covenats and promises<br />
contained herein, and other good and valuable consideration, the receipt and suffciency <strong>of</strong> which are<br />
hereby acknowledged by the paries to this <strong>Agreement</strong>, the paries agree to be legaly bound by the<br />
following tenus and conditions:<br />
1. Recitals. The Setting Paries acknowledge that the Recitals preceding this paagraph are true and<br />
correct, and are incorporated herein as material pars to this <strong>Agreement</strong>.<br />
2. Compliance with Court Order / Reha biltative Business Transfer <strong>of</strong> GTM Units; Court<br />
<strong>Approval</strong>. The Settling parties acknowledge and agree that this <strong>Agreement</strong> anticipates a separate<br />
agreement that will effectuate, upon approval by order <strong>of</strong> both the Court and the Banuptcy<br />
Cour, the tranfer to the Special Fiduciar to be held on behalf <strong>of</strong> the Charitable Trust as<br />
identified by the Cour in the Remedies Order, <strong>of</strong> all interests that the Setting GTM Defendants<br />
have in GTM. Further, the Settling Pares acknowledge and agree that this <strong>Agreement</strong> is entered<br />
into subject to and is conditioned on the approva1 <strong>of</strong> t1s <strong>Agreement</strong> by<br />
the Court and the<br />
Banptcy Court, uness all paries hereto agree to <strong>for</strong>ego such approval.<br />
The Settling Paries agree to cooperate in good faith to stuctue the anticipated separte<br />
agreement effectuating an irevocable business motivated rehabiltative transfer <strong>of</strong><br />
the Settling<br />
GTM Defendants' membership urts in GTM in such a way as to minimie to the greatest extent<br />
possible any tax liabilty accrung to the Settlirig GTM Defendants and to the Charitable Trut.<br />
3. Consideration. The Settling Paries represent and warant that each has received good and<br />
valuable consideration to enter into this <strong>Agreement</strong> and that each shall benefit, directly<br />
or<br />
indirectly, from the resolution <strong>of</strong> claims and agreement on the matters described herein.<br />
In fuer consideration <strong>of</strong> the terms and conditions set <strong>for</strong>t in this <strong>Agreement</strong>, the receipt and<br />
suffciency <strong>of</strong> which is hereby acknowledged, the Settling GTM Defendants agee to provide<br />
monetar consideration to or <strong>for</strong> the benefit <strong>of</strong> the Charitable Trüst as follows.<br />
(a) Not later than 28 days after both cours (the Court and the Bankrptcy Cour) approve<br />
th <strong>Agreement</strong> or one or both cours determine approval is not requied, and the Special<br />
Fiduciar has agreed on behalf <strong>of</strong> the Charitable Trut to be bound by this <strong>Agreement</strong>, the<br />
Settling GTM Defendants shall: .<br />
1. Pay, or cause to be paid, to the Davis Wright Tremaine Trust Account the total<br />
amount <strong>of</strong> Two Milion Two Hundred Fift Thousand Dollars ($2,250,000),<strong>for</strong><br />
the benefit <strong>of</strong>the Charitable Trust except that it is understood that $900,000.00 <strong>of</strong><br />
such payment may be made immediately available to Davis Wright Tremaine to<br />
pay attorney fees and/or costs that it has incurred in the Litigation, and tht<br />
$500,000.00 <strong>of</strong><br />
such payment shall be made immediately available to the Oregon<br />
Depaient <strong>of</strong> Justice <strong>for</strong> the payment <strong>of</strong> attorney fees and/or costs that it has<br />
incurred in the Litigation; and the balance to be held <strong>for</strong> distributions <strong>for</strong><br />
Page 3 OF 20- SETILEMENT AGREEMENT AND GENERA RELEASE<br />
0:\9490001\00 18 meffinal settement agreement 5-25,12 DOJ DM3403482-0521 I2<br />
DWT I 9476558v5 0089647-000002<br />
Exhibit 1<br />
Page 3 <strong>of</strong>37
PRIEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
payment <strong>of</strong> attorney fees and costs <strong>of</strong> Private Plaintiffs and the Deparment <strong>of</strong><br />
Justice, except that the extent the Special Fiduciar has not received access to the<br />
Trust Assets to adequately compensate him <strong>for</strong> prior services per<strong>for</strong>med by him<br />
and his attorneys prior to the date <strong>of</strong> this <strong>Agreement</strong>, the Special Fiduciar may<br />
receive an advance suffcient to pay such compensation from the <strong>Settlement</strong><br />
Payment; and<br />
2. Transfer to the ownership or custody <strong>of</strong> the Special Fiduciar all <strong>of</strong> their<br />
economic interests in GTM (which is 52% <strong>of</strong> all such interests), including the<br />
entirety <strong>of</strong> their certified capital accounts balances and all their other economic<br />
rights in GTM; and<br />
3. Make all reasonable and good faith ef<strong>for</strong>t, which ef<strong>for</strong>ts shall continue so long<br />
as there are reasonable prospects <strong>for</strong> success, to deliver to the Special Fiduciar<br />
such documents as are necessar to provide the Special Fiduciar with ownership<br />
or custody <strong>of</strong> all their management and other non-economic interests in GTM<br />
(which is 52% <strong>of</strong> all such interests).<br />
(b) . Subject to Section 9(b) below, the Settling GTM Defendants agree to pay over to the<br />
Special Fiduciar any and all net tax refunds they receive as à result <strong>of</strong> the transfer <strong>of</strong><br />
their interests in GTM or as a result <strong>of</strong> their payments pursuant to this <strong>Agreement</strong>.<br />
(c) Consistent with Section 5, below, the Settling GTM Defendants hereby relinquish their<br />
respective rights to collect from GTO their scheduled 2011 bonuses, which total not less<br />
than Five Hundred Thousand Dollars ($500,000.00) and are the result <strong>of</strong> each Settling<br />
GTM Defendant's employment in the regular course with GTO. .<br />
The Settling Paries agree to cooperate in good faith to allow the Settling GTM Defendants to<br />
per<strong>for</strong>m their payment obligations under this section in such a way as to minmize to the greatest<br />
extent possible any ta liabilty accruing to the Settling GTM Defendants and to the Charitable<br />
Trust.<br />
4. Monetary Award. Without limitig any other release given elsewhere in this <strong>Agreement</strong>, in the<br />
event that the Cour in the Litigation (or coúit in any other litigation or proceeding), orders or<br />
adjudges that any defendant pay money to UI and/or KIlT, or any other person or entity acting on<br />
behalf <strong>of</strong> the chartable community <strong>for</strong> which UI has, or has had, an obligation to act ("the<br />
Award"), then any such defendant shall not be responsible <strong>for</strong> and is hereby released from 52% <strong>of</strong><br />
the Award if the Award includes monies <strong>for</strong> which the Settling GTM Defendants are also liable;<br />
provided, however, that if the A ward imposes liability upori any defendant <strong>for</strong> breach <strong>of</strong> fiduciar<br />
duty, ths section shall not apply to that porton <strong>of</strong> the A ward. For the avoidance <strong>of</strong> confusion or<br />
doubt, this paragraph is intended to negate, or otherwise <strong>for</strong>eclose, contrbution or indemnity<br />
claims agai the Settling GTM Defendants.<br />
Page 4 OF 20- SEITEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001 \00 i 8 meffinal settlement agreement 5-25-12' DOJ DM3403482-052 J J 2<br />
DWT I 9476558v5 0089647-000002<br />
Exhibit 1<br />
Page 4 <strong>of</strong>37
PRIEGED SETTLEMENT DOcrENT<br />
OREGON EVIENCE RULE 408<br />
5. Transition Assistance.<br />
(a) Transition Period. Following the Effective Date (as defined in Section 8, below), the<br />
Settling G1M Defendants shall continue to serve in their curent pr<strong>of</strong>essional roles as<br />
employees <strong>of</strong> GTO <strong>for</strong> six (60) days (the "Tránsition Period") to ensure an orderly<br />
transition to new management. The services per<strong>for</strong>med by the Settling GTM Defendants<br />
during the Transition Period shall be consistent with their current duties and they wil<br />
continue to devote their full time, attention, and ef<strong>for</strong>ts in those roles at such times and in<br />
such maner as is necessary or appropriate and reasonably consistent with past practices.<br />
Provided, however, that if new management is in place during the transition period, the<br />
Settling GTM Defendants shall serve as directed by such new management. The Settling<br />
G1M Defendants shall continue to be compensated <strong>for</strong> such services (including any<br />
salar eared prior to the Transition Period but not yet paid, subject to Section 5( d) .<br />
below) in such amounts, and in such manner, as is consistent with their current salaries,<br />
which shall not be reduced during the Tranition Period as disclosed in writing to the<br />
pares prior to execution <strong>of</strong> this <strong>Agreement</strong> ("Current Salares"). The Settling GTM<br />
Defendants shall contiue to receive all benefits curently received by (or <strong>of</strong>fered by<br />
OTO to) the Settling GTM Defendants (including, but not limited to, vacation, other paid<br />
leave, and health insurance), as disclosed in writing to the pares prior to execution <strong>of</strong><br />
this <strong>Agreement</strong> ("Current Benefits"). All compensation paid directly to the Setting<br />
G1M Defendants during the Tranition Period wil be subject to stadard payroll tax<br />
witho1dings by GTO, except as otherwise set <strong>for</strong>t in ths <strong>Agreement</strong>. The pares<br />
covenant and agee to not contest or attempt to reduce or modify the Gurent Salaries or<br />
Curent Benefits paid to or received by the Settling GTM Defendants durg the<br />
Transition Period. GTO may, but is not obligated to, <strong>of</strong>fer longer employment terms or<br />
consulting arrangements to some or all <strong>of</strong> the Settling OTM Defendants. As par <strong>of</strong> their<br />
ef<strong>for</strong>t to comply with the Remedies Order and to rehabiltate their business reputations<br />
within the Sik communty, Settling GTM Defendants reliquish their respective rights to<br />
collect from OTO their scheduled 2011 bonuses as set <strong>for</strong>t in paragraph 3.<br />
(b) Termiation <strong>of</strong><br />
Employment. In the event that the employment <strong>of</strong> any Settling GTM<br />
Defendant is terminated by GTO other than <strong>for</strong> Good Cause, or by.the Settling GTM.<br />
Defendant <strong>for</strong> Good Reason, be<strong>for</strong>e the end <strong>of</strong> the Transition Period, suchtenninated<br />
employee (or his legal representative or estate, as applicable) shall contiue to be entitled<br />
to payment <strong>of</strong> aU accrued and unpaid salary, and, as appiicable, benefits through the end<br />
<strong>of</strong> the Tranition Period as if the employee had remaied employed; provided that, in the<br />
event a Settlig GTM Defendant's employment is terminated by GTO <strong>for</strong> Good Cause<br />
(as defied below) or the Settling GTM Defendant voluntarly terminates his employment<br />
without Good Reason (as defined below), the Settling GTM Defendat shall be entitled<br />
only to accrued and unpaid salar and benefits prorated though the termination date.<br />
Neither par may terminate the employment relationship (except <strong>for</strong> cause) without<br />
providing at least 30 days' prior written notice. In the event that the employment <strong>of</strong><br />
Settling GTM'Defendant is terminated as a result <strong>of</strong> such person's death or disabilty,<br />
any<br />
such person (or his estate or personal representative) shall be entitled to payment <strong>of</strong> all<br />
accrued and unpaid salary and, as applicable, benefits though the date <strong>of</strong> such disabilty<br />
or death.<br />
"Good Cause" and "Good Reason", For purposes <strong>of</strong><br />
this <strong>Agreement</strong>,<br />
"Good Cause" means (i) any material breach <strong>of</strong> an obligation owed to GTO by a Settling<br />
GTM Defendant under this <strong>Agreement</strong> or any other agreement between GTO and the<br />
(c) Defiition or<br />
. .<br />
Page 5 OF 20- SETTEMENT AGREEMENT AND GENERA RELEASE<br />
0:\9490001\0018 mer final settlement agreement 5-25- 12 DOJ DM3403482-0S2 J 12<br />
DWT 19476558v5 0089647-00002<br />
Exhibit 1<br />
Page 5 <strong>of</strong>37
PRIILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
Settling GTM Defendant, (ii) failure to comply with any GTO policy or procedure which<br />
failure adversely afects GTO in any material respect, (ii) commission <strong>of</strong> any act <strong>of</strong><br />
fraud, misappropriation, embezzement, theft breach <strong>of</strong> fiduciar duty involving personal<br />
pr<strong>of</strong>it, or other acts <strong>of</strong> dishonesty, alcoholism, drug addiction or dependency,<br />
(iv) conviction <strong>of</strong>, or gulty plea or plea <strong>of</strong> nolo contendere to, any crime <strong>of</strong> moral<br />
turpitude or crime punishable as a felony, or (v) gross negligence or willful misconduct in<br />
connection with or related to the business <strong>of</strong>GTO. Provided that, other than Under<br />
clauses (üi), (iv) and (v) above, none <strong>of</strong>tbe <strong>for</strong>egoing wil be deemed a termination <strong>for</strong><br />
"Good Cause" unleSs GTO notifies the applicable Settling GTM Defendant <strong>of</strong> its<br />
assertion that such action constitutes grounds <strong>for</strong> it to termnate his employment <strong>for</strong><br />
"Good Cause" and the Settling GTM Defendant fails to reverse such action or to<br />
otherwise remedy the matter in a manner reasonably acceptable to GTO withi thrt<br />
00) days after receipt <strong>of</strong> such written notice.<br />
For purposes <strong>of</strong> ths <strong>Agreement</strong>, "Good Reason" means: (a) any reduction <strong>of</strong> the Settling<br />
GTM Defendant's salar; (b) any material change in the benefits <strong>of</strong>fered to the Settling<br />
GTM Defendant unless such benefits are changed <strong>for</strong> al employees <strong>of</strong>GTO; (c) any<br />
material change in the duties or expected hours <strong>of</strong> service required <strong>of</strong> the Settling GTM<br />
Defendat except as dictated by the nature, circumstances or needs <strong>of</strong>GTO's Business<br />
and the direction <strong>of</strong> new management; (d) any <strong>for</strong>ced relocation <strong>of</strong> the Settling GTM<br />
Defendant's principal workplace by more than twenty five (25) miles outside <strong>of</strong><br />
the<br />
Portland, Oregonlancouver, Washigton metropolitan area (or such Settling GTM<br />
Defendant's other principal workplace); or (e) any material breach by GTO <strong>of</strong> its<br />
obligations to the Settling GTM Defendant under this <strong>Agreement</strong> or any other agreement<br />
between GTO and the Settling GTM Defendant; provided, that (except in thecase <strong>of</strong><br />
death or disabilty), none <strong>of</strong> the <strong>for</strong>egoing wil be deemed a termination <strong>for</strong> "Good<br />
Reason" uness (A) the applicable Settling GTM Defendant noties GTO <strong>of</strong> his. assert~n<br />
that such action constitutes grounds <strong>for</strong> to termate his employment <strong>for</strong> "Good Reason,"<br />
which notice shall be delivered with thrt (30) days afer such Settling GTM<br />
Defendant becomes aware <strong>of</strong> such action, and (B) GTO fails to reverSe such action or to<br />
otherwise remedy the matter in a maner reasonably acceptable to such Settling GTM<br />
Defendant within 30 days afer receipt <strong>of</strong> such written notice;<br />
(d) Releases Other than payment <strong>of</strong> the salaries and beneJìts described above, the Settling<br />
GTM Defendants release an claims to additionaîcompensation from GTO. The Settling<br />
GTM Defendants represent and warant that each has been paid his prorated salar by<br />
GTO in the ordinar course in accordance with GTU's standard payroll practices, and no<br />
Setting GTM Defendantis owed any salar, unpaid benefits or other unpaid amounts <strong>for</strong><br />
past pay periods other than, the most recent pay period ending prior to execution <strong>of</strong> this<br />
<strong>Agreement</strong>, and except as disclosed to the paries in wrting prior to the execution <strong>of</strong><br />
this<br />
<strong>Agreement</strong>. .<br />
Private Plaintiffs and the State individually and collectively, release the Settling GTM<br />
Defendants from any clais, counterclaims, causes <strong>of</strong> action, or suits assertg that the<br />
Transition'Period is or was not suffcient to ensure an orderly tranition to new<br />
management <strong>of</strong>GTO and GTM.<br />
6. Release <strong>of</strong> Claims by the State and the Private Plaintifs. In exchange <strong>for</strong>, and in consideration<br />
<strong>of</strong>, the covenants, tenus, and conditions described in thi <strong>Agreement</strong>, the Private Plaitiffs and the<br />
State, <strong>for</strong> themselves and: (a) as to the Private Plaintiffs, and to the maxmum extent permitted by<br />
law, the Communty; (b) as to the State, and to the extent permtted by law, any agency or<br />
Page 6 OF 20- SEITLEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\0018 mcffinal settlement agrement 5-25-12 DOJ DM3403482-052lJ2<br />
DWT 19476558v5 0089647-000002<br />
i<br />
Exhißit 1<br />
Page 6 <strong>of</strong>37
PRIEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
representative <strong>of</strong> the State <strong>of</strong> Oregon, <strong>for</strong> claims which could be asserted in the name <strong>of</strong> the<br />
A ttomey General in his capac ity as reguator or overseer <strong>of</strong> chartable interests; ( c) as to the State<br />
and the Private Plaintiffs, their employees (in their capacity as such), representatives, agents,<br />
transferees and assigns, as applicable, and any person claiming by, though or under the<br />
<strong>for</strong>egoing, in any such capacities; and (d) fuer, as to the Private Plaintiffs, and to the maximum<br />
extent permtted by law, any individual or entity not included in (a), (b) and/or (c) who might<br />
claim to represent UI, KIlT SSSC, OTO, GTM and/or any chartable or religious interest served<br />
by them or any <strong>of</strong> them (individualy and colIectively, "Releasing Paries"), hereby fully,<br />
unconditionally, and irrevocably release, acquit, and <strong>for</strong>ever discharge the Settling GTM<br />
Defendants, individually and in all capacities (including, but not limited to, in their capacity as<br />
members, managers, <strong>of</strong>fcers, representatives, employees, and/or agents <strong>of</strong>GTO and/or GTM, as<br />
applicable), and their heirs, donees, survivors, legatees, beneficiaries, executors, personal<br />
representatives, administrators, agents, transferees, and assign, in such capacities (individually a<br />
"Released Person" and collectively, "Released Persons"), from any and all cltiims, counterclaims,<br />
causes <strong>of</strong> action, suits, tort, rights, liabilties, tax liabilties, obligations (including contractual),<br />
demands, debts, sums <strong>of</strong> money, accountings, reckonings, bils, covenants, controversies,<br />
agreements, promises, variances, trespasses, executions, loss, damages <strong>of</strong> any kind (including but<br />
not lited to incidental, consequential and punitive damages), judgments, attorneys' fees, costs,<br />
charges, expenses and amounts whatsoever, <strong>of</strong> whatever kind or nature, in law, equity or<br />
otherwise, whether known or unkown, vested <strong>of</strong> contingent, suspected, or otherwise, whether or<br />
not based on misrepresentation, mistake, or omission, that the Releasing Paries (or any <strong>of</strong><br />
them)<br />
now have, have ever had, or may in the future have against the Settling OTM Defendants with<br />
respect to any matter, fact, or circumstace, <strong>of</strong> any kind or nature whatsoever, existing, arsing, or<br />
occurring, directly or indirectly, on or be<strong>for</strong>e the date <strong>of</strong>this <strong>Agreement</strong> relating to the Litigation,<br />
the facts or circumstances underlying or relating to the Litigation, the outcome <strong>of</strong>the Litigation,<br />
the Settling GTM Defendants' ownership or management <strong>of</strong>, or employment by, or affliation or<br />
relationship with, GTO or GTM or the restructuring <strong>of</strong>OTI, in any capacity, and any acts or<br />
omissions <strong>of</strong> the Settling GTM Defendants in connection with or relating to OTI, OTO, or OTM.<br />
The term "Released Persons" does not include any <strong>of</strong>the defendants in this Litigation other than<br />
the Settling GTM Defendants.<br />
These releases extend to and inure to the benefit <strong>of</strong>the Settling GTM Defendants.<br />
Notwithstading the <strong>for</strong>egoing, these releases shall not extend to and the term "Released Claims"<br />
shalI not include: (1) as to the applicable Settling OTM Defendant, any claims that arise out <strong>of</strong>the<br />
Settling GTJY Defendant's criminal misconduct, or any breach by the Settling GTM Defendant <strong>of</strong><br />
this <strong>Agreement</strong>, or any other agreement being entered into in connection with ths <strong>Agreement</strong>; or<br />
(2) acts or omissions <strong>of</strong><br />
the Settling OTM Defendant which arise or occur afer the date <strong>of</strong> this<br />
<strong>Agreement</strong>. Furermore, the <strong>for</strong>egoing releases are also not intended, and shall not be constred<br />
in any way, to release any claim or claims a Releasing Par may have agait any law firm, .<br />
lawyer, or other pr<strong>of</strong>essional, consultant, or advisor.<br />
The Pares fully intend that the <strong>for</strong>egoing releases are valid, effective, binding, and en<strong>for</strong>ceable<br />
in accordance with their terms and the other terms <strong>of</strong> this <strong>Agreement</strong>, notwithstanding the<br />
possibility that the paries may hereafer discover facts (regardless <strong>of</strong><br />
the reason why such facts<br />
were not known to them, but not including facts not known due to a knowig misrepresentation<br />
or omission misrepresented or omitted by the Settling GTM Defendants in writing in connection<br />
with this Agrement) that, if such facts had been known by them as <strong>of</strong> the time <strong>of</strong> execution <strong>of</strong><br />
ths <strong>Agreement</strong>, may have materialIy afected their decision'to enter into this <strong>Agreement</strong>.<br />
Accordingly, the paries hereby intentionally and voluntaly waive the benefits <strong>of</strong> any state or<br />
federal. statute, law, order, or rule that would provide to the contrar.<br />
Page 7 OF 20- SETfLEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001 \00 18 mef final settement agrement 5-25-12 DOJ DM3403482-052/ J 2<br />
DWT 19476558vS 0089647-000002<br />
!<br />
Exhibit i<br />
Page 70f37
PRnLEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
The pares hereto. agee that if any action or claim released or discharged herein is ever asserted<br />
by any par herein agaist any other par or paries herein released or discharged by the tenns<br />
<strong>of</strong> this <strong>Agreement</strong>, then the releases contained in this <strong>Agreement</strong> may be asserted, or pleaded as a<br />
defense to any such action or claim. Except as to claims by or against the State, in the event a<br />
claim is asserted agains a part hereto and said par prevails in such action based upon this<br />
paragraph, such prevailing par shall be entitled to an award <strong>of</strong> its reasonable attorneys' fees and<br />
costs, on trial, at arbitration, and/or on appeaL.<br />
7. Release <strong>of</strong> Claims by the Settlng GTMDefendants. In exchange <strong>for</strong>, and in consideration <strong>of</strong>,<br />
the covenants, tenns and conditions described in this <strong>Agreement</strong>, the Settling OTM'Defendants<br />
(individually and collectively, "Section 7 Releasing Paries"), <strong>for</strong> themselves and their respective<br />
past, present, and future heirs, beneficiares, executors, admiiùstrators, agents, transferees and<br />
assigns, and any person claiming by, through or under the <strong>for</strong>egoing, hereby fuly,<br />
unconditionally and irrevocably release, acquit, and <strong>for</strong>ever discharge the State and the Private<br />
Plaintiffs (as defied herein) and their respective past, present and future predecessors,<br />
successors, subsidiaries, partners, directors, <strong>of</strong>fcers, managers, owners, shareholders; members,<br />
employees, agents, tranferees and assigns and such individuals' heirs, donees, survvors,<br />
legatees, beneficiaries, executors, personal representatives and administrators, (individually and<br />
collectively, "Section 7 Released Persons") from any and all clais, counterclais, causes <strong>of</strong><br />
action, suits, tort, rights, liabilties, ta liabilties, obligations (including contractual), demands,<br />
debts, sums <strong>of</strong> money, accountings, reckonigs, bils, covenants, controversies, agreements,<br />
promises, varances, trespasses, executions, loss, damages <strong>of</strong> any kind (including but not limited<br />
to incidental, consequential and punitive damages), judgments, attorneys' fees, costs, charges,<br />
expenses, and amounts whatsoever, <strong>of</strong> whatever kind or nature, in law, equity or otherwse,<br />
otherwise, whether or not based<br />
whether known or unown, vested or contingent, suspected or<br />
on misrepresentation, mistae, or omission, that the Section 7 Releasing Paries (or any <strong>of</strong> them)<br />
now have, have ever had or may in the future have agaist any Section 7 Released Persons arising<br />
out <strong>of</strong> or relating to, directly or indirectly, with respect to any matter, fact or circumstance, <strong>of</strong> any<br />
kind or natue whatsoever, existing, arising, or occurring, on or be<strong>for</strong>e the date <strong>of</strong><br />
this <strong>Agreement</strong><br />
(individually, a "Section 7 Released Claim" and collectively, the "Section 7 Released Claims").<br />
the defendats in ths Litigation.<br />
The term "Section 7 Released Persons" does not include any <strong>of</strong><br />
These releases extend to and inure to the benefit <strong>of</strong><br />
the Section 7 Released Persons, their afilates<br />
and successors and assigns. Notwithstanding the fOiegoing, these ieleases shan not extend to and<br />
the term "Section 7 Released Clairs" shal not include, any (a) claims that arse out <strong>of</strong> any<br />
indemnification claims the Settling GTM Defendants may have under the GTO Operating<br />
this <strong>Agreement</strong>; (b) claims that<br />
<strong>Agreement</strong>(s), the OTM Operating <strong>Agreement</strong>, or arsing out <strong>of</strong><br />
arise out <strong>of</strong> any breach <strong>of</strong> ths <strong>Agreement</strong>; (c) clais <strong>for</strong> unpaid salary, bonuses, or benefits owed<br />
to the Settling OTM Defendants by GTO, subject to Section 5(d) above; (d) clais against OTM<br />
<strong>for</strong> any as <strong>of</strong> yet unreimbursed2011 and/or proportional 2012 tax liabilty due or owing pursuant<br />
to the GTM Operating <strong>Agreement</strong>; (e) claims and defenses agaist any person who is a defendant<br />
in the Litigation; or (f) claims that arse out <strong>of</strong> any other acts or omissions <strong>of</strong><br />
the Section 7'<br />
Released Persons which arise or occur afer the date <strong>of</strong><br />
ths <strong>Agreement</strong>. Furhennore, the<br />
<strong>for</strong>egoing releases are also not intended, and shal not be constued in any way, to release any<br />
claim or claims a Section 7 Releasing Part may have against any law firm, lawyer, or other<br />
pr<strong>of</strong>essional, consultant, or advisor.<br />
The Settling OTM Defendants have reserved their claims against OTM. GTM is not a par to<br />
this <strong>Agreement</strong>. If GTM becomes a par to this <strong>Agreement</strong>, the Settling GTM Defendants are<br />
Page 8 OF 20- SETIEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\00 I 8 meffinal settlement agreement 5-25-12 DOJ DM3403482-052 J J 2<br />
DWT i 9476558v5 0089647-000002<br />
l<br />
!<br />
Exhibit 1<br />
Page 8 <strong>of</strong>37
PRIILEGÉD SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
prepared to enter into mutual releaes with GTM in connection with the Litigation and the facts<br />
and circumstaces underlying or relating to the Litigation.<br />
The Paries fully intend that the <strong>for</strong>egoing releases, except as modified in the immediately<br />
<strong>for</strong>egoing paragraph, are valid, effective, binding, and en<strong>for</strong>ceable in accordance with their terms<br />
and the other terms <strong>of</strong> this <strong>Agreement</strong>, notwithstanding the possibilty that the paities may<br />
hereafer discover facts (regardless <strong>of</strong> the reason why such facts were not known to them, but not<br />
including facts not known due to a knowing misrepresentation or omission'misrepresented or<br />
omitted by the Section 7 Released Persons in writing in connection with this <strong>Agreement</strong>) that, if<br />
such facts had been known by them as <strong>of</strong> the time <strong>of</strong> execution <strong>of</strong> this <strong>Agreement</strong>, may have<br />
materially afected their decision to enter into ths <strong>Agreement</strong>. Accordingly, the paries hereby<br />
intentionally and voluntarly waive the benefits <strong>of</strong> any state or federal statue, law, order, or rule<br />
that would provide to the contra.<br />
The paries hereto agree that if any action or clai released or discharged herein is ever asserted<br />
by any par herein agaist any other par or paries herein released or discharged by the temis<br />
<strong>of</strong> ths <strong>Agreement</strong>, then the releases contained in this <strong>Agreement</strong> may be asserted, or pleaded as a<br />
defense to any such action or claim. Except as to clais by or against the State, in the event a<br />
claim is asserted against a par hereto and said par prevails in such action based upon this<br />
paragrph, such prevailng par shall be entitled to an award <strong>of</strong> its reasonable attorneys' fees and<br />
costs, on trial, at arbitraton, and/or on appeaL. .<br />
8. Court <strong>Approval</strong>; Dismissal <strong>of</strong> Litigation. Upon signatue <strong>of</strong> this <strong>Agreement</strong>, the Settling Paries<br />
shall present this <strong>Agreement</strong> and all related documents to the Cour and the Banuptcy Cour,<br />
and ask both cours to approve it. If both cours do approve it, the State and Private Plaintiffs shall<br />
dismiss their claims against the Settng GTMDefendants as soon as practicable thereafer with<br />
prejudice and without costs or attorneys' fees, and the State, Private Plaintiffs and the Setting<br />
GTM Defendants shall <strong>for</strong>ego any appeals <strong>of</strong> any claims. In the event a judgment has been<br />
entered by the Court be<strong>for</strong>e the State and/or the Private Plaintiffs<br />
dismiss their respective claims<br />
as set <strong>for</strong>t in this paragraph 8, the State and the Prvate Plaintifs covenant and agree that upon<br />
approval by the Cour and the Banuptcy Cour, or upon a determintion by both courts that no<br />
approval is necessar, or upon any combination <strong>of</strong> the <strong>for</strong>egoing, they wil file with the Cour as<br />
soon as practicable a full and final satisfaction <strong>of</strong> any judgment entered against the Settling GTM<br />
Defendants, whereupon the Settling GTM Defendants shall dismiss any appeal they may have<br />
fied.<br />
When presenting ths <strong>Agreement</strong> to the Cour <strong>for</strong> approval, the Settling Paries shall work<br />
cooperatively in good faith and use their best ef<strong>for</strong>ts to urge both cours to issue ordérs that, to the<br />
fullest extent permtted under the law, recogn the State and the Private Plaitiffs, together, are<br />
the sole rightfl representatives <strong>of</strong> the interests <strong>of</strong>UI, KIT, SSSC, the Community, the<br />
Community's Charitable Interest and all other charitable interests that UI and SSSC are charged<br />
to represent and advance, with respect to any clais against the Settlin GTM Defendants. If<br />
either Court does not approve ths <strong>Agreement</strong>, and until such time as both cour do approve it,<br />
this <strong>Settlement</strong> <strong>Agreement</strong> and General Release shall not be effective, except as provided in<br />
section 11. The requirement set <strong>for</strong>th in this Section 8 is waived as to the Bankrptcy Court if the<br />
petition in banptcy <strong>of</strong> GTM has been dismissed be<strong>for</strong>e this <strong>Agreement</strong> can<br />
be presented or<br />
rued upon by the Bankuptcy Court. Consistent with the terms <strong>of</strong><br />
ths <strong>Agreement</strong>, and this<br />
Section 8, the partes agree that the later <strong>of</strong> either the Court or the Banptcy Cour's approval <strong>of</strong><br />
this <strong>Agreement</strong> or its determination that no approval is necessar wil be deemed the "Effective<br />
Date," as that term is used in ths <strong>Agreement</strong>.<br />
Page 9 OF 20- SETTEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001 \00 18 meffinal settlement agreement 5-25-12 DOJ DM3403482-0521 12<br />
DWT i 9476558v5 0089647.000002<br />
Exhibit 1<br />
Page 9 <strong>of</strong>37
PRILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
Furter, the pares agree to work cooperatively in good faith and use their best ef<strong>for</strong>t to urge the<br />
Cour and the Banptcy Court to issue orders approving this <strong>Agreement</strong> that include a claims<br />
bar provision barng any claims by a non-part to this <strong>Agreement</strong> against any Settling GIM<br />
Defendant in any way connected to the Litigation, the restmcturing and management <strong>of</strong> GTO,<br />
and/or GTM's management <strong>of</strong>GTO's assets ("Claims Bar).<br />
Ths Section 8 may be modified in full or in par upon written agreement <strong>of</strong> all Settling Paries.<br />
9. Indemnifcation.<br />
(a) Except as expressly set out herein, this <strong>Agreement</strong> does not impact GTO's and GTM's<br />
legal obligation to defend, indemnify and hold harmless the Settling GTM Defendants to<br />
the fullest extent permitted under applicable law and the provisions <strong>of</strong> any applicable<br />
GTO Operatig <strong>Agreement</strong>(s) (including any indemnification obligations asumed by<br />
GTO in connection with the 2007 reorganation <strong>of</strong> GTI and/or the GTM Operating<br />
<strong>Agreement</strong>.<br />
obligation provided under subsection (a) <strong>of</strong> this Section 9,<br />
the Special Fiduciar, from assets under his management and control, shall indemnify the<br />
Setting GTM Defendants in an amount up to $250,000.00, ("the Indemnity") as provided<br />
in this subsection (b).<br />
(b) In addition to the indemnity<br />
i. The Indemnty shall be available only <strong>for</strong> payment <strong>of</strong> attorney fees and costs and<br />
not <strong>for</strong> indemnity fodiabilty; .<br />
2. The Indemnty shall be available only <strong>for</strong> attorney fees and costs incured afer<br />
the Effective Date <strong>of</strong> this <strong>Agreement</strong>; .<br />
3. The Indemnty shall be paid on a pro rata 50%/50% basis, with payments made<br />
<strong>for</strong> attomey fees and costs by persons or entities other than the Special Fiduciar.<br />
For puroses <strong>of</strong> ilustration, ths mean that if any <strong>of</strong> the Settling GTM<br />
Defendants were to receive a $40,000 attorneys' fee invoice in a matter covered<br />
by the indemnty in this subparagraph (b) then the Special Fiduciar would pay<br />
$20,000, or 50%, to the attorney/finn issuing t1ie invoice al'd the Settlhig GTM<br />
Defendant on whose behalfthe fees were incurred would pay the remaing<br />
$20,000. In the event the fees and costs to be indemnified against are incurred on<br />
behalf <strong>of</strong> multiple Settling GTM Defendants, the outcome would remai the<br />
same: the Special Fiduciar would pay half <strong>of</strong> any invoice (50%) covered by this<br />
subparagrph directly to the biling attorney/firm and the Settling GTM<br />
Defendants incurring the fees would pay the remaining half (50%);<br />
4. The Indemnty shall only be paid on account <strong>of</strong> attorney fees and costs incured<br />
in connection with the lawsuit Bibiji Inderjit Kaur Pui, et. ai. v. Sopurk Kaur<br />
Khalsa,et. aL. (U.S. District Cour <strong>of</strong> Oregon Case No. 3:10-cv-OI532 MO) and<br />
such other legal actions as a Settling GTM Defendant may become aware <strong>of</strong> <strong>for</strong><br />
the fist time after the date <strong>of</strong> this <strong>Agreement</strong> and that is brought by a Member <strong>of</strong><br />
the Communty (including any defendant in the Litigation) <strong>for</strong> the purpose <strong>of</strong><br />
. recovering damages or asserting other remedies in any way connected to the<br />
restructuring and management <strong>of</strong>GTO, GTM's management <strong>of</strong>GTO's assets,<br />
Page 10 OF 20- SETIEMENT AGREEMENT AND GENERA RELEASE<br />
0:\9490001\00) 8 mer final settement agrement 5-25- i 2 DOJ DM3403482-052112<br />
DWT 19476558v5 0089647-000002 .<br />
Exhibit 1<br />
Page 10 <strong>of</strong>37
PRIILEGED SETTLEMENT DOCUNT<br />
OREGON EVIDENCE RULE 408<br />
the Litigation, and/or this <strong>Agreement</strong>. A Member <strong>of</strong> the Communty is a person<br />
or entity satisfying the defiition <strong>of</strong> Community or Community's Chartable<br />
Interests in paragraphs C and/or D <strong>of</strong> the Recitals, above.<br />
5. The obligation under ths Section 9(c) expires 6 years afer the Effective Date.<br />
(c) As a part <strong>of</strong>, and not in addition<br />
to the $250,000 maximum indemnity set <strong>for</strong>th in'<br />
subsection (b), above, the Special Fiduciar, from assets under his management and<br />
control, shall also indemnfy the Settling GTM Defendants <strong>for</strong> any net tax liabilties they<br />
may incur as a result <strong>of</strong> the tranfer <strong>of</strong> their interests in GTM to the Special Fiduciar or<br />
as a result <strong>of</strong>their payments pursuant to this <strong>Agreement</strong>. Conversely, the Settling GTM<br />
Defendants agree to pay over to the Special Fiduciar any and alI net tax refunds they<br />
receive ~ a result <strong>of</strong> the transfer <strong>of</strong> their interests in GYM or as a result <strong>of</strong> their payments<br />
pursuant to this <strong>Agreement</strong>. The Setting GTM Defendants agree to file amended tax<br />
retums as pennitted by law to seek such refunds. In order to accomplish this, the Setting<br />
ÒTM Defendants agree (i) to provide, pursuant to an appropriate confidentiality<br />
ageement, access to their 2007-2011 tax retus and supportng financial materal to a<br />
tax expert designated by the Special. Fiduciar, who shall prepare the amended retur fo~<br />
the Settling GTM Defendants, (ii) to fie, as permitted by law, said 2007-2011 amended<br />
state and federal retu prepared by the ta expert designated by the Special Fiduciar,<br />
and (iii) to pay to the Special Fiduciar all money received as a result <strong>of</strong> filing the<br />
amended returns. The Settling GTM Defendants shalI have the rightto review and<br />
approve the amended return, which approval shall notbe unrasonably withheld. The<br />
Setling GTM Defendants covenant not to tae any action that would cause the taxfug<br />
authorities to not issue a refud that would otherwise be paid as a result <strong>of</strong> the fiing <strong>of</strong><br />
the amended tax returns.<br />
(d) The Settling GTM Defendants' agree to obtain their spouses' agreement to the tenus <strong>of</strong><br />
section 5( c) and in paricular their agreement to me amended tax returns and pay alI<br />
money received to the Special Fiduciar as set <strong>for</strong>th in sections 5(c) (i) and (ii). The<br />
agreement <strong>of</strong>the spouses <strong>of</strong>the Settling GTM Defendants shall be set <strong>for</strong>t in a separate<br />
written agreement in the <strong>for</strong>m attached hereto as Exhbit B, to be signed by the settling<br />
GTM Defendants spouses' contemporaneously with this <strong>Agreement</strong>.<br />
(e) Without limiting any other tenus in tms <strong>Agreement</strong>, the Settling GTM Defendants shall<br />
be entitled to retai one half <strong>of</strong> any tax refund(s) paid as a result <strong>of</strong>the amended ta<br />
retus referenced in Section 9(c) above, up to the first $500,000 received as a result <strong>of</strong><br />
any such amended retu(s). For the avoidance '<strong>of</strong> confusion, and <strong>for</strong> ilustation<br />
puroses only, if<br />
the Settling GTM Defendants, collectively or individually, receive<br />
. $700,000 as a result <strong>of</strong> a.ended return then they shal be entitled to retan $250,000,<br />
Le., one half <strong>of</strong> the first $500,000, and such sum shalI not be paid over to the Special<br />
Fiduciar, Likewise, ifthe Settling GTM Defendants, collectively or individually,<br />
receive $400,000 as a result <strong>of</strong> amended returns then they shall be entitled to retain<br />
$200,000, and such sum shall not be paid over to the Special Fiduciar.<br />
Without limiting any other terms in tms <strong>Agreement</strong>, and as a condition precedent to the<br />
Settling GTM Defendants' obligation to pay the monetary consideration and to transfer<br />
their collective 52% interest/membership units in GTM to the Special Fiduciar, as set<br />
<strong>for</strong>th above, the Special Fiduciar must first (1) agree to the terms <strong>of</strong>tms <strong>Agreement</strong>,<br />
includiig, but not limited to the obligations set <strong>for</strong>th in this Section 9; (2) represent and<br />
warant <strong>for</strong> the benefit <strong>of</strong> the Settling GTM Defendants that the Special Fiduciar wil<br />
Page 11 OF 20- SETTLEMENT AGREEME AND GENERAL RELEASE<br />
0:\9490001\00 J 8 mef final settlement agreement 5-25-12 DOJ DM340348i-052112<br />
owr 19476558v5 0089647-000002<br />
Exhibit 1<br />
Page 11 <strong>of</strong>37
PRnEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
maintain, or cause the Chartable Trust to maintain, assets necessary to pei<strong>for</strong>m the<br />
indemnity obligations set <strong>for</strong>th in this Section 9; (3) agee, on behalf <strong>of</strong> the Chartable<br />
Trust, its successors, agents and assign, that, to the extent the Special Fiduciary is unable<br />
or no longer authorizd to pei<strong>for</strong>m the obligations set <strong>for</strong>t in subparagaphs (a) though<br />
(d) <strong>of</strong> this Section 9, the Chartable Trust shall be responsible <strong>for</strong> any obligations<br />
remaining pursuant to subparagraphs (a) though (e); and (4) agree, on behalf <strong>of</strong>the<br />
Chartable Trust, its successors, agents and assigns, that the Charitable Trust shall, to the<br />
extent <strong>of</strong> its interest in GTO and to the extent economically feasible, require GTO to<br />
maintain Director's and Offcer'.s Liability Insurance <strong>for</strong> a period <strong>of</strong> 10 years from the<br />
Effective Date <strong>of</strong>this <strong>Agreement</strong>, and not tae any steps to remove any Settling GTM<br />
. Defendant as an insured under such policy or policies or act to specially reduce or<br />
eliminate coverage <strong>for</strong> future claims against any Settling GTM Defendant.<br />
(t) In addition to the indemnity provided in (a), (b), (c) and (d) <strong>of</strong>this Section 9, the Special<br />
Fiduciar, from assets under his management and control, shall indemnif the Settling<br />
GTM Defendants against tax liabilities attibutable to existing 2011 and prorated 2012<br />
GTM pass through ta liabilties allocated to the Settling GTM Defendants as <strong>of</strong> the<br />
Effective Date, defined above. To the extent the Special Fiduciar is unable or no longer<br />
authorized to peifonn the obligations set <strong>for</strong>th in this subparagaph (e), the Chartable<br />
Trust shall be responsible <strong>for</strong> any remaining obligations under ths subparagraph.<br />
(g) As a pre-condition to receiving the indemnity provided <strong>for</strong> in this Section 9, Settling<br />
GTM Defendants shall provide to the Special Fiduciar all documents and accountigs .<br />
reasonably requested by the Special Fiduciar to determine that the Special Fiduciar is<br />
obligated to provide the indemnity called <strong>for</strong> il this Section 9.<br />
10. Non-Competition and Non-Solicitation: Confdentiality. In consideration <strong>of</strong> the rehabiltative<br />
transfer <strong>of</strong> the Settling GTM qefendants' membership units in GTM, and other good and<br />
valuable consideration, the receipt and sufciency <strong>of</strong> which is hereby acknowledged, during the<br />
period ending on June 30, 2014, (the "Restction Period"), each Settling GTM Defendant<br />
covenants and agrees that he shall not, anywhere in the United States or any international market<br />
in which GTO, or its successor conducts its business as <strong>of</strong> the date <strong>of</strong> termination, directly or<br />
indirectly engage in the business <strong>of</strong> tea manufactuing or the sale <strong>of</strong> tea and/or tea products<br />
("Business"), either <strong>for</strong> himself or <strong>for</strong> any other person or entity, or own, operate, manage,<br />
cûntrol, engage in, Pâi'1:icipate in, Íi*lvest in, act as consulta'1t or advisor to, or otheivyise iendei<br />
services to any person or entity whose primar business (or a significant portion <strong>of</strong> whose<br />
business) is the Business. Notwithstading the <strong>for</strong>egoing, nothng herein shall prohibit any<br />
Settling GTM Defendant from (1) being a passive owner <strong>of</strong> not more than 5% <strong>of</strong> the outstading<br />
stock <strong>of</strong> any class <strong>of</strong> securities <strong>of</strong> a publicly traded corporation engaged in such business, so long<br />
as he has no active paricipation in the business <strong>of</strong> such corporation, or (2) per<strong>for</strong>ming any<br />
services <strong>for</strong> GTO or its affiiates. .<br />
Durig the Restction Period, the Settling GTM Defendants shall not directly or indirectly<br />
though another person or entity (i) solicit any employee, contractor, or consultat <strong>of</strong> GTO to<br />
leave his or her employment with GTO, or (ii) solicit any <strong>of</strong> GTO's curent or prospective<br />
customers or suppliers <strong>for</strong> any purpose which is competitive with the Business <strong>of</strong> GTO. . For<br />
purposes <strong>of</strong> ths section, a customer or supplier wil be deemed a "prospective" customer or<br />
supplier ifGTO can demonstrate that (a) it was or is actively pursuing a customer or supplier<br />
relationship with such person or entity prior to or during the Restricted Period, and (b) with<br />
Page 12 OF 20- SEITLEMENT AGREEMENT AND GENERA RELEASE<br />
0:\949000 I \00 1 8 mef fma! settement agreement 5-25-12 DOJ DM3403482-052 112<br />
DWT 19476558v5 0089647-000002.<br />
Exhibit 1<br />
Page 120f37
PRnLEGED SETTLEMENT DOCUMfNT<br />
OREGON EVIENCE RULE 408<br />
. regard to the period afer the date <strong>of</strong> this <strong>Agreement</strong>, the Settling GTM Defendant was or is aware<br />
<strong>of</strong> such ef<strong>for</strong>t with respect to such prospective customer or supplier.<br />
If at any time any cour <strong>of</strong> competent jurisdiction shall hold that the duration, scope, geogrphic<br />
area, or other restrictions stated herein are unreasonable under circumstances then exiting, the<br />
paries agree that the maxum duration, scope, geographic area, or other restrctions deemed<br />
reasonable under such circumstances by such court shall be substituted <strong>for</strong> the stated duration,<br />
scope, geographic area or other restrictions, but only to the extent <strong>of</strong> such cour's jurisdiction<br />
(geographic and otherwise).<br />
In addition to any obligations the Settling GTM Defendant's may have under any confidentiality,<br />
non-disclosure or other simar agreements with any <strong>of</strong><br />
the pares hereto, or otherwise under<br />
applicable law, each <strong>of</strong>tlie Settling GTM Defendants agrees at all times to hold in strctest<br />
confidence, and not to use or to disclose to any person or entity (other than employees <strong>of</strong>GTO<br />
and GTM), any confidential or proprietary inormation relating to GTO, GTM or the Business.<br />
For purposes <strong>of</strong> this <strong>Agreement</strong>, "confdential and proprietar infonnation" shall include, without<br />
limitation, inventions, processes, <strong>for</strong>mulas, technology, designs, trade secrets, know-how,<br />
research, product plans, products, services, suppliers, cUstomers and customer lists, costs and<br />
prices, marketing, financial inormation, budgets, business plan and strategies, analyses, models,<br />
<strong>for</strong>ecasts and projections, or other confdential or proprietay in<strong>for</strong>mation relating to GTO, GTM<br />
or the Business. For puroses <strong>of</strong><br />
this <strong>Agreement</strong>, the <strong>for</strong>egoing limitations shall not apply to<br />
confidential inormationthat (i) is or becomes generally known to the public, except by reason <strong>of</strong><br />
a breach <strong>of</strong> any confdentiality, fiduciar or other obligation by a Settling GTM Defendant or<br />
afi1iate there<strong>of</strong>, (ii) such Settlig GTM Defendant can establish by written evidence that such<br />
in<strong>for</strong>mation is obtained by such Settling GTM Defendant without restriction from a third par<br />
not subject to any confdentiality, fiduciar or other obligation; or (iii) such Settling GTM<br />
Defendant can establish by wrtten evidence that such in<strong>for</strong>mation is independently developed by<br />
such Settling GTM Defendant without use <strong>of</strong> or reference to any confidential or<br />
proprietar<br />
inormation.<br />
The Settling GYM Defendants acknowledge, agree and afir the obligations, if any, they have as<br />
individuals under their non-competition, non-solicitation, confdentiality and related agreements<br />
pursuant to the Asset Purchase <strong>Agreement</strong> by and among Golden Temple <strong>of</strong><br />
Oregon, LLC,<br />
Golden Temple Management, LLC, Hearside Food Solutions, LLC and Those Persons<br />
Identified as Additional Restrcted Paries on tlie Signature Pages Hereto dated as <strong>of</strong>Mâlch 6,<br />
2010 ("Hearhside <strong>Agreement</strong>") relating to the sale <strong>of</strong> GTO's cereal. business (where the<br />
Additional Restcted Parties <strong>for</strong> purposes <strong>of</strong> such non-competition, non-solicitation,<br />
confidentiality and related obligations include Karam Khalsa, Ajeet Khalsa, Guru Hari Khlsa<br />
and Gurdhan Khalsa) and fuher agree, <strong>for</strong> the benefit <strong>of</strong> il, KIlT, GTO and GTM to comply<br />
with the terms <strong>of</strong> such agreements.<br />
Each Setting GTM Defendant acknowledges ard afrms that in the event <strong>of</strong> his breach <strong>of</strong> any <strong>of</strong><br />
the provisions <strong>of</strong> this Section 10, money damages would be inadequate and GTO and its<br />
members would have no adequate remedy at law. Accordingly, each Settling GTM Defendant<br />
agrees that, in addition to an action <strong>for</strong> damages and any othei' rights and remedies available at<br />
law or in equity, GTO and its members may bring an action <strong>for</strong> specific pedonnance, injunctive<br />
and/or other equitable relief in order to en<strong>for</strong>ce or prevent any violations <strong>of</strong>the provisions <strong>of</strong> ths<br />
Section 10. Each <strong>of</strong> the Settling GTM Defendants acknowledges and agrees that the restrctions<br />
contained in this section are reasonable in all respects (including, without limitation, with respect<br />
to the subject matter, time period, and geographical ara) and are necessar to protect the value <strong>of</strong><br />
Page 13 OF 20- SETILEMENT AGREEMENT AND GENERA RELEASE<br />
0:\9490001100 I 8 .meffinal settlement agreement 5-25-12 DO) DM3403482-052//2<br />
DWT 19476558v5 0089647-000002<br />
Exhibit 1<br />
Page 13 <strong>of</strong>37
PRIVILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
the membership units transferred to the Special Fiduciar pursuant to Section 3 <strong>of</strong> this <strong>Agreement</strong><br />
and the value <strong>of</strong> the Business and constitute good and valuable consideration <strong>for</strong> the releaes,<br />
indemnities, and other rights granted to the Settling GTM Defendants under this <strong>Agreement</strong>. The<br />
covenants made under this Section 10 are <strong>for</strong> the benefit <strong>of</strong> GTO, GTM, and their members.<br />
11. Purpose <strong>of</strong> <strong>Agreement</strong>lForbearance. The paries intend that this <strong>Agreement</strong>, including but not<br />
limited to the releases and indemnitý obligations provided <strong>for</strong> hereunder, shall remain in full<br />
<strong>for</strong>ce and effect regardless <strong>of</strong> the outcome <strong>of</strong> the Litigation or any other proceeding. It is the<br />
intention <strong>of</strong>the Pares that approval <strong>of</strong> ths <strong>Agreement</strong> by the Court shall operate to modify any<br />
order <strong>of</strong> the Cour to the extent, and to that extent only, that such order is inconsistent with the<br />
terms <strong>of</strong> ths <strong>Agreement</strong>. F or avoidance <strong>of</strong> doubt, to the extent <strong>of</strong> any conflct between the terms<br />
<strong>of</strong> this <strong>Agreement</strong> and the' terms <strong>of</strong> any order issued by the Cour, the terms <strong>of</strong>this <strong>Agreement</strong><br />
shall prevail. Without limiting any other terms <strong>of</strong><br />
this <strong>Agreement</strong>, the State and Private Plaintiffs<br />
agree that notwithstanding the Remedies Order and any fuher order issued in connection with it<br />
and/or any judgment entered in the Litigation prior to the Effective Date (Section 8cCourt<br />
<strong>Approval</strong>), the State, Private Plaitiffs, and the Special Fiduciary agree to <strong>for</strong>ebear from<br />
executing on any such order issued or judgment entered against the Settling GTM Defendants<br />
pending the Cour and/or the Banptcy Court's issuance <strong>of</strong> orders regarding the approval <strong>of</strong>this<br />
<strong>Agreement</strong> or an agreement or finding that no approval is necessar. The State, Private Plaintiffs,<br />
and the Special Fiduciar furter agree that if either the Court or the Banptcy Court does not<br />
approve this <strong>Agreement</strong> then the State, Private Plaintiffs, and the Special Fiduciar wil <strong>for</strong>ebear<br />
from executing on any order issued or judgment entered agait the Settling GTM Defendants <strong>for</strong><br />
a period <strong>of</strong> 10 days afer the first cour to deny approval <strong>of</strong><br />
ths <strong>Agreement</strong>. The <strong>for</strong>bearance<br />
provisions <strong>of</strong> this Section 11 are not conditioned on court approval and are operative upon<br />
issuance <strong>of</strong>the Remedies Order.<br />
12. Covenants to Support <strong>Agreement</strong>. Without limiting any other provision <strong>of</strong>this <strong>Agreement</strong>, each<br />
par covenants and agrees that they wil (a) not suggest, encourage, assist, faciltate, or cooperate<br />
in the investigation, development, commencement, or prosecution <strong>of</strong> any claims against the<br />
Settling GlM Defendants relating to the matters being released under this <strong>Agreement</strong> by any<br />
person, except as may be required by law, and except, with respect to the State as it may deem<br />
proper pursuant to its obligations to the public; and (b) not take any action which could<br />
reasonably be expected to contradict, or undermne the purpose or terms <strong>of</strong><br />
this <strong>Agreement</strong> and<br />
the releases and indemnity granted hereunder in any material respect.<br />
13. Representations and Warranties.<br />
(a) The Settling GTM Defendants represent and warant that they own 52% <strong>of</strong> GTM, as<br />
more paricularly described on Exhibit A, and referenced in Recital<br />
1, free and clear <strong>of</strong> all<br />
liens, encumbrances, security interests, and restrictions other than as specified in the<br />
GTM Operatin <strong>Agreement</strong> and this <strong>Agreement</strong>;<br />
(b) Settling GTM Defendants represent and warant that the Current Salaries and Current<br />
Benefits constitute the stadard salaries and benefits received by the Setting GTM<br />
Defendants in the ordinar course <strong>of</strong> business during 2012 prior to execution <strong>of</strong> this<br />
<strong>Agreement</strong>;<br />
(c)<br />
Settling GTM Defendants represent and warant that the distrbutions ("Disclosed<br />
Distrbutions"), disclosed to the paries in writing prior to execution <strong>of</strong> this <strong>Agreement</strong><br />
and referenced in Recital I, are the exclusive distrbutions received by the Settling GTM<br />
Page 14 OF 20- SETTLEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\0018 mef.final settlement agreement 5-25- 12 DOl DM3403482-052112<br />
DWT 19476SS8vS 0089647.O002<br />
~ j<br />
'i<br />
'¡<br />
Exhibit l<br />
Page 14 <strong>of</strong>37<br />
¡:
PRnEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
Defendants from GTM in money or other propert in respect to their interests in GTM<br />
ths <strong>Settlement</strong> <strong>Agreement</strong>;<br />
from the date <strong>of</strong> GTM's creation until the Effective Date <strong>of</strong><br />
their GTM Capital<br />
(d) Settlig GTM Defendants represent and warrant that the balances <strong>of</strong><br />
Accounts as <strong>of</strong> May 26, 2012 as certified by the outside accountants <strong>for</strong> GTM ("Certified<br />
Capital Accounts Balances''), disclosed to the paries in writing prior to execution <strong>of</strong> this<br />
<strong>Agreement</strong> and referenced in Recita 1, are the true and accurate balances in their<br />
accounts as <strong>of</strong> the date <strong>of</strong> ths <strong>Settlement</strong> <strong>Agreement</strong>;<br />
14. Transaction is Reasonable. The Settling Parties each represent and warant that they believe the<br />
settement and terms <strong>of</strong>tls <strong>Agreement</strong> are reasonable, have been negotiated at ars'<br />
length and<br />
each par has been represented by legal counsel in the negotiation and execution <strong>of</strong>tls<br />
Agreèment.<br />
public.<br />
Moreover, subject to the receipt <strong>of</strong> approval<br />
.<br />
by<br />
.<br />
the Court and the Banptcy Cour<br />
the transaction is deemed fair to both the parties and the communities purorted to be represented<br />
by any par. Without limiting the generality or breadth <strong>of</strong> the <strong>for</strong>egoing, the State specifically<br />
affirs that the <strong>Agreement</strong> is fair to UI, KIlT, the Communty, the chartable trst, and the<br />
and warant that no person<br />
15. No Assignment. The Settling Pares, as defied herein, each represent<br />
other than the signatories hereto had or has any interest in the matters referred to in this<br />
<strong>Agreement</strong>, that the pares have the sole right and exclusive authority to execute ths <strong>Agreement</strong>,<br />
and that the paries have not sold, assigned, tranferred, conveyed, or otherwse disposed <strong>of</strong> any<br />
claim, demand or legal right that is the subject <strong>of</strong> this <strong>Agreement</strong>.<br />
16. Governing Law and Jurisdiction. This <strong>Agreement</strong> shall be governed and confonned in<br />
accordace with the laws <strong>of</strong> the State <strong>of</strong> Oregon, without regard to its confict <strong>of</strong>laws provision.<br />
In the event any par to the <strong>Agreement</strong> breaches any provision <strong>of</strong><br />
this <strong>Agreement</strong>, the paries<br />
af that any. par may institute an action to specifically en<strong>for</strong>ce any term or terms <strong>of</strong> this<br />
<strong>Agreement</strong>.<br />
i 7. No Admission <strong>of</strong> Liabilty. The pares agree that neither tls <strong>Agreement</strong> nor the fuishig <strong>of</strong>.<br />
the consideration <strong>for</strong> this <strong>Agreement</strong> shall be deemed or constred at anytime <strong>for</strong> any purose as<br />
an admission by the Settling GTM Defendants <strong>of</strong> any liabilty or unlawfl conduct <strong>of</strong> any kind.<br />
18. Headings. The heôdings ûfthe provisions herein are intended <strong>for</strong> convepJentreference opJy, a.rid<br />
the same shall not be, nor be deemed to be, interpretative <strong>of</strong> the contents <strong>of</strong> such provision. As<br />
used in this <strong>Agreement</strong>, the term "person" includes any individual, sole proprietorship,<br />
parnership, joint venture, trst corporation, limited liabilty company, association, entity,<br />
community and charitable or religious organiztion <strong>of</strong> any kid.<br />
19. Modification <strong>of</strong> <strong>Agreement</strong>. This Agrement may not be amended, revoked; changed, or<br />
the Settling Pares. The Settling<br />
modified in any way, except in wrting executed by each <strong>of</strong><br />
Paries agree not to make any claim at any time or place that this <strong>Agreement</strong> has been verbally<br />
modified in any respect whatsoever. No waiver <strong>of</strong> any provision <strong>of</strong> this <strong>Agreement</strong> wil be valid,<br />
nor should any be inferred, uness it is in writing and signed by the par against whom such<br />
waiver is charged.<br />
20. Exhibits, Schedules. Each Exhbit, Schedule, and addendum attched to and referred to in this<br />
<strong>Agreement</strong> is by this reference incorporated in this <strong>Agreement</strong>.<br />
Page 150F 20- SETIEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\0018 meffinal settement agrement 5-25-12 DOJ DM3403482-0521 12<br />
DWT I 9476558v5 0089647-000002<br />
I,.:...<br />
Exhibit 1<br />
Page 15 <strong>of</strong>37<br />
:;:~;
PRIILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
21. Payment <strong>of</strong> Attorneys' Fees. All attorneys' fees incurred by the paries in connection with the<br />
negotiation, drafng, filing, and execution <strong>of</strong>this <strong>Agreement</strong> shall be promptly paid by them,<br />
whether or not the cour approves this <strong>Agreement</strong>, and whether or not Insurance Proceeds are<br />
available to make such payments.<br />
22. \ Notices. Any notice, request; or consent required or permitted to be given under thi <strong>Agreement</strong><br />
shall be in writing and shall be deemed to have been given: (i) when personally delivered to a .<br />
part; (ii) five (5) business days afer deposit in the United States Mail, postage prepaid by both<br />
first class and certifed mail, retum receipt requested; (iii) on the date guaranteed <strong>for</strong> delivery if<br />
given by Federal Express or another recognized national ovenught carier, with overnight<br />
shipping charges paid; or (iv) upon receipt, if sent by confirmed facsimile, and addressed to such<br />
par at the address set <strong>for</strong>th below (or such other address as a<br />
par may specif by a notice in<br />
writing, given in the same maner):<br />
If to the State: Daniel H. Rosenhouse or his successor, and<br />
Elizabeth Grant, Esq.<br />
Deparent <strong>of</strong> Justice<br />
1515 SW 5th Avenue, Suite 410<br />
Portland OR 97201<br />
Fax: (971) 673-2196<br />
E-Mail: Dan.rosenhouse@doj.state.or.us<br />
If to the Settling GTM Defendants: Michael E. Farell, Esq.<br />
Parsons Farell & Grein, LLP<br />
1030 SWMorrison Street<br />
Portland OR 97205<br />
Ifto the Private Plaintiffs:<br />
Fax: (503) 274-7979<br />
E-Mail: mfarnel1@pfglaw.com<br />
John McGrory<br />
Davis Wright Tremaine LLP<br />
1300 SW 5th Ave., Ste 2300<br />
Portland, OR 97204<br />
Email: iohnmcgrory@dwt.com<br />
lfto GTM: Manager<br />
121 SW Morrson<br />
Suite 925<br />
Portland OR 97204<br />
IftoGTO: Manager<br />
2545 Prairie Road<br />
Eugene, OR 97402<br />
lfto Special Fiduciar:<br />
Conrad Myers<br />
6327 SW Capitol Highway, Suite 222<br />
Portand, OR 97239<br />
Page 16 OF 20: SETTLEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\0018 meffial settlement ageement 5-25-12 DOJ DM3403482-052/12<br />
DWT i 9476558vS 0089647-000002<br />
Exhibit i<br />
Page 16 <strong>of</strong>3?<br />
.'.'
PRIEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
23. Further Assurances. Each Setting Par shaH timely and in good faith execute and deliver, at the<br />
request <strong>of</strong> another par, such fuher documents or instrments, and shaH per<strong>for</strong>m such furter<br />
acts, that may be reasonably required by another par in order to more effectively confrm or<br />
car out the intent <strong>of</strong>this <strong>Agreement</strong>.<br />
24. Time <strong>of</strong> Essence. Time is <strong>of</strong>the essence <strong>of</strong> ths <strong>Agreement</strong> in all pariculars.<br />
25, Counterparts; Facsimiles. This <strong>Agreement</strong>, and any related documents, may be executed in<br />
several counterpars, each <strong>of</strong> which shall be deemed an original but all <strong>of</strong> which taken together<br />
shall constitute one and the same instrument. The paries agee to accept facsimile signatues,<br />
provided that at the request <strong>of</strong> another par, each other par shall confirm fax transmission by<br />
signatue and delivery <strong>of</strong> a duplicate original agreement. The pares hereby waive any defense to<br />
the validity <strong>of</strong> ths <strong>Agreement</strong>, or any related document, based on any such facsimile copies <strong>of</strong><br />
signatures.<br />
26. Authority; No Conflcts. Each Setting par represents and warrants that itle/she is duly<br />
authorized and empowered to execute and deliver ths <strong>Agreement</strong> and this <strong>Agreement</strong> constitues<br />
a valid and legally binding obligation <strong>of</strong> such par, en<strong>for</strong>ceable against such pary in accordance<br />
with its terms without further act or authorization is necessar. Without limitig the <strong>for</strong>egoing,<br />
each par shall, upon request by any other par, provide such additional documentation as may<br />
be reasonably requested to evidence the reqùisite authorization to enter into and bind the par<br />
under ths <strong>Agreement</strong>. Each par furter represents and warrants that the execution, delivery and<br />
per<strong>for</strong>mance <strong>of</strong> ths <strong>Agreement</strong> does not confct with, violate or result in the breach <strong>of</strong>, any<br />
agreement, obligation, instrment, order, judgment, decree, law or governenta regulation to<br />
which such par is subject.<br />
this <strong>Agreement</strong> shall in all cases be construed as a<br />
whole, according to its fair meang, and not strictly <strong>for</strong> or against any <strong>of</strong> the paries. The paries<br />
27. Interpretation; The language <strong>of</strong> all par <strong>of</strong><br />
are sophisticated business persons and have had an equal opportnity to parcipate in, and have<br />
paricipated in, the drafing <strong>of</strong>trus <strong>Agreement</strong>. This <strong>Agreement</strong> has been negotiated by and<br />
between attorneys <strong>for</strong> the pares and shall not be construed against the "drafer" <strong>of</strong><br />
the<br />
<strong>Agreement</strong> or any parcular provision.<br />
this <strong>Agreement</strong><br />
are both reasonable anò en<strong>for</strong>ceable. However, subject to Section 10, if any porUon or provision<br />
<strong>of</strong> this <strong>Agreement</strong> is determined to be ilegal, invalid, or. unen<strong>for</strong>ceable by any court <strong>of</strong> competent<br />
28. . Severabilty. The pares explicitly acknowledge and agree that the provisions <strong>of</strong><br />
jurisdiction iid canot be modified to be legal, valid, or en<strong>for</strong>ceable, the remaider <strong>of</strong> this<br />
<strong>Agreement</strong> shall not be affected by such determination and shall be valid and en<strong>for</strong>ceable to the<br />
fullest extent permitted by law, and said ilegal, invalid, or unen<strong>for</strong>ceable portion or provision<br />
shall be deemed not to be a par <strong>of</strong><br />
ths <strong>Agreement</strong>. .<br />
29. SurvivaL. The releases, indemnity obligations, and covenants given under this <strong>Agreement</strong>,<br />
together with all consruction, en<strong>for</strong>cement, and misceHaneous provisions, shall survive<br />
consummation <strong>of</strong> the transactions contemplated hereunder.<br />
30. Binding Nature <strong>of</strong> <strong>Agreement</strong>. Without limiting any other provision <strong>of</strong> this <strong>Agreement</strong>, this<br />
the paries hereto and their respective heirs,<br />
<strong>Agreement</strong> shall bind and inure to the benefit <strong>of</strong><br />
survivors, legatees, executors, adminstrators, personal representatives, receivers, trstees,<br />
shareholders, <strong>of</strong>ficers, directors, members, agents, empioyees, representatives, piiners,<br />
Page 17 Of 20- SETTEMENT AGREEMENT AND GENERA RELEASE<br />
0:\9490001\0018 meffinaJ settement agreement 5-25- 12 DOJ DM3403482-l521 12<br />
DWT 19476558v5 0089647-000002<br />
Exhibit 1<br />
Page 17 <strong>of</strong>37
PRnEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
congregants (including the Community), attorneys, accountants, parents, subsidiaries, affates,<br />
subrogees, successors, transferees, and assigns.<br />
31. Entire <strong>Agreement</strong>. THIS AGREEMENT, AND OTHER DOCUMNTS BEING ENTERED<br />
INO IN CONNCTION HEREWITH AND THEREWITH, SETS FORTH TH SOLE AND<br />
COMPLETE AGREEMENT OF THE P ARTlES ON THE MATTERS DESCRIBED HEREIN<br />
AND SUPERSEDES AND REPLACES ALL PRIOR AND CONTEMPORANEOUS<br />
PROMISES, lJERSTANDINGS, OBLIGATIONS, AND AGREEMENTS (VERBAL OR<br />
WRTTEN), EXPRESS OR IMLIED, BETWEEN AN AMONG THE PARTmS (OR ANY<br />
OF TIM) ON SUCH MATTERS. THE PARTIES TO TH AGREEMENT<br />
ACKNOWLEDGE THT THEY HA VB NOT RELmD ONANY REPRESENTA nONS,<br />
PROMISES, OR AGREEMENTS OF ANY KIN MADE TO HIMIR/IT IN CONNCTION .<br />
WITH HISIHRlTS DECISION TO ACCEPT THIS AGREEMENT, EXCEPT FOR THOSE<br />
SET FORTH IN THIS AGREEMENT AND OTHER DOCUMNTS BEING ENTERED INTO<br />
IN CONNCTION HEREWITH AND THEREWITH.<br />
32. Recitation Under ORS 42.300. Each par to this <strong>Agreement</strong> recites as facts, pursuant to<br />
ORS 42.300 that such par: (a) has not relied upon any representation or omission by any part<br />
except those specifically enumerated in this <strong>Agreement</strong>; (b) has had full opportity to be<br />
represented by competent, independent counsel; and (c) understands that under ORS 42.300 they<br />
may not deny the recitals or other factal statements made herein. .<br />
ths<br />
<strong>Agreement</strong> as follows: (l)the State is represented by Danel H. Rosenhouse, Esq~, Senior<br />
Assistant Attorney General; (2) the Settling GTM Defendants are represented<br />
by Michael E.<br />
Farell, Esq. <strong>of</strong> Parsons Farell & Grein, LLP; (3) the Private Plaintiffs are represented by John<br />
33. Representation. The paries are represented in the negotiation, drafting, and execution <strong>of</strong><br />
McGrory and James C. Waggoner <strong>of</strong><br />
Davis Wright Tremaine.<br />
(Signatures on following pages)<br />
Page 18 OF 20- SETTEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\949000110018 mef final settlement ageement 5-25-12 DOJ DM3403482-0521 1 2<br />
DWT 1 9476558v5 0089647-000002<br />
Exhibit 1<br />
Page 18 <strong>of</strong>3?
PRnEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong><br />
set <strong>for</strong>th below.<br />
Settling GTM Defendants:<br />
Karam S. Khal311<br />
Ajeet S. Khalsa<br />
Gurdhan S. Khalsa<br />
Guru Har S. Khalsa<br />
State <strong>of</strong> Oregon:<br />
By:<br />
Attorney General<br />
Private Plaintifs:<br />
the undersigned partes or their duly authorized representatives on the date<br />
Date: i2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Page i 9 OF 20- SEITLEMENT AGREEMENT AND GENERA RELEASE<br />
0:\949000110018 mef final settlement agrement 5-25-12 DOJ DM3403482-0521 12<br />
OWT 19476558v5 0089647-000002<br />
I<br />
i ;<br />
Exhibit t<br />
Page 19 <strong>of</strong>31<br />
i
P1UVIEGED SETÍLEMENT DOCU<br />
.Olma-ON EVIENCE RUL 408'<br />
. .. .,-. ... "t.. ..~....~.._.. . ':.' . '. .. ... .<br />
...';._. ,. ..:..;...-rJt.lill~ur-... .....~r.u...l.l.._..-=..::..;~..:.:.i:i<br />
E'Keclited 'by eai.h,<strong>of</strong>th~nndersigned pares or their duly auhori,represeiítätiveson the, datê<br />
set fnrt below.<br />
Setgf ~efeDdànts:..<br />
Kål:aK.Kliiba<br />
AielitS.:Kalsa<br />
Gurdhim S. Khalsa<br />
GmufI s,KIa1~<br />
Sm'te gtOregn:<br />
-By:<br />
. AttQi1ey Genen<br />
t&ate.Plaintif:<br />
Date: , ,2012<br />
¡jt4 . . , iK,<br />
Dat: ,,:21)12 '<br />
pa,;<br />
~:Date:,. ,<br />
.P.ii<br />
,;2ó1i<br />
,,20ii<br />
,2âlî<br />
nate: " ~2012<br />
t)e:<br />
'Datê:<br />
Thtii:<br />
,2n12<br />
2(H2<br />
:,..... .<br />
,,20.12<br />
''Otø: ,iuiz,<br />
Páge 19 OF 20- SE'IEMENTAGlMETAN GENRA RELEASE<br />
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I<br />
I<br />
1<br />
Exhibit 1<br />
Page 20 <strong>of</strong>37
.PRIGED SETTEME.<br />
OREGON EVIENCE RUL 408'<br />
Exected by each <strong>of</strong><br />
set <strong>for</strong>t below,<br />
Settling GTM Defendants:.<br />
K~¡~&~<br />
... ......'__..... . _..."'''ç"".,.....ç..-..-._. _ _.,,~n.'." . ;.._:i..f~..-l~.;_.I". .... ...... '~.~~i.~_"' ,-l.i:'.: .'~...<br />
DOCUNT<br />
the undersigned pares or their duly autorized,representatives on the date<br />
Date:<br />
i-,~tS :20".<br />
,<br />
"<br />
~<br />
~<br />
2012 IT<br />
,.' G~11~. I:<br />
Aje~Khalsa \. . .1,<br />
Date:<br />
,2012<br />
Gunidhan S. Kialsa<br />
Gk~c4y\ Gur Ha S; Khalsa<br />
Date: ? /w 'tr;<br />
t<br />
,2012<br />
Stte <strong>of</strong> Oregon:<br />
.<br />
By:<br />
Attrney Gener .<br />
Private Plaiti:<br />
Date:<br />
Date: .<br />
,2012<br />
,2012<br />
Date: ,2012<br />
Date: ,2012 !.<br />
Date: ,2012<br />
Date: ,2012<br />
Page i 9 OF 20- SETIEM AGREMET AN GENL RELEASE<br />
0:\949OOJ\OOIS meffual settemt agrI5-25-J2 . DOJ DM;40;48i~52J 12<br />
DWT 19a76SSSvS 00897-000002<br />
¡,<br />
"<br />
I.<br />
l<br />
f:<br />
r<br />
I<br />
i<br />
i.<br />
. ! ,.<br />
I i<br />
i<br />
¡<br />
:.,<br />
Exhibit Í<br />
Page 21 <strong>of</strong>37<br />
j'
PRnGED SETTEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong> the undersigned paìes or their duly authorized representatives on the date<br />
set <strong>for</strong>th below.<br />
Settling GTM Defendants:<br />
Kam S. Khalsa<br />
Gun Han S. Khalsa<br />
State <strong>of</strong> Oregon:<br />
By:<br />
Attorney Genera<br />
Private Plaintiffs:<br />
Dat:<br />
Date:<br />
ç, ¡d o." s ks<br />
Date:<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
.2012<br />
.2012<br />
,2012<br />
,2012<br />
,2012<br />
,2ûi2<br />
Page 19 OF 20- SETIEMNT AGREME AN GENERA REEASE<br />
0:\990 i \0 18 mef fina settement agrme 5-25-12 DOl DM3403482~52 lJ2<br />
owr i 9476558vS 008967-02<br />
'-<br />
Date:<br />
Date:<br />
bate:<br />
Date:<br />
Date:<br />
Date:<br />
..<br />
Exhibit<br />
Page 22 <strong>of</strong>37
. PRIEGED SETTLEMENT DOCUMENT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong> the undersigned paries or their duly authorized representatives on<br />
the date set <strong>for</strong>th below.<br />
Settling GTM Defendants:<br />
Date:<br />
Karam S. Khalsa<br />
Date: .<br />
Ajeet S. Khalsa<br />
Date:<br />
Gurudhai S. Khalsa<br />
Date:<br />
Guru Hari S. Khalsa<br />
Page 19 OF 20- SETTLEMENT AGREEMENT AN GENERA RELEASE<br />
Dwr 19476SS8v5 0089647-000002<br />
,2012<br />
,2012<br />
,2012<br />
Exhibit 1<br />
Page 23 <strong>of</strong>37
PRIEGED SErIMENT DOC:v<br />
OREGON EVIENCE RULE 408<br />
Execute by each <strong>of</strong> the undersigned paes or their duly authori representatives on<br />
tle date set <strong>for</strong>t below.<br />
Settling GYM Defendants: .<br />
Karm S. Khalsa<br />
Ajeet S. Khalsa<br />
Gunidlian S. Khalsa<br />
Gmu Hari S. Khalsa<br />
State <strong>of</strong> Oreon:<br />
By:<br />
Attorney General<br />
Date: ,2012<br />
Date:<br />
,2012.<br />
Date: ,2012<br />
Date:<br />
,2012<br />
Date: ,2012<br />
Page 19 OF 21). SETEMENT AGREMENT AND GENERA RELEASE<br />
Q:\990!IOO18 metbsetiçi 5-iS.12 DO DM3034~~5il /2<br />
owr 194765S8 007-0<br />
Exhibit 1.<br />
Page 24 <strong>of</strong>37
PRIEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong> the undersigned pares or their duly authoried representatives on the<br />
date set <strong>for</strong>t below.<br />
Settng GTM Defendants:<br />
Kaam S. Khalsa<br />
State <strong>of</strong> Oreon;<br />
By Attorney General<br />
Privat Plajntiffs;<br />
S. Gur Att Kaur Khal<br />
Avt Har Singh Khalsa<br />
Gur Raj Kaur Khlsa<br />
Gum Sangat Kaur Khsa<br />
Gurtej Singh Khala<br />
(~<br />
Page 19 OF 20- SETTEME AGREEME AN GENRA<br />
OW42OX)1YioI8 meffial seemlag5-25-12<br />
Dwr 19476558vS 009647-0<br />
Date:<br />
Date:<br />
Ajeet S. Khalsa<br />
Date:<br />
Gurdhn S. Khalsa<br />
Date:<br />
Gur Har S. Khalsa<br />
Date:<br />
Date<br />
Date:<br />
,2012<br />
,2012<br />
Date: May27,2012<br />
Date:<br />
Date:<br />
RELEASE<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
DO DM3403482-152I1<br />
Exhibit 1<br />
Page 25 <strong>of</strong>37
PRIEGED SETIEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong>the undersigned paries or their duly authorized representatives on<br />
the date set <strong>for</strong>th below.<br />
Settling GTM Defendants:<br />
Karam S. Khalsa<br />
Ajeet S. Khalsa<br />
Gurudhan S. Khalsa<br />
Gur Hari S. Khalsa<br />
State <strong>of</strong> Oregon:<br />
By:<br />
Attorney General<br />
Private Plaintiffs:<br />
S. Guru Arrit Kaur Khalsa<br />
A vt Hari Singh Khalsa<br />
Gur Rsj Kaur Khalsa<br />
!<br />
'~tW-l""!",\. t((, ".' ..--<br />
Gur 'Sàngat Kaur Khalsa<br />
Gurtej Singh Khalsa<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date<br />
Date:<br />
Date: Mai 28th, 2012<br />
Date:<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
Page 19 OF 20- SETTEMENT AGREEMENT AN GENERA RELEASE<br />
0:\490001\0018 meffial settement agment 5.25- 12 DOJ DM3403482-0521 12<br />
Dwr i 9476558v 0089647-0~2<br />
Exhibit 1<br />
Page 26 <strong>of</strong>37
pRIGED SETILEMENT DOCUNT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong> the undersigned pares or their duly authoried representatives on<br />
the date set <strong>for</strong>t below. .<br />
Settlng GTM Defendants;<br />
Karam S. Khalsa<br />
Ajeet S. Khalsa<br />
Gurudhan S. Khalsa<br />
Guru Har S. Khalsa<br />
State <strong>of</strong> Oree'0n:<br />
By:<br />
Attorney General<br />
Prvate Plaintiffs:<br />
S. Gur Amrit Kaur Khalsa<br />
A vtar Har Singh Khalsa<br />
Gur Ra Kaur Khalsa<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date:<br />
Date<br />
Date:<br />
Date:<br />
Date: Z'37!AY<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
,2012<br />
2012<br />
,2012<br />
Page 19 OF 20- SETIEMENT AGREEMET AND GENERAL RELEASE<br />
0-\942001 1001 8 mef fial settement agment 5-25-12 DOJ DM3403482-0S2112<br />
Dm 19476558v5 0089647.0000<br />
L<br />
-~:<br />
Exhibit f<br />
Page 27 <strong>of</strong>37
PRIVEGED SETTLEMENT DOCUMNT<br />
OREGON EVIENCE RULE 408<br />
Executed by each <strong>of</strong> the undersigned pares or their duly authorized representatives on the date<br />
set <strong>for</strong>t below.<br />
Settling GTM Defendants:<br />
Karam S. Khalsa .<br />
Ajeet S. Khalsa<br />
Gurdhan S. Khalsa<br />
Guru Hari S. Khalsa<br />
State <strong>of</strong> Oregon:<br />
~17~lV. JJ<br />
By: 5.,, A-§ +-, A&-<br />
Attorney General<br />
Private Plaintiffs:<br />
Date: ~ 2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: Jt'S/ ,2012<br />
Date: ,2012<br />
Date:' ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Page 19 OF 20- SETILEMENT AGREEMENT AND GENERAL RELEASE<br />
0:1949000110018 m6ffinal settlement agrement 5-25.12 DO) DMJ403482-0J21l2<br />
DWT 19476558v5 0089647.000002<br />
Exhibit 1<br />
Page 28 <strong>of</strong>37
PRIILEGED SETTLEMENT DOCUMENT<br />
OREGON EVIDENCE RULE 408<br />
EXHIBIT A<br />
Representations by Settling GTM Defendants regarding compensation and interests in GTM,<br />
which are attached hereto as Exhibit A and <strong>for</strong>m part <strong>of</strong><br />
this agreement.<br />
Page 20 OF 20- SETTLEMENT AGREEMENT AND GENERAL RELEASE<br />
0:\9490001\0018 meffinal settlement agreement 5-25-12 DOJ DM3403482-052112<br />
DWT 19476558v5 0089647-000002<br />
Exhibit 1<br />
Page 29 <strong>of</strong>37<br />
, .
"<br />
. " (<br />
RESTATED EXHIBIT 2.37<br />
, ' .<br />
PERCENTAGE UNEREST<br />
---.-:.1.<br />
, The undersigned acknowledge and agr thaI Exbii 237 to the Operating Agrment <strong>of</strong><br />
Golden<br />
Ttmple Management do.ted Seiiieinber i, 2007 is dcletei.in its cntirt ani!"repiåced with the<br />
following. aiid thaI the Units and Percentage Interets Sel <strong>for</strong>th below shall be effective as <strong>of</strong><br />
September 1,2007.. .<br />
Name Numher <strong>of</strong> Unit! Percl!ntage Interest<br />
..<br />
K.ii S. Khalsa . 480. 48%<br />
Karam S. Klalsi 220 22%<br />
Aje~t S. Khiisii )50 15.%<br />
Guru Huri s. Khalsa , SO 5%<br />
Gii~haß S.. Klalsa 100 10%<br />
Total<br />
" .<br />
.1,000 100%<br />
Acknowledged and agreed:<br />
. . Kartar S. Khalsa<br />
~b,,~io7 ..<br />
'-evfJUL<br />
.H'r,~<br />
. : ' el S. Khalsa' .<br />
r Ourudhan. S. Kha.lsa .<br />
. Qclo~cr~ 2007,<br />
....¿t<br />
Knrum ~. KhíÏsa<br />
odo~e~M;<br />
Guru Han S. Khalsa<br />
Oclober £.: 2007<br />
701 S i 8.00' 1660JZ~.1<br />
Statementslrepresentations herein. are accurate as <strong>of</strong> 5/?5/12<br />
EXHIBIT<br />
PAGE \<br />
.A . ii 4W~1o CONFIDENTIAL<br />
GT002004<br />
OF '1<br />
¡ I<br />
. ,<br />
i<br />
., '<br />
I ¡<br />
i i<br />
j;<br />
i<br />
\'<br />
I':<br />
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i<br />
I.<br />
r<br />
Exhibit 1<br />
Page 30 <strong>of</strong>37
RESTATED EXHIT i.i7<br />
. ,<br />
PERCENTAGE INEREST<br />
The. urdersigned'acknwJedge iid agree that Exhibit 2Ji to the Opting Agrmept <strong>of</strong>Ooldcn '<br />
Temple Magement dated September 1,2007 is deH:ted in ils entirety and replace with the<br />
followig, ii Ìht the Units and Percntie Interests set <strong>for</strong>t below sha be effecve 83 <strong>of</strong><br />
September i, 2007. '. .<br />
. . Name . Number <strong>of</strong> Units Percentage Interest<br />
A<br />
Ka S. Khalii 480 48% ..<br />
Ka S. KhalSa 220 22%<br />
Aj~ S. Khalsa iso 15%<br />
Gun Han S. Khalsa 50 5%<br />
Owudlan S. Khalsa 100 10%<br />
Total . 1,000 '100%<br />
'IJ .' .<br />
l,/7<br />
cIaowledge :<br />
. l<br />
, Ka S. Khal .<br />
(lcto.be r20Q7 .<br />
Ajeet.8. Khsa<br />
Oct-ober -J 2åo7<br />
'Gur~ S. Khalsa<br />
October ~ 2007<br />
7DX 18.00I/66DJ2U<br />
,<br />
Kar S. Khalsa<br />
October _.2007 ..<br />
Gur Har S. Kha'lsa<br />
Octobi¡r -J 2007<br />
Státements/representations herein are accurate as <strong>of</strong> 5/25/12<br />
EXHIB1T A<br />
PAGE b OF Lf<br />
CONFIDENTIAL<br />
GT 00200"5<br />
i<br />
,.<br />
i<br />
I<br />
i<br />
l<br />
I<br />
I<br />
i<br />
i<br />
¡<br />
I<br />
!<br />
r<br />
I<br />
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Exhibit 1<br />
Page 31 <strong>of</strong>37<br />
i:<br />
'_0
UNANIMOUS CONSENT OF TH<br />
MANAGERS<br />
OF<br />
GOLDEN TEMPLE MANAGEMENT, LLC<br />
The uidersigbèd, being the managers <strong>of</strong> Gold~n Temple Man~gem~nt, LLC, an Oregon<br />
Jimited liabiIity coinpany(/'GTM"), which Ìn .tur is the sole l'na1ager <strong>of</strong> Ooiden Temple <strong>of</strong><br />
Oregon, LLC~ an 01'eg~n limited liabilty company ("GT LLC"), hereby consent to aòd appi'ovè..<br />
the following ;resoiutiun~;<br />
WHEREAS~ Golden Temple <strong>of</strong><br />
an Option <strong>Agreement</strong> dated August 2712007, With Unto'<br />
Oregon, Inc., an Oregon coi:poration ("GTl") entered into<br />
In:iy,. LLC em';), an Ofegonlin:üed<br />
llabilty oQtnpany("Optión Agi'eelient"), PUl'suatt to which ÜI gtantød: to GTlim.d itš silcceSsórs<br />
and assign the ÍixeVQcable rígllt to a-cq\Ùre all çif the íssn~d El4 ontstandirig slWrea <strong>of</strong> cb.miOn<br />
stock <strong>of</strong> Kit l1Qli:g B.V.; a, company (jtgantzea under tJ;e la.ws <strong>of</strong> the 'Netherlands. (the<br />
"Op.tan'I).<br />
WIREAS, QT LLC is succ:eSSOr to OTl pursuat to .Arûcles <strong>of</strong> çònverslon fîlell wíth<br />
the Oregon 8ecre:tä øf'$tate on Au~ust 30, 20ò1. .<br />
WiREA~. GTLLC.exercised the,'Qption effective October 1, 2007. .<br />
~R.AS, the 'a:fìU'rs <strong>of</strong> OTM are .gövemed by thät ce:ril OJ:etatUg Agleeme!Ït '<strong>of</strong><br />
otMeffectIve a& <strong>of</strong> Augu,s.t 28, 2007 (the '¡Operating Agteem,el1t~).<br />
WHREAS; Section 2.37 <strong>of</strong><br />
the .operatig <strong>Agreement</strong> provides as follows:.<br />
"lï"di,e '¡\tm;tt".- . ..... . I!IiQ ~~¡ 'lS-'itã ..,~ "<br />
t9;,iqmr~; .,.!~.-,el: r'~.~--.. .... '.'~l1l~i~i.t.~~~lïti:tr,:\~~<br />
. . j:'lrQ,tis,~pfMetj\Qftsb-.:.ii;Qm!~pE,;¥;iJW~eti;Æ~g,ni.s:;i.t¡,l(ç),,\ánØ;<br />
~, (if ~;(;'l1'¡kë,Jl';,t'"'''' ...'d.i;itòin!.timEd':ëfe;;il~;1ll\M . . 'er .; ',;11- ..!t;' ô1"<br />
_.." ,;,I!;i,I'~,.¡i~,,_,,)(..l;r.Gine. . . 0, -y e ana,g.s,.mi,M~S e<br />
1IäQr:eûònJand shalL. be refetred to as the Kit B.V. Perce.niage Interest."<br />
WHREAS, Section 5..1 <strong>of</strong> the. Operating Agreer.en.t appoints Kartar S. Khiisa and<br />
Karn S.. Khalsii aS the initial Mapager.s <strong>of</strong> GTM.<br />
WHREAS, the MàIg'érš''Ydêšitê'Nt(il':dêteÏfrñe,thelOt.ii .¥'i ;:.EetQ,e.Ptagednterèšt¡:fcir;the<br />
:me,mbeNl''nf'''¡'lM' .,.<br />
. ......!(.:i~I'..~~'.t.J:~l! ~..!iW,,1I.L.., ..~...~~<br />
NOW THREFORE, IT IS:.<br />
RESOL VED,that theitìâI KI:B persenti¡Ûi1ntêrešil<strong>for</strong> each iùembel' shall be<br />
as set <strong>for</strong>t below, provided however, that ~Wtáf"S.XfK.biusR'\S'1ï~iU/Jñ)lìs'i'disêrëtiÖh;';'¥êiiûïiatily~<br />
smili'd~r,\~tiir:rM';'tv'ê i?êìc'êni"(5.%)';6flüs"tGt:;BV ,,;p.~t'cthï:åg~ .lrtéìesV without cornpensatioh, so<br />
State'ments/representations herein' are accu rate as <strong>of</strong> 5/25/12<br />
EXHIBIT A<br />
PAGE ~ OF t.<br />
.J<br />
~ .<br />
Exhibit 1<br />
Page 32 <strong>of</strong>37
the òther Members: ..<br />
that it can be issued by GTM to a new marketi.ng director without reducing the Kit BV<br />
Percentage Interest <strong>of</strong> -- --<br />
Karar S. Khalsa<br />
54%<br />
Karam S. Khalsa<br />
25%'<br />
Ajeet S.Khalsa<br />
17%:<br />
Gur,Ü Hari S. Khalsa<br />
3% ;<br />
Gui'udhaii S. Khalsa<br />
.1%:<br />
RESOLVED,.. that all capitalized tenus used, but not deíìned in ths Consent <strong>of</strong><br />
Managers shall have the meaning ascribed to such teim 111 the Operating AgreemEjnt. '<br />
'RSOLVED, thatths. conse¡'t ¡nay be etec1lted'in one or inore.counterpa~, any<br />
<strong>of</strong>"wh¡th may"1le delivered by faasimile tl'ansi;ttal, each <strong>of</strong>wlùch .shall be, deemed'an .origial,<br />
bllt a.U <strong>of</strong> which when taken together shall consttute one.andthe'saie instrument.<br />
Datedi Oetöhel'i 2001.<br />
Gelden Temple'<br />
By, Al<br />
, Karam S., I(alsa.. Manger<br />
Statements/representations herein are accurate as <strong>of</strong> 5/2p/12<br />
708518.0001/661856.1 A<br />
EXHIBIT .= . =<br />
'PAGE3-_0F..Ï-<br />
:.;<br />
Exhibit l'<br />
Page 33 <strong>of</strong>37
The SetGTMD.efendts' spo1ies agre-to-.thetem <strong>of</strong><br />
EXlllilITB<br />
._0__._' _...... . '__'~~' ._..' 0." _ _.'_~'-''''_~'o~ I.............~......_h._...' '._.' .~....._...-"-'.. ~...,.;~~~<br />
Secton 9 (p) and (~)<br />
óf'the SetUm,ent ,Agree:u~tittd iYhith, th EXlplt is a,uache;dMCL in pareulát,àgee to<br />
the fig <strong>of</strong>amendedla re_ as set <strong>for</strong>t therein. Tb~..sfgnates ,ôftheSettmi. 6TM<br />
Defendanis' sp.oúsêS ändör th sole PUìöse. òf s'ettg föft their agreèlent to Secon ?<br />
(ç) and '(e) <strong>of</strong> the 'S"ttemßï1t Ag¡eeineüt. The'Setut arM D.tfetdants'\sPouses dó not<br />
.agreor oonséhH6 any'Óther sectiôn.or 'pro'Vsion in íheSetteroent Agreeinnt.()tbedb~<br />
$écti6n9 (c) ~ (~)tt. ltØlté. shö,w4 b(, inerrd frOD: tbeksi~at .hereò1l. Fuer.<br />
this Exhb-it B ha no <strong>for</strong>ce or efec'hinle.sstHsp)iY'ši~Uy 'ât'èhetI iØ tle Setieinent<br />
<strong>Agreement</strong>e'Kø.atiêd'~ ihe SëttUï¡.:OTMDefeiidiüfs\.<br />
Sëtt:ìgQTM Defeiiidi' .SpnUHll Consentto. S.em.òII 9(clatMq1:Othe ~eteinent<br />
Aireement¡ . ' .<br />
~ éwWitÁò.l1attt I)att, ,..' . sA'$"pÍ,j~<br />
Date;<br />
Dlrê: .'<br />
Date:<br />
D~:<br />
..ZØ.I2.<br />
,20)..2<br />
,2o.iZ<br />
_,.'2~îž<br />
...2012.<br />
I,<br />
t<br />
¡<br />
r .<br />
!<br />
j.<br />
Exhibit i<br />
Page 34 <strong>of</strong>37
EXHITB<br />
The Settg GTM Defendants' spouses agree to the ter~ <strong>of</strong> Section 9 (c) and (e)<br />
<strong>of</strong> the Settement <strong>Agreement</strong> to which ths Exhbit is ,attched and, in parcular, agre to<br />
the fiing <strong>of</strong> amended ta retu as set <strong>for</strong>t.therein.Thesignatues <strong>of</strong> the Settlig GTM<br />
Defendats' spouses ar <strong>for</strong> the sole pUrose <strong>of</strong> settg <strong>for</strong>t their agreement to Section 9<br />
<strong>of</strong> the Settement <strong>Agreement</strong>. . The 'Settlig GTM Defendants' spouses do not<br />
(c) and (e )<br />
agree or consent to any other secton or provision li the Settement <strong>Agreement</strong> other' th<br />
. Section 9 (0) and (e) and none shmud 00 inered from' their signes hereon. Furher,<br />
ths Exhbit B has no <strong>for</strong>ce or effect uness it is physicaly attched to the Settement<br />
, <strong>Agreement</strong> executed by the Settlig GTM Defendants; .<br />
. Ageement: . . ..<br />
1Ju!~ Date: ~.3(<br />
Settg CrrMDefendåts' Spousal Consent to Sections 9(0) and (e) <strong>of</strong> the Settement<br />
" ¡-<br />
,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date: ,2012<br />
Date:<br />
,2012<br />
!<br />
Exhibit 1<br />
Page 35 <strong>of</strong>37
,;'~<br />
EXHßITB<br />
The Settìng GTMDefendats' spUses agree to the ters <strong>of</strong> Section 9 (c) an (e)<br />
<strong>of</strong> the' Settement. Agreent to which ths Exhbit is athed and, in parcular, agree to<br />
the Setlig GTM<br />
the fiing <strong>of</strong> amnded ta re as set <strong>for</strong>t therein. The signatues <strong>of</strong><br />
Defendas' spouses ar <strong>for</strong> the sole pUrse p£ settg <strong>for</strong>t their agreement to Secton 9<br />
(c) and (e) <strong>of</strong><br />
the <strong>Settlement</strong> <strong>Agreement</strong>. The Settg GlMDefendants' spouses do not<br />
other secton or provision in th ~ttement <strong>Agreement</strong> othei th<br />
agee oreonsent to any<br />
. Section 9 (c) and (e) an none should be infeid fromtheÌI signtuesllereon. Fmier,<br />
this Exh'bit B ha no <strong>for</strong>ce or effect uness it is physicaly attched to the Setteinent<br />
Agment executed by the Setg OTM Defendants.<br />
Setting GTMDafandants' Spoyal ConsenttQ SectiQii 9(-c) and (e) <strong>of</strong>ila <strong>Settlement</strong><br />
<strong>Agreement</strong>:<br />
I<br />
.'<br />
f<br />
Date:c;. ~O. 12. ,2012<br />
Date: ;2012<br />
Date: ,2012<br />
Date:<br />
Date:<br />
,2012<br />
,2012<br />
Exhibit i<br />
Page 36 <strong>of</strong>37
..'--~._.' .__...- .._---_..._-<br />
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Exhibit l<br />
Page 37 <strong>of</strong>3?'<br />
I<br />
,
1<br />
2<br />
CERTIFICATE OF SERVICE<br />
I hereby certify that I served a copy <strong>of</strong> the <strong>for</strong>egoing JOINT MOTION FOR APPROVAL<br />
3 OF SETTLEMENT AGREEMENT on:<br />
4<br />
5<br />
6<br />
7<br />
8<br />
9<br />
10<br />
Kenneth R. Davis 1I<br />
Peter D. Hawkes<br />
Darin M. Sands<br />
Lane Powell, PC<br />
601 SW Second Avenue, Suite 2100<br />
Portland, OR 97204<br />
DavisK@LanePowell.com<br />
hawkesp@lanepowell.com<br />
sandsd@lanepowell.com<br />
GarciaT@LanePowelL.com<br />
docketing-pdx@lanepowell.com<br />
Telephone: 503-778-2121<br />
Facsimile: 503-778-2200<br />
11<br />
Attorneys <strong>for</strong> Defendants Kartar Singh Khalsa<br />
12 Golden Temple Management, LLC (Case Nos.<br />
0909-13281 and 1010-14518); and Karam S.<br />
13 Khalsa; Ajeet S. Khalsa; Guru Hari S. Khalsa;<br />
Gurudhan S. Khalsa; Robert Ziehl; and Kartar<br />
14 Singh Khalsa (Case No. 1010-14518)<br />
15<br />
16<br />
17<br />
18<br />
19<br />
20<br />
21<br />
Wiliam F. Gary<br />
Susan Marmaduke<br />
C. Robert Steringer<br />
Harrang Long Gary Rudnick P.e.<br />
1001 SW Fifth Avenue, 16th Floor<br />
Portland, OR 97204-1 1 16<br />
william.f.gary@harrang.com<br />
susan.marmaduke@harrang.com<br />
bob.steringer@harrang.com<br />
veleria.sharp@harrang.com<br />
Telephone: 503-242-0000<br />
Facsimile: 503-241-1458<br />
Attorneys <strong>for</strong> Defendant KIlT Company, Inc. and<br />
22 Unto Infinity, LLC<br />
23<br />
24<br />
25<br />
26<br />
Daniel Rosenhouse<br />
Susan A. Bower<br />
Department <strong>of</strong> Justice<br />
1515 SW Fifth, Suite 410<br />
Portland, OR 97201<br />
Telephone: 971-673- 1880<br />
Facsimile: 971-673-1882<br />
Dan.Rosenhouse@doj.state.or.us<br />
susan.a. bower@doj .state.or. us<br />
toni.c.kemple@state.or.us<br />
Attorneys <strong>for</strong> Plaintiff State <strong>of</strong> Oregon (Case<br />
No. 1010-14518)<br />
Michael E. Farnell<br />
Parsons Farnell & Grein, LLP<br />
1030 SW Morrison Street<br />
Portland, OR 97205<br />
Telephone: 503-222-1812<br />
Facsimile: 503-274-7979<br />
mfarnell@pfglaw.com<br />
kkaran@pfglaw.com<br />
Page 1 - CERTIFICATE OF SERVICE<br />
DWT 19641333v3 0089647-000002 DAVIS WRIGHT TREMAIE LLP<br />
1300 S.W, Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300<br />
Attorneys <strong>for</strong> Defendants Karam Singh Khalsa,<br />
Gurdhan Singh Khalsa, Guru Hari Singh Khalsa,<br />
and Ajeet Singh Khalsa
1<br />
David H. Angeli<br />
2 Kevin M. Sali<br />
121 SW Morrison Street, Suite 400<br />
3 Portland, OR 97204<br />
Telephone: 503-954-2232<br />
4 Facsimile: 503-227-0880<br />
david@angelilaw.com<br />
5 kevin@angelilaw.com<br />
cheryl@angelilaw.com<br />
6<br />
Attorneys <strong>for</strong> Defendant <strong>Sikh</strong> <strong>Dharma</strong> International<br />
7<br />
Irving Potter<br />
8 Josselson & Potter<br />
9400 SW Beaverton-Hillsdale Highway<br />
9 Suite 13 I-A<br />
Beaverton, OR 97005<br />
10 Telephone: 503-228-1455<br />
Facsimile: 503-228-0171<br />
11 Email: Irving@jprlaw.com<br />
12 Of Attorneys <strong>for</strong> Kartar Singh Khalsa and Robert<br />
Ziehl<br />
13<br />
Robert L. O'Halloran<br />
14 McEwen Gisvold LLP<br />
1100 SW 6th Avenue, Suite 1600<br />
15 Portland, OR 97204<br />
Email: Roberto@incewengisvold.com<br />
16<br />
Attorney <strong>for</strong> Sopurkh Kaur Khalsa<br />
17<br />
18<br />
19<br />
20<br />
21<br />
22<br />
23<br />
24<br />
25<br />
26<br />
¡g by email and first-class maiL.<br />
Dated this 13th day <strong>of</strong> June, 2012.<br />
John S. Stewart<br />
Thomas A. Larkin<br />
Stewart Sokol & Gray LLC<br />
2300 SW First Avenue, Suite 200<br />
Portland, OR 97201 -5047<br />
Telephone: 503-221-0699<br />
Facsimile: 503-223-5706<br />
Email: jstewart@lawssg.com<br />
Email: tlarkin@lawssg.com<br />
Attorneys <strong>for</strong> Defendant Peraim Kaur Khalsa<br />
David P. Morrison<br />
Cosgrave Vergeer Kester LLP<br />
888 SW Fifth Avenue, Suite 500<br />
Portland, OR 97204<br />
Telephone: 503-323-9000<br />
Facsimile: 503-323-9019<br />
dmorrison@cosgravelaw.com<br />
pberg@cosgravelaw.com<br />
Attorney <strong>for</strong> Siri Singh Sahib Corporation<br />
DA VIS WRGHT TREMAINE LLP<br />
Page 2 - CERTIFICATE OF SERVICE<br />
DWT I9641333v3 0089647-000002 DAVIS WRIGHT TREMAIE LLP<br />
1300 S.W, Fifth Avenue' Suite 2300<br />
Portland, Oregon 97201 . (503) 241-2300<br />
By<br />
JohnF.N1cGro J OSB#813115<br />
johnmcgrory@dwt.com<br />
Of Attorneys <strong>for</strong> Private Plaintiffs (Case No. 0909- 13281)