CipherLoc Corporation (OTCMKTS:CLOK) Files An 8-K Entry into a Material Definitive Agreement
On August 28, 2020 (the “Effective Date”), CipherLoc Corporation (the “Company”) entered into a Settlement Agreement and Mutual General Release (the “Settlement”) with Michael De La Garza, a director of the Company. The Settlement relates to certain pending actions, including (i) CipherLoc Corporation vs. Michael De La Garza, MSR, LLC, and James LaGanke, as Trustee of the Caramel Trust II, Civil Action No. 1:19-CV-01147-LY in the United States District Court for the Western District of Texas, Austin Division, (ii) CipherLoc Corporation vs. Michael De La Garza, Cause No. D-1-GN-19-005253 in the 53rd Judicial District Court of Travis County, Texas, and (iii) Michael De La Garza and CipherLoc, Inc. v. Tom Wilkinson, Anthony Ambrose, Manchester PR, LLC and Manchester Explorer, LP; Cause No. D-1-GN-19-004708 in the 53rd Judicial District Court of Travis County, Texas. Under the Settlement, all of the foregoing actions are to be dismissed with prejudice.
to the Settlement, Mr. De La Garza, agreed to, among other things, (i) resign as a director of the Company as of the Effective Date and confirmed that he had no disagreements with the Board of Directors, and (ii) return 13,137,757 shares of the Company’s common stock, $0.01 par value per share (the “Forfeited Stock”), held by him to the Company’s treasury. The Company agreed to pay Mr. De La Garza an aggregate sum of $400,000 (the “Settlement Amount”), payable as follows: (A) $300,000 on or before ten (10) business days after the last to occur (the “Settlement Date”) of (i) the execution of the Settlement by Mr. De La Garza, (ii) actual receipt by the Company of the Forfeited Stock and consummation of the deliveries contemplated by the Settlement, and (iii) the receipt by the Company of a completed Internal Revenue Service Form W-9 from Mr. De La Garza; and (B) $25,000 on each of the four (4) succeeding quarterly anniversaries of the Settlement Date. Notwithstanding the foregoing, in the event that Mr. De La Garza is not in compliance with the Settlement on any such payment date, then no payment shall be due and the Company shall have the right to pursue any and all remedies against De La Garza including, without limitation, seeking the return of all amounts paid.
In exchange for the consideration described above, and subject to the terms and conditions set forth in the Settlement, the Company and Mr. De La Garza mutually agreed to grant each other a general release.
The foregoing description of the Settlement is qualified in its entirety by reference to the text of such agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Reference is made to the disclosure under Item 1.01 above which is hereby incorporated in this Item 5.02 by reference.
On September 1, 2020, the Company issued a press release in connection with the Settlement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
|10.1||Settlement Agreement, dated August 28, 2020|
|99.1||Press Release, dated September 1, 2020|
CIPHERLOC Corp Exhibit
EX-10.1 2 ex10-1.htm Exhibit 10.1 SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE THIS SETTLEMENT AGREEMENT AND MUTUAL GENERAL RELEASE (this “Agreement”) is made as of August 28,…
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About CipherLoc Corporation (OTCMKTS:CLOK)
Cipherloc Corporation is a technology and services based solutions company operating in the cloud-based cyber security industry. The Company offers an encryption technology with over five international patents, called CipherLoc. CipherLoc is a commercially viable polymorphic key progression algorithmic cipher engine (PKPA). This morphing cipher can be used in commercial data security industry and/or in sensitive applications, including banks, financial transactions, credit cards, securities, stock and bonds transactions, e-mail, phones, tablets, servers and or computers. This PKPA Engine eliminates replay attacks because the cipher morphs over time. CipherLoc also rejects data access and injection, false commands, and data alteration. CipherLoc is a facet of a layered defense in depth protection plan for any organization. The CipherLoc Polymorphic Cipher Engine provides an electronic gate that restricts access to vital assets, production facilities, and distribution systems.