Debt Forgiveness Settlement Agreement

DEBT FORGIVENESS SETTLEMENT AGREEMENT

This Debt Forgiveness Settlement Agreement (the Agreement) is entered into as of by and between Creditor Name: , Creditor Mailing Address: (Creditor), and Debtor Name: , Debtor Mailing Address: (Debtor).

RECITALS

WHEREAS, Debtor incurred obligations to Creditor identified as Account Number: arising from certain transactions described as: (collectively, the Debt); and

WHEREAS, the parties desire to compromise and settle all claims and obligations arising under the Debt, and to set forth the terms under which Creditor will accept payment and forgive the remaining indebtedness in full satisfaction of the Debt.

WHEREAS, the parties intend that this Agreement constitutes the complete and final settlement of the matters described herein.

NOW, THEREFORE

In consideration of the mutual covenants and promises contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. DEFINITIONS

For purposes of this Agreement, the following terms shall have the meanings set forth below:

"Settled Amount" means the aggregate amount payable by Debtor to Creditor under Section 2: $ .

"Forgiven Amount" means the portion of the Debt that Creditor agrees to forgive upon satisfaction of the Settled Amount, equal to $ .

2. SETTLEMENT PAYMENT TERMS

Debtor shall pay the Settled Amount to Creditor as follows: Payment Amount: $ ; Payment Due Date: . Payment shall be made by electronic transfer, cashier's check, or other instrument acceptable to Creditor and delivered to Creditor at the address for Notices set forth in Section 10.

If the Settled Amount is not paid in full by the Payment Due Date, Creditor's agreement to forgive the Forgiven Amount shall be void and Creditor shall retain all rights to pursue collection of the full Debt, subject to the terms of this Agreement.

3. FORGIVENESS AND RELEASE

Upon receipt of the Settled Amount in cleared funds, Creditor shall forgive the Forgiven Amount and release Debtor from any and all claims, demands, liabilities and causes of action that Creditor has or may have had against Debtor relating to the Debt through the effective date of forgiveness. This release does not cover obligations arising from false statements, fraud, intentional misrepresentation, or subsequent debts not encompassed by the Account referenced in this Agreement.

4. REPRESENTATIONS AND WARRANTIES

Each party represents and warrants to the other that: (a) it has full power and authority to enter into and perform this Agreement; (b) the person signing this Agreement on its behalf is duly authorized to do so; and (c) this Agreement is a valid and binding obligation enforceable in accordance with its terms.

5. TAX CONSEQUENCES

Debtor acknowledges and agrees that the forgiveness of indebtedness may have tax consequences, and that Creditor makes no representation as to the tax treatment of any amounts forgiven. Debtor shall be solely responsible for any tax liability that may arise as a result of the Forgiven Amount and shall indemnify and hold Creditor harmless from and against any taxes, penalties or interest assessed against Creditor attributable to such forgiveness that were caused by Debtor's failure to report income or other acts or omissions by Debtor.

6. COVENANT NOT TO SUE

In consideration of the performance by Creditor under this Agreement, Debtor covenants not to initiate any action, claim or proceeding against Creditor with respect to the Debt or any matter arising prior to the Effective Date, except where the claim arises from Creditor's gross negligence or willful misconduct.

7. CONFIDENTIALITY

Except as required by law, neither party shall disclose the existence or terms of this Agreement to third parties without the prior written consent of the other party. Notwithstanding the foregoing, either party may disclose this Agreement to its attorneys, accountants, insurers or as otherwise required to effectuate the terms hereof.

8. INDEMNIFICATION

Debtor shall indemnify, defend and hold Creditor harmless from any and all losses, claims, liabilities, costs and expenses (including reasonable attorneys' fees) arising from Debtor's breach of this Agreement, Debtor's misrepresentations, or any claims arising from taxes related to the Forgiven Amount as set forth in Section 5.

9. FURTHER ASSURANCES

Each party shall execute and deliver such further documents and take such further actions as may be reasonably necessary to carry out the purposes and intent of this Agreement.

10. NOTICES

Any notice, demand or communication required or permitted under this Agreement shall be in writing and shall be deemed given when delivered personally, sent by overnight courier, or mailed by certified mail, return receipt requested, to the addresses set forth below or to such other address as either party may specify in writing.

11. DEFAULT

If Debtor fails to pay the Settled Amount in accordance with Section 2, Creditor shall be entitled to declare this Agreement void and pursue all remedies available under applicable law or equity, including reinstatement of the full amount of the Debt less any payments actually received under this Agreement.

12. AMENDMENTS; WAIVER

This Agreement may be amended only by a written instrument executed by both parties. No waiver by any party of any breach or default shall be deemed a waiver of any subsequent breach or default.

13. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the state of , without regard to its conflict of laws principles.

14. ENTIRE AGREEMENT

This Agreement constitutes the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, negotiations and understandings, whether written or oral.

15. SEVERABILITY

If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect and the parties shall negotiate in good faith to replace the invalid provision with a valid provision that achieves, to the extent possible, the original intent.

16. COUNTERPARTS

This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one instrument. Signatures transmitted by electronic means shall be deemed original signatures for all purposes.

17. MISCELLANEOUS

The headings in this Agreement are for convenience only and shall not affect its interpretation. The parties acknowledge that they have read and understand this Agreement, and that they have had the opportunity to obtain independent legal advice prior to execution.

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