Declaration of Charles Watts in Support of Defendant Cyberlux Corporation’s Opposition to Plaintiffs’ Ex Parte Application for Order to Post a Bond

HAHN LOESER & PARKS LLP Gabe P. Wright (SBN 208647) One America Plaza 600 W. Broadway, Suite 1500 San Diego, CA 92101 Telephone: 619.810.4300 Facsimile: 619.810.4301

gwright@hahnlaw.com

THOMPSON COBURN LLP JEFFREY N. BROWN, CSB 105520 jbrown@thompsoncoburn.com 10100 Santa Monica Blvd., Suite 500 Los Angeles, California 90067 Tel: 310.282.2500 / Fax: 310.282.2501

EDWARD W. GRAY, JR. (SBN 80966) egray@thompsoncoburn.com 1909 K Street, NW Suite 600 Washington, D.C. 20006 Tel: 202.585.6967 / Fax: 202.585.6969

ALLEN CHESSON & GRIMES DOUGLAS GRIMES (pro hac vice application pending) dgrimes@allenchesson.com 505 N. Church Street Charlotte, NC 28202 Tel: 704.755.6012

Attorneys for Defendant CYBERLUX CORPORATION

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA

ATLANTIC WAVE HOLDINGS, LLC, a Virginia limited liability company; and SECURE COMMUNITY, LLC, a Virginia limited Liability company,

Plaintiffs, V.

CYBERLUX CORPORATION, a Nevada Corporation;

Defendant.

Case No. 3:24-cv-00482-RBM-VET

DECLARATION OF CHARLES WATTS IN SUPPORT OF DEFENDANT CYBERLUX CORPORATION'S OPPOSITION TO PLAINTIFFS' EX PARTE APPLICATION FOR ORDER TO POST A BOND

Dist. Judge: Ruth Bermudez Montenegro

3:24-cv-00482-RBM-VET

DECLARATION OF CHARLES WATTS

I, Charles Watts, declare:

Plaintiffs need to do is allow release of the sequestered settlement funds and they would be paid for June and July.

Executed this 18th day of July, 2024, at Greensboro, North Carolina.

On Date Charles Watts

Virgínia: In the Circuit Court of the City of Richmond, John Marshall Courts Building

ATLANTIC WAVE HOLDINGS, LLC, AND SECURE COMMUNITY, LLC, Plaintiffs, v. CYBERLUX CORPORATION, AND MARK D. SCHMIDT, Defendants.

Case No. CL22-3882

On May 31, 2024 came the parties, by counsel, to be heard on the Defendants' "Emergency Motion for Declaratory Relief," filed on May 21, 2024. Upon consideration of the filings, evidence, and arguments included in the record in the above-styled matter, the Court grants Defendants' temporary injunction only.

IT IS HEREBY ORDERED:

" The Defendants shall provide a spreadsheet of all payments made pursuant to this Order with information noting how it complies with this Order.

The Court NOTES the Defendants' objection to the Court's ruling, including the Court's ruling on jurisdiction. The Court further NOTES that it will accept, in camera, documentation of the payment of payroll and payments on the judgment owed. The Court hereby ORDERS the remainder of this matter be TAKEN UNDER ADVISEMENT pending the issuance of a written ruling.

The Clerk is DIRECTED to forward a certified copy of this Order to the parties. The Court DISPENSES with the parties' endorsements pursuant to Rule 1:13. It is so ORDERED.

ENTER: 5/31/2021

Jacqueline S. McClenney, Judge

VIRGINIA:

IN THE CIRCUIT COURT OF THE CITY OF RICHMOND

CYBERLUX CORPORATION and MARK D. SCHMIDT, individually Plaintiffs,

V. ATLANTIC WAVE HOLDINGS, LLC AND SECURE COMMUNITY, LLC

Case No.

Defendants.

Plaintiffs Cyberlux Corporation and Mark D. Schmidt, (hereinafter, collectively, "Plaintiffs"), by counsel, state as follows for its Complaint against Defendants Atlantic Wave Holdings, LLC and Secure Community, LLC (hereinafter "Defendants").

the Settlement Agreement and to credit Plaintiffs' overpayments toward payments to be scheduled to be made in the following months.

a. The parties entered into an oral contract modifying the payment schedule set forth in the written settlement agreement.

b. Both the written and oral agreements are enforceable, valid and binding contracts.

c. The parties agreed that the September 8, 2023 wired payments paid by Plaintiffs in excess of the amounts then due under the Settlement Agreement would be credited to future monthly payments due under the Settlement Agreement.

d. After the September 8, 2023 wired payments, Plaintiffs made timely payments pursuant to the terms of the Settlement Agreement which were unconditionally accepted by Defendants.

e. Defendants improperly initiated garnishments, writ of fieri facias, and notices of judgment lien processes, improperly relying on this Court's Amended Final Order and in breach of the written and oral agreements.

f. Defendants' actions breached both the written and oral settlement agreements.

g. Defendants breached their implied duty of good faith and fair dealing by acting in bad faith and against usual and prudent business practices by ignoring the terms of the written and oral contracts and breaching the implied covenant by acting dishonestly in its contractual rights and acting arbitrarily and unfairly in the performance of its obligations under the settlement agreement.

Wherefore for the reasons stated above, Plaintiffs pray that this Court enter an Order declaring (i) the parties entered into an oral contract modifying the payment schedule set forth in the written settlement agreement; (ii) both the written and oral agreements are enforceable, binding contracts; (iii) the parties agreed that the September 8, 2023 wired payments paid by Plaintiffs in excess of the amounts then due under the

Settlement Agreement would be credited to future monthly payments due under the Settlement Agreement; (iv) after the September 8, 2023 wired payments, Plaintiffs made timely payments pursuant to the terms of the Settlement Agreement which were unconditionally accepted by Defendants; (v) Defendants acts of issuing garnishments, judgment liens and writs of fieri facias were improper and breached both the written and oral settlement agreements; (vi) Defendants breached their implied duty of good faith and fair dealing by acting in bad faith and against usual and prudent business practices by ignoring the terms of the written and oral contracts and breaching the implied covenant by acting dishonestly in its contractual rights. (vii) Defendants must release all sequestered funds from Plaintiffs' bank accounts and reimburse Plaintiffs for its attorneys' fees and costs associated with the unauthorized litigation initiated against Plaintiffs including all attorneys' fees necessitated by the bringing of this Complaint, court costs, and any other and further relief as the Court deems appropriate.

Dated July 8, 2024

Respectfully Submitted,

CYBERLUX CORPORATION LLC AND MARK D. SCHMIDT

By_/s/ Jimmy F. Robinson, Jr. Jimmy F. Robinson, Jr., Esquire Virginia States Bar Number 43622 jimmy.robinson@ogletreedeakins.com Counsel for Plaintiffs OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. 901 East Byrd Street, Suite 1300 Riverfront Plaza, West Tower Richmond, VA 23219 Tel .: (804) 663-2336 Fax: (855) 843-1809

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VIRGINIA:

IN THE CIRCUIT COURT OF THE CITY OF RICHMOND

CYBERLUX CORPORATION and MARK D. SCHMIDT, individually Plaintiffs,

Case No.

v. ATLANTIC WAVE HOLDINGS, LLC AND SECURE COMMUNITY, LLC

Defendants.

Plaintiffs Cyberlux Corporation and Mark D. Schmidt, (hereinafter, collectively, "Defendants"), by counsel, state as follows for its Verified Complaint for Preliminary Injunction against Defendants Atlantic Wave Holdings, LLC and Secure Community, LLC (hereinafter "Defendants").

Plaintiffs bring this Emergency Application to seek immediate relief from Defendants' practice of violating written and oral settlement agreements and acting in bad faith against usual and prudent business practices by breaching the implied covenant of good faith and fair dealing and sequestering Plaintiffs' business operation funds, while dishonestly using this Court's judgment order to justify its unfair performance of its obligations under the settlement agreements.

Without an immediate injunction from this Court, Defendants will continue to use the pretext of this Court's judgment order to injure and harass Plaintiffs.

WHEREFORE, Plaintiffs request that this Court issue a temporary injunction awarding Plaintiffs the following relief:

Finding that Defendants Atlantic Wave Holdings, LLC and Secure Community, LLC, and their agents, servants, employees, directors, officers, attorneys and representatives, and all persons acting in concert or participating with them, are hereby enjoined and restrained during the pendency of this action from engaging in, committing, or performing, directly or indirectly, any and all of the following acts: Attempting to enforce the Amended Final Order and Judgment entered on June 28, 2023, in the Circuit Court of the City of Richmond, Case No. CL22- 3882-4 by any means, including, but not limited to, garnishment, writ of execution, writ of fieri facias, writ of possession, judgment lien or judgment debtor exam, in any manner and in any state, including, but not limited to, the State of California, where Defendants have attempted to domesticate the Amended Final Order and Judgment.

Dated July 8, 2024

Respectfully Submitted,

CYBERLUX CORPORATION LLC AND MARK D. SCHMIDT

By_/s/ Jimmy F. Robinson, Jr. Jimmy F. Robinson, Jr., Esquire Virginia States Bar Number 43622 jimmy.robinson@ogletreedeakins.com Counsel for Plaintiffs OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. 901 East Byrd Street, Suite 1300 Riverfront Plaza, West Tower Richmond, VA 23219 Tel .: (804) 663-2336 Fax: (855) 843-1809