1
EXHIBIT 10.80
RELEASE AGREEMENT
THIS RELEASE AGREEMENT ("Agreement") is made this 3rd day of July,
1996, between WILSHIRE TECHNOLOGIES, INC., a California corporation ("WT"), and
ADVANCED MATERIALS, INC., a California corporation ("AM").
RECITALS
A. On December 3, 1992, AM purchased certain assets from WT. A portion
of the purchase price was in the form of a $1,000,000 Secured Subordinated
Promissory Note ("Old Note").
B. The Old Note was secured by the purchased assets pursuant to a
Security Agreement dated December 3, 1992 ("Security Agreement").
C. On November 15, 1993, AM purchased additional assets from WT. A
portion of that purchase price was reflected in a $1,750,000 Amended and
Restated Secured Subordinated Promissory Note ("New Note") (the principal
amount of which was reduced to $1,700,000 by reason of a subsequent transfer by
AM to WT of rights in certain products), and in a $1,550,000 Secured
Promissory Note ("Secured Note" and collectively with the New Note, the
"Notes").
D. The New Note and the Secured Note were secured by all of Debtor's
assets, including both those purchased on December 3, 1992, and those purchased
on November 23, 1993, by means of an Amendment dated November 23, 1993 to the
Security Agreement (the "Amendment to Security Agreement").
AGREEMENT
In consideration of the foregoing and of the mutual promises contained
in this Agreement, the parties agree as follows:
1. PAYMENT OF LIABILITIES. AM has previously repaid the Secured Note and
has, contemporaneously with the date hereof, paid $1,190,000 (which amount is
calculated as 70% of $1,700,000) in full and final payment of all remaining
principal and interest on the New Note, minus an additional $240,586.26 to bring
WT's open account balance with AM to thirty day terms, for an actual cash
payment to WT of $949,413.74, the receipt and sufficiency of which sum is hereby
acknowledged by WT.
2. MUTUAL RELEASES. Each of the parties, on behalf of itself and its
successors and assigns, hereby fully releases and discharges the other party
and its officers, directors, employees, agents, successors and assigns, from
any and all claims, liabilities, damages, demands or causes of action, whether
known or unknown, which exist on the date of this Agreement, which may have
existed in the past or which may exist in the future, and arise out of the
Notes. To the full extent of the releases set forth above, the parties hereby
waive the provisions of California Civil Code Section 1542, which provides:
A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor.
2
at the time of executing the release, which if known by
him must have materially affected his settlement with the
debtor.
3. MISCELLANEOUS.
3.1 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties as to the subject matter hereof and supersedes any
and all prior or contemporaneous oral or written communications with respect to
the subject matter hereof, all of which are merged herein. This Agreement may
not be modified, amended or in any way altered except by an instrument in
writing signed by an authorized representative of each party. Each party
acknowledges that it is not entering into this Agreement on the basis of any
statement, warranty, representation or promise not expressly contained or
incorporated herein.
3.2 SEVERABILITY. If any term or provision of this Agreement
shall to any extent be invalid or unenforceable, the remainder of this
Agreement shall not be affected thereby, and each term of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.
3.3 INTERPRETATION. Each party hereto acknowledges that it has
received independent legal advice regarding this Agreement and has had the
opportunity to negotiate modifications to the language of this Agreement.
Accordingly, each such party agrees that in any dispute regarding the
interpretation or construction of this Agreement, no presumption should operate
in favor of or against any party hereto by virtue of its role in drafting or
not drafting the terms and conditions set forth herein.
3.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument. This Agreement shall be
effective only when an authorized representative of each party has executed
this Agreement.
The parties have executed this Agreement as of the date first above
written.
WILSHIRE TECHNOLOGIES, INC.
By: /s/ James W. Klingler
------------------------------
James Klingler
Vice-President and Chief
Financial Officer
ADVANCED MATERIALS, INC.
By:
------------------------------
J. Douglas Graven
Vice-President and Chief
Financial Officer
2