NOTE MODIFICATION AND RELEASE OF SECURITY AND GUARANTOR
NOTE
MODIFICATION AND
RELEASE
OF SECURITY AND GUARANTOR
This Note
Modification Agreement and Release of Security and Guarantor
(“Agreement”) is made and entered into as of the 31st day of
December , 2009 (the “Effective Date”), by and among Isotec, Inc., a Colorado
corporation (“Borrower”), Xxxxx X. Xxxxxx, an individual (“Lender”) and World
Am, Inc., a Nevada corporation (“Guarantor”).
RECITALS
WHEREAS,
Borrower and Lender are parties to that Secured Promissory Note dated as of June
19, 2008 (the “Note”) pursuant to which Lender loaned to Borrower One Hundred
Twenty Five Thousand Dollars ($125, 000);
WHEREAS,
Borrower and Lender are parties to that Security Agreement dated as of June 19,
2008 (the “Security Agreement”) pursuant to which Borrower granted Lender a
security interest in certain assets of Borrower in consideration of Borrower’s
loan under the Note;
WHEREAS,
Borrower and Lender are parties to that certain Note Modification Agreement date
as of August 1, 2008 (“Note Modification Agreement”), pursuant to the payment
schedule under the Note was revised and pursuant to which Lender loaned to
Borrower an additional Seventy Five Thousand Dollars ($75, 000);
WHEREAS,
Lender and Guarantor are parties to that certain Guaranty of Payment Agreement
date as of August 1, 2008 (the “Guaranty”), pursuant to which Guarantor
guaranteed performance of Borrower’s obligations under the Note, as amended by
the Note Modification Agreement;
WHEREAS,
Borrower is the sole shareholder of Isotec Security, Inc., a Colorado
corporation (“Purchaser”);
WHEREAS,
concurrently with the execution and delivery of this Agreement, Purchaser has
purchased from Borrower all or substantially all of the assets of Borrower’s
Assets and Business, and has assumed certain liabilities of Borrower including
but not limited to Borrower’s liabilities under the Note, as amended by the Note
Modification Agreement, pursuant to the terms of that certain Asset Purchase
Agreement of even date entered into by and among the Borrower, the Guarantor and
the Purchaser, (the “Purchase Agreement”).
WHEREAS,
as a material inducement to both Borrower and Guarantor to execute the Purchase
Agreement and to consummate the purchase of the Business (as defined in the
Purchase Agreement), Borrower and Guarantor has required that the Lender agree,
and Lender has agreed, to release Borrower and Guarantor from their respective
obligations, commitments and liabilities under the Note, as amended, the
Security Agreement and the Guaranty;
NOW
THEREFORE, in consideration of the foregoing premises and mutual covenants
contained herein, the parties agree as follows:
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1. Release of Obligations Under
The Note; Termination of Agreements.
(a) Notwithstanding anything
to the contrary in the Note, as amended by the Note Modification Agreement, the
Security Agreement or the Guaranty, Lender hereby remises, releases and forever
discharges Borrower and Guarantor, as well as their respective shareholders,
officers, employees, agents and representatives, from all obligations arising at
any time under the Note, the Note Modification Agreement, the Security Agreement
or the Guaranty, including all manner of claims, demands, causes of action,
losses, costs (including, without limitation, reasonable court costs and
attorneys' fees), liabilities or damages of any kind or nature whatsoever
relating thereto, and agrees that the Security Agreement and Guaranty (the
“Terminated “Agreements”), and any and all provisions thereof including any
provisions which would otherwise survive termination, are hereby terminated and
of no further force or effect.
(b) In accordance with the foregoing
provision, the parties further agree that Section 2 of the Note (entitled
“Security”) is hereby deleted in its entirety.
(c) Borrower recognizes
Purchaser as Borrower’s successor-in-interest in and to the Note, as amended by
the Note Modification Agreement, and that Purchaser has assumed all obligations,
commitments and liabilities of Borrower under the Note, as amended. Following
the Effective Date of this Agreement, the term “Company” and “Borrower”, as used
in the Note and Note Modification Agreement, respectively, shall refer to the
Purchaser. Lender accepts the liability of Purchaser in lieu of the
liability of Borrower and Guarantor with respect to all obligations, commitments
and liabilities arising under or in connection with Note, as
amended.
(d) Lender shall promptly
execute and deliver to the Borrower and Guarantor such documents and
instruments, and take such other action, reasonably requested by the Borrower or
Grantor as shall be necessary to evidence of the termination of all security
interests and guarantees given by the Borrower and Guarantor under the Security
Agreement and Guaranty, respectively.
2. Notices. Any
notice, demand, consent, approval, direction, agreement or other communication
required or permitted hereunder or under any other documents in connection
herewith shall be in writing and shall be directed as follows:
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If
to Borrower:
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Isotec,
Inc.
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c/o
World Am, Inc.
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0000
Xxx Xxxxxx Xxxxxx, Xxxxx 000
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Xxxxxxx
xxxxx, XX 00000
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Attn: Xxxxxxxxx
X. Xxxxxx
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If
to Lender:
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Xxxxx
X. Xxxxxx 00000 Xxxxx Xxxxx Xxxx
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Xxxxxx
Xxxxx, XX 00000
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If
to Guarantor:
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0000
Xxx Xxxxxx Xxxxxx, Xxxxx 000
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Xxxxxxx
xxxxx, XX 00000
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Attn: Xxxxxxxxx
X. Xxxxxx
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2
All
notices, demands, requests, consents or approvals that may or are required to be
given by any party to another shall be in writing and shall be
deemed given (i) when actually received by the other party, if served
personally; (ii) one business day after deposit with a
nationally-recognized overnight courier with return receipt; or (iii) three
business days after deposit with by United States registered or certified mail,
postage prepaid, return receipt requested, in each case addressed to such other
party at the address specified above or at such other place as such other party
may from time to time designate by notice in writing to the other parties
hereto.
3. Miscellaneous.
(a) Each provision of this
Agreement shall extend, bind and inure to the benefit of the parties hereto and
their respective permitted successors and assigns.
(b) This Agreement contains
the entire agreement between the parties, and all prior negotiations and
agreements are merged in this Agreement. This Agreement may not be changed,
modified or discharged, in whole or in part, except by a written instrument
executed by the party against whom enforcement of the change, modification or
discharge is sought.
(c) This Agreement may be
executed in any number of counterparts, each of which upon execution and
delivery shall be considered an original for all purposes; provided, however,
all such counterparts shall, together, upon execution and delivery, constitute
one and the same instrument.
(d) Any rule of construction
to the effect that any ambiguities are to be resolved against the drafting party
shall not apply to the interpretation of this Agreement or any amendments or
exhibits hereto.
(e) This Agreement shall be
governed in all respects by the laws of the State or Commonwealth in which the
Premises are located.
(f) If any term or provision
of this Agreement or any application thereof shall be invalid or unenforceable,
the remainder of this Agreement and any other application of such term shall not
be affected thereby.
4. All Parties
Consent. Each of Lender, Borrower and Guarantor consent to all
of the provisions of this Agreement. Each of Lender, Borrower and
Guarantor further consent to re-execute this Agreement in the presence of a
notary public if requested by Borrower or Guarantor.
IN
WITNESS WHEREOF, the parties have made this Agreement effective as of the day
and year first above written.
[Signature Page
Follows]
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LENDER
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Xxxxx
X. Xxxxxx
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BORROWER:
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ISOTEC,
INC.
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By:
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Name: Xxxx
X. Xxxxxx
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Title:
Chief Executive Officer
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GUARANTOR:
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By:
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Name: Xxxx
X. Xxxxxx
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Title:
Chief Executive
Officer
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STATE
OF )
) ss:
COUNTY
OF )
The foregoing instrument was
acknowledged before me this __ day of _________, 200_, by Xxxxx X. Xxxxxx, an
individual residing at _____________________________________________, on my own
behalf.
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Notary
Public
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My
Commission Expires:
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STATE
OF )
) ss:
COUNTY
OF )
The foregoing instrument was
acknowledged before me this __ day of _________, 200_, by Xxxx X. Xxxxxx, Chief
Executive Officer of Isotec, Inc., a Nevada corporation, on behalf of the
corporation.
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Notary
Public
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My
Commission Expires:
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STATE
OF )
) ss:
COUNTY
OF )
The foregoing instrument was
acknowledged before me this __ day of _________, 200_, by Xxxx X. Xxxxxx, Chief
Executive Officer of World Am, Inc., a Nevada corporation, on behalf of the
corporation.
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Notary
Public
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My
Commission Expires:
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