RELEASE AGREEMENT
This Release Agreement (the "Agreement") is entered into and dated
effective as of December 28, 2005 (the "Effective Date") by and among Applied
Spectrum Technologies, Inc., a Delaware corporation (the "Company"), Xxxxxxx
Venture Corp., a Delaware corporation ("Xxxxxxx"), and Xxxx X. Xxxxxxx, an adult
resident of the State of New Jersey ("Xxxxxxx").
RECITALS
X. Xxxxxxx, Xxxxxxx and Xxxxxxx'x affiliated companies, stockholders,
officers, directors, employees, advisors or controlling persons ("Xxxxxxx
Affiliates") desire to release the Company from any and all obligations and
claims that Xxxxxxx, Xxxxxxx or Xxxxxxx Affiliates may have against the Company.
B. The execution and delivery of this Agreement is a condition to the
closing of the transactions contemplated under a certain Securities Purchase
Agreement by and between KI Equity Partners III, LLC, a Delaware limited
liability company ("Buyer") and Xxxxxxx dated December 14, 2005 ("Purchase
Agreement").
NOW, THEREFORE, in consideration of the above recitals, the following
representations, warranties, covenants and conditions, and other good and
valuable consideration, the receipt of which is acknowledged, the parties agree
as follows:
1. Release of all Claims. Xxxxxxx, for himself, and Xxxxxxx and itself and
the Xxxxxxx Affiliates, and each of respective successors and assigns of the
foregoing, hereby forever and irrevocably release and discharge the Company and
its successors and assigns, and their respective past and present officers and
directors, employees, shareholders, and all other related entities, including,
but not limited to, assigns, predecessors, successors, controlling corporations,
subsidiaries or other affiliates (jointly, the "Related Parties") from any and
all claims, demands, and causes of action of every kind and nature, including,
without limitation, those relating to any federal, state or local laws, and
common law; provided, however, that nothing contained herein shall be construed
to limit in any way the rights of either Xxxxxxx, Xxxxxxx or Xxxxxxx Affiliates,
and their successors and assigns, to enforce the terms of this Agreement.
Xxxxxxx and Xxxxxxx irrevocably agree to refrain from directly or indirectly
asserting any claim or demand or commencing (or causing to be commenced) any
suit, action, or proceeding of any kind, in any court or before any tribunal,
against the Company and its Related Parties based upon any released claim.
2. Representations and Warranties of Company. Company represents and
warrants to Xxxxxxx that: (i) on the date of this Agreement, Company has all
necessary authority to execute this Agreement; (ii) there is no claim, action,
suit or other proceeding pending, threatened or known, which, if decided
adversely, would interfere with the consummation of the transaction contemplated
hereby; (iii) no approval or consent of any governmental authority or third
party is required for Company to enter into or perform this Agreement; (iv) this
Agreement is enforceable in accordance with its terms, subject to the laws of
insolvency and general principles of equity; and (v) this Agreement has been
duly authorized and adopted by the Company.
3. Representations and Warranties of Xxxxxxx. Xxxxxxx represents to
Company that: (i) on the date of this Agreement, Xxxxxxx has all necessary
authority to execute this Agreement; (ii) there is no claim, action, suit or
other proceeding pending, threatened or known against Xxxxxxx, which, if decided
adversely, would interfere with the consummation of the transaction contemplated
hereby; (iii) no approval or consent of any governmental authority or third
party is required for Xxxxxxx to enter into or perform this Agreement; (iv) this
Agreement is enforceable against Xxxxxxx in accordance with its terms, subject
to the laws of insolvency and general principles of equity; and (v) this
Agreement has been duly authorized and adopted by Xxxxxxx.
4. Reserved.
5. Delivery and Cooperation. If either party requires any further
documentation, the other party will promptly respond to any reasonable requests
for additional documentation.
6. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be binding upon the
parties hereto and their respective successors and assigns.
(b) Survival of Covenants and Representations. All agreements,
covenants, representations and warranties made by the parties herein shall
survive the delivery of this Agreement.
(c) Severability. Should any part of this Agreement for any reason
be declared invalid or unenforceable, such decision will not affect the validity
or enforceability of any remaining portion, which remaining portion will remain
in force and effect as if this Agreement had been executed with the invalid
portion thereof eliminated, and it is hereby declared as the intention of the
parties hereto that the parties would have executed the remaining portion of
this Agreement without including therein any such part or portion that may, for
any reason, be hereafter declared invalid or unenforceable.
(d) Governing Law and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without
reference to choice of law principles.
(e) Captions. The descriptive headings of the various Sections or
parts of this Agreement are for convenience only and shall not affect the
meaning or construction of any of the provisions hereof.
(f) Entire Agreement. This Agreement constitutes the entire
agreement among the parties hereto concerning the subject matter contained
herein, and supersedes all prior agreements or understanding of the parties. No
provision of this Agreement may be waived or amended except in a writing signed
by both parties. A waiver or amendment of any term or provision of this
Agreement shall not be construed as a waiver or amendment of any other term or
provision.
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(g) Counterparts. This Agreement may be executed by facsimile
signatures and in multiple counterparts, each of which shall be deemed an
original. It shall not be necessary that each party executes each counterpart,
or that any one counterpart be executed by more than one party so long as each
party executes at least one counterpart.
(h) Arbitration. All disputes, controversies or claims ("Disputes")
arising out of or relating to this Agreement shall in the first instance be the
subject of a meeting between a representative of each party who has
decision-making authority with respect to the matter in question. Should the
meeting either not take place or not result in a resolution of the Dispute
within twenty (20) business days following notice of the Dispute to the other
party, then the Dispute shall be resolved in a binding arbitration proceeding to
be held in New York, New York in accordance with the international rules of the
American Arbitration Association. The arbitrators may award attorneys' fees and
other related arbitration expenses, as well as pre- and post-judgment interest
on any award of damages, to the prevailing party or parties, in their sole
discretion. The parties agree that a panel of three arbitrators shall be
required, all of whom shall be fluent in the English language, and that the
arbitration proceeding shall be conducted entirely in the English language. Any
award of the arbitrators shall be deemed confidential information for a minimum
period of five years.
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IN WITNESS WHEREOF, this Agreement has been executed as of the date first
written above.
XXXXXXX VENTURE CORP.
By: /s/ Xxxx X. Xxxxxxx
-------------------------------------
Xxxx X. Xxxxxx, President
/s/ Xxxx X. Xxxxxxx
----------------------------------------
Xxxx X. Xxxxxxx, Individually
APPLIED SPECTRUM TECHNOLOGIES, INC.
By: /s/ Xxxx X. Xxxxxxx
-------------------------------------
Xxxx X. Xxxxxx, President
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