LEASE TERMINATION AND MUTUAL RELEASE OF CLAIMS
THIS
LEASE TERMINATION AND MUTUAL RELEASE OF CLAIMS (this “Agreement”) is entered
into this 27th day of August, 2009, by and between Merix Corporation (“MERIX”)
and XSUNX, Inc. (“XSUNX”). Reference is made to that certain Sublease
Agreement dated as of April 1, 2008 (the “Sublease”), by and between MERIX as
Sublandlord and XSUNX as Subtenant concerning certain real property and
improvements located at 00000 XX Xxxxxx Xx. in the City of Wood Village, County
of Multnomah and State of Oregon (the “Premises”).
RECITALS
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A.
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On
or around May 19, 2008, MERIX sold certain equipment more particularly
described on Exhibit A attached hereto (the “Equipment”) to XSUNX for
$111,620.00.
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B.
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Now
and at all times since such sale, the Equipment has been located on the
Premises.
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C.
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As
security for its performance under the Sublease and pursuant to Section
3.3 of the Sublease, XSUNX caused Xxxxx Fargo Bank, N.A. to issue its
Irrevocable Letter of Credit No. NZS904387 (the “Letter of Credit”) in
favor of MERIX in the amount of
$106,000.00.
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D.
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XSUNX
is in default under the Sublease for nonpayment of rent. As of
this date, such default is in the amount of
$433,568.62. Extending out its obligations until the expiration
of the Sublease, such default would total
$1,614,512.25.
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X.
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XXXXX
has retaken possession of the Premises, drawn the full amount under the
Letter of Credit and asserted its statutory landlord’s lien against the
Equipment.
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F.
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XSUNX
and MERIX desire to permit XSUNX to vacate the Premises in an orderly
fashion and to fix its obligations under the Sublease at a reduced amount
pursuant to a promissory note and the sale back to MERIX of the Equipment,
all on the terms and conditions set forth
below.
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NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, MERIX and XSUNX agree as follows.
AGREEMENT
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1.
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Lease Termination;
Vacation of Premises. XSUNX shall vacate the Premises in
accordance with the terms of the Sublease, under the supervision of MERIX,
on or before September 1st, 2009. All of the Equipment shall
remain on the Premises at all times. Upon such vacation, the
return of all keys to MERIX and MERIX’s approval of the condition of the
Premises, the Sublease shall be deemed terminated and of no further force
or effect, with such date memorialized by e-mail from MERIX to
XSUNX.
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2.
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Sale of the
Equipment. XSUNX hereby sells to MERIX, as a bulk sale
and in accordance with all of the terms of the prior sale of the Equipment
by MERIX to XSUNX, including price (but with the parties reversed as
appropriate). XSUNX covenants and agrees to promptly execute and deliver
any and all documentation necessary or desirable in order to effectuate,
consummate or memorialize such sale as and when requested by
MERIX.
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3.
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Letter of
Credit. XSUNX acknowledges and confirms its acceptance
and approval of the full drawdown of the Letter of Credit by MERIX and the
release of all such funds to MERIX as partial payment of past due
rent.
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4.
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Promissory
Note. Simultaneously with the execution and delivery of
this Agreement, XSUNX shall and has made and delivered a promissory note
to MERIX as Holder in the amount of $456,920.66 and on the terms and
conditions set forth therein, in form and substance satisfactory to
MERIX.
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5.
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Mutual
Release. Except for the obligations of the parties under
this Agreement and as of the date hereof, MERIX and XSUNX, on behalf of
each of their officers, employees, directors, shareholders, agents,
attorneys, successors and assigns (collectively, “Affiliates”), hereby
unconditionally releases, acquits and forever discharges the other and its
Affiliates from any and all claims, demands, damages, liabilities and
causes of action of any kind or nature arising out of or related to the
Sublease.
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6.
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Miscellaneous
Provisions. (a) This Agreement contains the entire understanding of
the parties and is intended to integrate all prior negotiations,
discussions, proposals or understandings, either oral or written, with
respect to its subject matter. (b) Time is of the essence of
this Agreement. (c) This Agreement shall be governed by,
interpreted under, and construed and enforced in accordance with the laws
of the State of Oregon, without giving effect to its conflict of laws
principles. (d) This Agreement shall to the benefit of and be
binding upon the parties hereto and their respective successors and
assigns. (e) Any amendment, waiver or modification of this
Agreement may be made only with the written consent of the parties
hereto. (f) Any provision of this
Agreement that is deemed invalid or unenforceable shall be ineffective to
the extent of such invalidity or unenforceability, without rendering
invalid or unenforceable the remaining provisions of this Agreement. (g) In the
event of litigation concerning this Agreement or its enforcement, the
prevailing party shall be entitled to recover all costs and expenses of
any such action, including reasonable attorneys’ fees, from the other
party, including in bankruptcy and on
appeal.
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IN
WITNESS WHEREOF, MERIX and XSUNX have executed this Agreement as of the date
first above written.
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MERIX
CORPORATION
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XSUNX,
INC.
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By:
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By:
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Name:
Xxxxx Xxxx
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Name:
Xxx Xxxxxxxxx
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Title:
EVP/CFO Merix Corporation
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Title:
CEO XsunX, Inc.
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