TERMINATION AND RELEASE AGREEMENT
THIS RELEASE AGREEMENT (this "Release") is made as of April 18, 1997, by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇▇▇▇"), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇▇▇▇▇▇") and ▇▇▇▇▇▇
Manufacturing, Inc. ("▇▇▇▇▇▇").
WITNESSETH
WHEREAS, on or about December 31, 1995, ▇▇▇▇▇▇ and Sanwa Business Credit
Corporation ("Sanwa") entered into a Loan and Restructuring Agreement (the "Loan
Agreement") and certain Ancillary Agreements (as such term is defined in the
Loan Agreement) pursuant to which Sanwa and ▇▇▇▇▇▇ restructured the guarantee
obligations of ▇▇▇▇▇▇ to Sanwa which arose in connection with Sanwa's loan to
EPR, Inc.;
WHEREAS, in connection with the Loan Agreement, Sanwa, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇
and ▇▇▇▇▇▇ entered into Standstill Agreements pursuant to which Messrs.
▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ agreed (i) not to acquire, offer to acquire or agree to
acquire; (ii) exercise any option or right to acquire; or (iii) transfer, offer
to transfer or agree to transfer any ▇▇▇▇▇▇ stock or option or right to acquire
any ▇▇▇▇▇▇ stock or otherwise take any similar steps to diminish the net
operating losses of ▇▇▇▇▇▇;
WHEREAS, in connection with the Standstill Agreements, ▇▇▇▇▇▇ entered into
a Compensation Agreement (the "Compensation Agreement") with Messrs. ▇▇▇▇▇▇▇▇▇▇
and ▇▇▇▇▇▇, a true and correct copy of which is attached hereto as EXHIBIT A,
pursuant to which ▇▇▇▇▇▇ agreed to pay to each of Messrs. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇
$50,000.00 in cash on the date of the Compensation Agreement and to compensate
Messrs. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ for the loss of future financial opportunities as
a result of their entering into the Standstill Agreements;
WHEREAS, Messrs. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ have not received any payments under
the Compensation Agreement;
WHEREAS, Sanwa, ▇▇▇▇▇▇ and Messrs. ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ have agreed to
terminate the Standstill Agreements as of the same date as this Release;
WHEREAS, the Company's total obligation to compensate ▇▇. ▇▇▇▇▇▇▇▇▇▇ under
the Compensation Agreement is $116,873.75 as of the date of this Release;
WHEREAS, the Company's total obligation to compensate ▇▇. ▇▇▇▇▇▇ under the
Compensation Agreement is $110,588.00 as of the date of this Release;
NOW THEREFORE, FOR VALUE RECEIVED, in consideration of the recitals and for
other good and valuable consideration the receipt and adequacy of which is
hereby acknowledged, the parties hereby agree as follows:
SECTION 1. TERMINATION AND RELEASE FROM OBLIGATIONS.
Except as set forth in Section 2, the Compensation Agreement is hereby
terminated, and ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ hereby absolutely, unconditionally,
and irrevocably release and forever discharge ▇▇▇▇▇▇ from any and all of
its respective debts, duties, obligations and liabilities arising under the
Compensation Agreement.
SECTION 2. PAYMENTS TO ▇▇▇▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇.
▇▇▇▇▇▇ acknowledges, agrees and reaffirms that it shall be and remain
obligated to ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ in the amounts of $116,873.75 and
$110,588.00, respectively, and that this obligation shall survive the
termination of the Compensation Agreement and shall not be subject to the
release and discharge by ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇ set forth in Section 2
hereof.
SECTION 3. MISCELLANEOUS.
a. EXECUTION. This Release may be executed in any number of
counterparts, which, when taken together, will constitute one
original.
b. NO MODIFICATION WITHOUT WRITING. This Release may not be modified,
amended, revised, revoked, terminated, changed or varied in any way
whatsoever except expressly by a written instrument signed by the
party or parties sought to be bound thereby.
c. GOVERNING LAW. This Release shall be governed and controlled as to
interpretation, enforcement, validity, construction, effect and in all
other respects by the internal laws, statutes and decisions of the
State of Minnesota.
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IN WITNESS WHEREOF, the parties hereto have executed this Release as of the
day and year first above written.
▇▇▇▇▇▇ MANUFACTURING, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its: President
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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