AGREEMENT AND MUTUAL RELEASE
1. PARTIES. This Agreement is entered into on September 22, 2005 by and
between ▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇"), an individual residing in Munich, Germany, on
the one hand, and DERMISONICS, INC. ("DERMISONICS"), a Nevada corporation, on
the other hand.
2. DEFINITIONS. The following terms shall have the meanings set forth
below when used in this Agreement:
2.1 "Agreement" shall mean this Agreement and Mutual Release,
together with the exhibits attached hereto.
2.2 "Claims" shall mean any and all claims, demands, rights,
agreements, contracts, options, covenants, representations, warranties,
promises, undertakings, actions, suits, causes of action, obligations,
controversies, debts, costs, expenses (including but not limited to attorneys'
fees), accounts, damages, judgments, losses and liabilities of whatever kind or
nature, fixed or contingent, in law, equity or otherwise, whether known or
unknown, whether or not apparent or concealed that relate to the conduct of
business by DERMISONICS and ▇▇▇▇▇ in furtherance of the business and prospects
of DERMISONICS and the actions of ▇▇▇▇▇ and DERMISONICS relative to such
business activities that exist as of the Effective Date.
2.3 "Dispute" shall mean any controversy, dispute, or claim of
whatever nature arising out of, in connection with, or in relation to the
interpretation, performance or breach of this Agreement, including, but not
limited to, any controversy, dispute, or claim based on contract, tort, or any
federal, state, or local statute, law, order, ordinance, or regulation, whether
seeking equitable or legal relief of any kind or nature.
2.4 "Effective Date," for accounting and all other purposes, shall
mean September 22, 2005.
2.5 "Note" shall mean that certain Promissory Note dated June 30,
2004 executed by DERMISONICS in favor of ▇▇▇▇▇ in the principal amount of
$500,000.
2.6 "Release" shall mean the mutual general releases to be entered
into by and between ▇▇▇▇▇, on the one hand, and DERMISONICS, on the other hand.
3. RECITALS. This Agreement is entered into with reference to the
following facts, the truthfulness and accuracy of which the parties hereby
acknowledge:
3.1 DERMISONICS is in default of the Note.
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3.2 DERMISONICS owes ▇▇▇▇▇ $60,000 in accordance with the terms of
the Consulting Agreement between the parties dated December 3, 2004 (the
"Consulting Fee."
3.3 A controversy may exist between the parties concerning the
Claims; however, neither party has filed a complaint or taken any other court
action with respect to such controversy.
4. ACKNOWLEDGEMENT OF AMOUNTS DUE. ▇▇▇▇▇ hereby acknowledges that
DERMISONICS owes him, as of the date hereof, a total of $653,880.00 in
principal, accrued interest, and extension fees to fully repay the Note.
DERMISONICS acknowledges that it owes ▇▇▇▇▇ $60,000 for the Consulting Fee,
which will be repaid out of the proceeds of the next investment by VEM
Aktienbank AG within 24 hours of DERMISONICS receiving good funds from such
investment.
5. WIRE TRANSFER OF AMOUNT DUE. DERMISONICS hereby represents that it will
wire $653,880.00 upon the receipt of an executed copy of this Agreement by
▇▇▇▇▇; however, the parties acknowledge that this Agreement will be of no force
or effect if DERMISONICS does not wire $653,880.00 to the account designated by
▇▇▇▇▇ within 24 hours after the Effective Date.
6. MUTUAL GENERAL RELEASES.
6.1 RELEASE OF ▇▇▇▇▇ BY DERMISONICS. In consideration of the terms
and provisions of this Agreement, DERMISONICS, and each of their officers,
directors, employees, successors, heirs, representatives, affiliates, executors,
attorneys, administrators, accountants, and all other related individuals and
entities (the "Dermisonics Parties"), if any, shall and do hereby forever
relieve, release, and discharge ▇▇▇▇▇ and his successors, heirs,
representatives, affiliates (including but not limited to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇),
executors, attorneys, administrators, accountants, employees, from any and all
Claims; provided, however, neither this Section 6.1 nor any other term of this
Agreement shall release ▇▇▇▇▇ from any Disputes for breach of this Agreement.
This Release includes, but is not limited to, all Claims arising directly or
indirectly from ▇▇▇▇▇'▇ involvement with DERMISONICS.
6.2 RELEASE OF DERMISONICS AND CERTAIN GUARANTORS BY ▇▇▇▇▇. In
consideration of the terms and provisions of this Agreement, ▇▇▇▇▇ and his
successors, heirs, representatives, affiliates (including but not limited to
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇), executors, attorneys, administrators, accountants,
employees, does hereby forever relieve, release, and discharge each of the
Dermisonics Parties from any and all Claims other than DERMISONICS obligation to
pay the Consulting Fee as set forth in Section 4 above, which release and
discharge shall include the release and discharge of any and
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all personal guarantees of the Note made by those certain guarantors referred to
in the Note.
6.3 SECTION 1542 OF THE CALIFORNIA CIVIL CODE. The parties hereto
expressly waive any and all rights under California Civil Code Section 1542, or
any other federal, state, or local statutory rights or rules or principles of
common law or equity similar to Section 1542 similar provision. Thus, no party
may invoke the benefits of Section 1542 or any similar provision in order to
prosecute or assert in any manner any Claims released under this Agreement.
Section 1542 provides as follows:
"A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him
must have materially affected his settlement with the
debtor."
6.4 DISCOVERY OF ADDITIONAL FACTS. The parties expressly and
knowingly acknowledge that, after the execution of this Agreement, they may
discover facts different from or in addition to those that each party now knows
or believes to be true with respect to the Claims released in this Agreement.
Nonetheless, each party agrees that this Agreement shall be and remain in full
force and effect in all respects, notwithstanding such different or additional
facts. It is the intention hereby fully, finally and forever to settle and
release the Claims released herein. In furtherance of such intention, the
releases given in this Agreement shall be and remain in effect as full and
complete releases of such Claims, notwithstanding the discovery by any of the
parties of the existence of any additional or different Claims or of facts
relating to the Claims. Similarly, in entering into this Agreement, each party
assumes the risk of misrepresentations, concealment, or mistakes, and if any
party should subsequently discover that any fact such party relied upon in
entering into this Agreement was untrue, that any fact was concealed from such
party, or that such party's understanding of the facts or law was incorrect,
such party shall not be entitled to set aside the mutual releases provided for
herein or be entitled to recover any damages on that account. The mutual
releases set forth in this Agreement are intended, pursuant to the advice of
independently selected legal counsel, to be final and binding between and among
the parties thereto regardless of any allegations of misrepresentations, or
promises made without the intention of performance, or concealment of facts, or
mistake of fact or law or of any other circumstances whatsoever.
6.5 COVENANT NOT TO ▇▇▇. Except as required to enforce the terms of
this Agreement or to the extent required by law, DERMISONICS, on the one hand,
and ▇▇▇▇▇, on the other hand, each agree not to bring, or to induce or assist
any person or entity to bring, any Claim, action, or proceeding released or
dismissed under this Agreement. The parties each agree that this Agreement is a
bar to bringing, inducing or assisting, except to the extent required by law,
any such Claim, action, or proceeding,
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and that each shall indemnify and hold the other harmless, from and against any
Claims arising out of or connected with a breach of this Section 6.5 of this
Agreement.
6.6 NON-ASSIGNMENT OF CLAIMS. DERMISONICS, on the one hand, and
▇▇▇▇▇, on the other hand, represent and warrant that he or it has not assigned
or transferred any portion of the Claims released under this Agreement to any
other person or entity, and that no other person or entity has any lien or
interest in any such Claims. DERMISONICS, on the one hand, and ▇▇▇▇▇, on the
other hand, shall indemnify each other and defend and hold each other harmless,
from and against any and all Claims arising out of or connected with a breach of
this Section 6.6 of this Agreement or any Claim arising out of or connected with
any such prior assignment or transfer (or any such purported assignment or
transfer).
6.7 NON-DISPARAGEMENT COVENANT; CONFIDENTIALITY OF AGREEMENT. The
parties hereto each agree that he or it, as the case may be, will not in any
manner publish or make any written or oral statement concerning any of the other
parties to this Agreement, and their officers, directors, employees, and
stockholders that is derogatory, denigrating, or creates any negative inference
concerning another party and any personal, business, or other dealings he or it,
as the case may be, may have had with another party. The parties agree that a
breach of the terms of this Section 6.7 will constitute a material breach of the
terms of this Agreement excusing further performance by the damaged party and,
because of the difficulty in establishing the damages that may result therefrom,
will justify the imposition of liquidated damages of $50,000 per occurrence.
The parties agree that the terms of this Agreement are confidential and the
parties covenant that they will not disclose the terms of this Agreement or show
this Agreement to anyone other than their respective attorneys, accountants,
auditors, spouses, and/or governmental agencies if compelled by any such agency
to disclose the terms of this Agreement. Notwithstanding the foregoing, nothing
herein shall inhibit a party from complying with a legal order to disclose
information about another party.
7. MISCELLANEOUS TERMS.
7.1 WAIVERS. No modification, amendment or waiver of any of the
provisions contained in the Agreement, or any future representations, promise,
or condition in connection with the subject matter of the Agreement, shall be
binding upon any party to the Agreement unless made in writing and signed by
such party or by a duly authorized officer or agent of such party. No
alteration, modification or impairment will be implied by reason of any previous
waiver, extension of time, or delay or omission in exercise of rights or other
indulgence.
7.2 AMENDMENTS; SUPPLEMENTS. This Agreement may be amended or
supplemented at any time by the mutual written consent of the respective
parties.
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7.3 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements and understandings, oral and written,
between the parties hereto with respect to the subject matter hereof. No
representation, warranty, promise, inducement or statement of intention has been
made by any party which is not embodied in this Agreement, and no party shall be
bound by, or be liable for, any alleged representation, warranty, promise,
inducement or statement of intention not embodied herein or therein.
7.4 BINDING EFFECT; BENEFITS. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective permitted
successors and assigns. Notwithstanding anything contained in this Agreement to
the contrary, nothing in this Agreement, expressed or implied, is intended to
confer on any person other than the parties hereto or their respective permitted
successors and assigns, any rights, remedies, obligations or liabilities under
the Agreement.
7.5 ASSIGNABILITY. Neither this Agreement nor any of the parties'
rights hereunder shall be assignable by DERMISONICS or ▇▇▇▇▇ without the prior
written consent of the other.
7.6 NOTICES. Any notice or the delivery of any item to be delivered
by a party hereto shall be delivered personally or by commercial express mail
service (e.g. FedEx, UPS, DHL), postage prepaid, next-day delivery. Any
personal delivery made shall be deemed to have been made upon the execution of a
receipt for the item to be delivered by the party to whom delivery is made.
Delivery by commercial express mail service shall be deemed to have been made
when delivered by such service to the party to whom addressed. All such
deliveries shall be made to the following addresses, or such other addresses as
the parties may have instructed the others in accordance with the provisions of
this Section:
(a) If to ▇▇▇▇▇: ▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
(b) If to DERMISONICS: Dermisonics, Inc.
c/o ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
Any party may change his or its address for purposes of this paragraph by giving
the other party written notice of the new address in the manner set forth above.
7.7 SEVERABILITY. The validity, legality or enforceability of the
remainder of the provisions in any of this Agreement will not be affected even
if one or
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more of the provisions of this Agreement will be held to be invalid, illegal or
unenforceable in any respect.
7.8 GOVERNING LAW; JURISDICTION. This Agreement have been negotiated
and entered into in the State of California, and all questions with respect to
this Agreement and the rights and liabilities of the parties will be governed by
the laws of that state, regardless of the choice of laws provisions of
California or any other jurisdiction.
7.9 ATTORNEYS' FEES. If any proceeding or litigation is commenced
(including any proceedings in a bankruptcy court) between the parties hereto or
their Representatives concerning any provision of this Agreement, or the rights
and duties of any person or entity thereunder, solely as between the parties
hereto or their successors, the party or parties prevailing in such proceeding
will be entitled to the reasonable attorneys' fees and expenses of counsel and
court costs or arbitration incurred by reason of such litigation or proceeding.
(The remainder of this page is intentionally blank. The signature page
follows.)
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
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▇▇▇▇ ▇. ▇▇▇▇▇
DERMISONICS, INC.
By:
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
AGREED AND ACCEPTED AS TO SECTION 6:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
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