Cascade Designs, Inc. - Page 12




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          pertinent part, provided the following:                                     
                    5.  NEW PATENTS AND PATENTS PENDING                               
                    Since the original sales agreement was entered                    
               into, Lea has been granted an additional patent as                     
               follows                                                                
                    US Patent 4,261,776 [the 776 patent4]"Method of                   
                    making self-inflated air mattresses" issued April                 
                    14, 1981.                                                         
                    Lea has also applied for an additional patent                     
               under:                                                                 
                         SN 395,750 [the 750 patent application or the                
                         750 technology5] "Method and apparatus for                   
                         making air mattresses" filed July 6, 1982.                   
                    The additional patent and patent pending are                      
               improvements on the prior patent sold to Cascade by Lea                
               and are valuable to Cascade in the manufacturing of air                
               mattresses, pads and related products and methods.                     
                              *    *    *    *    *    *    *                         
                    7.  NEW CONSIDERATION                                             
                    In consideration for Lea waiving prior breaches of                
               the original sales agreement by Cascade, of waiving any                
               claim which Lea may have for interest on unpaid amounts                
               due,[6] and of Lea granting to Cascade his entire right,               
               title, and interest in and to the new patent and patent                

               4The 776 patent was a division of U.S. Patent Application              
          S.N. 800,288, "Method of Making Self-Inflating Air Mattress".               
               5No patent was ever granted on the 750 patent application;             
          the application was rejected by the U.S. Patent and Trademark               
          Office primarily because of its "obviousness".  Cascade used the            
          750 technology in its manufacturing process and regarded it as a            
          trade secret.                                                               
               6At the time Cascade and Lea entered into the 1982                     
          agreement, the interest on the delinquent payments totaled                  
          approximately $39,102.                                                      






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