MUTUAL RELEASE
Exhibit 10.2
THIS
MUTUAL RELEASE (“Agreement”) is made and entered into as of
this 1st day of
December, 2006, by and between Alliance Semiconductor Corporation, a Delaware corporation
(“ALSC”), for itself and its capacity as sole limited partner of Alliance Ventures I, L.P.,
Alliance Ventures II, L.P., Alliance Ventures III, L.P., Alliance Ventures IV, L.P. and Alliance
Ventures V, L.P. (collectively the “Partnerships”) each of the Partnerships, and ALSC Venture
Management, LLC, a California limited liability company (“ALSC Venture”) on one hand, and Alliance
Venture Management, LLC, a California limited liability company (“AVM”) for itself and in its
capacity as the former sole general partner and special limited partner of each of the
Partnerships, on the other hand.
RECITALS:
A. On May 3, 2006, Alliance Semiconductor Corporation removed Alliance Venture
Management, LLC as general partner and named ALSC Venture Management as a new general partner.
Alliance Venture Management LLC now holds a limited partner interest in each partnership pursuant
to the provisions of California law and will retain its capital account as computed through May 3,
2006 but will not accrue further increases, or decreases for loss allocations, in its capital
account.
B. Pursuant to a Memorandum of Understanding dated as of May 17, 2006 (“MOU”) the parties have
agreed that the agreement of limited partnership for each of the Partnerships shall be amended to
remove from each such partnership agreement the provisions for allocating 15% of net profits from
portfolio investments to the general partner and to remove the existing provisions in paragraph 4.2
regarding payment of a management fee, and that there will be no further payments of compensation
to AVM for past or future services as general partner of the Partnerships.
C. The parties have agreed that Alliance Venture Management, LLC will sell its partnership
interests to ALSC for $400,000 (from all Partnerships in the aggregate), and for the allocation to
ALSC Venture of 2% (two percent) of the gross sales proceeds from the investments in any
partnership’s portfolio, including proceeds from a liquidity event such as an IPO or a sale of the
portfolio company (which payments may be made in kind at the applicable Partnership’s option).
D. The parties have agreed that X.X. Xxxxxxxxx will be employed or will consult with ALSC
Venture for compensation of $300,000 per year plus payment of reasonable and defined expenses.
E. AVM, ALSC, ALSC Venture and each of the Partnerships have agreed to enter into a complete
release of all claims, known and unknown, with respect to rights and claims concerning the
Partnerships, except for obligations created by the MOU as described in the preceding recitals (the
“MOU Agreements”), and provided that the indemnification provisions contained in section 5.7 of
each of the partnership agreements shall survive.
NOW THEREFORE, for good and valuable consideration (including the execution and delivery of
the releases set forth in this Agreement), the receipt and sufficiency of which is hereby
acknowledged, ALSC, the Partnerships and AVM hereby agree as follows:
1. Releases.
(a) ALSC, ALSC Venture and each of the Partnerships hereby releases and forever discharges AVM
and all of its respective successors, assigns, managers, officers, agents, employees and members,
and each of them (collectively, the “AVM Released Parties”), of and from any and all claims,
damages, demands, debts, liabilities, losses, obligations, suits, actions and causes of action, of
every kind and character whatsoever, at law or in equity, whether known or unknown, which ALSC or
any of the Partnership ever had, now has or hereafter may have against any of the AVM Released
Parties, arising out of or in any way relating to the Partnerships, all activities of the
Partnership and the acts or omissions of AVM in connection with the Partnerships since the
beginning of time through the date of this Agreement (the “Released Matters”).
(b) AVM hereby releases and forever discharges ALSC, ALSC Venture, each of the Partnerships
and their respective successors, assigns, directors, officers, agents, and employees, and each of
them (collectively, the “ALSC Released Parties”), of and from any and all claims, damages, demands,
debts, liabilities, losses, obligations, suits, actions and causes of action, of every kind and
character whatsoever, at law or in equity, whether known or unknown, which AVM ever had, now has,
or hereafter may have against any of the ALSC Released Parties, arising out of or in any way
relating to the Released Matters.
(c) The parties acknowledge the provisions of Section 1542 of the Civil Code of the State of
California, which 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.
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.
(d) For the purposes of implementing the full and complete release and discharge of the
AVM Released Parties against ALSC, ALSC Venture or any of the Partnerships, and of the ALSC
Released Parties against AVM described under Paragraphs 1(a) and (b), the parties expressly waive,
relinquish and forfeit all rights and benefits afforded by Section 1542 of the Civil Code of the
State of California .
(e) The parties have each carefully read and fully understand all of the provisions of this
Release which sets forth the entire agreement, and each acknowledge that they have not relied upon
any representation or statement, written or oral, not otherwise set forth within this document.
2. Representations and Warranties. Each of ALSC, ALSC Venture, the Partnerships and
AVM represents and warrants:
(a) that such party has not assigned, transferred, encumbered or conveyed in any other way,
all or any portion of the claims or rights covered by this Agreement;
(b) that such party has executed this Agreement voluntarily, with full knowledge of its import
and significance; that this Agreement is fair and reasonable and is not the result of any
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duress, overreaching, coercion, pressure or undue influence exercised by any other party upon
such party; and that the parties have been awarded the opportunity and have obtain independent
legal advice from counsel of their own selection with respect to this Agreement and their rights
and obligations under this Agreement; and
(c) that such party has full corporate or limited liability company, as applicable, power and
authority to execute and deliver this Agreement to the other party.
3. Limitations of Agreement. The releases under this Agreement relate only to the
Released Matters. ALSC, ALSC Venture, each of the Partnerships and AVM agree that the releases set
forth in this Agreement shall be and remain in effect in all respects as a complete general release
as to the matters released; provided however that this release does not extend to any obligations
incurred under this Agreement or any of the MOU Agreements; notwithstanding the releases
contemplated hereunder, ALSC, ALSC Venture and each of the Partnerships acknowledges that each of
the AVM Released Parties is entitled to continuing enforcement of Section 5.7 of each agreement of
limited partnership for each of the Partnerships.
4. Confidentiality. The parties hereto each agree to use their best efforts to
maintain in confidence the existence of this Agreement, the contents and terms of this Agreement,
and the consideration for this Agreement (hereinafter collectively referred to as “Settlement
Information”). Each party hereto agrees to take every reasonable precaution to prevent disclosure
of any Settlement Information to third parties, with the exception that the terms of this Agreement
may be disclosed to and discussed with agent, those employees, officers, directors, attorneys,
accountants, governmental agencies, and family members who have a reasonable need to know of such
Settlement Information. In addition, the Settlement Information may be disclosed to the extent
required under applicable securities laws or to enforce this Agreement.
5. No Admission of Liability. The parties understand and acknowledge that this
Agreement constitutes a compromise and settlement of disputed claims. No action taken by the
parties hereto, or either of them, either previously or in connection with this Agreement shall be
deemed or construed to be (a) an admission of the truth or falsity of any claims heretofore made or
(b) an acknowledgement or admission by either party or any fault or liability whatsoever to the
other party or to any third party.
6. Costs. The parties shall each bear their own costs, expenses, attorneys’ and other
fees incurred in connection with this Agreement. The prevailing party in any action to enforce
this Agreement will be entitled to its attorneys’ fees, costs and expenses.
7. Governing Law. This Agreement shall be governed by, and construed in accordance
with, the laws of California.
8. Severability. If any term or provision of this Agreement shall for any reason be
determined to be invalid, illegal and/or enforceable, the remaining provisions of this Agreement
shall nonetheless continue in full force and effect.
IN WITNESS WHEREOF, ALSC, ALSC Venture, each of the Partnerships and AVM have executed this
Agreement as of the day and year first written above.
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| ALLIANCE SEMICONDUCTOR CORPORATION | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, President | ||||||
| ALSC VENTURE MANAGEMENT, LLC | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
| ALLIANCE VENTURES I, L.P. | ||||||
| By: ALSC VENTURE MANAGEMENT, LLC | ||||||
| Its: General Partner | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
| ALLIANCE VENTURES II, L.P. | ||||||
| By: ALSC VENTURE MANAGEMENT, LLC | ||||||
| Its: General Partner | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
| ALLIANCE VENTURES III, L.P. | ||||||
| By: ALSC VENTURE MANAGEMENT, LLC | ||||||
| Its: General Partner | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
| ALLIANCE VENTURES IV, L.P. | ||||||
| By: ALSC VENTURE MANAGEMENT, LLC | ||||||
| Its: General Partner | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
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| ALLIANCE VENTURES V, L.P. | ||||||
| By: ALSC VENTURE MANAGEMENT, LLC | ||||||
| Its: General Partner | ||||||
| By: | /s/ Xxxxxx X. Xxxxxxx | |||||
| Xxxxxx X. Xxxxxxx, Manager | ||||||
| ALLIANCE VENTURE MANAGEMENT, LLC | ||||||
| By: | /s/ X.X. Xxxxxxxxx | |||||
| X.X. Xxxxxxxxx, Manager | ||||||
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