Exhibit A
AGREEMENT AND ASSIGNMENT
This AGREEMENT, dated as of September 25, 2002 (this "Agreement"), between
▇▇▇▇▇▇▇.▇▇▇, INC., a Delaware corporation (the "Company"), INTER ASSET JAPAN
CO., LTD., a Japanese corporation ("IAJ"), and ▇▇▇▇▇ ▇▇▇▇▇▇ ("▇▇▇▇▇▇").
WHEREAS, ▇▇▇▇▇▇ holds a significant number of shares of the Common Stock of the
Company, par value $0.01 per share (the "Common Stock");
WHEREAS, IAJ, as a consequence of the completion of the conversion of the
Company's Series A Preferred Stock to Common Stock, is the majority stockholder
of the Company;
WHEREAS, ▇▇▇▇▇▇ and the Company have entered into the Consulting Services
Agreement dated as of December 1, 2001 (the "Consulting Agreement") annexed
hereto as Exhibit A;
WHEREAS, ▇▇▇▇▇▇ and the Company have entered into the Mezzanine Financing Loan
Agreement dated as of March 31, 2002 (the "Loan Agreement") annexed hereto as
Exhibit B to memorialize the past loans and funds advanced by ▇▇▇▇▇▇ and new
loans and advances to be made by ▇▇▇▇▇▇ from time to time;
WHEREAS, pursuant to the Loan Agreement, the Company has issued a Convertible
Promissory Note dated May 31, 2002 (the "Convertible Note") to ▇▇▇▇▇▇ annexed
hereto as Exhibit C, and the principal amount of the Convertible Note
outstanding as of the Effective Date shall be $563,857.32;
WHEREAS, the Company and ▇▇▇▇▇▇ wish to terminate the Consulting Agreement on
terms and conditions hereinafter set forth; and
WHEREAS, to induce ▇▇▇▇▇▇ to terminate the Consulting Agreement and to
facilitate the orderly restructuring of the Company's finances, IAJ has agreed
to purchase the Loan Agreement and Convertible Note.
NOW, THEREFORE, the parties hereto hereby agree as follows:
Section 1. Definitions.
As used herein, the following terms shall have the following meanings:
"▇▇▇▇▇▇ Agreements" shall mean the Consulting Agreement, the Loan Agreement, the
Convertible Note, and any and all other written or oral agreements, arrangements
and understandings existing as of the Effective Date between the Company and
▇▇▇▇▇▇. "Claims" shall have the meaning set forth in Section 3(b) hereof.
"Consulting Agreement" shall have the meaning set forth in the recitals hereof.
"Convertible Note" shall have the meaning set forth in the recitals hereof.
"Effective Date" shall mean the date on which the First Installment (as
hereinafter defined) is paid.
"Loan Agreement" shall have the meaning set fort in the recitals hereof.
"Purchase Price" shall have the meaning set forth in Section 2 hereof.
Section 2. Payment of Purchase Price to ▇▇▇▇▇▇; Amendment and Waiver.
(a) Subject to payment of the First Installment (as hereinafter defined), ▇▇▇▇▇▇
hereby sells, transfers and assigns to IAJ without recourse to ▇▇▇▇▇▇ (except to
the extent of his obligations under this Agreement) all of his rights, title and
interest under the Loan Agreement and the Convertible Note. In consideration of
such sale, transfer and assignment, IAJ hereby agrees to pay $563,857.32 (the
"Purchase Price") to ▇▇▇▇▇▇ in two installments, the first of which (the "First
Installment") in the amount of $400,000 shall be paid to ▇▇▇▇▇▇ on or before
September 30, 2002, and the second of which in the amount of $163,857.32 (the
"Second Installment" and, together with the First Installment, the
"Installments") shall be paid on December 31, 2002.
(b) IAJ and the Company hereby confirm that each has been provided with
satisfactory evidence that as of the Effective Date unreimbursed advances,
including those to be made with proceeds of the First Installment, at least
equal to the Purchase Price will have been made by ▇▇▇▇▇▇ for and on behalf of
the Company in accordance with the terms of the Loan Agreement and the
Convertible Note.
(c) ▇▇▇▇▇▇, the Company and IAJ hereby agree to amend Section 2.3 of the
Convertible Note to delete the following sentence: "If such approval shall not
have been obtained by August 31, 2002, the failure to obtain such approval shall
constitute an Event of Default hereunder." All parties agree to said amendment
of the Convertible Note. The parties hereby agree that Schedule A to the
Convertible Note shall be revised as of the Effective Date to reflect the
principal amount owing of $563,857.32.
(d) In consideration of the foregoing amendment, as of the Effective Date the
Company agrees irrevocably to waive any defenses or counterclaims to payment
under the Loan Agreement and Convertible Note, which would otherwise be
available to it with respect to ▇▇▇▇▇▇.
Section 3. Termination of the Consulting Agreement/ Release.
(a) Upon payment of the First Installment, the Company and ▇▇▇▇▇▇ hereby agree
that the Consulting Agreement and all accrued obligations thereunder shall be
terminated and cancelled and shall have no further legal force or effect,
whereupon ▇▇▇▇▇▇ shall be released from any and all claims, liabilities,
obligations, actions, suits, causes of action, damages and expenses of any
nature whatsoever, at law or in equity, known or unknown, which the Company or
IAJ or anyone claiming through the Company or IAJ had, now have or hereafter may
have against ▇▇▇▇▇▇ arising out of the Consulting Agreement from the beginning
of time until the Effective Date.
(b) Upon payment of the Second Installment ▇▇▇▇▇▇ hereby agrees to release and
discharge irrevocably and unconditionally, as of the Effective Date, the
Company, IAJ, their subsidiaries, affiliates, successors and assigns, as well as
their respective officers, directors, employees, shareholders, agents and
representatives (collectively, the "Released Parties"), from any and all claims,
liabilities, obligations, actions, suits, causes of action, damages and expenses
of any nature whatsoever, at law or in equity, known or unknown, which ▇▇▇▇▇▇ or
anyone claiming through him had, now have or hereafter may have (collectively,
the "Claims") against any of the Released Parties, from the beginning of time to
the Effective Date, including, without limitation, any of the Claims arising out
of the ▇▇▇▇▇▇ Agreements, but excluding the payment obligations assumed by IAJ
under this Agreement.
Section 4. Representations and Warranties of ▇▇▇▇▇▇/Indemnification.
▇▇▇▇▇▇ hereby represents and warrants to the Company and IAJ as follows:
(a) Exhibit D hereto sets forth all (i) advances made by ▇▇▇▇▇▇ to the
Company and reimbursements thereof prior to the Effective Date; (ii)
expenses, obligations and liabilities of the Company, whether contingent
or accrued, which have been discharged with the funds or loans that
▇▇▇▇▇▇ advanced or made pursuant to the ▇▇▇▇▇▇ Agreements or otherwise
and (iii) payments to be made on behalf of the Company with proceeds of
the First Installment;
(b) Exhibit E hereto sets forth all expenses, obligations and liabilities of
the Company which will be outstanding as of the Effective Date and all
actions, suits, proceedings and claims pending or threatened against the
Company known to ▇▇▇▇▇▇ as of the Effective Date; and
(c) ▇▇▇▇▇▇ is not aware of any expenses, obligations or liabilities of the
Company or any pending or threatened actions, suits, proceedings or
claims against the Company other than those disclosed in Exhibit D and
Exhibit E, respectively.
▇▇▇▇▇▇ shall indemnify and hold the Company and IAJ harmless from and against
any and all expenses, obligations, and liabilities (including, without
limitation, reasonable legal fees and other costs of defense) (collectively
"Losses") either incurs which are attributable to (i) any breach of the
representations and warranties set forth in this Section 4 or (ii) the bona fide
claims of any commercial creditor of the Company not disclosed on Exhibit D or
Exhibit E, whether known or unknown to ▇▇▇▇▇▇ as of the Effective Date. In the
event the Company or IAJ intends to seek indemnification for Losses, the Company
or IAJ shall notify ▇▇▇▇▇▇ within ten (10) business days after receiving
notification of the matter which is or may be the subject of a claim for Losses.
In the event that ▇▇▇▇▇▇ is not so notified, he shall be under no obligation to
indemnify the Company or IAJ with respect to such matter. In the event ▇▇▇▇▇▇ is
required to indemnify the Company or IAJ under the terms hereof, ▇▇▇▇▇▇ shall
have the right to obtain counsel of his choice to represent the Company and/or
IAJ at his expense. ▇▇▇▇▇▇ shall have no obligation to indemnify and hold the
Company and IAJ harmless until the aggregate amount of Losses subject to the
foregoing indemnity exceeds Two Thousand Five Hundred Dollars ($2,500),
whereupon ▇▇▇▇▇▇ shall indemnify for any excess. (In the event the Company's
Losses are less than $2,500 and ▇▇▇▇▇▇ has retained counsel has provided herein,
the Company shall reimburse ▇▇▇▇▇▇ for legal fees up to the difference between
the Losses the Company sustained and $2,500.) All representations, warranties
and indemnification obligations shall apply only with respect to claims made by
the Company or IAJ within one year after the Effective Date.
Section 5. Consulting and Cooperation.
Prior to and after the Effective Date, ▇▇▇▇▇▇ and the Company will cooperate
with each other in regard to the Company's American Stock Exchange listing and
to develop the business of the Company and enhance the value of the Company. In
consideration of such cooperation, IAJ shall transfer or cause to be transferred
to ▇▇▇▇▇▇ two million (2,000,000) shares of the Company's common stock within
four months after the Effective Date in accordance with applicable securities
laws. The Company shall file or cause to be filed a registration statement
covering said shares as promptly as possible, but no later than 45 days of the
transfer date. The Company shall use its best efforts to ensure that the
registration statement is declared effective by the SEC and that said shares are
listed by AMEX. ▇▇▇▇▇▇ shall be responsible for the costs associated with having
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ prepare such filing and subsequent efforts to ensure that the
registration statement is declared effective by the SEC.
Section 6. Governing Law.
This Agreement shall be governed by, and construed in accordance with, the laws
of the State of New York.
Section 7. Successors, Etc.
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns.
Section 8. Entire Agreement.
This Agreement sets forth the entire agreement between the parties hereto with
respect to the subject matter hereof, and supersedes any and all prior oral or
written agreements or understandings between the parties hereto with respect to
such subject matter.
Section 9. Arbitration.
Any dispute, controversy or claim arising out of or in connection with this
Agreement which is not resolved through good faith discussions between the
parties hereto shall be finally settled by arbitration. The arbitration shall be
held in New York City, New York, in accordance with the rules then in effect of
the American Arbitration Association. The arbitration shall be conducted by one
arbitrator. The arbitrator shall have the authority to allocate between the
parties the cost of arbitration in such equitable manner as the arbitrator may
determine. The prevailing party shall be entitled to receive reimbursement of
its reasonable expenses incurred in connection with such arbitration. Judgment
upon the award so rendered may be entered in any court having jurisdiction or
application, or application may be made to such court for judicial acceptance of
any award and an order of enforcement, as the case may be.
Section 10. Notices.
Unless applicable law requires a different method, any notice that must be given
to either party under this Agreement will be given by (a) certified mail, return
receipt requested, (b) domestic or international express mail or courier
service, or (c) personal delivery, addressed as follows, or to such other
address as any party may by written notice advice the other parties:
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇.▇▇▇, Inc. Inter Asset Japan Co., Ltd.
▇▇ ▇▇▇▇▇ ▇▇▇▇ 1220 ▇▇▇▇▇▇▇ Ave. Atago Green Hills MORI Tower ▇▇▇ ▇-▇-▇,
▇▇▇. #▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇-▇-▇ ▇▇▇▇▇, ▇▇▇▇▇▇-▇▇, ▇▇▇▇▇ 105-0235
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇
Notice shall be effective upon mailing or dispatch by courier service or
personal delivery, as the case may be.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
▇▇▇▇▇▇▇.▇▇▇, INC. INTER ASSET JAPAN CO., LTD.
By:/S/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By:/S/ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: CEO and CFO Title: President
/S/ ▇▇▇▇▇ ▇▇▇▇▇▇
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