EXHIBIT 10.2
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (the "Agreement") is made as of August
5th, 2003, by and among Cyber Holdings Co., Ltd., a corporation organized and
existing under the laws of Japan ("Cyber"); Fan Club Entertainment Co., Ltd., a
corporation organized and existing under the laws of Japan ("Fan Club"); and IA
Global, Inc., a corporation organized and existing under the laws of the State
of Delaware ("IAG").
P r e l i m i n a r y S t a t e m e n t s
A. Cyber and IAG have memorialized the Investment in that certain
Investment Agreement between them dated as of even date herewith (the "Share
Purchase Agreement").
B. Before giving effect to the Investment, Fan Club has a share capital
of One Hundred and Forty Four Million Japanese Yen ((Y)144,000,000) representing
Two Hundred and Eighty Eight Thousand (288,000) shares, each with a face value
of Fifty Thousand Japanese Yen ((Y)500). Cyber is the sole shareholder of Fan
Club Entertainment.
C. IAG has agreed with Cyber to invest One Hundred and Thirty Four
Million Japanese Yen ((Y)134,000,000) in Fan Club (the "Investment"), and to
receive, in consideration therefor, Two Hundred and Sixty Eight Thousand
(268,000) shares of Fan Club's Common Stock, each with a face value of Fifty
Thousand Japanese Yen ((Y)500) (the "Purchased Shares");
D. Cyber will immediately after above stated C) transaction is
completed, subscribe to newly issued shares in Fan Club in the amount of Fifty
Six Million Japanese Yen ((Y)56,000,000) in return for One Hundred and Twelve
Thousand (112,000) shares of Fan Club's Common Stock, each with a face value of
Fifty Thousand Japanese Yen ((Y)500).
E. At this time, as a result of these transactions, the total issued
shares of Fan Club will be Four Hundred Thousand (400,000) shares, with IAG and
Cyber holding Two Hundred and Six Eight Thousand (268,000) and One Hundred and
Thirty Two Thousand (132,000) shares of Fan Club's Common Stock, each with a
face value of Fifty Thousand Japanese Yen ((Y)500), respectively.
F To induce IAG to enter into the Investment Agreement and to make the
Investment, Cyber desires to indemnify IAG from damages it may incur as a result
of Cyber's breach of the Investment Agreement or the inaccuracy of Cyber's
representations and warranties in the Investment Agreement.
E. Cyber, Fan Club and IAG desire to set forth in writing their
agreements and understandings with respect to such indemnification and to
matters ancillary thereto.
NOW, THEREFORE, for and in consideration of the premises, covenants,
and agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties do
covenant, agree, represent, warrant, and stipulate as follows:
August 5, 2003
Page 1 of 4
A g r e e m e n t
1. INDEMNIFICATION
(a) Scope. Cyber hereby unconditionally agree to indemnify and
hold IAG harmless against, and will reimburse IAG on demand for, any payment,
loss, cost, liability, demand, damage, and expense, including reasonable
attorneys' fees (including reasonable attorney's fees and reasonable costs of
investigation incurred in defending against such payment, loss, cost or expense
or claim therefor) ("Losses") made or incurred by or asserted against IAG at any
time after the date hereof, in respect of any and all damage or deficiency
resulting from any omission, misrepresentation, breach of warranty, or
nonfulfillment of any term, provision, covenant or agreement on the part of
Cyber contained in the Investment Agreement, or from any misrepresentation in,
or omission from, any certificate or other instrument furnished to IAG pursuant
to the Investment Agreement.
1.2. Limitation on Indemnification Obligation. The obligations of Cyber
to indemnify IAG pursuant to this Agreement shall only be applicable to Losses
arising within three (3) years from the date hereof.
2. MISCELLANEOUS
2.1. Assignability. IAG may assign or transfer its rights hereunder
upon prior written notice to Cyber.
2.2. Notices. All notices and other communications required or
permitted hereunder shall be in writing and shall be sent by registered or
certified mail (return receipt requested and postage prepaid), transmitted by
telecopier, or delivered by hand, by messenger or by a recognized overnight
delivery service, addressed as follows, or to such other address as such party
may have from time to time furnished to the other party in writing:
If to Cyber: Cyber Holdings Co., Ltd.
0-00 Xxxxxx Xxxxxx 0-Xxxxx
Xxxxxx-xx, Xxxxx
Xxxxx
If to Fan Club: Fan Club Entertainment, Co., Ltd.
0-00 Xxxxxx Xxxxxx 0-Xxxxx
Xxxxxx-xx, Xxxxx
Xxxxx
If to IAG: IA Global, Inc.
000 Xxxxxxx Xxxx. Xxxxx 000
Xxxxxxxxxx, XX 00000
August 5, 2003
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Each such notice or other communication shall for all purposes of this Agreement
be treated as effective or having been given (i) if sent by registered or
certified mail, the earlier of receipt and five (5) business days after
dispatch, (ii) if transmitted by telecopier, on the business day of confirmed
receipt by the addressee thereof, and (iii) if delivered in person or by
overnight courier, on the business day delivered.
2.3. Counterparts. This Agreement may be executed in several
counterparts, and each executed copy shall constitute an original instrument,
but all such counterparts shall together constitute but one and the same
instrument.
2.4. Headings; Construction. The headings of the several sections,
divisions or subsections of this Agreement shall not be construed to constitute
any part or to affect the meaning of any such sections, divisions or
subsections. The parties hereto have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties hereto and no presumption of burden of proof shall arise favoring
or not favoring any party by virtue of the authorship of any of the provisions
of this Agreement.
2.5. Severability. If any provision of this Agreement or portion of any
provision, or the application thereof to any person or circumstance, shall, to
any extent, be held invalid or unenforceable, the remainder of this Agreement or
the remainder of such provision and the application thereof to other persons or
circumstances, other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each term and provision of this Agreement
shall be valid and be enforced to the fullest extent permitted by law.
2.6. Governing Law. This Agreement, all exhibits and amendments hereto,
shall be governed in all respects under the internal laws of the State of
Delaware applicable to agreements made and to be performed wholly in the State
of Delaware (excluding any such law which may direct the application of the laws
of any other jurisdiction). The parties hereby submit to the exclusive
jurisdiction of the state and federal courts of the State of Delaware and with
venue in Wilmington, Delaware for the confirmation and enforcement of any
arbitration award relating to any dispute arising from or in connection with
this Agreement, including the validity, execution, performance and enforcement
hereof, and any matter relating hereto or relating to the relationship between
the parties that was created or contemplated hereunder. The parties agree that
they will not resort to the courts or other governmental agencies of any other
jurisdiction for the resolution of any such dispute or controversy and agree to
service by mail and waives any requirements of personal service. EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A
JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION
HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.
[signature page follows]
August 5, 2003
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their respective corporate officers thereunto duly authorized
on the day and year first above written.
Cyber Holdings Co., Ltd.
By: ____/S/ Xxxxxxxx Xxx ________
Xxxxxxxx Xxx
Fan Club Entertainment Co., Ltd.
By: ___/S/ Kazunori Ito_______
Xxxxxxxx Xxx
IA Global, Inc.
By: __/S/ Xxxx Margerison_________
Xxxx Xxxxxxxxxx, CEO
August 5, 2003
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