ASSIGNMENT AGREEMENT
THIS ASSIGNMENT AGREEMENT ("Agreement"), dated effective as
of May 1, 1999, between IEO HOLDINGS LIMITED, a Nevis West Indies
corporation ("Assignor"), and INFINITY INVESTORS LIMITED, a Nevis
West Indies corporation ("Assignee").
RECITALS:
A. Infinity Emerging Opportunities Limited ("Emerging"), the
parent corporation of Assignor, acquired (i) 291 shares (the
"Original Shares") of common stock of Orix Global Communications,
Inc. (the "Company"), representing a 12.12% interest in the
issued and outstanding shares of common stock of the Company at
that time pursuant to that certain Assignment, dated as of June
11, 1998, between Assignee and Emerging, and (ii) a 12.12%
interest in the Debenture, dated June 11, 1998, in the original
principal amount of $6,000,000, and the Debenture, dated August
19, 1998, in the original principal amount of $850,000, each
issued by the Company to Assignee (the "Old Debentures"),
pursuant to that certain Participation Agreement, dated June 11,
1998, between Assignee and Emerging (the "First Participation
Interest").
B. Emerging contributed to Assignor the Original Shares and the
First Participation Interest pursuant to that certain Assignment,
dated as of December 9, 1998, between Emerging and Assignor.
C. Assignor purchased 909 shares of common stock (the
"Purchased Shares") of the Company pursuant to that certain
Agreement, dated as of December 9, 1998, between Assignee and
Assignor. Following the acquisition of the Purchased Shares,
Assignor owned 1,200 shares of common stock of the Company
(representing a 33.33% interest in the issued and outstanding
shares of common stock of the Company at that time) and Assignee
owned 1,200 shares of common stock of the Company (representing a
33.33% interest in the issued and outstanding shares of common
stock of the Company at that time).
D. Since the issuance of the Old Debentures, the Company has
issued to Assignee the following: (i) a Convertible Debenture,
dated as of February 9, 1999, in the original principal amount of
$390,000 (the "Convertible Debenture"), (ii) an Amended and
Restated Debenture, dated as of April 15, 1999, in the original
principal amount of $7,050,000 (which amended, restated and
superseded the terms of the Old Debentures and reflected an
additional $200,000 loan to the Company),(iii) a Debenture, dated
as of April 29, 1999, in the original principal amount of
$500,000 and (iv) a Debenture, dated April 30, 1999, in the
original principal amount of $100,000 (collectively, items (ii) -
(iv) being referred to as the "New Debentures"). In connection
with the issuance of the New Debentures, Assignor and Assignee
each received a Common Stock Purchase Warrant exercisable for 170
shares of common stock of the Company (the "Warrants").
E. Pursuant to prior agreements between Assignor and Assignee,
each of Assignor and Assignee agreed that Assignee would
participate to Assignor an aggregate 50% interest in
the New Debentures and in the Convertible Debenture (in
each case after giving effect to the previous First Participation
Interest) (the "New Participation Interest"). After giving
effect to the issuance of the New Participation Interest,
Assignor and Assignee will each own identical interests in the
equity and the indebtedness of the Company (with Assignor's
interest in such indebtedness being reflected by the
Participation Agreement) as follows:
(1) New Debentures - an aggregate of $7,650,000 - (50% for each
of Assignor and Assignee)
(2) Convertible Debentures - an aggregate of $390,000 - (50% for
each of Assignor and Assignee)
(3) Warrants exercisable for an aggregate of 340 shares of
common stock of the Company (170 shares for each of Assignor and
Assignee)
(4) 2,400 issued and outstanding shares of common stock of the
Company (1,200 for each of Assignor and Assignee).
F. In consideration of the issuance of the New Participation
Interest, Assignor desires to assign to Assignee those certain
securities issued by certain entities (collectively, the
"Securities") as set forth on SCHEDULES A-1 - A-3 attached
hereto, together, in each instance, with all rights and
obligations of Assignor set forth in the governing documents, as
amended from time to time (collectively, the "Transaction
Documents"), executed in connection with the issuance of such
Securities, including, without limitation, all security
interests, registration rights, indemnity rights and voting
rights associated therewith.
G. Assignee has agreed to accept the assignment of the
Securities and Transaction Documents from Assignor on the terms
and conditions hereinafter set forth, and subject to the
restrictions (if any) set forth in the Transaction Documents.
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AGREEMENTS:
NOW, THEREFORE, Assignor and Assignee agree as follows:
1. ASSIGNMENT. In consideration of the issuance by Assignee to
Assignor of the New Participation Interest, Assignor hereby
conveys, transfers and assigns to Assignee the Securities, the
Transaction Documents and all of Assignor's right, title and
interest thereto and therein, together with all other rights,
obligations, restrictions, covenants, benefits and privileges in
any way now or hereafter belonging or accruing to the benefit of
the Assignor in respect of the Securities and the Transaction
Documents.
2. REPRESENTATIONS AND WARRANTIES.
(a) Assignor represents and warrants that:
(i) this Agreement has been duly authorized by all necessary
action on the part of Assignor; and
(ii) it is the lawful owner of the Securities and of its rights
under the Transaction Documents and it holds legal and equitable
title to the Securities free and clear of any and all liens,
claims, charges, pledges, encumbrances and security interests
(except as set forth in the Transaction Documents).
(b) Assignee represents and warrants that:
(i) this Agreement has been duly authorized by all necessary
action on the part of Assignee;
(ii) it has received and reviewed copies of the Securities and
Transaction Documents;
(iii) it is an accredited investor as defined under Rule
501(a) of Regulation D promulgated under the Securities Act of
1933, as amended;
(iv) it is acquiring the Securities and Assignor's rights under
the Transaction Documents for its own account for investment and
without any view to the sale or further distribution of any part
thereof (except as set forth in, or allowed by, the Transaction
Documents); and
(v) it shall accept the Securities with all rights and
privileges and subject to all obligations and restrictions set
forth in the Transaction Documents and shall be bound by the
terms of such Transaction Documents as if it were an original
signatory thereto.
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EXECUTED the day and year first written above.
ASSIGNOR:
IEO HOLDINGS LIMITED
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxx
------------------------------
Title: Director
----------------------------
ASSIGNEE:
INFINITY INVESTORS LIMITED
By: /s/ Xxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxxx
-------------------------------
Title: Director
------------------------------
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SCHEDULE A-1
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SCHEDULE OF SECURITIES
AURA SYSTEMS, INC.
1. Variable Interest Convertible Note, dated September 30,
1997, in the original principal amount of $1,875,000, executed by
Aura Systems, Inc. in favor of Emerging, which has an unpaid
principal balance of $1,475,836, together with accrued and unpaid
interest thereon of $221,499.92, in each case through and as of
April 30, 1999.
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SCHEDULE A-2
---------------
SCHEDULE OF SECURITIES
ADVANCED ENTERTAINMENT CONCEPTS INC.
1. $315,123.95 of principal of that certain Term Loan
Promissory Note, dated May 7, 1998, in the original principal
amount of $400,000, together with accrued and unpaid interest on
such $315,123.95 of principal through April 30, 1999 of
approximately $31,644.44, executed by Advanced Entertainment
Concepts, Inc. in favor of Emerging.
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SCHEDULE A-3
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SCHEDULE OF SECURITIES
VISUAL EDGE SYSTEMS INC.
1. Convertible Note, dated June 13, 1997 (as amended), in the
original and current principal amount of $200,000, executed by
Visual Edge Systems Inc. in favor of Emerging, together with
accrued and unpaid interest thereon for the month of April 1999
of approximately $1,376.00.
2. 800 shares of preferred stock of Visual Edge Systems Inc.,
$.01 par value per share, representing a liquidation value of
$800,000. No accrued and unpaid dividends are owed thereon.
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