EXHIBIT 2
ASSIGNMENT OF INTEREST IN INNOVATION GROWTH PARTNERS, LLC
AND AGREEMENT AS TO OTHER MATTERS
This Assignment of Interest in Innovation Growth Partners, LLC and
Agreement as to Other Matters (the "Agreement") is made as of this 18th day of
April, 2002 by and among each of Innovation Growth Partners, LLC, a Delaware
limited liability company (the "Company"), Innovation Growth Partners II, LLC, a
Delaware limited liability company ("IGP II"), ▇▇▇▇▇▇▇ ▇▇▇▇ ("▇▇▇▇"), ▇▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇ ("▇▇▇▇▇▇▇"), ▇▇▇▇▇ ▇. ▇▇▇▇ ("West"), (▇▇▇▇, ▇▇▇▇▇▇▇ and West are
collectively referred to herein as the "IGP Parties"), and ▇▇▇▇▇▇, Inc., a New
Jersey corporation ("▇▇▇▇▇▇") and certain parties named on the signature pages
hereto for the limited purposes stated therein.
WHEREAS, ▇▇▇▇▇▇ owns certain membership interests in the Company,
including the membership interest issued to it by the Company pursuant to the
Operating Agreement dated June 19, 2000 (the "Original Interest"), the Class A
Membership Interest (the "Class A Interest") and Class B Membership Interest
(the "Class B Interest") issued to it pursuant to the Amendment No. 1 to
Operating Agreement dated as of September 7, 2001 (the "First Amendment");
WHEREAS, ▇▇▇▇▇▇ wishes to sell to the Company, and the Company wishes
to acquire from ▇▇▇▇▇▇, ▇▇▇▇▇▇'▇ entire right, title, interest, and ownership in
the Company;
WHEREAS, IGP II wishes to transfer to ▇▇▇▇▇▇, and ▇▇▇▇▇▇ wishes to
acquire from IGP II, IGP II's rights under a certain Warrant to purchase 25,000
shares of Common Stock of Miresco Investment Services, Inc. ("Miresco") executed
as of July 12, 2001 and effective as of May 25, 2001 (the "Warrant");
WHEREAS, IGP wishes to transfer to ▇▇▇▇▇▇, and ▇▇▇▇▇▇ wishes to acquire
from IGP, a contingent interest in any proceeds which IGP may realize from the
dissolution of MindSearch Limited Partnership, a Texas limited partnership
("MindSearch Partnership");
NOW, THEREFORE, in consideration of the mutual premises herein set
forth, and for other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereto agree as follows:
1. ASSIGNMENT OF INTERESTS BY ▇▇▇▇▇▇. ▇▇▇▇▇▇ hereby assigns and transfers
to the Company its entire ownership interest in the Company, including
the Original Interest, the Class A Interest and the Class B Interest,
and acknowledges that it no longer has ownership, any claim of
ownership, or any right to acquire any ownership, in the Company and is
no longer a member of the Company. ▇▇▇▇▇▇ represents and warrants to
the Company that it has good and marketable title to such ownership
interest and such ownership interest is being transferred to the
Company free of all liens, charges and encumbrances.
2. RESIGNATION OF ▇▇▇▇▇▇ REPRESENTATIVES. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ hereby resign as Managers of the Company.
3. DISSOLUTION PROCEEDS.
(a) IGP, IGP II, and the IGP Parties each hereby agree that each
shall pay to ▇▇▇▇▇▇ the net proceeds it receives (if any) upon
the dissolution and liquidation of MindSearch Partnership (the
"Dissolution Interest") after deduction from such proceeds of
any income tax attributable to such proceeds. IGP, IGP II and
the IGP Parties each hereby represent and warrants to ▇▇▇▇▇▇
that other than through any ownership interest (if any, and as
applicable to each such party) in IGP, II, MindSearch, Inc., a
Delaware corporation, MindSearch Management, L.L.C., a
Delaware limited liability company ("MindSearch Management")
and its direct ownership interest in MindSearch Partnership,
such party does not have any direct or indirect ownership
interest in MindSearch Partnership. IGP, IGP II and the IGP
parties agree that in the event that MindSearch, Inc receives
any proceeds from the dissolution and liquidation of
MindSearch Partnership, they will use their best efforts to
cause MindSearch, Inc to dividend the net proceeds received to
its shareholders after the deduction of any tax on MindSearch,
Inc. applicable to such proceeds. In addition, to the extent
they have knowledge of same, each of the IGP Parties agrees to
provide prompt notice to ▇▇▇▇▇▇ of the sale or other
disposition of any of the assets of MindSearch Partnership
other than as contemplated by Section 3(d) below.
(b) The parties hereto acknowledge that the agreement to pay to
▇▇▇▇▇▇ provided for in Section 3(a) above represents an
agreement to pay proceeds when, and if, any proceeds are
received by them from the dissolution of MindSearch
Partnership only and does not impose on ▇▇▇▇▇▇, or convey to
▇▇▇▇▇▇, any rights, duties, liabilities or obligations as a
member or partner of either IGP, IGP II, MindSearch
Management, MindSearch Partnership or any other entity. The
conveyance of the Dissolution Interest to ▇▇▇▇▇▇, and the
ownership of the Dissolution Interest by ▇▇▇▇▇▇, does not
create or evidence any duty, liability, or obligation of IGP
to ▇▇▇▇▇▇ except as expressly stated herein. Any other duty,
liability or obligation which may be implied by law or at
equity is hereby expressly waived and negated by ▇▇▇▇▇▇.
(c) IGP, IGP II, and the IGP Parties each agree that in the event
that it acquires, directly or indirectly, any additional
interest in MindSearch Partnership or the property or assets
of MindSearch Partnership or any successor thereto, it shall
promptly notify ▇▇▇▇▇▇ in writing (the "Offer Notice") of such
acquisition and ▇▇▇▇▇▇ shall have the option of acquiring such
interest, property or assets upon the same terms as were
provided to IGP. ▇▇▇▇▇▇ shall provide written notice of its
election to exercise the option (the "Exercise Notice")
provided in this Section 3(d) within thirty (30) days of the
receipt of the Offer Notice. If the Election Notice is not
provided within such thirty (30) day period, the option shall
expire. Any closing of a transaction between ▇▇▇▇▇▇ and IGP,
IGP II, and the IGP Parties pursuant to this Section 3(d)
shall occur within thirty (30) days of the receipt of the
Election Notice by the applicable party.
(d) Each of IGP, IGP II, and the IGP Parties hereby represents and
warrants to ▇▇▇▇▇▇ that they have received no distribution
from the MindSearch Partnership since
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March 1, 2002 other than (i) the payment of $8,225 IGP has
received in partial repayment of that certain note dated
_________, 2002 from MindSearch Partnership to IGP in the
original principal amount of $___________, and (ii) the
payment of approximately $2,000 as the remaining cash assets
of MindSearch Partnership received by IGP and held for payment
to IGP, and certain other creditors (none of which is an IGP
Party).
4. ASSIGNMENT OF MIRESCO WARRANTS.
(a) IGP II does hereby transfer and assign to ▇▇▇▇▇▇ its entire
right, title and interest in the Warrant and all rights
applicable to the shares of Miresco common stock issuable upon
the exercise of the Warrant under the Amended and Restated
Registration Rights Agreement executed on or about July 18,
2002 by ▇▇▇▇▇▇▇, IGP II and the other parties thereto. IGP II
does hereby represent and warrant to ▇▇▇▇▇▇ that it has good
and marketable title to the Warrant. Such Warrant is being
transferred and assigned to ▇▇▇▇▇▇ free of all liens, charges
and encumbrances except those liens, charges, or encumbrances
which may (i) be imposed thereon by the terms of the document
evidencing such Warrant and (ii) be imposed upon the holder of
such Warrant under the governing corporate documents of
Miresco, and applicable state and federal securities and
corporate laws. Contemporaneous with the execution of this
Agreement, IGP II shall execute and deliver the form of
"Assignment in Full" annexed to the Warrant and name ▇▇▇▇▇▇ as
the assignee therein. To the extent that ▇▇▇▇▇▇▇ requires an
opinion of counsel to effect the transfer and assignment of
the Warrant, ▇▇▇ agrees that it will arrange for the delivery
of such opinion at its cost.
(b) Each of the IGP Parties hereby represents and warrants to
▇▇▇▇▇▇ that the number of shares of Series A Preferred Stock
of Miresco issued to IGP have not and will not be increased
pursuant to Section H(9) of that certain Amended and Restated
Certificate of Designation, Rights, Preferences and
Limitations of Miresco dated July 18, 2001.
5. CASH PAYMENT. Immediately upon the execution of this Agreement, the
Company shall pay to ▇▇▇▇▇▇ the sum of One Million Thirty Thousand
Dollars ($1,030,000). Such payment shall be made by wire transfer of
immediately available funds to an account designated by ▇▇▇▇▇▇.
6. CANCELLATION OF OPTION ARRANGEMENT. Each of the IGP Parties
acknowledges and agrees that the obligations of ▇▇▇▇▇▇ to award options
to acquire ▇▇▇▇▇▇ common stock under the letter agreement executed by
▇▇▇▇▇▇ and the Company on or about June 19, 2000 is hereby cancelled
and of no further force and effect.
7. REPRESENTATIONS AND WARRANTIES. Each of the parties hereto represent
and warrant one to another that (a) it has all requisite power and
authority to enter into this Agreement and to perform its obligations
hereunder; (b) if such party is an entity, the execution and delivery
by it and the performance of its obligations hereunder do not and will
not conflict with or result in any violation or default under its
organizational documents or any agreement or instrument to which it is
a party or by which its property or assets may
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be bound; (c) such party has received independent tax and legal advice
from attorneys of his choice with respect to the advisability of
executing this Agreement; (d) such party has made such investigation of
the facts pertaining to this Agreement, and all of the matters
pertaining thereto, as he deems necessary; (e) except as expressly
provided herein, no person has made any statement or representation to
such party regarding any fact relied upon by such party in entering
into this Agreement and each party specifically does not rely upon any
statement, representation, or promise of any other person in executing
this Agreement; (f) such party relies on the finality of this Agreement
as a material factor inducing his execution of this Agreement, and the
obligations under this Agreement; and (g) such party will not take any
action which would interfere with the performance of this Agreement by
any other party or which would adversely affect any of the rights
provided for herein.
8. FURTHER ASSURANCES. Each of the parties hereto agree, that at the
reasonable request of another party hereto, it will take such further
action and execute, deliver and acknowledge where necessary from time
to time such other and further things as may be reasonably necessary to
more fully and effectively consummate the transactions contemplated by
this Agreement.
9. COOPERATION IN ACCOUNTING AND TAX MATTERS. From and after the date
hereof, IGP and the IGP Parties shall cooperate in furnishing such
accounting and tax records relating to the Company as may be reasonably
requested by ▇▇▇▇▇▇.
10. RELEASE OF ▇▇▇▇▇▇. IN CONSIDERATION OF THE BENEFITS RECEIVED BY IGP AND
THE IGP PARTIES HEREUNDER, IGP AND THE IGP PARTIES HEREBY RELEASE,
RELINQUISH AND FOREVER DISCHARGE ▇▇▇▇▇▇, AS WELL AS ITS PREDECESSORS,
SUCCESSORS, ASSIGNS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES,
AFFILIATES, INSURERS, ATTORNEYS AND REPRESENTATIVES (THE "▇▇▇▇▇▇
INDEMNITY PARTIES"), OF AND FROM ANY AND ALL CLAIMS, DEMANDS, ACTIONS
AND CAUSES OF ACTION OF ANY AND EVERY KIND OR CHARACTER, PAST OR
PRESENT, WHICH IGP AND THE IGP PARTIES MAY HAVE AGAINST THE ▇▇▇▇▇▇
INDEMNITY PARTIES, ARISING OUT OF OR WITH RESPECT TO ANY AND ALL
AGREEMENTS, REPRESENTATIONS, WARRANTIES, OR TRANSACTIONS RELATING TO OR
ARISING OUT OF IGP, IGP II, MINDSEARCH, INC., MIRESCO, MINDSEARCH
MANAGEMENT, MINDSEARCH PARTNERSHIP, OR THE OPERATION OR MANAGEMENT OF,
OR INVESTMENT IN ANY OF THE FOREGOING, OCCURRING PRIOR TO THE DATE
HEREOF, INCLUDING ANY LOSS, COST OR DAMAGE, OF ANY KIND OR CHARACTER,
ARISING OUT OF OR IN ANY WAY CONNECTED WITH OR IN ANY WAY RESULTING
FROM THE ACTS, ACTIONS OR OMISSIONS OF ▇▇▇▇▇▇, AND ITS PREDECESSORS,
SUCCESSORS, ASSIGNS, AGENTS, OFFICERS, DIRECTORS, EMPLOYEES AND
REPRESENTATIVES, INCLUDING ANY BREACH OF FIDUCIARY DUTY, BREACH OF ANY
DUTY OF FAIR DEALING, BREACH OF LOYALTY, BREACH OF CONFIDENCE, BREACH
OF FUNDING COMMITMENT, UNDUE INFLUENCE, DURESS, ECONOMIC COERCION,
CONFLICT OF INTEREST, NEGLIGENCE, BAD FAITH, MALPRACTICE, INTENTIONAL
OR NEGLIGENT INFLICTION OF MENTAL DISTRESS, TORTIOUS INTERFERENCE WITH
CONTRACTUAL RELATIONS, TORTIOUS INTERFERENCE WITH CORPORATE GOVERNANCE
OR PROSPECTIVE BUSINESS ADVANTAGE, BREACH OF CONTRACT, DECEPTIVE TRADE
PRACTICES, LIBEL, SLANDER OR CONSPIRACY EXCEPT THAT THE RELEASE HEREBY
GIVEN SHALL NOT APPLY TO (I) THE OBLIGATIONS OF ▇▇▇▇▇▇ UNDER THE
PROVISIONS OF THIS AGREEMENT, (II) ANY BREACH OF THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN THIS AGREEMENT OR (III) ANY ILLEGAL OR
CRIMINAL CONDUCT OR ACTIVITY.
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11. RELEASE OF IGP PARTIES. IN CONSIDERATION OF THE BENEFITS RECEIVED BY
▇▇▇▇▇▇ HEREUNDER, THE ▇▇▇▇▇▇ INDEMNITY PARTIES HEREBY RELEASE,
RELINQUISH AND FOREVER DISCHARGE IGP, IGP II, EACH OF THE IGP PARTIES,
MINDSEARCH, INC., MINDSEARCH MANAGEMENT, MINDSEARCH PARTNERSHIP,
MIRESCO (THE "IGP INDEMNITY PARTIES") AS WELL AS THEIR RESPECTIVE
PREDECESSORS, SUCCESSORS, ASSIGNS, AGENTS, OFFICERS, DIRECTORS,
MANAGERS, MEMBERS, EMPLOYEES, AFFILIATES, INSURERS, ATTORNEYS AND
REPRESENTATIVES, OF AND FROM ANY AND ALL CLAIMS, DEMANDS, ACTIONS AND
CAUSES OF ACTION OF ANY AND EVERY KIND OR CHARACTER, PAST OR PRESENT,
WHICH THE ▇▇▇▇▇▇ INDEMNITY PARTIES MAY HAVE AGAINST THE IGP INDEMNITY
PARTIES ARISING OUT OF OR WITH RESPECT TO ANY AND ALL AGREEMENTS,
REPRESENTATIONS, WARRANTIES, OR TRANSACTIONS RELATING TO OR ARISING OUT
OF IGP, IGP II, MINDSEARCH, INC., MIRESCO, MINDSEARCH MANAGEMENT,
MINDSEARCH PARTNERSHIP, OR THE OPERATION OR MANAGEMENT OF, OR
INVESTMENT IN ANY OF THE FOREGOING, OCCURRING PRIOR TO THE DATE HEREOF,
INCLUDING ANY LOSS, COST OR DAMAGE, OF ANY KIND OR CHARACTER, ARISING
OUT OF OR IN ANY WAY CONNECTED WITH OR IN ANY WAY RESULTING FROM THE
ACTS, ACTIONS OR OMISSIONS OF THE IGP INDEMNITY PARTIES, INCLUDING ANY
BREACH OF FIDUCIARY DUTY, BREACH OF ANY DUTY OF FAIR DEALING, BREACH OF
LOYALTY, BREACH OF CONFIDENCE, BREACH OF FUNDING COMMITMENT, UNDUE
INFLUENCE, DURESS, ECONOMIC COERCION, CONFLICT OF INTEREST, NEGLIGENCE,
BAD FAITH, MALPRACTICE, INTENTIONAL OR NEGLIGENT INFLICTION OF MENTAL
DISTRESS, TORTIOUS INTERFERENCE WITH CONTRACTUAL RELATIONS, TORTIOUS
INTERFERENCE WITH CORPORATE GOVERNANCE OR PROSPECTIVE BUSINESS
ADVANTAGE, BREACH OF CONTRACT, DECEPTIVE TRADE PRACTICES, LIBEL,
SLANDER OR CONSPIRACY EXCEPT THAT THE RELEASE HEREBY GIVEN SHALL NOT
APPLY TO (I) THE OBLIGATIONS OF IGP AND THE IGP PARTIES UNDER THE
PROVISIONS OF THIS AGREEMENT, (II) ANY BREACH OF THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN THIS AGREEMENT OR (III) ANY ILLEGAL OR
CRIMINAL CONDUCT OR ACTIVITY.
12. AFTER-DISCOVERED FACTS. It is understood by each party that there is a
risk that subsequent to the execution of this Agreement, a party may
discover facts different from or in addition to the facts which he now
knows or believes to be true with respect to the subject matter of this
Agreement, or that certain debts, claims, expenses, or liabilities
presently known may be or become greater than a party now expects or
anticipates. Each party intends this agreement to apply to all unknown
or unanticipated results, as well as those known and anticipated, and
it is the intention of each Party to hereby fully, finally, absolutely,
and forever resolve any and all claims and disputes which have existed,
do exist, or may exist relating to the Company or its activities.
13. APPROVAL OF PURCHASE. WHTP, L.L.C. and ▇▇▇▇ hereby: (a) approve the
purchase of the ownership interest from ▇▇▇▇▇▇ for the consideration
stated herein and the agreement to pay the Dissolution Interest and (b)
approve, ratify and adopt as the act and deed of the Company any acts
undertaken by any manager, member, officer, or agent thereof in
connection with the purchase of the ownership interest by the Company.
14. CONTINUATION OF COMPANY. WHTP, L.L.C. and ▇▇▇▇ hereby agree that the
Company shall continue and shall not be dissolved because of the
retirement and redemption of the ▇▇▇▇▇▇ ownership interests or the
withdrawal of ▇▇▇▇▇▇ as a member of the Company.
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15. Miscellaneous.
(a) SURVIVAL. The representations, warranties and covenants set
forth in this Agreement shall survive the closing of the
transactions contemplated by this Agreement.
(b) ATTORNEY'S FEES TO ENFORCE THIS AGREEMENT OR IN SUBSEQUENT
LITIGATION. In the event any party shall maintain or commence
any action, proceeding, or motion against any other party to
enforce this Agreement or any provision thereof, the
prevailing party therein shall be entitled to recover, in
addition to any other recoverable damages, his actual
attorneys' fees and costs therein incurred.
(c) COSTS. Each party shall pay its own legal fees and expenses
incidental to the execution of this Agreement and the
consummation of the transactions contemplated hereby.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of the transferees, successors, assigns, heirs,
beneficiaries, executors, administrators, partners, agents,
employees, and representatives of each party.
(e) COUNTERPART EXECUTION. This Agreement may be executed in
multiple counterparts each of which may be deemed an original
and shall become effective when the separate counterparts have
been exchanged among the parties.
(f) CONSTRUCTION. Every covenant, term, and provision of this
Agreement shall be construed simply according to its fair
meaning and not strictly for or against any party.
(g) HEADINGS. Section and other headings contained in this
Agreement are for reference purposes only and are not intended
to describe, interpret, define, or limit the scope, extent, or
intent of this Agreement or any provision hereof.
(h) VARIATION OF PROVISIONS. All pronouns and any variations
thereof shall be deemed to refer to the masculine, feminine,
or neuter, singular or plural, as the identity of the person
or persons may require.
(i) ENTIRE AGREEMENT. This Agreement contains the entire
understanding among the parties and supersedes any prior
written or oral agreements between them respecting the subject
matter of this Agreement. There are no representations,
agreements, arrangements, or understandings, oral or written,
between the parties relating to the subject matter of this
Agreement that are not fully set forth herein.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of this
18th day of April, 2002.
INNOVATION GROWTH PARTNERS, L.L.C.
By:
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Name:
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Title:
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INNOVATION GROWTH PARTNERS II, L.L.C.
By:
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Name:
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Title:
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▇▇▇▇▇▇▇ ▇▇▇▇
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▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇, INC.
By:
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Name:
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Title:
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Executed solely to acknowledge its agreement to the provision of Sections 13 and
14 hereof:
WHTP, L.L.C.
By:
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Name:
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Title:
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