Re: Amendment of Additional Conditions for Granting Credits
June
14,
2006
Israel
Discount Bank Ltd
Dear
Sirs,
Pursuant
to Section 11.2 of the Additional Conditions for Granting Credits dated
November
30, 2000, as amended (the “Additional Conditions”) and the Convertible Debenture
Agreement dated November 30, 2000, as amended (the “CD”; the Additional
Conditions and the CD, the "Loan Documents"), we hereby confirm our agreement
to
the amendment of the Loan Documents as follows:
All
capitalized terms used herein not otherwise defined shall have the meaning
ascribed to them in the Loan Documents.
|
1.
|
The
Borrower shall sell to Sky Mobilemedia Inc. (“Buyer”), by not later than
September 30, 2006 (or such later date requested by ▇▇▇▇▇ and
approved by
▇▇▇▇▇▇▇▇ and Bank but not later than October 31, 2006, such
date, the
“Final Sale Date”) all or substantially all of its assets (“Asset Sale”)
in consideration for an aggregate amount of not less than $11,000,000
(eleven million US dollars). From said amount of $11,000,000
(eleven
million US dollars) (the “Purchase Consideration”), not more than
$6,000,000 (six million US dollars) and not less than $5,000,000
(five
million US dollars) will be paid in cash and the remaining
amount of the
Purchase Consideration will be in securities of the Buyer.
In the event of
the closing of the Asset Sale as per the foregoing, fifty five
percent
(55%) of the Utilized Credit including Interest shall be repaid,
within 7
(seven) days of the receipt of the cash component of the purchase
price by
the Borrower, as described above. From the remaining forty
five percent
(45%) of the Utilized Credit, the Bank shall purchase 495,833
Ordinary
Shares of the Borrower, the payment whereof will be effected
by a set-off
against the Utilized Credit. The remaining amount of the Utilized
Credit
not deferred or repaid as per the foregoing, the Bank shall
waive and
forgive, and such amount shall be deemed repaid in full by
the
Borrower.
|
|
2.
|
In
order to facilitate the receipt by the Borrower from the Buyer
of a bridge
loan in an amount of $700,000 (seven hundred thousand US dollars)
prior to
the Asset Sale, and notwithstanding any indebtedness of the
Borrower to
the Bank and any obligation to make payments to the Bank, the
Bank hereby
agrees and permits the Borrower to receive from the Buyer a
bridge loan
and to use the funds in the ordinary course of business. The
Borrower may
not use the funds received from the Borrower as a bridge loan,
to repay
the Bank any amount. The bridge loan is provided as an unsecured
loan.
|
|
3.
|
All
the remaining terms of the Additional Conditions and the CD
shall remain
operative and in effect without any
change.
|
|
4.
|
Should
Buyer fail to provide and make available to Borrower a bridge
loan in an
amount not less than $500,000 (five hundred US dollars) by
no later than
July 15, 2006, then, and in that event, this document shall
automatically
and immediately thereafter be canceled, revoked and be regarded
as of no
force and effect.
|
|
5.
|
In
the event that the bridge loan was granted and made available
to the
Borrower by no later than July 15, 2006, and the assets of
the Borrower
described in Section 1 above (the “Assets”) were not purchased by Buyer by
the Final Sale Date, then this document shall automatically
and
immediately thereafter be canceled, revoked and be regarded
as of no force
and effect.
|
|
6.
|
The
Bank hereby gives its consent to the execution, delivery and
performance
of the Asset Sale and, contingent on and concurrent with the
sale of the
Assets to the Buyer and the receipt of the Purchase Consideration
by the
Borrower, to cancel and remove all liens, pledges, charges
and other
encumbrances from the Borrower and its assets and the CD shall
be
terminated and of no further force and effect, except for the
right to
purchase shares of the Borrower. Any certificates instruments
or documents
required for the removal of the pledges, charges or encumbrances
registered in favor of he Bank shall be held in escrow by the
Bank until
the payment to the Bank of the 55% of the Utilized Credit (plus
Interest)
as referenced in Section 1
above.
|
Please
confirm your agreement to the above amendments to the Loan
Documents.
Yours
sincerely,
|
|
e-SIM Ltd. | |
|
By:
|
||
|
Title:
|
We
confirm our agreement to the above amendments to the Loan
Documents.
| Israel Discount Bank Ltd. |
|
|
By:
|
|
|
|
Title:
|
|