EXHIBIT 10.1
AGREEMENT TO EXCHANGE STOCK
BETWEEN
UNLTD VENTURES INCORPORATED
AND
ACTIVEIN LTD.
INDEX
Page
ARTICLE I - EXCHANGE OF SECURITIES ...................................... 5
ARTICLE II - REPRESENTATIONS AND WARRANTIES ............................. 5
2.0l - Organization .............................................. 5
2.02 - Capital ................................................... 5
2.03 - Directors and Officers' Compensation; Banks ............... 5
2.04 - Financial Statements ....................................... 5
2.05 - Absence of Changes ........................................ 6
2.06 - Absence of Undisclosed Liabilities ........................ 6
2.07 - Tax Returns ............................................... 6
2.08 - Corporate Matters........................................... 6
2.09 - Trade Names and Rights .................................... 6
2.l0 - Contracts and Leases ....................................... 6
2.ll - Insurance Policies ........................................ 6
2.l2 - Compliance with Laws ....................................... 6
2.l3 - Litigation ................................................ 6
2.l4 - Ability to Carry Out Obligations .......................... 7
2.l5 - Full Disclosure ............................................ 7
2.l6 - Assets .................................................... 7
2A - Organization .................................................. 6
2B - Directors and Officers' Compensation; Banks ................... 7
2C - Capital ....................................................... 8
2D - Financial Statements ......................................... 8
2E - Absence of Changes ........................................... 8
2F - Absence of Undisclosed Liabilities ........................... 8
2G - Tax Returns .................................................. 8
2H - Corporate Matters ............................................ 8
2I - Trade Names and Rights ........................................ 8
2J - Contracts and Leases .......................................... 8
2K - Insurance Policies ............................................ 9
2L - Compliance with Laws .......................................... 9
2M - Litigation .................................................... 9
2N - Ability to Carry Out Obligations .............................. 9
2O - Full Disclosure ............................................... 9
2P - Assets ......................................................... 9
2Q - Risk Assessment................................................. 9
2R - No Public Market ............................................... 10
ARTICLE III - SHAREHOLDER REPRESENTATIONS ............................... 10
ARTICLE IV - OBLIGATIONS BEFORE CLOSING ................................. 11
4.0l - Investigative Rights ......................................... 11
4.02 - Conduct of Business .......................................... 11
ARTICLE V - CONDITIONS PRECEDENT TO PERFORMANCE BY UNLTD ............... 11
5.0l - Conditions ................................................... 11
5.02 - Accuracy of Representations .................................. 11
5.03 - Performance................................................... 11
2
Page
5.04 - Absence of Litigation ........................................ 12
5.05 - Other ........................................................ 12
ARTICLE VI - CONDITIONS PRECEDENT TO PERFORMANCE ........................ 12
BY ACTI .............................................. 12
6.0l - Conditions ................................................... 12
6.02 - Accuracy of Representations ................................. 12
6.03 - Performance ................................................. 12
6.04 - Absence of Litigation ........................................ 12
6.05 - Other ........................................................ 12
ARTICLE VII - CLOSING ................................................... 13
7.0l - Closing ...................................................... 13
7.02 - Exchange of Shares ........................................... 14
7.03 - No Fractional Shares ......................................... 14
7.04 - Officers and Directors ....................................... 14
ARTICLE VIII - REMEDIES ................................................. 14
8.0l - Arbitration .................................................. 14
8.02 - Costs ....................................................... 14
8.03 - Termination .................................................. 15
ARTICLE IX - MISCELLANEOUS .............................................. 15
9.0l - Captions and Headings ........................................ 15
9.02 - No Oral Change ............................................... 15
9.03 - Non-Waiver ................................................... 15
9.04 - Time of Essence .............................................. 15
9.05 - Entire Agreement ............................................. 16
9.06 - Governing Law ................................................ 16
9.07 - Counterparts ................................................. 16
9.08 - Notices ...................................................... 16
9.09 - Binding Effect ............................................... 16
9.l0 - Effect of Closing ............................................ 16
9.ll - Mutual Cooperation ........................................... 17
9.12 - Expenses...................................................... 17
Schedule 1- Allocation of Shares..................................... 19
Exhibit A - Options, Warrants and Covertible Securities (ACTI)........
Exhibit B - Officers and Directors (ACTI)..............................
Exhibit C - Financial Statements - Changes in Financial
Condition (ACTI) .........................................
Exhibit D - Trademarks, Trade Names and Copyrights (ACTI..............
Exhibit E - Material Contracts (ACTI)................................
Exhibit F - Insurance Policies (ACTI).................................
Exhibit G - Officers, Directors, Bank Accounts, Safe Deposit
Boxes, Powers of Attorney (UNLTD).........................
Exhibit H - Options, Warrants and Convertible Securities (UNLTD) .....
Exhibit I - Financial Statements - Changes in Financial
Condition (UNLTD).....................................
Exhibit J - Trademarks, Trade Names and Copyrights (UNLTD) ...........
Exhibit K - Material Contracts (UNLTD) ...............................
Exhibit L- Insurance Policies (UNLTD)................................
Exhibit M - Litigation (UNLTD)........................................
3
Exhibit N - Shareholders' Agreement..................................
Exhibit O - Form of UNLTD Share Certificate ..........................
Exhibit P - Shareholders' Resolution and New AOA of ACTI .............
Exhibit Q - UNTLD Resolution - Designation of Preferred Shares/
Issuance of Shares................... .................
Exhibit R - Form of UNTLD Share Certificate to Be Issued to
ACTI Shareholders.....................................
Exhibit S - Shareholder
Register ............................................................
Exhibit T - Amendment to Certificate of Incorporation.................
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AGREEMENT TO EXCHANGE COMMON STOCK
This SHARE EXCHANGE AGREEMENT ("this Agreement"), made this ___ day of
___, 2008, by and between UNLTD Ventures Incorporated ("UNLTD") and ActiVein
Ltd. ("ACTI"), and the shareholders of ACTI is made for the purpose of setting
forth the terms and conditions upon which UNLTD will acquire all of the issued
and outstanding common stock of ACTI in exchange for shares of UNLTD's common
stock.
In consideration of the mutual promises, covenants, and representations
contained herein, THE PARTIES HERETO AGREE AS FOLLOWS:
ARTICLE I
EXCHANGE OF SECURITIES
1.01 Subject to the terms and conditions of this Agreement, UNLTD agrees
to issue, and the shareholders of ACTI agree to accept 5,800,297 shares of
UNLTD's common stock and 3,770,935 shares of UNLTD's Series A Preferred stock
(the "UNLTD Stock") in consideration for all of the issued and outstanding
common and preferred stock of ACTI (the "ACTI Shares"). The shares of the UNLTD
will be allocated to the shareholders of ACTI in accordance with Schedule 1 to
this Agreement.
1.02 The distribution and use of funds shall be pursuant to the
Shareholders Agreement attached hereto.
ARTICLE IIREPRESENTATIONS AND WARRANTIES
ACTI represents and warrants to UNLTD that:
2.0l Organization. ACTI is a company duly organized, validly existing, and
in good standing under the laws of Israel.
2.02 Capital. The authorized capital stock of ACTI consists of 992,076
ordinary shares and 7,924 Preferred A shares, of which 10,944 ordinary shares
and 7,115 Preferred A shares and will be issued and outstanding at closing. At
closing, there will be no outstanding subscriptions, options, rights, warrants,
convertible securities, or other agreements or commitments obligating ACTI to
issue or to transfer from treasury any additional shares of its capital stock of
any class other than as set forth on Exhibit A. The Shareholder List of ACTI
immediately prior to the execution of this Agreement is attached hereto in
Exhibit A.
2.03 Directors and Officers' Compensation; Banks. Exhibit B to this
Agreement contains the names and titles of all directors and officers of ACTI.
2.04 Financial Statements. Exhibit C to this Agreement contains the
audited financial statements of ACTI as of March 31, 2008. The financial
statements have been prepared in U.S. $ and in accordance with Israeli generally
accepted accounting principles consistently followed by ACTI throughout the
periods indicated, and fairly present the financial position of ACTI as of
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the dates of the balance sheets included in the financial statements, and the
results of its operations for the periods indicated.
2.05 Absence of Changes. Since March 31, 2008 there has not been any
change in the financial condition or operations of ACTI, other than changes
reflected on Exhibit C or changes in the ordinary course of business, which
changes have not in the aggregate been materially adverse.
2.06 Absence of Undisclosed Liabilities. ACTI did not as of March 31, 2008
have any debt, liability, or obligation of any nature, whether accrued,
absolute, contingent, or otherwise, and whether due or to become due, that is
not reflected on Exhibit C.
2.07 Tax Returns. Within the times and in the manner prescribed by law,
ACTI has filed all Israeli tax returns required by law and has paid all taxes,
assessments, and penalties due and payable. The provision for taxes, if any,
reflected in ACTI's balance sheet as of March 31, 2008, is adequate for any and
all Israeli taxes for the period ending on the date of that balance sheet and
for all prior periods, whether or not disputed. There are no present disputes as
to taxes of any nature payable by ACTI.
2.08 Corporate Matters. The minutes of ACTI as supplied to UNLTD are a
complete and accurate record of all meetings of the shareholders and directors
of ACTI and accurately reflect all resolutions taken at such meetings. The
signatures of the directors and/or officers on such minutes are the valid
signatures of ACTI's directors and/or officers who were duly elected or
appointed. The share register of ACTI contains an accurate record of all
transactions with respect to the capital stock of ACTI.
2.09 Trade Names and Rights. Exhibit D attached hereto and made a part
hereof lists all trademarks, trademark registrations or applications, trade
names, service marks, copyrights, copyright registrations or applications which
are owned by ACTI. No person other than ACTI owns any trademark, trademark
registration or application, service ▇▇▇▇, trade name, copyright, or copyright
registration or application the use of which is necessary or contemplated in
connection with the operation of ACTI's business.
2.10 Contracts and Leases. Exhibit E attached hereto and made a part
hereof contains a summary of the provisions of all material contracts, leases,
and other agreements of ACTI presently in existence or which have been agreed to
by ACTI (whether written or oral). Except as disclosed on Exhibit E, ACTI is not
in default under of these agreements or leases. For the purposes of this
Agreement, "Material" shall be any amounts over US$10,000.
2.11 Insurance Policies. Exhibit F to this Agreement is a description of
all insurance policies held by ACTI concerning its business and properties. All
these policies are in the respective principal amounts set forth in Exhibit F
and are in full force and effect.
2.12 Compliance with Laws. ACTI has complied with, and is not in violation
of, applicable Israeli laws, and regulations affecting its properties or the
operation of its business.
2.13 Litigation. ACTI is not a party to any suit, action, arbitration, or
legal, administrative, or other proceeding, or governmental investigation
pending or, to the best knowledge of ACTI threatened, against or affecting ACTI
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or its business, assets, or financial condition. ACTI is not in default with
respect to any order, writ, injunction, or decree of any federal, state, local,
or foreign court, department, agency, or instrumentality. ACTI is not engaged in
any legal action to recover moneys due to ACTI or damages sustained by ACTI.
2.14 Ability to Carry Out Obligations. Subject to the approval of its
shareholders, ACTI has the right, power, and authority to enter into, and
perform its obligations under, this Agreement. The execution and delivery of
this Agreement by ACTI and the performance by ACTI of its obligations hereunder
will not cause, constitute, or conflict with or result in (a) any breach or
violation or any of the provisions of or constitute a default under any license,
mortgage, articles of association of ACTI (the "AOA"), or other agreement to
which ACTI is a party, or by which it may be bound, nor will any consents or
authorizations of any party other than those hereto be required other than
consents or authorizations by the Office of the Israeli Chief Scientist and the
Israeli Tax Authorities; (b) an event that would permit any party to any
agreement to terminate it or to accelerate the maturity of any indebtedness or
other obligation of ACTI; or (c) an event that would result in the creation or
imposition or any lien, charge, or encumbrance on any asset of ACTI or would
create any obligation for which ACTI would be liable, except as contemplated by
this Agreement. For the avoidance of doubt, the Parties agree that the shares of
UNLTD which are issued to Xenia may be subject to a lien granted in favor of
certain Israeli regulatory authorities including the Office of the Chief
Scientist.
2.15 Full Disclosure. None of the representations and warranties made by
ACTI, contains any untrue statement of material fact.
2.16 Assets. ACTI has good and marketable title to all of its property.
UNLTD represents and warrants to ACTI and its Shareholders that:
2A. Organization. UNLTD is a corporation duly organized, validly existing,
and in good standing under the laws of Delaware, has all necessary corporate
powers to own its properties and to carry on its business as now owned and
operated by it, and is duly qualified to do business and is in good standing in
each of the states where its business requires qualification. UNLTD has no
subsidiaries. There are no voting trusts or other agreements or understandings
to which UNLTD is a party with respect to the holding, voting or disposing of
capital stock of UNLTD.
2B. Directors and Officers' Compensation; Banks. Exhibit G to this
Agreement contains: (i) the names and titles of all directors and officers of
UNLTD and all persons, together with their titles whose compensation, and the
tasks for which they receive such compensation, from UNLTD as of the date of
this Agreement will equal or its expected to equal or exceed, at an annual rate,
the sum of $1,000; (ii) the name and address of each bank with which UNLTD has
an account or safety deposit box, and the names of all persons who are
authorized to draw thereon or have access thereto; and (iii) the names of all
persons who have a power of attorney from UNLTD and a summary of the terms
thereof.
2C. Capital. The authorized capital stock of UNLTD consists of 50,000,000
shares of common stock, and 1,000,000 shares of preferred stock. Immediately
prior to closing 9,112,733 shares of common stock are issued and outstanding.
All of the shares are validly issued, fully paid, and non-assessable. UNLTD has
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not issued any shares, warrants or other convertible securities of preferred
stock. At closing, there will be no outstanding subscriptions, options, rights,
warrants, convertible securities, or other agreements or commitments obligating
UNLTD to issue or to transfer from treasury any additional shares of its capital
stock of any class except as reflected on Exhibit H. The Shareholder List of
UNLTD immediately prior to the execution of this Agreement is attached hereto as
Exhibit H.
2D. Financial Statements. Exhibit I to this Agreement sets forth balance
sheets of UNLTD as of March 31, 2008, and the related statements of income and
retained earnings for the period then ended. The financial statements have been
prepared in accordance with U.S. generally accepted accounting principles as
consistently followed by UNLTD throughout the periods indicated, and fairly
present the financial position of UNLTD as of the dates of the balance sheets
included in the financial statements, and the results of its operations for the
periods indicated.
2E. Absence of Changes. Since March 31, 2008, there has not been any
change in the financial condition or operations of UNLTD, except (i) changes in
the ordinary course of business, which changes have not in the aggregate been
materially adverse, and (ii) changes disclosed on Exhibit I, which changes have
not in the aggregate been materially adverse.
2F. Absence of Undisclosed Liabilities. UNLTD did not as of March 31, 2008
have any debt, liability, or obligation of any nature, whether accrued,
absolute, contingent, or otherwise, and whether due or to become due, that is
not reflected on Exhibit I.
2G. Tax Returns. Within the times and in the manner prescribed by law,
UNLTD has filed all federal, state, and local tax returns required by law and
has paid all taxes, assessments, and penalties due and payable. No federal
income tax returns of UNLTD have been audited by the Internal Revenue Service.
The provision for taxes, if any, reflected in UNLTD's balance sheet as of March
31, 2008, is adequate for any and all federal, state, county, and local taxes
for the period ending on the date of that balance sheet and for all prior
periods, whether or not disputed. There are no present disputes as to taxes of
any nature payable by UNLTD.
2H. Corporate Matters. The minutes of UNLTD are a complete and accurate
record of all meetings of the shareholders and directors of UNLTD and accurately
reflect all actions taken at such meetings. The signatures of the directors
and/or officers on such minutes are the valid signatures of UNLTD's directors
and/or officers who were duly elected or appointed.
2I. Trade Names and Rights. Exhibit J attached hereto and made a part
hereof lists all trademarks, trademark registrations or applications, trade
names, service marks, copyrights, copyright registrations or applications which
are owned by UNLTD. No person, other than UNLTD, will own any trademark,
trademark registration or application, service ▇▇▇▇, trade name, copyright, or
copyright registration or application the use of which is necessary or
contemplated in connection with the operation of the business of UNLTD, as such
business is to be conducted after the closing of this transaction.
2J. Contracts and Leases. Exhibit K attached hereto and made a part hereof
8
contains a summary of the provisions of all material contracts, leases, and
other agreements of UNLTD presently in existence or which have been agreed to by
UNLTD (whether written or oral).
2K. Insurance Policies. Exhibit L to this Agreement is a description of
all insurance policies held by UNLTD concerning its business and properties. All
these policies are in the respective principal amounts set forth in Exhibit L
and are in full force and effect.
2L. Compliance with Laws. UNLTD has complied with, and is not in violation
of, applicable federal, state, or local statutes, laws, and regulations
affecting its properties or the operation of its business, including but not
limited to federal and state securities laws. UNLTD does not have any employee
benefit plan which is subject to the provisions of the Employee Retirement
Income Security Act of 1974.
2M. Litigation. UNLTD is not a party to any suit, action, arbitration, or
legal, administrative, or other proceeding, or governmental investigation
pending or, to the best knowledge of UNLTD threatened, against or affecting
UNLTD or its business, assets, or financial condition. UNLTD is not in default
with respect to any order, writ, injunction, or decree of any federal, state,
local, or foreign court, department, agency, or instrumentality. UNLTD is not
engaged in any legal action to recover moneys due to it or damages sustained by
it.
2N. Ability to Carry Out Obligations. UNLTD has the right, power, and
authority to enter into, and perform its obligations under, this Agreement. The
execution and delivery of this Agreement by UNLTD and the performance by UNLTD
of its obligations hereunder will not cause, constitute, or conflict with or
result in (a) any breach or violation or any of the provisions of or constitute
a default under any license, indenture, mortgage, charter, instrument, articles
of incorporation, by-law, or other agreement or instrument to which UNLTD is a
party, or by which it may be bound, nor will any consents or authorizations of
any party other than those hereto be required, (b) an event that would permit
any party to any agreement or instrument to terminate it or to accelerate the
maturity of any indebtedness or other obligation of UNLTD, or (c) an event that
would result in the creation or imposition or any lien, charge, or encumbrance
on any asset of UNLTD or would create any obligations for which UNLTD would be
liable, except as contemplated by this Agreement.
2O. Full Disclosure. None of representations and warranties made by UNLTD,
or in any certificate or memorandum furnished or to be furnished by UNLTD, or on
its behalf, contains or will contain any untrue statement of material fact, or
omit any material fact the omission of which would be misleading. UNLTD has
disclosed to ACTI all reasonably foreseeable contingencies which, if such
contingencies transpired, would have a material adverse effect on UNLTD.
2P. Assets. UNLTD has good and marketable title to all of its property.
2Q. Risk Assessment. UNLTD, its shareholders, officers, and directors
represent that they are sophisticated investors and have the requisite knowledge
and experience in financial and business matters to be capable of evaluating the
merits and risks of an investment in ACTI. In making the decision to invest in
ACTI and signing this Agreement, they have relied on their own knowledge and
upon independent investigations made by it. In addition, they represent that
they have been given the full opportunity and time in which to carry out a "due
9
diligence" investigation of ACTI, and the business conducted and proposed to be
conducted by ACTI and anything else related to them, have received in the
framework of such "due diligence" investigation all materials, information,
documentation and answers which they requested and obtained information
necessary to verify the accuracy of the information contained in this Agreement,
and were satisfied with the results of the investigation, and it appears to them
suitable for their objectives and therefore caused UNLTD to sign this Agreement.
2R. No Public Market. UNLTD its shareholders, officers, and directors
further represent that they are aware that there is no public market for ACTI's
shares and there is no assurance that a market will ever develop. The shares of
ACTI to be exchanged in this offering have not been registered with any state
securities commission or with the United States Securities and Exchange
Commission and ACTI has no plans and is under no obligation to register the
shares. UNLTD, its shareholders, officers and directors are prepared to accept
the fact that their investment is of a long-term nature and may not be readily
liquidated. ACTI is a hi-tech company and as such a "high risk" investment. The
acquisition of ACTI shares consequently involves certain risks, which could
adversely affect the value of ACTI's shares. ACTI does not make, nor has it
authorized any other person to make, any representation about the future market
value of ACTI's shares.
ARTICLE III
SHAREHOLDER REPRESENTATIONS
Each shareholder of ACTI severally and not jointly, represents to UNLTD
that he she or it has the right, power, and authority to enter into, and perform
his or her obligations under this Agreement, and that all necessary corporate
actions needed to transfer shares to UNLTD have been taken. The execution and
delivery of this Agreement by such shareholder and the delivery by such
shareholder of his or her shares in ACTI pursuant to Article I will not cause,
constitute, or conflict with or result in any breach or violation or any of the
provisions of or constitute a default under any license, mortgage, or agreement
to which he or she is a party, or by which he or she may be bound, and any
consents or authorizations of any party which are required, have been duly
obtained or will be obtained at or prior to the Closing. Each shareholder of
ACTI severally and not jointly, represents and warrants to UNLTD that the shares
of ACTI that such shareholder will deliver at closing will be free of any liens
or encumbrances. Each shareholder of ACTI severally and not jointly, hereby
declares that it has waived its rights under Article 44.7 of the AOA in
connection with the transaction.
Xenia Venture Capital Ltd. hereby waives any rights it may have under
Articles 16 and 72 of the AOA.
Each shareholder of ACTI understands that the shares being acquired from
UNLTD represent restricted securities as that term is defined in Rule l44 of the
Securities and Exchange Commission.
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ARTICLE IV
OBLIGATIONS BEFORE CLOSING
4.0l Investigative Rights. From the date of this Agreement until the date
of closing, each party shall provide to the other party, and such other party's
counsel, accountants, auditors, and other authorized representatives, full
access during normal business hours to all of each party's properties, books,
contracts, commitments, records and correspondence and communications with
regulatory agencies for the purpose of examining the same. Each party shall
furnish the other party with all information concerning each party's affairs as
the other party may reasonably request.
4.02 Conduct of Business. Prior to the closing, and except as contemplated
by this Agreement, each party shall conduct its business in the normal course,
and shall not sell, pledge, or assign any assets, without the prior written
approval of the other party, except in the regular course of business. Except as
contemplated by this Agreement, (and subject to Section 4.03 below), neither
party to this Agreement shall issue or sell any shares, stock, options or other
securities, amend its Articles of Association, Incorporation or By-laws, declare
dividends, redeem or sell stock or other securities, incur additional or
newly-funded material liabilities, acquire or dispose of fixed assets, change
senior management, change employment terms, enter into any material or long-term
contract, guarantee obligations of any third party, settle or discharge any
balance sheet receivable for less than its stated amount, pay more on any
liability than its stated amount, or enter into any other transaction other than
in the regular course of business, or enter into any agreement or take any
action that is likely to cause any of the representations and warranties of such
party under this Agreement not to be true and correct as of the Closing, or that
is likely to affect the Closing. However and notwithstanding, any provision in
this Agreement to the contrary, UNLTD hereby assents and permits ACTI to raise
further financing in any manner including by way of a bridge loan provided in
exchange for the issuance of shares by ACTI.
ARTICLE V
CONDITIONS PRECEDENT TO PERFORMANCE BY UNLTD
5.01 Conditions. UNLTD's obligations hereunder shall be subject to the
satisfaction, at or before the Closing, of all the conditions set forth in this
Article V. UNLTD may waive any or all of these conditions in whole or in part
without prior notice; provided, however, that no such waiver of a condition
shall constitute a waiver by UNLTD of any other condition of or any of UNLTD's
other rights or remedies, at law or in equity, if ACTI shall be in default of
any of its representations, warranties, or covenants under this agreement.
5.02 Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by ACTI in this Agreement or in
any written statement that shall be delivered to UNLTD by ACTI under this
Agreement shall be true on and as of the Closing Date as though made at those
times.
5.03 Performance. ACTI shall have performed, satisfied, and complied with
all covenants, agreements, and conditions required by this Agreement to be
performed or complied with by it, on or before the closing. ACTI shall have
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obtained all necessary consents and approvals necessary to consummate the
transactions contemplated hereby including those required by Section 4.02.
5.04 Absence of Litigation. No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this agreement or to its consummation, shall have been
instituted or threatened on or before the Closing.
5.05 Other. In addition to the other provisions of this Article V, UNLTD's
obligations hereunder shall be subject to the satisfaction, at or before the
Closing, of the following:
o A shareholders agreement executed by the parties hereto in the form
attached as Exhibit N (the "Shareholders Agreement").
o The liabilities of ACTI will not exceed $50,000.
o The shareholders holding preferred shares of ACTI have waived their
rights under Article 16.1 of the AOA.
ARTICLE VI
CONDITIONS PRECEDENT TO PERFORMANCE BY ACTI
6.01 Conditions. ACTI's and its Shareholder's obligations hereunder shall
be subject to the satisfaction, at or before the Closing, of the conditions set
forth in this Article VI. ACTI may waive any or all of these conditions in whole
or in part without prior notice; provided, however, that no such waiver of a
condition shall constitute a waiver by ACTI of any other condition of or any of
ACTI's other rights or remedies, at law or in equity, if UNLTD shall be in
default of any of its representations, warranties, or covenants under this
agreement.
6.02 Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by UNLTD in this Agreement or in
any written statement that shall be delivered to ACTI by UNLTD under this
Agreement shall be true on and as of the Closing Date as though made at those
times.
6.03 Performance. UNLTD shall have performed, satisfied, and complied with
all covenants, agreements, and conditions required by this Agreement to be
performed or complied with by it, on or before the closing. UNLTD shall have
obtained all necessary consents and approvals necessary to consummate the
transactions contemplated hereby, including those required by Section 4.02.
6.04 Absence of Litigation. No action, suit, or proceeding before any
court or any governmental body or authority, pertaining to the transaction
contemplated by this agreement or to its consummation, shall have been
instituted or threatened on or before the closing.
6.05 Other. In addition to the other provisions of this Article VI, ACTI's
and its Shareholders obligations hereunder shall be subject to the satisfaction,
at or before the Closing, of the following:
o The Shareholders Agreement shall be duly executed.
o The liabilities of UNLTD will not exceed $5,000.
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o The shareholders holding preferred shares of ACTI have waived their
rights under Article 16.1 of the AOA.
o The shareholders of UNLTD, at a special meeting, shall have approved
the Certificate of Amendment attached as Exhibit T and the acquisition
of ACTI.
o UNLTD issue to Xenia Venture Capital Ltd. the warrant attached as
Exhibit B to Exhibit Q hereto
ARTICLE VIICLOSING
7.0l Closing. The closing of this transaction shall be held at the offices
of M. Firon and Co. Law Offices, 16 Abba Hillel Silver St., Ramat Gan, or such
other location as the parties may agree. Unless the execution of the agreements
which form the whole of this transaction takes place before January 31, 2009,
then either party may terminate this Agreement without liability to the other
party, except as otherwise provided in Section 9.12, excluding claims for
breaches of obligations by any party hereto prior to such termination. Closing
of the transaction shall follow within seven days of the receipt of approval of
the transaction from the Israeli Office of the Chief Scientist and the Israeli
Income Tax Authorities. At the closing, the following documents, in form
reasonably acceptable to counsel to the parties or as set forth herein, shall be
delivered:
By ACTI:
A. An officer's certificate, dated the Closing Date, that all
representations, warranties, covenants, and conditions set forth in this
Agreement on behalf of ACTI are true and correct as of, or have been fully
performed and complied with by, the Closing Date.
B. A validly executed share certificate in respect of 100% of the
ordinary shares of ACTI, issued in the name of UNLTD in the form attached hereto
as Exhibit O;
C. A copy of the revised shareholders register of ACTI reflecting
the share sale of the ACTI shares at the Closing; and
D. A written opinion of M. Firon & Co. Advocates & Notaries, in a
form acceptable to UNLTD, dated the date of the Closing.
E. A resolution of ACTI's shareholders in the form attached hereto
as Exhibit P replacing the existing AOA with the new AOA also attached as
Exhibit P.
By UNLTD:
A. An officer's certificate, dated the Closing Date, that all
representations, warranties, covenants, and conditions set forth in this
Agreement on behalf of UNLTD are true and correct as of, or have been fully
performed and complied with by, the Closing Date.
B. A resolution of the board of UNLTD issuing and allotting the
UNLTD Stock to be allotted at the Closing to the subscribing shareholders as
13
well as designating the rights, preferences and limitations of UNLTD's Series A
preferred stock, also in the form attached hereto as Exhibit Q;
C. Validly executed share certificates in respect of the UNLTD
Shares to be issued at the Closing, issued in the name of each subscribing
shareholder in the form attached hereto as Exhibit R;
D. A copy of the revised shareholders register of UNLTD reflecting
the issuance of the UNLTD Stock to be issued at the Closing; and
E. A written opinion of ▇▇▇▇ & ▇▇▇▇▇▇, in a form acceptable to ACTI,
dated the date of the Closing.
F. A resolution of UNLTD's shareholders in the form attached hereto
as Exhibit S amending the Articles of Incorporation and By-Laws of UNLTD; and
G. to the extent required by law or by any such third-party, a
signed undertaking to be submitted to the office of the Israeli Chief Scientist
or any other signed undertaking to any such third-party, as reasonably required
by each such third-party.
7.02 Exchange of Shares. On the Closing Date, each share of common stock
of ACTI then issued and outstanding will be exchanged for fully paid and
non-assessable shares of UNLTD and each share of preferred A stock of ACTI then
issued and outstanding will be exchanged for fully paid and non-assessable
Preferred A shares of UNLTD in accordance with Schedule 1 to this Agreement.
7.03 No Fractional Shares. No certificates for fractional share interests
of common stock of ACTI will be issued, but, in lieu thereof, UNLTD will issue
one share of common stock for each fractional share held in ACTI.
7.04 Officer and Directors. At the closing of this Agreement the parties
will cause ▇▇. ▇▇▇▇ Dor, ▇▇. ▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇ Kyiet, ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ and
Mr. Avi Lior, to be appointed as directors of UNLTD. Simultaneously with such
appointment, all present officers and directors of UNLTD will resign.
7.05 At the Closing, UNLTD and ACTI and the shareholders of ACTI shall
sign the Shareholders Agreement.
ARTICLE VIII
REMEDIES
8.01 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Israel. The parties hereto hereby
submit to the exclusive jurisdiction of the courts of Tel-Aviv-Jaffa.
8.02 Costs. If any legal action or any arbitration or other proceeding is
brought for the enforcement of this Agreement, or because of an alleged dispute,
14
breach, default, or misrepresentation in connection with any of the provisions
of this Agreement, the successful or prevailing party or parties shall be
entitled to recover reasonable attorney's fees and other costs incurred in that
action or proceeding, in addition to any other relief to which it or they may be
entitled.
8.03 Termination. In addition to the other remedies, UNLTD or ACTI may on
or prior to the Closing Date terminate this Agreement, without liability to the
other party:
(i) If any bona fide action or proceeding shall be pending against
UNLTD or ACTI on the Closing Date that could result in an unfavorable judgment,
decree, or order that would prevent or make unlawful the carrying out of this
Agreement or if any agency of the federal or of any state or national government
shall have objected at or before the Closing Date to this acquisition or to any
other action required by or in connection with this Agreement;
(ii) If the legality and sufficiency of all steps taken and to be taken
by each party in carrying out this Agreement shall not have been approved by the
respective party's counsel, which approval shall not be unreasonably withheld.
(iii) If a party breaches any representation, warranty, covenant or
obligation of such party set forth herein and such breach is not corrected
within ten days of receiving written notice from the other party of such breach.
ARTICLE IX
MISCELLANEOUS
9.01 Captions and Headings. The Article and paragraph headings throughout
this Agreement are for convenience and reference only, and shall in no way be
deemed to define, limit, or add to the meaning of any provision of this
Agreement.
9.02 No Oral Change. This Agreement and any provision hereof, may not be
waived, changed, modified, or discharged orally, but only by an agreement in
writing signed by all parties hereto.
9.03 Non-Waiver. Except as otherwise expressly provided herein, no waiver
of any covenant, condition, or provision of this Agreement shall be deemed to
have been made unless expressly in writing and signed by the party against whom
such waiver is charged; and (i) the failure of any party to insist in any one or
more cases upon the performance of any of the provisions, covenants, or
conditions of this Agreement or to exercise any option herein contained shall
not be construed as a waiver or relinquishment for the future of any such
provisions, convenants, or conditions, (ii) the acceptance of performance of
anything required by this Agreement to be performed with knowledge of the breach
or failure of a covenant, condition, or provision hereof shall not be deemed a
waiver of such breach or failure, and (iii) no waiver by any party of one breach
by another party shall be construed as a waiver with respect to any other or
subsequent breach.
9.04 Time of Essence. Time is of the essence of this Agreement and of each
and every provision hereof.
15
9.05 Entire Agreement. This Agreement contains the entire Agreement and
understanding between the parties hereto, and supersedes all prior agreements,
understandings and the letters of intent between the parties.
9.06 Governing Law. This Agreement and its application shall be governed by
the laws of Delaware.
9.07 Counterparts. This Agreement may be executed simultaneously in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.08 Notices. All notices, requests, demands, and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party to whom notice is
to be given, or on the third day after mailing if mailed to the party to whom
notice is to be given, by first class mail, registered or certified, postage
prepaid, and properly addressed as follows:
UNLTD Ventures Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
ActiVein Ltd.
▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇
Israel
9.09 Binding Effect. This Agreement shall inure to and be binding upon and
be enforceable against the respective successors of each of the parties to this
Agreement. No party may assign or transfer any of its rights or obligations
hereunder, without the prior written consent of the other parties hereto.
Nothing in this Agreement, express or implied, shall give to any person other
than the parties hereto any benefit or any legal or equitable right, remedy or
claim under this Agreement.
9.10 Effect of Closing. All representations, warranties, covenants, and
agreements of the parties contained in this Agreement, or in any instrument,
certificate, opinion, or other writing provided for in it, shall survive the
closing of this Agreement and shall remain in effect for a period of twelve
months thereafter. In the event there is any material misrepresentation or
warranty of any party to this Agreement, then UNLTD (if such misrepresentation
is made by ACTI or the ACTI shareholders) or the shareholders of ACTI ( if such
misrepresentation is made by UNLTD) may recind this Agreement during the 90 day
period following the closing of this Agreement.
16
9.11 Mutual Cooperation. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement, and shall execute such other and
further documents and take such other and further actions as may be necessary or
convenient to effect the transaction described herein. Neither party will
intentionally take any action, or omit to take any action, which will cause a
breach of such party's obligations pursuant to this Agreement.
9.12 Expenses. Each of the parties hereto agrees to pay all of its own
expenses (including without limitation, attorneys' and accountants' fees)
incurred in connection with this Agreement, the transactions contemplated herein
and negotiations leading to the same and the preparations made for carrying the
same into effect. Each of the parties expressly represents and warrants that no
finder or broker has been involved in this transaction and each party agrees to
indemnify and hold the other party harmless from any commission, fee or claim of
any person, firm or corporation employed or retained by such party (or claiming
to be employed or retained by such party) to bring about or represent such party
in the transactions contemplated by this Agreement.
AGREED TO AND ACCEPTED as of the date first above written.
UNLTD Ventures Incorporated
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, President
ActiVein Ltd.
By: /s/ Adi Plaschkes
-------------------------------
Adi Plaschkes, President
Shareholders of ActiVein
/s/ ▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇
-------------------------------
▇▇▇▇ ▇▇▇
/s/ Adi Plaschkes
-------------------------------
Adi Plaschkes
17
/s/ Yifat Gurion
-------------------------------
Yifat Gurion
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Eftan Investment Consulting Ltd.
By: /s/ Eitan Kyiet
-------------------------------
Eitan Kyiet, Authorized Officer
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
M.M.T.K. Real Estate Ltd.
By: /s/ ▇▇▇▇▇▇▇ Kata
-------------------------------
▇▇▇▇▇▇▇ Kata, Authorized Officer
XENIA VENTURE CAPITAL LTD.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
------------------------------
▇▇▇▇ ▇▇▇▇▇, Authorized Officer
18
Schedule 1
Allocation of Shares of Common Stock
Shares of UNLTD
ACTI Shareholdings Common Stock to be
Shareholder in ACTI received by ACTI Shareholder
▇▇▇▇ ▇▇▇▇▇▇ 1,783 944,986
▇▇▇▇ ▇▇▇ 1,783 944,986
Adi Plaschkes 840 445,198
Yifat Gurion 1,070 567,098
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 984 521,518
Eftan Investment Consulting Ltd. 713 377,888
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 542 287,259
▇▇▇ ▇▇▇▇▇▇▇▇▇ 542 287,259
▇▇▇▇▇ ▇▇▇▇▇▇ 400 211,999
M.M.T.K. Real Estate Ltd. 400 211,999
ActiVein Employee Stock
Ownership Plan 1,887 1,000,106
--------- ------------
Total 10,944 5,800,297
======== ============
19
Schedule 1
Allocation of Shares of Preferred Stock
Shares of UNLTD
ACTI Shareholdings Series A Preferred Stock to be
Shareholder in ACTI received by ACTI Shareholder
Xenia Venture Capital Ltd. 7,115 3,770,935
20
EXHIBIT A
OPTIONS, WARRANTS AND CONVERTIBLE SECURITIES
SHAREHOLDER LIST
Activein Ltd.
--------------------------------------------------------------------------------------------------------------------
As Issued Fully Diluted
-------------------------------------- -----------------------------------------
Shareholders Ordinary Preferred A Ordinary Preferred A
Shares Shares % Holding Shares Shares % Holding
------------ -------- ----------- --------- --------- ------------ ---------
▇▇▇▇ ▇▇▇▇▇▇ 1,783 11.03% 1,783 9.45%
▇▇▇▇ ▇▇▇ 1,783 11.03% 1,783 9.45%
Adi Plaschkes 840 5.19% 840 4.45%
Yifat Gurion 1,070 6.62% 1,070 5.67%
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 984 6.08% 984 5.22%
Eftan Investment Consulting Ltd. 713 4.41% 713 3.78%
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 542 3.35% 542 2.87%
▇▇▇ ▇▇▇▇▇▇▇▇▇ 542 3.35% 542 2.87%
▇▇▇▇▇ ▇▇▇▇▇▇ 400 2.47% 400 2.12%
M.M.T.K. Real Estate Ltd. 400 2.47% 400 2.12%
Xenia Venture Capital Ltd. 7,115 44.00% 7,115 37.71%
Xenia Venture Capital Ltd.
(Tiful Warrant) 809 4.29%
ESOP* 1,887 10.00%
--------------------------------------------------------------------------------------------------------------------
Total 9,057 7,115 100.00% 10,944 7,924 100.00%
===== ===== ======= ====== ===== =======
21
EXHIBIT B
Directors and Officers
Directors
▇▇▇▇ ▇▇▇▇▇ - Director ID NO.: 22179915 Address: 9 ▇▇▇▇▇ ▇▇▇ Tel-Aviv, Israel
Avi Lior - Director ID NO.: 07776115 Address: ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇-▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ - Director ID No.: 50196658 Address: ▇ ▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
Eitan Keiyt - Director ID No.:▇▇▇▇▇▇▇▇▇ Address: ▇ ▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇
Officers Position
Adi Plaschkes - ID No: ▇▇▇▇▇▇▇▇▇ Chief Executive Officer
Address: ▇▇ ▇▇▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
22
EXHIBIT C
Financial Statements of Activein Ltd.
23
Activein Ltd.
Balance Sheet US$
----------------------------------------------------------------------------
December 31, March 31,
2007 2008
----------- ----------
Audited Unaudited
Current assets
Cash and cash equivalents 15,340 19,500
Government Institutions 4,507 9,748
-------- --------
19,847 29,249
Fixed Assets 1,937 1,937
Intangible Assets 3,441 3,441
25,225 34,627
------ ------
Current Liabilities
Trade Payables 22,415 35,270
Other Payables 30,066 26,061
------ ------
52,480 61,331
Long-term Liabilities
Accrued Severance Pay 4,509 4,881
Shareholders' Deficiency (31,763) (30,743)
-------- --------
25,226 35,469
======== ========
Following are details of the representative rates of exchange in the reported
period:
December 31, 2007 3.846 NIS Exchange rate of 1 U.S. dollar
March 31, 2008 3.553 NIS Exchange rate of 1 U.S. dollar
24
Activein Ltd.
Statements of Profit and Loss US$
----------------------------------------------------------------------------
December 31, March 31,
2007 2008
----------- ----------
Audited Unaudited
R&D expenses 285,253 76,516
General and administrative expenses 86,159 36,836
--------- --------
Operating loss (371,412) (113,352)
Financial Expenses 1,126 315
---------- -----------
Net loss for the period (372,538) (113,668)
---------- ----------
Following are details of the representative rates of exchange in the reported
period:
December 31, 2007 3.846 NIS Exchange rate of 1 U.S. dollar
March 31, 2008 3.553 NIS Exchange rate of 1 U.S. dollar
25
EXHIBIT D
Trademarks, Trade Names, and Copyrights
None.
26
EXHIBIT E
Material Contracts
None.
27
EXHIBIT F
Insurance Policies
ACTI does not have any insurance policies which list ACTI as the insured.
All insurance policies are held under Xenia umbrella.
28
EXHIBIT G
Officers and Directors
Name Position
▇▇▇▇▇▇▇ ▇▇▇▇▇ President, Secretary, Treasurer and a Director
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Director
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Chief Financial Officer
Bank Accounts
Royal Bank of Canada
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ is the only person authorized to withdraw funds from the Company's
bank account at Royal Bank of Canada.
The Company does not have a safe deposit box. No person has a power-of-attorney
from the Company.
29
EXHIBIT H
UNLTD SHAREHOLDER LIST
Shareholder Name Shares
----------------- --------
▇▇▇▇▇▇▇ ▇▇▇▇▇ 2,500,000
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 2,500,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 500,000
▇▇▇, ▇▇▇▇▇ 20,000
▇▇▇, ▇▇▇▇ 20,000
▇▇▇▇▇▇, V. ▇▇▇▇▇ 13,333
▇▇▇▇▇▇, ▇▇▇▇ 6,667
▇▇▇▇▇▇, ▇▇▇ 6,667
Delure-Savage, ▇▇▇▇▇-▇▇▇ 66,667
Homes Unlimited/▇▇▇ ▇▇▇▇▇▇ 233,333
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 33,333
▇▇▇▇▇▇, ▇▇▇ 300,000
Dadwan, ▇▇▇▇▇▇▇▇▇▇ 12,500
Dadwan, ▇▇▇▇▇▇▇▇▇ 12,500
▇▇▇▇▇▇▇▇, Dr. ▇▇▇▇▇ 666,667
Gareth, ▇▇▇▇▇ 166,667
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 23,333
▇▇▇▇▇▇▇ ▇▇▇▇▇ 20,000
Lombarni, Len 10,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ 100,000
▇▇▇▇▇▇,▇▇▇▇▇ 20,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 30,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 100,000
▇▇▇▇▇, ▇▇▇▇ 50,000
▇▇▇▇▇, ▇▇▇▇▇▇▇ 100,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 5,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 10,000
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. 20,000
▇▇▇, ▇▇▇▇▇▇ 83,333
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 66,000
Witzu M. 33,333
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 35,000
▇▇▇▇▇▇▇, ▇▇▇ 25,000
▇▇▇▇, ▇▇▇▇-▇▇▇▇▇▇ 10,000
Caro, Gad 2,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 3,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 3,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,000
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 10,000
30
Shareholder Name Shares
----------------- --------
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 108,900
▇▇▇▇▇▇, ▇▇▇▇ 233,333
Wa, ▇▇▇▇▇ 3,153
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 6,680
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 6,667
▇▇▇▇, ▇▇▇▇▇▇ 6,667
Astortno, ▇▇▇▇▇▇ 6,667
▇▇▇▇▇▇, ▇▇▇▇ 10,000
▇▇▇▇▇, ▇▇▇▇▇ 10,000
▇▇▇▇▇▇▇▇▇, ▇.▇. 10,000
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 30,000
▇▇▇▇▇▇▇, ▇▇▇▇ 66,667
▇▇▇▇▇ ▇▇▇▇▇▇▇ 20,000
▇▇▇▇▇▇▇, ▇▇▇ 20,000
-----------
8,358,067
The Company does not have any outstanding options, warrants or convertible
securities.
Boaz Dor will receive 750,000 shares at closing as a finders fee.
31
EXHIBIT I
Financial Statements of UNLTD Ventures Incorporated
32
PRIVATE AND CONFIDENTIAL
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
FINANCIAL STATEMENTS
MARCH 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
33
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
FINANCIAL STATEMENTS
MARCH 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
TABLE OF CONTENTS
Page No
Balance Sheet as of March 31, 2008 2
Statement of Operations for the year ended March 31, 2008 and
the period from Inception (January 8, 2007) to March 31, 2008 3
Statement of Cash Flows for the year ended March 31, 2008 and
the period from Inception (January 8, 2007) to March 31, 2008 4
Statement of Changes in Stockholders' Equity from Inception
(January 8, 2007) to March 31, 2008 5
Notes to Financial Statements 6-12
34
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Balance Sheet
As at March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
ASSETS
2008
----
CURRENT
Cash and cash equivalents $ 20,094
Short term Investments 403,040
-------
Total Current Assets 423,134
-------
TOTAL ASSETS $ 423,134
-------
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 335
--------
Total Current Liabilities 335
STOCKHOLDERS' EQUITY
Capital Stock (Note 4) $ -
Additional Paid-In Capital 429,260
Deficit Accumulated During the Development Stage (6,461)
----------
Total Stockholders' Equity 422,799
---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 423,134
=========
The accompanying notes are an integral part of these
unaudited financial statements.
35
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Statement of operations
Year Ended March 31, 2008 and the
Period from Inception (January 8, 2007) to March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
Cumulative
Since
Inception 2008
Expenses
General and administrative 9,501 9,501
------- -------
Total Operating Expenses 9,501 9,501
-------- -------
Loss from Operations (9,501) (9,501)
Interest Income 3,040 3,040
------- --------
Loss before Income Taxes (6,461) (6,461)
Provision for income taxes - -
------- --------
Net Loss (6,461) (6,461)
======= ========
The accompanying notes are an integral part of
these unaudited financial statements.
36
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Statement of Cash Flows
Year ended March 31, 2008 and Period
From Inception (January 8, 2007) to March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
Cumulative
Since
Inception 2008
Cash Flows from Operating Activities
Net loss (6,461) (6,461)
Adjustments for:
Changes in non-cash working capital
Accounts payable and accrued liabilities 335 335
-------- --------
Net cash used in operating activities (6,126) (6,126)
-------- --------
Cash Flows from Investing Activities
Increase in Short-term investments (403,040) (403,040)
-------- --------
Net cash used in investing activities (403,040) (403,040)
-------- --------
Cash Flows from Financing Activities
Stock subscriptions received 429,260 429,260
-------- --------
Net cash provided by financing activities 429,260 429,260
-------- --------
Net Change in Cash 20,094 20,094
Cash- beginning of year - -
-------- --------
Cash - end of year 20,094 20,094
-------- --------
Supplemental Cash Flow Information
Interest paid -- --
Income taxes paid -- --
The accompanying notes are an integral part
of these unaudited financial statements.
37
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Statement of Changes in Stockholders' Deficiency
From Inception (January 8, 2007) to March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by Management)
Number of Common Additional Total
Common Shares Paid-in Deficit Shareholders'
Shares amount Capital Accumulated Equity
--------- ------ --------- ----------- --------------
$ $ $ $
Balance as of January 8, 2007 -- -- -- -- --
Stock subscriptions received from
directors/officers -- -- 550 -- 550
Stock subscriptions received from
Non- related investors -- -- 428,710 -- 428,710
Net loss for the period -- -- -- (6,461) (6,461)
------- ------- -------- -------- -------
Balance as of
March 31, 2008 -- -- 429,260 (6,461) 422,799
------- ------- -------- -------- -------
The accompanying notes are an integral part of
these unaudited financial statements.
38
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
1. BASIS OF PRESENTATION
The financial statements include the accounts of Unltd Ventures
Incorporated (the "Company"). The first period of the financial
statements commenced January 8, 2007 and ended March 31, 2007. The
Company did not do any transactions during this period.
2. NATURE OF OPERATIONS AND GOING CONCERN
The Company was incorporated under the laws of the state of Delaware, USA
on January 8, 2007. The company is currently negotiating an agreement for
exchange of common stock with ActiVein, an Israel based Company which is
developing an elegant dual-action IV catheter that can enable both fluid
infusion and blood withdrawal from the same vein.
The company has not commenced operations. It has no source for operating
revenue and expects to incur significant expenses before establishing
operating revenue. The Company's future success, if it concludes the
transaction with ActiVein, is dependent upon its ability to raise
sufficient capital which will be required in the development and the
marketability of the products to be manufactured by ActiVein.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the Company are in accordance with accounting
principles generally accepted in the United States of America. Outlined
below are the significant accounting policies:
Basis of Presentation
a) Cash and Cash Equivalents
Cash consists of cash and cash equivalents, which are short-term, highly
liquid investments with original terms to maturity of 90 days or less.
b) Short-Term Investments
Short-term investments include money market instruments and commercial
paper carried at the lower of cost or market value.
39
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
c) Income taxes
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes". Deferred tax assets and liabilities are
recorded for differences between the financial statement and tax basis of
the assets and liabilities that will result in taxable or deductible
amounts in the future based on enacted tax laws and rates. Valuation
allowances are established when necessary to reduce deferred tax assets
to the amount expected to be realized. Income tax expense is recorded for
the amount of income tax payable or refundable for the period increased
or decreased by the change in deferred tax assets and liabilities during
the period.
d) Revenue Recognition
The Company's revenue recognition policies are expected to follow common
practice in the manufacturing industry.
e) Stock Based Compensation
All awards granted to employees and non-employees after June 30, 2005
will be valued at fair value in accordance with the provisions of SFAS
123 (R) by using the Black-Scholes option pricing model and recognized on
a straight line basis over the service periods of each award. The Company
accounts for equity instruments issued in exchange for the receipt of
goods or services from other than employees in accordance with SFAS No.
123 and the conclusions reached by the Emerging Issues Task Force
("EITF") in Issue No. 96-18, "Accounting for Equity Instruments That Are
Issued to Other Than Employees for Acquiring or in Conjunction with
Selling Goods or Services". Costs are measured at the estimated fair
market value of the consideration received or the estimated fair value of
the equity instruments issued, whichever is more reliably measurable. The
value of equity instruments issued for consideration other than employee
services is determined on the earlier of a performance commitment or
completion of performance by the provider of goods or services as defined
by EITF No. 96-18.
As of March 31, 2008, no awards are granted to employees and
non-employees and accordingly, no amount has been charged as stock based
compensation expense.
40
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
f) Use of Estimates
Preparation of financial statements in accordance with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the amounts
reported in the financial statements and related notes to financial
statements. These estimates are based on management's best knowledge of
current events and actions the Company may undertake in the future.
Actual results may ultimately differ from such estimates.
g) Fair values
The carrying amount of the Company's cash, short term investments
approximates fair values because of the short term maturity of these
instruments.
h) Foreign Currency
The Company maintains its books, records and banking transactions in U.S.
dollars which is its functional currency. As such, no translation
adjustment is created.
i) Recent Pronouncements
In July 2006, the FASB issued Interpretation No. 48, "Accounting for
Uncertainty in Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting
for uncertainty in income taxes recognized in enterprises' financial
statements in accordance with SFAS No. 109, "Accounting for Income
Taxes". FIN 48 prescribes a recognition threshold and measurement
attributable for the financial statement recognition and measurement of a
tax position taken or expected to be taken in a tax return. FIN 48 also
provides guidance on derecognizing, classification, interest and
penalties, accounting in interim periods, disclosures and transitions.
FIN 48 is effective for fiscal years beginning after December 15, 2006.
The adoption of this statement is not expected to have a material effect
on the Company's future reported financial position or results of
operations.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measures"
("SFAS No. 157"). SFAS No. 157 defines fair value, establishes a
framework for measuring fair value in generally accepted accounting
principles ("GAAP"), expands disclosures about fair value measurements,
and applies under other accounting pronouncements that require or permit
fair value measurements. SFAS No. 157 is effective for financial
statements issued for fiscal
41
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
years beginning after November 15, 2007. The Company is currently
reviewing the effect, if any, SFAS 157 will have on its financial
position and operations.
In September 2006, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 158, Employers' Accounting for Defined Benefit Pension
and Other Postretirement Plans - an amendment of FASB Statements No. 87,
88, 106, and 132(R)". This statement requires employers to recognize the
overfunded or underfunded status of a defined benefit postretirement plan
(other than a multi employer plan) as an asset or liability in its
statement of financial position and to recognize changes in that funded
status in the year in which the changes occur through comprehensive
income of a business entity or changes in unrestricted net assets of a
not-for-profit organization.
This statement also requires an employer to measure the funded status of
a plan as of the date of its year-end statement of financial position,
with limited exceptions. The provisions of SFAS No. 158 are effective for
employers with publicly traded equity securities as of the end of the
fiscal year ending after December 15, 2006. The adoption of this
statement did not have a material effect on the Company's future reported
financial position or results of operations.
In February 2007, the FASB issued SFAS No. 159 ("SFAS 159") - the fair
value option for financial assets and liabilities including in amendment
of SFAS 115.
This Statement permits entities to choose to measure many financial
instruments and certain other items at fair value. The objective is to
improve financial reporting by providing entities with the opportunity to
mitigate volatility in reported earnings caused by measuring related
assets and liabilities differently without having to apply complex hedge
accounting provisions. This Statement is expected to expand the use of
fair value measurement objectives for accounting for financial
instruments. This Statement is effective as of the beginning of an
entity's first fiscal year that begins after November15, 2007, and
interim periods within those fiscal years. Early adoption is permitted as
of the beginning of a fiscal year that begins on or before November 15,
2007, provided the entity also elects to apply the provisions of FASB
Statement No. 157, Fair value measurements. The Company is currently
evaluating the impact of SFAS No. 159 on its financial statements.
42
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
In September 2006, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 108 (Topic 1N), "Quantifying Misstatements
in Current Year Financial Statements" ("SAB No. 108"). SAB No. 108
addresses how the effect of prior year uncorrected misstatements should
be considered when quantifying misstatements in current year financial
statements. SAB No. 108 requires SEC registrants (i) to quantify
misstatements using a combined approach which considers both the balance
sheet and income statement approaches; (ii) to evaluate whether either
approach results in quantifying an error that is material in light of
relevant quantitative and qualitative factors; and (iii) to adjust their
financial statements if the new combined approach results in a conclusion
that an error is material. SAB No. 108 addresses the mechanics of
correcting misstatements that include effects from prior years. It
indicates that the current year correction of a material error that
includes prior year effects may result in the need to correct prior year
financial statements even if the misstatement in the prior year or years
is considered immaterial. Any prior year financial statements found to be
materially misstated in years subsequent to the issuance of SAB No. 108
would be restated in accordance with SFAS No. 154, "Accounting Changes
and Error Corrections." Because the combined approach represents a change
in practice, the SEC staff will not require registrants that followed an
acceptable approach in the past to restate prior years' historical
financial statements. Rather, these registrants can report the cumulative
effect of adopting the new approach as an adjustment to the current
year's beginning balance of retained earnings. SAB No. 108 is effective
for fiscal years ending after November 15, 2006. The implementation of
SAB No. 108 did not have a material impact on the Company's results of
operations and financial condition.
In December 2007, the FASB issued SFAS No. 141(R), "Business
Combinations". This Statement replaces SFAS No. 141, Business
Combinations.
This Statement retains the fundamental requirements in Statement 141 that
the acquisition method of accounting (which Statement 141 called the
purchase method) be used for all business combinations and for an
acquirer to be identified for each business combination. This Statement
also establishes principles and requirements for how the acquirer: a)
recognizes and measures in its financial statements the identifiable
assets acquired, the liabilities assumed, and any non-controlling
interest in the acquiree; b) recognizes and measures the goodwill
acquired in the business combination or a gain from a bargain purchase
and c) determines what information to disclose to enable users of the
financial statements to evaluate the nature and financial effects of the
business combination. SFAS No. 141(R) will apply prospectively to
business combinations for
43
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont'd)
which the acquisition date is on or after Company's fiscal year beginning
May 1, 2009. The Company is currently assessing the impact of FAS 141(R).
In December 2007, the FASB issued SFAS No. 160, "Non-controlling
Interests in Consolidated Financial Statements". This Statement amends
ARB 51 to establish accounting and reporting standards for the
non-controlling (minority) interest in a subsidiary and for the
deconsolidation of a subsidiary. It clarifies that a non-controlling
interest in a subsidiary is an ownership interest in the consolidated
entity that should be reported as equity in the consolidated financial
statements. SFAS No. 160 is effective for the Company's fiscal year
beginning May 1, 2009. The Company is currently assessing the impact of
FAS 160.
In March 2008, the FASB issued SFAS No. 161, "Disclosures about
Derivative Instruments and Hedging Activities--an amendment of FASB
Statement No. 133" ("FAS 161"). FAS 161 changes the disclosure
requirements for derivative instruments and hedging activities. Entities
are required to provide enhanced disclosures about (a) how and why an
entity uses derivative instruments, (b) how derivative instruments and
related hedged items are accounted for under Statement 133 and its
related interpretations, and (c) how derivative instruments and related
hedged items affect an entity's financial position, financial
performance, and cash flows. The guidance in FAS 161 is effective for
financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, with early application encouraged.
This Statement encourages, but does not require, comparative disclosures
for earlier periods at initial adoption. The Company is currently
assessing the impact of FAS 161.
In May 2008, the FASB issued SFAS No. ▇▇▇, "▇▇▇ ▇▇▇▇▇▇▇▇▇ of Generally
Accepted Accounting Principles" ("SFAS 162"). SFAS 162 is intended to
improve financial reporting by identifying a consistent framework, or
hierarchy, for selecting accounting principles to be used in preparing
financial statements that are presented in conformity with U.S. GAAP for
nongovernmental entities. SFAS 162 is effective 60 days following the
Securities and Exchange Commission's approval of the Public Company
Accounting Oversight Board auditing amendments to AU Section 411, "The
Meaning of Present Fairly in Conformity with Generally Accepted
Accounting Principles." The Company does not expect SFAS 162 to have a
material effect on its consolidated financial statements.
44
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
4. CAPITAL STOCK
a) Authorized
50,000,000 Common shares, $0.0001 par value
And
1,000,000 Preferred shares, $0.0001 par value
b) Changes to Stockholders' Equity
i) The Company received $250, being subscription for 2,500,000
common shares from a director of the Company at $0.0001 per
share.
ii) The Company received $250, being subscription for 2,500,000
common shares from a director of the Company at $0.0001 per
share.
iii) The Company received $50, being subscription for 500,000 common
shares from an officer of the Company at $0.0001 per share.
iv) The Company received $428,710, being subscription for 2,858,067
common shares from non-related Investors at $0.15 per share.
c) Purchase Warrants
During the current year no warrants were issued.
5. RELATED PARTY TRANSACTIONS
i) The Company received $250, being subscription for 2,500,000
common shares from a director of the Company at $0.0001 per
share.
ii) The Company received $250, being subscription for 2,500,000
common shares from a director of the Company at $0.0001 per
share.
iii) The Company received $50, being subscription for 500,000 common
shares from an officer of the Company at $0.0001 per share.
45
UNLTD VENTURES INCORPORATED
(A Development Stage Enterprise)
Notes to Financial Statements
March 31, 2008
(Amounts expressed in US Dollars)
(Unaudited-Prepared by management)
6. INCOME TAXES
The Company has certain non-capital losses of approximately $6,461
available, which can be applied against future taxable income and which
expires by 2028.
Reconciliation of statutory tax rate to the effective income tax rate is
as follows:
Federal statutory income tax rate (34.0) %
State income taxes, net of tax benefit (3.5) %
-------
Deferred tax asset valuation allowance (37.5) %
--------
Effective rate (0.0) %
Deferred tax asset components as of March 31, 2008 are as follows:
Operating losses available to offset future income-taxes $6,461 Valuation
Allowance $(6,461) Net deferred tax assets -
As the company is in the development stage, it has provided a 100 per
cent valuation allowance on the net deferred tax asset as of March 31,
2008.
7. COMMITMENTS
The Company is committed to issue 750,000 common shares as finder's fee
after the conclusion of the agreement with ActiVein.
46
EXHIBIT J
Trademarks, Trade Names and Copyrights
None
47
EXHIBIT K
Material Contracts
None
48
EXHIBIT L
Insurance Policies
None
49
EXHIBIT M
Litigation
None
50
EXHIBIT N
Shareholders' Agreement
51
SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (the "Agreement") is made and entered into as
of ______, 2008, among UNLTD Ventures Incorporated (the "Company"), ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, and ▇▇▇▇ Dor,; and the following shareholders of
ActiVein Ltd.: Xenia Venture Capital Ltd. ("Xenia"), ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇. ▇▇▇▇
▇▇▇, ▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇ (collectively the ----- ActiVein Shareholders);
(collectively the ActiVein Shareholders); (each individually a "Party" and
together the "Parties").
WITNESSETH:
WHEREAS, the Parties are party to the Share Exchange Agreement to which
this Agreement is attached; and
WHEREAS, the shareholders of the Company desire to set forth certain
matters regarding the Shares herein.
NOW, THEREFORE, in consideration of the mutual agreements and
understandings set forth herein, the parties hereby agree as follows:
SECTION 1. DEFINITIONS AND RELATED MATTERS
1.1 Definitions.
When used in this Agreement, the following terms shall have the respective
meanings set forth below:
"Acquisition Notice" is defined in Section 3.8.
"Articles of Incorporation" shall mean the Company's Articles of
Incorporation or By-Laws, as amended from time to time.
"Board" or "Board of Directors" means the board of directors of the
Company.
"Buyer" is defined in Section 3.3.
"Co-Sale Offer" is defined in Section 4.2.1.
"Founders" mean the founders of Activein Ltd. namely Adi Plasckes, ▇▇▇▇
▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇.
"IPO" means the date the Company's shares may be publicly traded on the OTC
Bulletin Board, the NASD, or any national stock exchange based in the
United States.
"New Securities" is defined in Section 2.1."Notice of Sale" is defined in
Section 3.1.
52
"Notice Period" is defined in Section 3.3
"Offer" is defined in Section 4.1.
"Offerees" shall have the meaning set forth in Section 3.1.
"Offered Shares" shall have the meaning set forth in Section 3.1.
"Other Shareholders" is defined in Section 4.2.1.
"Other Shareholders Co-Sale Pro Rata Percentage" is defined in Section
4.2.1.
"Permitted Transfer" is defined in Section 3.12.
"Permitted Transferee" is defined in Section 3.12.
"Remaining Buyers" is defined in Section 3.7.
"Response Notice" is defined in Section 3.3.
"Seller" is defined in Section 4.2.1.
"Selling Shareholder" is defined in Section 3.1.
"Shares" means the shares of the Company.
"Shareholder(s)" means ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ Dor
and the ActiVein Shareholders.
"Share Exchange Agreement" means the Share Exchange Agreement to which this
Agreement is attached as a Schedule.
"Third Party" is defined in Section 3.1.
"Transfer" is defined in Section 3.1.
1.2.1 Related Definitional Matters.
1.2.1. All capitalized terms used and not otherwise defined herein
shall have the meanings given them in the Share Exchange Agreement.
1.2.2. In case of the identical terms defined otherwise in this
Agreement and the Share Exchange Agreement, the definition as appearing
in this Agreement shall prevail for purposes of this Agreement.
53
1.2.3. All references herein to Dollars or $ are references to United
States dollars.
SECTION 2. PREEMPTIVE RIGHTS
2.1 Until an IPO, and except to the extent the right to receive such offer
has been waived in writing (before or after the effective date hereof) by a
Shareholder who would otherwise be entitled thereto, any New Securities to
be allotted by the Company shall first be offered by the Board of Directors
by written notice of offer to the registered Shareholders holding at least
3% of the issued and outstanding share capital of the Company on an issued
and outstanding basis. "New Securities" shall mean any share capital of the
Company, whether or not now authorized, and rights, options or warrants to
purchase share capital, and securities of any type whatsoever that are, or
may become, convertible into share capital.
New Securities shall not include: (i) securities issued to employees,
directors, or consultants of the Company pursuant to any stock option plan
or stock plan or stock purchase or stock bonus arrangement approved by the
Board of Directors or as otherwise approved by the Board of Directors; (ii)
securities issued for consideration which does not consist of cash or which
does not consist entirely of cash, including without limitation real estate
(including ownership, leasing or any other rights thereto), patents or
technology or other know-how (including ownership, licensing or any other
rights thereto), research and/or development services or activities,
distribution or manufacture of the Company's products or services, any
other services or activities, or joint ventures; (iii) shares of the
Company issuable upon exercise of options or warrants issued in full
compliance with the provisions of this Section 2; (iv) securities offered
to the public; (v) securities issued pursuant to the acquisition (including
if applicable acquisition of shares) by the Company of another corporation
or business entity (or their business unit or division) or purchase or
acquisition by the Company of all or substantially all the assets of
another corporation or business entity (or their business unit or division)
or merger of any corporation or business entity with or into the Company;
(vi) securities issued pursuant to stock split, recapitalization,
reclassification or payment of any dividend, bonus shares, or distribution
with respect to the Company's issued and outstanding share capital, or any
similar event of the Company; or (vii) any commission paid pursuant to
Section 2.5 below.
2.2 As aforesaid, in the event the Company shall undertake an issuance of
New Securities, it shall give the registered Shareholders holding at least
3% of the issued and outstanding share capital of the Company on an issued
and outstanding basis written notice thereof. Such notice shall state the
terms of the proposed allotment, and offer each such Shareholder to
purchase such number of such New Securities as is necessary for such
Shareholder to retain the proportion of his respective holdings. Each such
Shareholder may accept such offer, as to all or any part of the shares so
offered to him, by giving the Company written notice of acceptance within
thirty (30) days after being served with such
54
notice of offer together with the amount of consideration for the number of
New Securities offered to him and accepted thereby. Any Shareholder who
fails to respond within such period or to pay the above specified
consideration shall be deemed to have refused that offered part of the New
Securities and to have waived any and all rights in connection with this
Section 2. The closing of any sale pursuant to this Section 2.2 shall occur
within the later of one hundred and twenty (120) days of the date the first
written notice to the Shareholders under Section 2.2 and the date of
initial sale of New Securities pursuant to Section 2.3.
2.3 Any such offered New Securities that are not accepted by Shareholders
as aforesaid shall be under the control of the Board of Directors and may
be subsequently allotted without regard to this Section 2, except to the
extent that said offered New Securities may not be allotted at a price and
upon terms more favorable to the purchaser than that offered pursuant to
Section 2.2. In the event the New Securities are not acquired under this
Section 2.3 prior to the expiration of one-hundred and twenty (120) days
from the first written notice to the Shareholders under Section 2.2, they
may not be issued except by compliance again with the provisions of this
Section 2.
2.4 For the purposes of any offer under this Section 2, the respective
holdings of any Shareholder shall mean the respective proportions of the
aggregate number of shares held by such Shareholder out of the total issued
and outstanding share capital of the Company as determined prior to the
offer made pursuant to Section 2.1.
2.5 The Company may pay a commission or brokerage fee to any person in
consideration of his subscribing or agreeing to subscribe, whether
absolutely or conditionally, for any shares in the Company, or procuring or
agreeing to procure subscriptions, whether absolute or conditional, for any
shares in the Company, provided such commission or brokerage fee does not
exceed 10% of the price at which the shares, in respect of which the
commission is paid, are issued. Such commission or brokerage fee may be
paid in cash or in fully or partly paid shares of the Company or in options
for the purchase of such shares, or in a combination of such methods.
SECTION 3. RIGHT OF FIRST REFUSAL
3.1 Except for Transfers to Permitted Transferees (as such terms are
defined below), in the event that, at any time prior to the consummation of
an IPO, any Shareholder desires to assign, transfer, pledge, hypothecate or
otherwise dispose of (each a "Transfer") any or all of such Shareholder's
shares in the Company (or any securities convertible into or exercisable
for any shares of the Company, or any agreement or commitment to issue any
of the foregoing)(the "Offered Shares") pursuant to the terms of a bona
fide firm offer received from any person or entity ("Third Party"), then
such Shareholder must first offer the Offered Shares to the other
Shareholders (the "Offerees"), on terms and conditions no less favorable
than those proposed by the Third Party, by a written notice (the "Notice of
55
Sale") to the Company, and the Company shall promptly give a copy of the
Notice of Sale to the Offerees. For the purposes of this Section 3, the
holder of shares wishing to Transfer shares of the Company shall be
referred to as the "Selling Shareholder".
3.2 The Notice of Sale shall include the number of Offered Shares, whether
the Offered Shares will, upon the sale, be free of all liens charges and
encumbrances, affirmation that a bona fide firm offer has been received
from the Third Party, the identity of the Third Party, any representations,
warranties, covenants and indemnities offered by the Selling Shareholder(s)
and the price and terms of payment for the Offered Shares.
3.3 Each Offeree shall be entitled to purchase the Offered Shares, in whole
or in part, at the price and under the conditions stated in the Notice of
Sale, within fourteen (14) days of its receipt (the "Notice Period"), by
giving written notice of intention to do so to the Selling Shareholder,
with copies to the Company (the "Response Notice") (each Shareholder who
has submitted a Response Notice, a "Buyer").
The Response Notice shall, when taken in conjunction with the offer as
contained within the Notice of Sale, be deemed to constitute a valid,
legally binding and enforceable agreement for the sale and purchase of such
Offered Shares.
3.4 If the Response Notice has not been given by an Offeree within fourteen
(14) days as set forth in Section 3.3 above, then such Offeree shall be
deemed to have waived his right of first refusal pursuant to this Section
3.
3.5 Notwithstanding anything to the contrary herein, in the event that by
the end of the Notice Period, no Response Notices have been received by the
Selling Shareholder or the Selling Shareholder has received Response
Notices with respect to a total number of shares less than the number of
the Offered Shares, the Selling Shareholder shall have the option to either
(i) sell all of the Offered Shares to the Third Party at a price not less
than and upon terms not more favorable to the Third Party than those
provided for in the Notice of Sale, provided that the sale be consummated
within forty five (45) days from the expiration of the Notice Period, or
(ii) unless otherwise agreed with the Third Party who demands the right to
purchase all of the Offered Shares, sell to the Buyers such quantity of the
Offered Shares as specified in their Response Notices, and sell the
remaining Offered Shares to the Third Party, at a price not less than and
upon terms not more favorable to the Buyers and to the Third Party than
those provided for in the Notice of Sale, provided that the sale be
consummated within forty five (45) days from the expiration of the Notice
Period. Any Offered Shares not Transferred within such forty five (45) day
period shall be subject to the requirements of first refusal pursuant to
this Section 3.
3.6 If Response Notices shall have been received for a total number of
shares equal to the number of Offered Shares, every Buyer shall buy the
number of shares as mentioned in the Response Notice as submitted.
3.7 If Response Notices shall have been received for a total number of
shares greater than the number of Offered Shares, the Buyers may acquire
shares in a quantity proportionate to the share capital of the Company held
56
by them at that time (based on the ratio of the share capital of the
Company held by each of them at that time relative to the total share
capital of the Company, on an as converted basis). However, no Buyer shall
be required to buy a greater number of shares than the number provided for
in the Response Notice submitted by him. Any Offered Shares remaining shall
be allocated among those Buyers who have not received all the shares
indicated by them in their Response Notice (the "Remaining Buyers") based
on the ratio of the share capital of the Company held by each of them at
that time relative to the total share capital of the Company held by the
Remaining Buyers, on an as converted basis. However, no Remaining Buyer
shall be required to buy a greater total number of shares than the number
provided for in the Response Notice submitted by him. This procedure shall
be repeated until all of the Offered Shares have been allocated.
3.8 In every one of the events referred to in Sections 3.5, 3.6 and 3.7,
the Selling Shareholder shall send within seven (7) days after the last
date for submission of Response Notices to each of the Buyers, a notice
(accompanied by copies of all Response Notices received by the Selling
Shareholders, and if actually received, any notices of non-acceptance of
the offer pursuant to the Notice of Sale) that shall mention the number of
shares that shall be acquired by each Buyer (hereinafter the "Acquisition
Notice").
3.9 After receipt of the Acquisition Notice each Buyer shall purchase from
the Selling Shareholder, and the Selling Shareholder shall sell and
Transfer to such Buyer the number of shares referred to in such notice
according to the terms of the Notice of Sale. Upon Transfer to the Buyer
such shares must be free and clear of any liens or encumbrances unless
otherwise specified in the Notice of Sale. The Selling Shareholder and such
Buyer shall each have all the remedies for breach of contract available
under any applicable laws in connection with the transaction set forth in
this Section 3.
3.10 In the event that as a result of the provisions of this Section 3, the
Selling Shareholder would be required to Transfer a fraction of a share,
such number of shares shall be rounded to the nearest whole number (with
1/2 being rounded down). In the event that there shall be Offered Shares
that cannot be allocated pursuant to this Section 3.10, such Offered Shares
shall be allocated as the Board of Directors shall see fit.
3.11 Nothing in this Section 3 shall have any effect upon the requirement
of the consent of the Board of Directors to the Transfer of any shares or
upon its authority to refuse to consent to the Transfer.
3.12 Notwithstanding the above, a Shareholder may Transfer any of his
shares to a Permitted Transferee. For the purposes of this Section 3,
"Permitted Transferee" or a "Permitted Transfer" shall mean: (i) any
Shareholder's spouse, ancestors or descendants, or to trusts for the
benefit of such persons; (ii) any person or entity which controls, is
controlled by or is under common control with such Shareholder (for the
purposes hereof, the term "control" shall mean the power to appoint a
majority of the Board of Directors of such entity, or ownership of more
than 90% of both the equity securities (or similar interests) and the
voting rights in the entity; (iii) from a Permitted Transferee back to the
57
given transferring Shareholder; (iv) in the case of a corporate
Shareholder, (a) any successor of such Shareholder by merger or (b) any
person, firm or corporation to which at the same time, substantially all
the business and assets of such Shareholder are being sold; or (c) any
secondary venture capital fund; or (v) in the case of joint holders of a
share, each such joint holder as regards any other joint holder's rights in
such share.
provided, however, in all cases such Permitted Transferee is required to
agree in writing to be bound by the obligations of the transferor under all
agreements involving the Company; and
Following a Permitted Transfer to a Permitted Transferee, such Permitted
Transferee shall have the right be considered a Shareholder for any and all
purposes, including for the purpose of the Transfer of its shares to its
Permitted Transferee.
SECTION 4. DISPOSITIONS OF SECURITIES
4.1Drag-Along Rights. In the event that prior to an IPO any person or
entity unrelated or unaffiliated to any Shareholder (a "Third Party")
makes an offer to purchase in a bona fide arm's length transaction more
than 90% of (i) the issued and outstanding share capital of the Company;
or (ii) the assets of the Company (the "Offer"), and the holders at least
90% of the issued and outstanding share capital of the Company on an
issued and outstanding basis, indicate, in writing, their acceptance of
such Offer and such Offer is conditioned upon the sale of all remaining
shares of the Company to such Third Party, then, the remaining
Shareholders shall be obligated to sell or exchange their shares under
identical terms as concluded in any such acquisition. Such remaining
Shareholders shall be deemed to have given an irrevocable proxy to a
person to be appointed by the Board of Directors to vote for the
acceptance of the Offer and at the closing of such Offer all of the
Shareholders shall sell all of their shares to the Third Party making such
Offer on the same terms and conditions as contained in the Offer. In the
event that a Shareholder fails to surrender its share certificate in
connection with the consummation of an Offer, such certificate shall be
deemed cancelled and the Company shall be authorized to issue a new
certificate in the name of the Third Party and the Board shall be
authorized to establish an escrow account into which the consideration for
such cancelled shares shall be deposited and to appoint a trustee to
administer such account. Proceeds received from a Third Party pursuant to
this Section 4.1 shall be distributed in accordance with the rights of the
shares pursuant to the Articles of Incorporation.
4.2T ag-Along Rights. Prior to an IPO of the Company, if a Shareholder
or group of Shareholders that holds more than 25% of the issued and
outstanding share capital of the Company on an issued and outstanding
basis reaches an agreement to sell all or a portion of its Shares in a
single transaction or series of related transactions, each other holder of
58
Shares shall have the right to sell a pro rata share of their Shares in
such transaction at the same price and on the same terms as the selling
Shareholder. If a Shareholder or a group of Shareholders for which the
provisions of this Section are applicable (in this Section, the "Seller")
desires to Transfer any Shares held by it in the Company pursuant to the
terms of a bona fide offer received from any party (in this Section, the
"Buyer") or otherwise, such Seller shall promptly give the other
Shareholders (the "Other Shareholders") written notice thereof, which
fully describes the proposed Transfer (the "Co-Sale Offer") and the Other
Shareholders or any one of them shall have the right to require, within 14
days of receipt of the Co-Sale Offer, as a condition to such Transfer
described therein, that the Buyer shall purchase from such Other
Shareholders at the same price per share and on the same terms and
conditions as involved in such Transfer by the Seller, that percentage of
the Shares proposed to be acquired by the Buyer (in this Section, the
"Transaction Shares") expressed by a fraction, the numerator of which is
the number of Shares then held by the Other Shareholders who exercise
their right hereunder and the denominator of which is the sum of (i) the
aggregate number of Shares and (ii) the aggregate number of Shares then
held by the Seller, all multiplied by 100 (such percentage shall be
referred to as the "Other Shareholders Co-Sale Pro Rata Percentage").
4.2.1 In the event that one or more of the Other Shareholders shall
elect to participate in such Transfer, each such Other Shareholders shall
communicate in writing such election to the Seller within the aforesaid
period of time, and, if the Transfer to the Buyer is consummated, such
Other Shareholder shall be entitled to Transfer to the Buyer as part
thereof, and no Transfer of any Shares by the Seller shall be completed
unless simultaneously with such Transfer the Buyer purchases, the Other
Shareholders Co-Sale Pro Rata Percentage of the Transaction Shares (and if
more than one Other Shareholders so notified the Seller, such Co-Sale Pro
Rata Percentage shall be allocated among them pro rata to their relative
holdings in the Company), at the same price per share and on the same
terms and conditions as set forth in the Co-Sale Offer. If any Other
Shareholder did not respond to a Co-Sale Offer within the aforesaid time
period, it shall be deemed to be refusing to participate in such Transfer.
4.2.2 If none of the Other Shareholders elected to participate in such
Transfer, or if some of them did elect to so participate, then the Seller
shall be entitled to sell or transfer all, or the appropriate pro rata
portion (together with the participating Other Shareholders' shares), as
applicable, of the Transaction Shares to the Buyer at any time within 90
days thereafter. Any such Transfer shall be at not less favorable terms
and conditions to the Seller than those specified in the Co-Sale Offer.
Any Shares not sold within such 90-day period shall continue to be subject
to the requirements of this Section 4.
4.2.3 The rights of co-sale under this Section 4 shall not apply to a
Transfer exempt from a right of first refusal under Section 3.
SECTION 5. AFFAIRS OF THE COMPANY
5.1 Administration of the Company.
5.1.1 Following the acquisition of Activein Ltd. the Board shall
consist of ▇▇. ▇▇▇▇ Dor, ▇▇. ▇▇▇▇ ▇▇▇▇▇, ▇▇. ▇▇▇▇▇ Kyiet, ▇▇. ▇▇▇▇
▇▇▇▇▇▇ and Mr. Avi Lior. In the event Boaz Dor resigns as a director,
Mr. Dor can designate his replacement on the Board of Directors. Xenia
has the right to remove ▇▇▇▇ ▇▇▇▇▇, and/or Avi Lior as directors and
to designate the replacement on the Board of Directors of any director
so removed. The Founders have the right to remove Eitan Kyiet, and/or
59
▇▇▇▇ ▇▇▇▇▇▇ as directors and to designate the replacement on the Board
of Directors of any director so removed.
In all cases the right to appoint a director shall include the right to
remove and replace such director. Appointments, removals and
replacements shall be effected by furnishing written notification to
the Company, signed by the Shareholder with the right to appoint the
director. Any notice regarding the appointment, removal or replacement
of a director shall be delivered to the Company in writing, and shall
become effective on the date fixed in such notice, or upon the delivery
thereof to the Company, whichever is later.
5.1.2 The presence of a majority of the directors shall constitute a
quorum for meetings of the board.
5.1.3 Any one director or Shareholders holding more than 10% of the
voting power in the Company may call a meeting of the Board of
directors of the Company, and the chairman of the Board shall call such
a meeting upon such request. The Company shall ensure that there shall
be at least 4 Board meetings per year.
5.2Matters Requiring Security Holder Approval.
5.2.1 Veto Rights. Until an IPO, any action or resolution of the
Company's general meeting, or of the Board, regarding any of the
following actions whether concerning the Company itself, or its
Subsidiary Activein Ltd., shall require the consent of two thirds of
the Company's directors in a Board meeting or the approval of Xenia:
5.2.1.1 an amendment to the Articles of Incorporation;
5.2.1.2 the entry into any new line of business or new business
activity;
5.2.1.3 a merger, consolidation or acquisition, or the sale,
lease or other disposal of all or substantially all of the
Company's assets or those of Activein Ltd.;
5.2.1.4 a transactions with any officer, director, or any other
party related, directly or indirectly;
5.2.1.5 the declaration and payment of any dividends or other
distributions;
5.2.1.6 the liquidation, dissolution or winding-up of the Company
or of Activein Ltd.;
5.2.1.7 the constitution of any committee of the Board of
Directors;
60
5.2.1.8 the sale, license, contribution or disposition of the
Company's core intellectual property or that of Activein Ltd.; or
5.2.1.9 a change of domicile of Activein Ltd., whose domicile and
base of operations shall remain in Israel.
5.2.10 any change to the composition of the Board of Directors of
Activein Ltd.
SECTION 6. DISTRIBUTION & USE OF FUNDS
The distribution of funds following the closing of the Exchange Agreement
to which this Agreement is attached (the "Closing") will be as follows:
6.1 Upon Closing the Company will transfer to its subsidiary, Activein
Ltd., US$250,000. These funds will be used by Activein Ltd. for research
and development;
6.2 The remaining funds of the Company - amounting to at least US$167,000
shall be used as follows:
6.2.1 For a one year period following the Closing - US$6,500 per month
paid to ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇ for investor relations and investment
banking services;
6.2.2 For a one year period following the Closing - US$1,500 per month
paid to ▇▇. ▇▇▇▇ Dor for investor relations and investment banking
services.
6.2.3 To pay all costs related to the generation of financial reports
for both the Company and Activein Ltd. in US GAAP format.
6.3 The remainder shall be used for legal, accounting and other expenses
associated with an initial public offering of the Company.
SECTION 7. AFFIRMATIVE COVENANTS & DECLARATIONS
7.1 Following the Closing, the current shareholders of the Company will
take all necessary steps to promptly file a registration statement with the
Securities and Exchange Commission to offer to the public 5,000,000 shares
of its common stock at an offering price of $0.20 per share. From the
proceeds of the public offering the Company will use $125,000 for investor
relations services. The $125,000 will be used according to instructions
which will be received from time to time from ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇ and shall
be pursuant to a plan agreed upon by the Board of Directors of the Company.
7.2 The Company will not issue any options, warrants or similar securities
to any of its officers, directors or persons performing similar functions
until 60 days after the common stock of the Company begins trading. After
this 60-day period, and during the two-year period ending on the date which
61
is two years after the Company's stock begins to trade, the Company may
issue options, warrants or similar securities to its officers, directors
and persons performing similar functions provided that the number of shares
issuable upon the exercise of such securities does not exceed 2,500,000
shares.
7.3If the execution of this Agreement and the Share Exchange Agreement
which shall be signed between the Company and Activein Ltd. and various
other parties does not take place by ________ 2008, this Shareholders
Agreement will terminate, and any of the $250,000 not spent by Activein
Ltd. will be promptly returned to the Company, together with an accounting
of all funds which Activein Ltd. has spent.
7.4 Each current shareholder of Activein Ltd. hereby declares that it has
waived its rights of first refusal it may have under the Articles of
Association of Activein Ltd.
7.5 Xenia Venture Capital Ltd. hereby waives any rights of deemed
liquidation it may have under the Articles of Association of Activein Ltd.
7.6 Each current shareholder of Activein Ltd. holding preferred shares of
Activein Ltd. has waived their rights in respect of the transaction
specified in that certain Exchange Agreement between the Company and
Activein Ltd. regarding any "Special Issues" or any other rights granted to
the preferred shareholders of Activein Ltd. under its Articles of
Association.
7.7 In the event that any representations or warranties are required from
the directors of the Company in connection with a listing of its shares on
any public exchange, the directors appointed by the former shareholders of
Activein Ltd. shall provide representations or warranties solely and
exclusively in connection with the technology of Activein Ltd. No other
representations or warranties of any nature whatsoever shall be provided
by such directors, or by their appointing shareholders. All other
representations and warranties shall be provided solely and exclusively by
▇▇. ▇▇▇▇ Dor.
SECTION 8. REGISTRATION RIGHTS
Registration rights in the Company shall be as set out in Appendix A
hereto.
SECTION 9. MISCELLANEOUS
9.1 Notices. Any notice under this Agreement shall be in writing and shall
be deemed to have been duly given for all purposes the earlier of (a) when
received or seven (7) calendar days after it is mailed by prepaid
registered mail; (b) the next calendar day after the day of transmittal
thereof by facsimile; or (c) upon the manual delivery thereof, to the
respective addressee or fax numbers set forth in above or to such other
address of which notice as aforesaid is actually received.
62
9.2 Benefit of Agreement; Assignments and Participations. Subject to the
next sentence, and except as otherwise expressly provided herein, all
covenants, agreements and other provisions contained in this Agreement by
or on behalf of any of the parties hereto shall bind, inure to the benefit
of and be enforceable by their respective successors. No party may assign
or transfer any of its rights or obligations (other than transfers required
under law) without the prior written consent of the other parties, except a
transfer in accordance with the terms of this Agreement which shall not
require such consent.
9.3 No Waiver; Remedies Cumulative. No failure or delay on the part of any
party hereto in exercising any right, power or privilege hereunder and no
course of dealing between the Company and any other party shall operate as
a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are exclusive of any
rights or remedies that the parties would otherwise have.
9.4 Amendments, Waivers and Consents. This Agreement may be only be
amended, with the written consent of the Parties hereto.
9.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be an
original, enforceable against the party actually executing such
counterpart, but all of which shall constitute one and the same instrument.
For the purposes of the Closing, signatures transmitted via telecopy (or
other facsimile device) will be accepted as original signatures if the
sender on the same day, but not later than within seven calendar days,
sends a manually executed signature page by a recognized overnight delivery
service (charges prepaid).
9.6 Expenses. Each Party shall pay its own costs and expenses (including
attorneys' and accountants' fees and disbursements) incurred by such Party
in connection with the Transactions, otherwise related thereto.
9.7 Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning
or construction of any provision of this Agreement.
9.8 Governing Law; Submission to Jurisdiction; Venue. This Agreement shall
be governed by the laws of the State of Israel. The parties hereto hereby
submit to the exclusive jurisdiction of the courts of Tel-Aviv-Jaffa.
9.9 Severability. If any provision of this Agreement is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable
to the extent of such illegality, invalidity or unenforceability and the
remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
9.10 Construction. Each covenant contained herein shall be construed
(absent express provision to the contrary) as being independent of each
63
other covenant contained herein, so that compliance with any one covenant
shall not (absent such an express contrary provision) be deemed to excuse
compliance with any other covenant.
9.11 Should there be any material breach of the terms of Section 5, 6.1,
6.2, 6.3, 7.1, or 7.2 of this Agreement, through no fault of ▇▇▇▇▇▇▇ ▇▇▇▇▇
or Boaz Dor respecting Sections 6.1, 6.2, 6.3, 7.1, or 7.2 and upon the
demand of ▇▇▇▇▇▇▇ ▇▇▇▇▇ or ▇▇▇▇ Do; or through no fault of Xenia respecting
Section 7.1, and upon the demand of Xenia; all shares issued to the
ActiVein Shareholders at the Closing will be returned to the Company and
cancelled and , all officers and directors of the Company, with the
exception of Boaz Dor will resign as officers and directors of the Company,
and all shares of ActiVein held by the Company will be returned to their
previous holders.
9.12 Termination. Except as provided herein, this Agreement shall
immediately and automatically terminate, without any further action by any
party, upon any of the following: (a) the dissolution, bankruptcy,
receivership or insolvency of the Company; (b) as to any Shareholder when
such holder shall no longer hold any Shares; or (c) upon the closing of an
IPO.
9.13 Entire Agreement. This Agreement contains the entire Agreement and
understanding between the parties hereto, and supersedes all prior
agreements, understandings and the letters of intent between the parties.
For the avoidance of doubt, all parties hereto acknowledge and declare that
this Shareholders Agreement and the Registration Rights attached hereto as
Appendix A, replace in there entirety any other Shareholders Agreements
and/or Registration Rights Agreements previously agreed upon amongst any of
the Parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day, month and year first above written.
--------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
--------------------------------
Boaz Dor
64
XENIA VENTURE CAPITAL LTD.
By: /s/ ▇▇▇▇ ▇▇▇▇▇
-------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Chief Executive Officer
--------------------------------
▇▇▇▇ ▇▇▇▇▇▇
--------------------------------
▇▇. ▇▇▇▇ ▇▇▇
--------------------------------
Adi Plaschkes
65
APPENDIX A - REGISTRATION RIGHTS AGREEMENT
The following provisions govern the registration of the Company's securities:
1. Definitions. As used herein, the following terms have the following meanings:
"Holder" means any Shareholder and shareholders who are party to the
Shareholders Agreement to which this Appendix A is attached.
"Form S-1" means Form S-1 under the Exchange Act, available to the
Company, as in effect on the date hereof or any registration form under
the Securities Act subsequently adopted by the Securities and Exchange
Commission ("SEC") which permits inclusion or incorporation of substantial
information by reference to other documents filed by the Company with the
SEC.
"Initiating Holders" means Holders of an aggregate of at least 15% of the
Registrable Shares.
"Register," "registered" and "registration" refer to a registration
effected by filing a registration statement in compliance with the
Securities Act and the declaration or ordering by the SEC of effectiveness
of such registration statement, or the equivalent actions under the laws
of another jurisdiction.
"Registrable Shares" means all shares now or hereafter issued by the
Company prior to its initial public offering; provided, however, that any
shares (i) sold by a person to the public either pursuant to a
registration statement or Rule 144; or (ii) sold in a private transaction
in which the transferor's rights under this Section 3 are not assigned; or
(iii) that could be distributed by the holder thereof (in accordance with
applicable law) within three (3) months under Rule 144, shall not be
deemed to be Registrable Shares.
"Securities Exchange" shall mean the NYSE, the Nasdaq Global Market, the
AMEX, the LSE, the AIM, or the OTC Bulletin Board.
All capitalized terms used and not otherwise defined herein shall have the
meanings given them in the Shareholders Agreement to which this Agreement
is attached.
2. Incidental Registration. If the Company at any time proposes to register
any of its securities, other than (i) registrations on such form or similar
form(s) solely for registration of securities in connection with an
employee benefit plan or dividend reinvestment plan or an acquisition,
merger or consolidation or (ii) in a registration under Section 3 or
Section 4 of this Agreement, it shall give notice to the Holders of such
intention. Upon the written request of any Holder given within twenty (20)
days after receipt of any such notice, the Company shall include in such
registration all of the Registrable Shares indicated in such a request by a
Holder, so as to permit the disposition of the shares so registered.
Notwithstanding any other provision of this Section 2, if the managing
underwriter advises the Company in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the number of
shares that may be included in the registration shall be allocated, first
to the Company, and second: (a) up to 60% of the balance, to the Initiating
66
Holders on a pro rata basis based on the total number of Registrable Shares
held by such Initiating Holders; and (b) up to 40% of the balance, to the
remaining Holders, on a pro rata basis based on the total number of
Registrable Shares held by such Holders. The Company shall have the right
to terminate or withdraw any registration initiated by it under this
Section 2 prior to the effectiveness of such registration whether or not
any Holder has elected to include securities in such registration.
3. Demand Registration. At any time after six months following the closing of
the initial public offering (the "IPO") and until the fifth anniversary
thereafter, the Initiating Holders may request in writing that all or part
of the Registrable Shares shall be registered for trading on the Securities
Exchange on which such Registrable Shares are listed. Within thirty (30)
days after receipt of any such request, the Company shall give written
notice of such request to the other Holders and shall include in such
registration all Registrable Shares held by all such Holders who wish to
participate in such demand registration and provide the Company with
written requests for inclusion therein within fifteen (15) days after the
receipt of the Company's notice. Thereupon, the Company shall use its best
efforts to effect the registration of all Registrable Shares as to which it
has received requests for registration for trading on the Securities
Exchange specified in the request for registration; provided, however, that
the Company shall not be required to effect any registration under this
Section 3: (i) within a period of one hundred and eighty (180) days
following the effective date of a previous registration; or (ii) if the
Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell Registrable
Shares and such other securities (if any) at an aggregate price to the
public (net of any underwriters' discounts or commissions) of less than
US$20 million; or (iii) if the Initiating Holders propose to dispose of
Registrable Shares that may be immediately registered on Form S-1 pursuant
to a request made pursuant to Section 4 below; or (iv) during the period
sixty (60) days prior to the Company's estimated date of filing of any
registration statement pertaining to the securities of the Company,
provided that the Company is actively employing in good faith reasonable
efforts to cause such registration statement to become effective and that
the Company's estimate of the date of filing of such registration statement
is made in good faith. Notwithstanding any other provision of this Section
3, if the managing underwriter advises the Company in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the number of shares that may be included in the
registration shall be allocated, first, to the Initiating Holders on a pro
rata basis based on the total number of Registrable Shares held by such
Initiating Holders; and second, to the remaining Holders, on a pro rata
basis based on the total number of Registrable Shares held by such Holders.
If the Company shall furnish to the Holders a certificate signed by the
chairman of the Board (the "Chairman") stating that in the good faith
judgment of the Board it would be materially detrimental to the Company or
its shareholders for such registration statement to be effected at such
time, the Company shall have the right to defer the filing of such
registration statement for a period of not more than one hundred twenty
(120) days after receipt of the request of the Holders under this Section
67
3; provided, however, that the Company shall not utilize this right more
than once in any twelve (12) month period. The Company may not cause any
other registration of securities for sale for its own account (other than a
registration effected solely to implement an employee benefit plan) to be
initiated after a registration requested pursuant to Section 3 and to
become effective less than ninety (90) days after the effective date of any
registration requested pursuant to Section 3. The Company shall not be
required to effect more than two (2) registrations under this Section 3.
4. Form S-1 Registration. In case the Company shall receive from any one
Holder or Holders a written request or requests that the Company effect a
registration on Form S-1, and any related qualification or compliance, with
respect to Registrable Shares the Company shall within thirty (30) days
after receipt of any such request give written notice of the proposed
registration, and any related qualification or compliance, to all other
Holders, and include in such registration all Registrable Shares held by
all such Holders who wish to participate in such registration and provide
the Company with written requests for inclusion therein within fifteen (15)
days after the receipt of the Company's notice. Thereupon, the Company
shall use its best efforts to effect such registration and all such
qualifications and compliances as may be so requested and as would permit
or facilitate the sale and distribution of all or such portion of such
Holders' Registrable Shares as are specified in such requests, together
with all or such portion of the Registrable Shares of any other Holders
joining in such request as are specified in a written request given within
fifteen (15) days after receipt of such written notice from the Company;
provided, however, that the Company shall not be obligated to effect any
such registration, qualification or compliance, pursuant to this Section 4:
(i) if Form S-1 is not available for such offering by the Holders; or (ii)
if the Company shall furnish to the Holders a certificate signed by the
Chairman stating that in the good faith judgment of the Board it would be
materially detrimental to the Company or its shareholders for such Form S-1
registration statement to be effected at such time, in which event the
Company shall have the right to defer the filing of the Form S-1
registration statement for a period of not more than one hundred twenty
(120) days after receipt of the request of the Holders under this Section
4; provided, however, that the Company shall not utilize this right more
than once in any twelve (12) month period; or (iii) if the Company has,
within the twelve (12) month period preceding the date of such request,
already effected two registrations on Form F-3 for the Holders pursuant to
this Section 4; or (iv) during the period sixty (60) days prior to the
Company's estimated date of filing of any registration statement pertaining
to the securities of the Company, provided that the Company is actively
employing in good faith reasonable efforts to cause such registration
statement to become effective and that the Company's estimate of the date
of filing of such registration statement is made in good faith.
Notwithstanding any other provision of this Section 4, if the managing
underwriter advises the Company in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the number of
shares that may be included in the registration shall be allocated as
follows: (a) up to 75% of the shares, to the Initiating Holders, on a pro
rata basis based on the total number of Registrable Shares held by such
Initiating Holders, and (b) up to 25% of the shares, to the remaining
Holders, on a pro rata basis based on the total number of Registrable
Shares held by such Holders.
68
5. Designation of Underwriter. In the case of any registration, the Company
shall have the right to designate the managing and other underwriters in
any underwritten offering; provided that such designation shall be
approved by the Initiating Holders, such approval not to be unreasonably
withheld.
6. Expenses. All expenses incurred in connection with any registration under
Sections 2, 3 and/or 4 shall be borne by the Company; provided, however,
that each of the Holders participating in such registration shall pay its
pro rata portion of discounts or commissions payable to any underwriter and
that the Company shall not be required to bear the expenses and other
out-of-pocket costs of more than one counsel representing, and acting on
behalf of, the Initiating Holders in connection with each registration
under Section 2, 3 or 4. The Company shall not be required to pay for
expenses of any registration proceeding begun pursuant to Sections 3 or 4,
the request of which has been subsequently withdrawn by the Initiating
Holders or the Holders, as applicable. If the Holders are required to pay
the registration expenses, such expenses shall be borne by the holders of
securities (including Registrable Shares) requesting such registration in
proportion to the number of shares for which registration was requested.
7. Indemnities. In the event of any registered offering of shares of the
Company pursuant to this Appendix A:
7.1 The Company will indemnify and hold harmless, to the fullest
extent permitted by law, any Holder and any underwriter for such
Holder, and each person, if any, who controls the Holder or such
underwriter, from and against any and all losses, damages, claims,
liabilities, joint or several, costs and expenses (including any
amounts paid in any settlement effected with the Company's
consent) to which the Holder or any such underwriter or
controlling person may become subject under Applicable Law or
otherwise, insofar as such losses, damages, claims, liabilities
(or actions or proceedings in respect thereof), costs or expenses
arise out of or are based upon (i) any untrue statement or alleged
untrue statement of any material fact made by the Company itself
contained in the registration statement or included in the
prospectus, as amended or supplemented by the Company itself, or
(ii) the omission of by the Company itself or alleged omission of
the Company itself to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the
light of the circumstances in which they are made, not misleading,
and the Company will reimburse the Holder, such underwriter and
each such controlling person of the Holder or the underwriter,
promptly upon demand, for any reasonable legal or any other
expenses incurred by them in connection with investigating,
preparing to defend or defending against or appearing as a
third-party witness in connection with such loss, claim, damage,
69
liability, action or proceeding; provided, however, that the
Company will not be liable in any such case to the extent that (i)
such violation was made in a preliminary prospectus and was
corrected in a subsequent prospectus that was required by law to
be delivered to the person making the claim with respect to which
indemnification is sought hereunder, and such subsequent
prospectus was made available by the Company to permit delivery of
such prospectus in a timely manner, and such subsequent prospectus
was so delivered to such person (ii) any such loss, damage,
liability, cost or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished
in writing by a Holder, such underwriter or such controlling
persons in writing specifically for use in connection with such
registration; provided further, that this indemnity shall not be
deemed to relieve any underwriter of any of its due diligence
obligations; provided further, that the indemnity agreement
contained in this subsection 7.1 shall not apply to amounts paid
in settlement of any such claim, loss, damage, liability or action
if such settlement is effected without the consent of the Company,
which consent shall not be unreasonably withheld. Such indemnity
shall remain in full force and effect regardless of any
investigation made by or on behalf of the selling Shareholder, the
underwriter or any controlling person of the selling Shareholder
or the underwriter, and regardless of any sale in connection with
such offering by the selling Shareholder. Such indemnity shall
survive the transfer of securities by a selling Shareholder for a
period of five years, provided further, that the indemnity
agreement contained in this subsection 7.1 shall not apply to
amounts paid in settlement of any such claim, loss, damage,
liability or action if such settlement is effected without the
consent of the Company, which consent shall not be unreasonably
withheld. In no event shall the liability of the Holder exceed the
amount received by such Holder in such sale.
7.2 Each Holder participating in a registration hereunder will
indemnify and hold harmless, to the fullest extent permitted by
law, the Company, its officers and directors, each other Holder
participating in such registration and their partners,
shareholders, directors or officers, any underwriter for the
Company, or for any such other Holder, and each person, if any,
who controls the Company or such underwriter or such other Holder,
from and against any and all losses, damages, claims, liabilities,
joint or several, costs or expenses (including any amounts paid in
any settlement effected with the selling Shareholder's consent) to
which the Company or any such controlling person and/or any such
underwriter and/or such other Holder may become subject under
Applicable Law or otherwise, insofar as such losses, damages,
claims, liabilities (or actions or proceedings in respect
thereof), costs or expenses arise out of or are based on (i) any
untrue or alleged untrue statement of any material fact contained
in the registration statement or included in the prospectus, as
amended or supplemented, or (ii) the omission or the alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, in the light
of the circumstances in which they were made, not misleading, and
each such Holder will reimburse the Company, its officers and
directors and each other Holder participating in such registration
and their partners, shareholders, directors or officers, any
underwriter and each such controlling person of the Company or any
underwriter, promptly upon demand, for any reasonable legal or
other expenses incurred by them in connection with investigating,
preparing to defend or defending against or appearing as a
third-party witness in connection with such loss, claim, damage,
liability, action or proceeding; in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was so made in
conformity with written information furnished by such Holder
specifically for use in connection with such registration. The
foregoing indemnity agreement is subject to the condition that,
70
insofar as it relates to any such untrue statement (or alleged
untrue statement) or omission (or alleged omission) made in the
preliminary prospectus but eliminated or remedied in the amended
prospectus at the time the registration statement becomes
effective or in the final prospectus, such indemnity agreement
shall not inure to the benefit of (i) the Company and (ii) any
underwriter, if a copy of the final prospectus was not furnished
to the person or entity asserting the loss, liability, claim or
damage at or prior to the time such furnishing is required by the
Securities Act; provided further, that this indemnity shall not be
deemed to relieve any underwriter of any of its due diligence
obligations; provided further, that the indemnity agreement
contained in this subsection 7.2 shall not apply to amounts paid
in settlement of any such claim, loss, damage, liability or action
if such settlement is effected without the consent of the
indemnifying Holders, which consent shall not be unreasonably
withheld. In no event shall the liability of a Holder exceed the
net proceeds from the offering received by such Holder. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company, the underwriter
or any controlling person of the Company or the underwriter.
7.3 Promptly after receipt by an indemnified party pursuant to the
provisions of subsections 7.1 or 7.2 of notice of the commencement
of any action involving the subject matter of the foregoing
indemnity provisions, such indemnified party will, if a claim
thereof is to be made against the indemnifying party pursuant to
the provisions of said subsection 7.1 or 7.2, promptly notify the
indemnifying party of the commencement thereof; but the omission
to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise
than hereunder. In case such action is brought against any
indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall have the right
to participate in, and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume
the defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, that if the defendants in
any action include both the indemnified party and the indemnifying
party and there is a conflict of interests which would prevent
counsel for the indemnifying party from also representing the
indemnified party, the indemnified party or parties shall have the
right to select one separate counsel to participate in the defense
of such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party
of its election to assume the defense thereof, the indemnifying
party will not be liable to such indemnified party pursuant to the
71
provisions of said subsections 7.1 or 7.2 for any legal or other
expense subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified
party shall have employed counsel in accordance with the provision
of the preceding sentence, (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified
party to represent the indemnified party within a reasonable time
after the notice of the commencement of the action and within 15
days after written notice of the indemnified party's intention to
employ separate counsel pursuant to the previous sentence, or
(iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the
indemnifying party. No indemnifying party will consent to entry of
any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation.
7.4 If recovery is not available under the foregoing indemnification
provisions, for any reason other than as specified therein, the
parties entitled to indemnification by the terms thereof shall be
entitled, to the extent permitted under Applicable Law, to
contribution to liabilities and expenses as more fully set forth
in an underwriting agreement to be executed in connection with
such registration. In determining the amount of contribution to
which the respective parties are entitled, there shall be
considered the parties' relative faults, knowledge and access to
information concerning the matter with respect to which the claim
was asserted, the opportunity to correct and prevent any statement
or omission, and any other equitable considerations appropriate
under the circumstances. In no event shall the liability of a
Holder exceed the net proceeds from the offering received by such
Holder.
8. Obligations of the Company. Whenever required under this Appendix A to
effect the registration of any Registrable Shares, the Company shall, as
expeditiously as possible:
8.1 prepare and file with the SEC a registration statement with
respect to such Registrable Shares and use its best efforts to
cause such registration statement to become effective, and, upon
the request of the holders of a majority of the Registrable Shares
registered thereunder, keep such registration statement effective
for a period of up to four (4) months or, if sooner, until the
distribution contemplated in the registration statement has been
completed; provided, however, that at any time, upon written
notice to the participating Holders and for a period not to exceed
one hundred twenty (120) days thereafter (the "Suspension
Period"), the Company may delay the filing or effectiveness of any
registration statement or suspend the use or effectiveness of any
registration statement (and the participating Holders hereby agree
not to offer or sell any Registrable Shares pursuant to such
registration statement during the Suspension Period) if the
Company reasonably believes that the Company may, in the absence
of such delay or suspension hereunder, be required under state or
federal securities laws to disclose any corporate development the
disclosure of which could reasonably be expected to have a
material adverse effect upon the Company. No more than one (1)
such Suspension Period shall occur in any twelve (12) month
period. In the event that the Company shall exercise its right to
delay or suspend the filing or effectiveness of a registration
hereunder, the applicable time period during which the
registration statement is to remain effective shall be extended by
a period of time equal to the duration of the Suspension Period.
72
8.2 prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply
with the provisions of the Securities Act with respect to the
disposition of all Registrable Shares covered by such registration
statement.
8.3 furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as
they may reasonably request in order to facilitate the disposition
of Registrable Shares owned by them.
8.4 in the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter of such
offering. Each Holder participating in such underwriting shall
also enter into and perform its obligations under such an
agreement.
8.5 notify each holder of Registrable Shares covered by such
registration statement at any time when a prospectus relating
thereto is required to be delivered under the Securities Act of
the happening of any event as a result of which the prospectus
included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary to make
the statements therein not misleading in the light of the
circumstances then existing.
8.6 use its best efforts to cause all Registrable Shares registered
pursuant hereunder to be listed on each Securities Exchange on
which similar securities issued by the Company are then listed.
8.7 provide a transfer agent and registrar for all Registrable Shares
registered pursuant hereunder and a CUSIP number for all such
Registrable Shares, in each case not later than the effective date
of such registration.
8.8 use its best efforts to furnish, at the request of any Holder
requesting registration of Registrable Shares pursuant to this
Appendix A, on the date that such Registrable Shares are delivered
to the underwriters for sale in connection with a registration
pursuant to this Appendix A, if such securities are being sold
through underwriters, (i) an opinion, dated such date, of the
counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to
underwriters in an underwritten public offering, addressed to the
underwriters, and to the respective Holder requesting registration
of Registrable Shares and (ii) a letter dated such date, from the
independent certified public accountants of the Company, in form
and substance as is customarily given by independent certified
public accountants to underwriters in an underwritten public
offering, addressed to the underwriters and to the respective
Holder requesting registration of Registrable Shares.
73
9. Assignment of Registration Rights. Any assignment of registration rights
hereunder shall be in accordance with the provisions of Section 9.2 of the
Shareholders' Agreement to which these Registration Rights are appended.
10. Lock-Up. In any registration of the Company's shares all Holders agree that
any sales of Registrable Shares may be subject to a "lock-up" period
restricting such sales, and all Holders will agree to abide by such
customary "lock-up" period of up to one hundred and eighty (180) days in
connection with the IPO, and ninety (90) days in connection with other
registrations, if and to the extent required by the underwriter in such
registration, which period may be extended upon the request of the
underwriter for an additional period of up to fifteen (15) days if the
Company issues or proposes to issue an earnings or other public release
within fifteen (15) days of the expiration of the ninety (90)-day lockup
period, not to (x) lend; offer; pledge; sell; contract to sell; sell any
option or contract to purchase; purchase any option or contract to sell;
grant any option, right, or warrant to purchase; or otherwise transfer or
dispose of, directly or indirectly, including any sale pursuant to Rule 144
under the Exchange Act (as defined below), any Shares or any securities
convertible into or exercisable or exchangeable for Shares (whether such
securities are then owned by the Holder or are thereafter acquired) or to
(y) enter into any swap or other arrangement that transfers to another, in
whole or in part, any of the economic consequences of ownership of such
securities, whether any such transaction described in clause (x) or (y)
above is to be settled by delivery of Shares or other securities, in cash,
or otherwise.
11. Public Information. At any time and from time to time after the earlier of
the close of business on such date as (a) a registration statement filed by
the Company under the Securities Act becomes effective, (b) the Company
registers a class of securities under Section 12 of the United States
Securities Exchange Act of 1934, as amended, or any federal statute or code
which is a successor thereto (the "Exchange Act"), or (c) the Company
issues an offering circular meeting the requirements of Regulation A under
the Securities Act, the Company shall undertake to make publicly available
and available to the Holders pursuant to Rule 144, such information as is
necessary to enable the Holders to make sales of Registrable Shares
pursuant to that Rule. The Company shall comply with the current public
information requirements of Rule 144 and shall furnish thereafter to any
Holder, upon request, a written statement executed by the Company as to its
compliance with the reporting requirements of the said Rule 144.
12. Certificate Legends. Each certificate representing Shares prior to
registration or Registrable Shares shall be stamped or otherwise imprinted
with legends substantially similar to the following (in addition to any
legend required under applicable state securities laws):
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER ANY
SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SUCH
74
LAWS OR UNLESS SUCH REGISTRATION IS NOT REQUIRED. THE SALE, PLEDGE,
HYPOTHECATION OR TRANSFER OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF A CERTAIN
SHAREHOLDERS AGREEMENT BY AND AMONG THE COMPANY AND CERTAIN SHAREHOLDERS
THEREOF. COPIES OF SUCH AGREEMENT MAY BE OBTAINED UPON WRITTEN REQUEST TO
THE SECRETARY OF THE COMPANY."
13. Delay of Registration; Furnishing Information. It shall be a condition
precedent to the obligations of the Company to take any action pursuant to
Section 2, 3 or 4 that the selling Holders shall furnish to the Company
such information regarding themselves, the Registrable Shares held by them
and the intended method of disposition of such securities as shall be
required by law and regulations to effect the registration of their
Registrable Shares.
14. Termination of Registration Rights. All registration rights granted under
this Agreement shall terminate and be of no further force and effectone
year after the date of the IPO.
15. Certain Limitations on Registration Rights. In the case of any registration
under Section 2, 3, and 4 pursuant to an underwritten offering, if the
Company has determined to enter into an underwriting agreement in
connection therewith, all securities to be included in such registration
shall be subject to an underwriting agreement and no Holder may participate
in such registration unless such Holder agrees to sell such Holder's
securities on the basis provided therein and, completes and executes all
reasonable questionnaires, and other documents (including custody
agreements and powers of attorney) which must be executed in connection
therewith, and provides such other information to the Company or the
underwriter as may be necessary to register such Holder's securities.
16. Nominees for Beneficial Owners. If Registrable Shares are held by a nominee
for the beneficial owner thereof, the beneficial owner thereof shall be
treated as the Holder of such Registrable Shares for purposes of any
request or other action by any Holder or Holders of Registrable Shares
pursuant to this Agreement (or any determination of any number or
percentage of shares constituting Registrable Securities held by any Holder
or Holders of Registrable Shares contemplated by this Agreement) and all
notices to be sent hereunder to any Holder or Holders of Registrable Shares
shall also be sent to such beneficial owner; provided that the Company
shall have received reasonable assurances of such beneficial ownership.
17. Holdback. Each Holder not participating in a given registration in which
Registrable Shares are included agrees not to sell or distribute shares of
the Company, during the period beginning 24 days prior to, and ending 180
days following, the effective date of such registration, in such number
which may have a material adverse effect on the price of the Company's
shares, and will execute such customary form of agreement evidencing such
obligation.
75
EXHIBIT O
76
Number O - 1
ACTIVEIN LTD.
THIS IS TO CERTIFY
That Unlimited Ventures Incorporated
Of ▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Is the Registered Holder of 9057
ORDINARY SHARES
Of N.I.S. 0.01 each
fully paid up in the
Above named Company, subject to the
Articles of Association of the Company.
Given under the Common Seal of the Company
this ___ day of ____________, 2008.
---------------------------------
▇▇▇▇ ▇▇▇▇▇▇, Director
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO, AND ARE
TRANSFERABLE ONLY UPON COMPLIANCE WITH, THE PROVISIONS OF THE ARTICLES OF
ASSOCIATION, AS THE SAME MAY BE AMENDED FROM TIME TO TIME, OF ACTIVEIN LTD., A
COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY.
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY APPLICABLE STATE SECURITIES
LAWS, OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION INCLUDING THE STATE OF
ISRAEL, AND THEY MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED, PLEDGED OR
HYPOTHECATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, UNDER ANY APPLICABLE STATE SECURITIES LAWS, AND/OR THE APPLICABLE
SECURITIES LAWS OF ANOTHER JURISDICTION.
77
Number O - 2
ACTIVEIN LTD.
THIS IS TO CERTIFY
That Unlimited Ventures Incorporated
Of ▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Is the Registered Holder of 9057
PREFERRED SHARES
Of N.I.S. 0.01 each
fully paid up in the
Above named Company, subject to the
Articles of Association of the Company.
Given under the Common Seal of the Company
this ___ day of ____________, 2008.
---------------------------------
▇▇▇▇ ▇▇▇▇▇▇, Director
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO, AND ARE
TRANSFERABLE ONLY UPON COMPLIANCE WITH, THE PROVISIONS OF THE ARTICLES OF
ASSOCIATION, AS THE SAME MAY BE AMENDED FROM TIME TO TIME, OF ACTIVEIN LTD., A
COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY.
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY APPLICABLE STATE SECURITIES
LAWS, OR THE SECURITIES LAWS OF ANY OTHER JURISDICTION INCLUDING THE STATE OF
ISRAEL, AND THEY MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED, PLEDGED OR
HYPOTHECATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, UNDER ANY APPLICABLE STATE SECURITIES LAWS, AND/OR THE APPLICABLE
SECURITIES LAWS OF ANOTHER JURISDICTION.
78
EXHIBIT P
79
ACTIVEIN LTD.
Private Company No. ▇▇-▇▇▇▇▇▇-▇ (the "Company")
UNANIMOUS WRITTEN CONSENT OF THE SHAREHOLDERS
A resolution in writing by the Company's Shareholders dated ___ October, 2008.
The following resolutions were adopted unanimously by the shareholders:
The Exchange Agreement, together with all of its schedules has been presented to
the shareholders.
NOW, THEREFORE, BE IT RESOLVED*:
1. RESOLVED, to approve the execution, delivery and performance of the Share
Exchange Agreement, including all of its schedules, appendices and annexes
in the form attached hereto as Annex A and any ancillary agreements and
documents thereto, including without limitation, any and all of the
Company's obligations thereunder and the transactions contemplated thereby,
including the exchange of all shares as set forth therein, as such may be
further amended and finalized by the Company's CEO, Mr. Adi Plaschkes, or
by ▇▇. ▇▇▇▇ ▇▇▇▇▇▇ on behalf of the Company, in their sole discretion (the
"Exchange Agreement").
2. RESOLVED, to approve the replacement of the Company's existing articles of
association by the articles of association attached as Annex B hereto (the
"Amended Articles"), as such may be further amended and finalized by Mr.
Adi Plaschkes, or by ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, on behalf of the Company, in their
sole discretion.
3. RESOLVED, to authorize (a) Mr. Adi Plaschkes, or, (b) ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, to
execute and deliver, in the name and on behalf of the Company, the Exchange
Agreement, the Amended Articles, and all other documents and instruments to
be delivered and executed under and pursuant to such documents, and to take
all steps necessary or expedient to effectuate these foregoing Resolutions
and the consummation of such documents including but not limited to the
issuance of the applicable share certificates, in such form as shall be
approved by (a) Mr. Adi Plaschkes, or, (b) ▇▇. ▇▇▇▇ ▇▇▇▇▇▇, and all
necessary reports to the Israeli Registrar of Companies, the Israeli Tax
Authorities, the Israeli Chief Scientist, and any other applicable
regulatory authorities, and to update the shareholders register of the
Company accordingly.
4. RESOLVED, further to authorize Mr. Adi Plaschkes as well as each of the
directors of the Company to execute, make, verify, acknowledge, deliver,
file and record any and all applications, consents, certificates,
instruments, agreements, notices, reports and documents and to take any
and all other actions as may be necessary or desirable in their judgment
in order to carry out and give to the intent and purposes of the forgoing
Resolutions.
80
* All Resolutions shall come into force and effect only upon and subject to the
receipt by the Company of the waiver in form attached hereto as Annex 1.
------------------------- ------------------------
▇▇▇▇ ▇▇▇▇▇, Adi Plaschkes
Chief Executive Officer
Xenia Venture Capital Ltd.
------------------------- ------------------------
Yifat Gurion ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------- ------------------------
Eftan Investment ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Consulting Ltd.
------------------------- ------------------------
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
------------------------- ------------------------
M.M.T.K. Real Estate ▇▇▇▇▇ ▇▇▇▇▇▇ Ltd.
------------------------- ------------------------
------------------------- ------------------------
▇▇▇▇ ▇▇▇▇▇▇
▇▇
EXHIBIT Q
82
ACTION BY THE CONSENT OF
THE DIECTORS OF
UNLTD VENTURES INCORPORATED
BE IT RESOLVED that the designation of this Corporation's Series A
preferred stock, in the form attached to this resolution, is approved, and be it
FURTHER RESOLVED that, in consideration for the agreement of the persons
shown on Exhibit A to exchange their shares of common stock and preferred stock
in ActiVein Ltd for shares of this Corporation's common stock and Series A
preferred stock, this Corporation is authorized to issue shares of its common
stock and Series A preferred stock to the persons and in the amounts shown on
Exhibit A, and be it
FURTHER RESOLVED that upon the closing of this Corporation's Agreement
with Activein Ltd. and the shareholders of Activein, Ltd. this Corporation issue
a warrant to Xenia Venture Capital Ltd., in the form attached to this resolution
as Exhibit B, in exchange for a warrant which allows Xenia Venture Capital Ltd.
to purchase 809 Series A Preferred shares in Activein.
The foregoing resolutions were adopted to be effective October __, 2008.
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
83
CERTIFICATE OF THE DESIGNATION, PREFERENCES AND RIGHTS
OF THE SERIES A PREFERRED STOCK
OF
UNLTD VENTURES INCORPORATED
I, ▇▇▇▇▇▇▇ ▇▇▇▇▇, the President and Secretary of UNLTD Ventures
Incorporated, a Delaware corporation, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors by
the Articles of Incorporation of the Company, the Board of Directors on October
, 2008, adopted the following resolution creating a series of Preferred Shares,
$0.001 par value per share, designated as the Series A Preferred Shares.
The relative rights and preferences of the Series A Preferred Stock are as
follows:
1. Designation and Amount. The shares of such series shall be designed as
the Series A Preferred Shares (the "Series A Preferred Shares"), and the number
of shares constituting such series shall be 4,200,000. The number of shares
constituting such series may, unless prohibited by the Articles of
Incorporation, be decreased by resolution of the Board of Directors; provided
that no decrease shall reduce the number of Series A Preferred Shares to a
number less than the number of shares then outstanding plus the number of shares
issuable upon the exercise of outstanding options, rights or warrants or upon
the conversion of any outstanding securities issued by the Company convertible
into Series A Preferred Shares.
2. Reacquired Shares. Any Series A Preferred Shares purchased or otherwise
acquired by the Company in any manner whatsoever shall constitute authorized but
unissued Preferred Shares and may be reissued as part of a new series of
Preferred Shares by resolution or resolutions of the Board of Directors, subject
to the conditions and restrictions on issuance set forth herein, in the Articles
of Incorporation, or in any other Certificate of Designation creating a series
of Preferred Shares or as otherwise required by law.
3.1 Liquidation Preference. In the event of: (i) any liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary; (ii)
any Deemed Liquidation Event (as defined below), any and all assets of the
Company available for distribution (and, in the case of certain reorganizations,
mergers or consolidations, the securities received by the Company or its
shareholders in such reorganization, merger or consolidation) shall be
distributed to the shareholders of the Company in the following order and
preference:
3.2 First, prior to the repayment of any shareholders loans and prior and
in preference to any distribution to any of the holders of any other classes or
series of shares of the Company, each holder of Series A Preferred Shares shall
be entitled to receive an amount (in cash, cash equivalents or, if applicable,
securities) for each Series A Preferred Share held equal to (i) $0.133 (subject
to adjustment for Recapitalization Events); plus (ii) $0.0106 for each Preferred
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Share (subject to adjustment for Recapitalization Events), compounded annually
from the date of the issuance of each Series A Preferred Share up to the date of
distribution; plus (iii) an amount equal to the declared but unpaid dividends on
such Series A Preferred Shares (the "Preference Amount"). Such distribution
among the holders of the Series A Preferred Shares shall be made in proportion
to the aggregate respective preferences amounts of the Series A Preferred Shares
owned by each such holder.
3.3 After payment in full of the Preference Amounts, all remaining assets,
if any, shall be distributed among all of the Company's shareholders (holders of
Series A Preferred Shares and common shares) pro rata to their holdings in the
Company's issued share capital on an as-converted basis.
3.4 For purposes of this Section 3 "Deemed Liquidation Event(s)" shall
mean (i) any merger, reorganization or consolidation of the Company with or into
another entity, other than a wholly owned subsidiary of the Company, or the
acquisition of the Company by means of any transaction or series of related
transactions, following which the existing shareholders of the Company as of
immediately prior to such transaction or series of related transactions hold, by
virtue of securities issued as consideration for the Company's acquisition, less
than 50% of the voting power of the surviving or acquiring entity or less than
50% of the issued and outstanding share capital of the surviving or acquiring
entity; (ii) a sale, exclusive license, lease or other disposal of all or
substantially all of the shares and/or a sale of all or substantially all of the
assets of the Company (including without limitation its intellectual property
rights), in a single transaction or a series of related transactions, other than
to a wholly owned subsidiary of the Company and other than to an entity in which
Company's shareholders existing prior to said sale hold over 50% of the issued
and outstanding shares of the purchasing entity; or (iii) a financial or
corporate reorganization similar to any of the events described in (i) or (ii)
above having the same effect, unless the holders of more than 50% of the voting
power of all then issued Series A Preferred Shares, voting together as a single
class and on an as converted basis, determine not to treat such event as a
Deemed Liquidation Event for the purpose of this Section 3.
3.5 For purposes of this Section 3, "Recapitalization Events" shall mean
any share combination or subdivision, share split, share dividend, or any other
reclassification, reorganization or recapitalization of the Company's share
capital and the like.
4. Dividend Preference. Prior to and in preference to the distribution of
any dividends to the holders of any class or series of shares of the Company
(including shares of common stock), each of the holders of the Series A
Preferred Shares shall be entitled to receive for each Series A Preferred Share
held, non-cumulative dividends, as and when dividends are declared by the Board,
at the rate of $0.0106 (subject to adjustment for Recapitalization Events, as
that term is defined in Section 3.5) for such Preferred Share per annum,
calculated thereon from the respective original issue date of such share until
the date of distribution of such dividends. After the dividend preference of the
Series A Preferred Shares has been paid in full for a given calendar year, the
Series A Preferred Shares shall participate pro rata with the common shares in
the receipt of any additional dividends distributed, pro rata and pari passu
amongst the holders of the Series A Preferred Shares and the shares of common
stock in accordance with their respective shareholdings in the Company on an as
converted basis.
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5.1 Conversion. The holders of the Series A Preferred Shares shall have
conversion rights as follows (the "Conversion Rights"):
5.2 Each Preferred Share shall be convertible, at the option of the holder
of such share, at any time after the date of issuance of such share, into one
fully paid and non-assessable share of the Company's common stock.
5.3 Notwithstanding anything to the contrary herein, each series of Series
A Preferred Shares shall automatically be converted into one fully paid and
non-assessable share of the Company's common stock, immediately: (i) prior to
the closing of an offering by the Company of its securities to the public in a
bona fide underwriting pursuant to a registration statement under the U.S.
Securities Act of 1933, as amended, the Israeli Securities Law - 1968, or
similar securities law of another jurisdiction, with gross offering proceeds to
the Company of not less than $15,000,000 (fifteen million U.S. dollars), which
yields an imputed pre-money company valuation of at least $50,000,000 (fifty
million U.S. dollars) on a fully diluted basis (the "Qualified IPO"); or (ii)
upon written demand of the holders (on an as converted basis) of at least 51% of
the then outstanding Series A Preferred Shares.
5.4 Before any holder of the Series A Preferred Shares shall be entitled
to convert the same into shares of common stock the holder shall surrender the
certificate or certificates thereof at the Company's office and shall give
written notice by registered mail, postage prepaid, to the Company of the
election to convert the same. The Company shall, as soon as practicable
thereafter, issue and deliver to such holder of Series A Preferred Shares a
certificate or certificates for the number of shares of common stock to which
such holder shall be entitled as aforesaid. Such conversion shall be deemed to
have been made immediately prior to the close of business on the date of such
surrender of the Series A Preferred Shares to be converted, and the person or
persons entitled to receive the shares of common stock issuable upon such
conversion shall be treated for all purposes as the record holder of such shares
of common stock as of such date. In the case of automatic conversion pursuant to
Section 5.3, such conversion shall be deemed to have been made immediately prior
to the close of business on the date of the occurrence of any of the events
listed in Section 5.3, and the person or persons entitled to receive the shares
of common stock issuable upon such conversion shall be treated for all purposes
as the record holder of such shares of common stock issuable as of such date.
If the conversion is in connection with a Qualified IPO, the conversion,
unless otherwise designated by the holder, will be conditioned upon the closing
with the underwriters of the sale of securities pursuant to shares of common
stock issuable upon the conversion of the Series A Preferred Shares. The Series
A Preferred Shares will be deemed to have converted immediately prior to the
closing of such sale of securities.
5.5 In the event the Company shall at any time declare or pay any
dividend on its common stock payable in shares of common stock, or effect a
subdivision, combination, consolidation, or stock split of the outstanding
shares of common stock (by reclassification or otherwise) into a greater or
lesser number of shares of common stock, then in each such case the number of
shares of common stock issuable upon the conversion of the Series A Preferred
Shares immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of common
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stock outstanding immediately after such event and the denominator of which is
the number of shares of common stock that were outstanding immediately prior to
such event.
5.6 In the event the Company shall declare a distribution payable in
securities of the Company, securities of other persons, evidence of indebtedness
issued by the Company or other persons, assets (including cash dividends) or
options or rights then, in each such case for the purpose of this Section 5.6
the holders of the Series A Preferred Shares shall be entitled to a
proportionate share of any such distribution as though they were the holders of
the number of shares of common stock into which their Series A Preferred Shares
are convertible as of the record date fixed for the determination of the holders
of shares of common stock entitled to receive such distribution.
5.7 If at any time or from time to time there shall be a recapitalization
of the shares of common stock (other than a subdivision, combination or merger
or sale of assets transaction provided for elsewhere in this Section 5),
provision shall be made so that the holders of the Series A Preferred Shares
shall thereafter be entitled to receive upon conversion of the Series A
Preferred Shares the number of shares of common stock or other securities or
property of the Company or otherwise, to which a holder of shares of common
stock deliverable upon conversion of the Series A Preferred Shares would have
been entitled immediately prior to such recapitalization. In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 5.7 with respect to the rights of the holders of the Series A
Preferred Shares after the recapitalization to the end that the provisions of
this Section 5.7 (including adjustment of the number of shares issuable upon
conversion of the Series A Preferred Shares) shall be applicable after that
event as nearly equivalent as may be practicable.
5.8 The Company will not, by amendment of its Articles of Incorporation or
through any reorganization, recapitalization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms with
respect to any rights of the holders of the Series A Preferred Shares against
impairment, but will at all times in good faith assist in the carrying out of
all the provisions of this Section 5 and in the taking of all such action as may
be necessary or appropriate in order to protect the Conversion Rights of the
holders of the Series A Preferred Shares against impairment.
5.9 No fractional shares shall be issued upon conversion of the Series A
Preferred Shares, and the number of shares of common stock to be issued shall be
rounded to the nearest whole share.
5.10 The Company shall at all times reserve and keep available out of its
authorized but unissued common stock, solely for the purpose of effecting the
conversion of the Series A Preferred Shares, such number of its shares of common
stock as shall from time to time be sufficient to effect the conversion of all
outstanding Series A Preferred Shares; and if at any time the number of
authorized but unissued shares of common stock shall not be sufficient to effect
the conversion of all then outstanding Series A Preferred Shares, in addition to
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such other remedies as shall be available to the holder of Series A Preferred
Shares, the Company will take such corporate action as may be necessary to
increase its authorized but unissued common stock to such number of shares as
shall be sufficient for such purposes.
5.11 The Company shall pay any and all issue and other taxes that may be
payable in respect of any issue or delivery of shares of common stock upon
conversion of the Series A Preferred Shares pursuant hereto; provided, however,
that the Company shall not be obligated to pay any transfer taxes resulting from
any transfer requested by any holder in connection with any such conversion.
6. Notices of Record Date. In the event of any taking by the Company of a
record of the holders of any class of securities for the purpose of determining
the holders thereof who are entitled to receive any dividend (other than a cash
dividend) or other distribution, any right to subscribe for, purchase or
otherwise acquire any shares of any class or any other securities or property,
or to receive any other right, the Company shall mail to each holder of the
Seroes A Preferred Shares, at least 15 days prior to the date specified therein,
a notice specifying the date on which any such record is to be taken for the
purpose of such dividend, distribution or right, and the amount and character of
such dividend, distribution or right.
7. Notices of Adjustment. Upon the occurrence of each adjustment
applicable to the Series A Preferred Shares, the Company, at its expense, shall
promptly compute such adjustment in accordance with the terms hereof and prepare
and furnish to each holder of Series A Preferred Shares a certificate setting
forth each adjustment and showing in detail the facts upon which such adjustment
is based. The Company shall furnish or cause to be furnished to such holder a
like certificate setting forth (i) such adjustment, (ii) any adjustment to the
amount of the Liquidation Preference or Dividend Preference, and (iii) the
number of shares of common stock and the amount, if any, of other property which
at the time would be received upon the conversion of each Series A Preferred
Share.
8.1 Voting Rights. Each Series A Preferred Share shall entitle the holder
thereof to one vote for each share of common stock into which such Series A
Preferred Share could then be converted (with any fractional share determined on
an aggregate conversion basis being rounded to the nearest whole share), and
with respect to such vote, such holder shall have full voting rights and powers
equal to the voting rights and powers of the holders of common stock, and shall
be entitled, notwithstanding any provision hereof, to notice of any
shareholders' meeting in accordance with Delaware law, and shall be entitled to
vote, together with holders of common stock, with respect to any question upon
which holders of common stock have the right to vote.
8.2 The holders of the common stock and the Series A Preferred Shares
shall not vote as separate classes on any matter except where required by law or
by the Company's Articles of Incorporation.
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IN WITNESS WHEREOF, I have executed this Certificate of Designation,
Preferences and Rights this __ day of October, 2008.
------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇, President and Secretary
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EXHIBIT A
Allocation of Shares of Common Stock
Shares of UNLTD
ACTI Common Stock to be
Shareholder Shareholdings in ACTI received by ACTI Shareholder
▇▇▇▇ ▇▇▇▇▇▇ 1,783 944,986
▇▇▇▇ ▇▇▇ 1,783 944,986
Adi Plaschkes 840 445,198
Yifat Gurion 1,070 567,098
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 984 521,518
Eftan Investment Consulting Ltd. 713 377,888
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 542 287,259
▇▇▇ ▇▇▇▇▇▇▇▇▇ 542 287,259
▇▇▇▇▇ ▇▇▇▇▇▇ 400 211,999
M.M.T.K. Real Estate Ltd. 400 211,999
Activein Employee Stock
Ownership Plan 1,887 1,000,106
--------- ------------
Total 10,944 5,800,297
======== ============
Allocation of Shares of Preferred Stock
Shareholdings Series A Preferred Stock to be
Shareholder in ACTI received by ACTI Shareholder
Xenia Venture Capital Ltd. 7,115 3,770,935
90
EXHIBIT B
[PG NUMBER]
EXHIBIT B
120
371539/v4
UNLTD VENTURES INCORPORATED
Warrant to Purchase Series A Preferred Shares
THIS WARRANT AND THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), THE ISRAELI SECURITIES LAW
5728 - 1968, AS AMENDED, OR ANY STATE OR FOREIGN SECURITIES LAWS. SUCH
SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF SUCH REGISTRATION UNLESS SUCH SALE, OFFER, PLEDGE OR HYPOTHECATION IS
EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT AND
OF ANY APPLICABLE SECURITIES LAWS.
No. 1 ISSUED: October __, 2008
This is to certify that, FOR VALUE RECEIVED, Xenia Venture Capital Ltd., or
registered assigns ("Holder") is entitled to purchase, subject to the provisions
of this Warrant, from UNLTD Ventures Incorporated (the "Company"), 428,768
shares of the Series A Preferred stock of the Company ("Preferred Shares") at a
purchase price of $0.0001 per share. The number of Preferred Shares to be
received upon the exercise of this Warrant and the price to be paid for a
Preferred Share may be adjusted from time to time as hereinafter set forth. The
Preferred Shares deliverable upon such exercise, as may be adjusted from time to
time, are hereinafter sometimes referred to as "Warrant Shares"; and the
exercise price of a Preferred Share in effect at any time, and as may be
adjusted from time to time, is hereinafter sometimes referred to as the
"Exercise Price."
1. Exercise of Warrant
(a) This Warrant may be exercised by the Holder at any time during the period
commencing with the date hereof and ending upon the earlier of: (i) the
Company's initial public offering of its shares, reflecting a pre-money
valuation of the Company of at least fifty million United States dollars (US
$50,000,000) with net proceeds to the Company of not less than fifteen million
United States Dollars (US $15,000,000) ("QIPO"); (ii) a merger or consolidation
of the Company with or into another company, and (iii) the sale of all or
substantially all of the Company's properties and assets or the sale of all or
substantially all of the Company's shares to another party (each of the events
in (ii) and (iii) an "M&A") (the "Exercise Period") provided, however, that the
Company shall provide written notice to the Holder of an intended QIPO or M&A
not less than 45 days prior to the intended closing of such QIPO or M&A. The
Warrant may be exercised by the Holder in whole or in part, by delivering to the
Company (a) this Warrant certificate, (b) an amount equal to the Exercise Price
multiplied by the number of Warrant Shares for which this Warrant is being
exercised (the "Purchase Price"), and (c) the Notice of Exercise attached as
Exhibit A duly completed and executed by the Holder. Upon exercise, the Holder
shall be entitled to receive from the Company a share certificate in proper form
representing the number of Warrant Shares so purchased.
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(b) The Holder may condition its exercise hereof in connection with a
QIPO or M&A on the consummation of closing of such QIPO or M&A.
2. Delivery of Share Certificates; No Fractional Shares
(a) Within 10 days after the payment of the Purchase Price following the
exercise of this Warrant (in whole or in part), the Company at its expense shall
(1) issue in the name of the Holder the number of fully paid and nonassessable
Warrant Shares to which the Holder shall be entitled upon such exercise; and (2)
register the Holder in the Company's shareholders registrar as the holder of the
Warrant Shares to which the Holder shall be entitled upon such exercise, and
deliver to the Holder: (i) a certificate or certificates thereof, and (ii) a new
Warrant of like tenor to purchase up to that number of Warrant Shares, if any,
as to which this Warrant has not been exercised.
(b) If, upon exercise of this Warrant, a fraction of a share results, the
Company will round up the number of Warrant Shares deliverable hereunder to the
next whole number of such shares.
3. Adjustments
The number and kind of securities purchasable upon the exercise of this Warrant,
and the Exercise Price therefore, shall be subject to adjustment from time to
time upon the occurrence of certain events, as follows:
(a) Reclassification. In case of any reclassification or change of the
Warrant Shares (other than as a result of a subdivision or combination), the
Company shall execute a new Warrant, providing that the holder of this Warrant
shall have the right to exercise such new Warrant, and procure upon such
exercise and payment of the same aggregate Exercise Price, in lieu of the
Warrant Shares theretofore issuable upon exercise of this Warrant, the kind and
amount of shares, other securities, money and property receivable upon such
reclassification or change by a holder of an equivalent number of Warrant Shares
immediately prior to such reclassification or change. Such new Warrant shall
provide for adjustments that shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 3. The provisions of this
Section 3(a) shall similarly apply to successive reclassifications or changes.
(b) Share Splits and Combinations. In the event that the Company shall at
any time subdivide the Warrant Shares, the number of Warrant Shares issuable
upon exercise of this Warrant immediately prior to such subdivision shall be
proportionately increased, and in the event that the Company shall at any time
combine the Warrant Shares, the number of Warrant Shares issuable upon exercise
of this Warrant immediately prior to such combination shall be proportionately
decreased, effective at the close of business on the date of such subdivision or
combination, as the case may be.
(c) Adjustments for Certain Dividends and Distributions. In the event the
Company at any time or from time to time makes, or fixes a record date for the
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determination of holders of the Warrant Shares entitled to receive, a dividend
or other distribution payable in securities of the Company, then in each such
event provision shall be made so that the Holder shall receive upon exercise of
this Warrant, in addition to the number receivable thereupon of Warrant Shares,
the amount of securities of the Company that the Holder would have received had
this Warrant been exercised immediately prior to such event (or the record date
for such event) and had the Holder thereafter, during the period from the date
of such event to and including the date of exercise, retained such securities
receivable by it as aforesaid during such period, subject to all other
adjustments called for during such period under this Section.
(d) Reorganization. If at any time there is a capital reorganization of
the Company's shares (other than a recapitalization, subdivision, combination or
reclassification provided for elsewhere in this section), then, as a part of
such reorganization, provision shall be made so that the Holder shall thereafter
be entitled to receive upon exercise of this Warrant, the number of shares or
other securities or property of the Company to which a holder of Warrant Shares
would have been entitled on such capital reorganization. In any such case,
appropriate adjustment shall be made in the application of the provisions of
this Section 3(d) and with respect to the rights of the Holder after the
reorganization to the end that the provisions of this Section 3(d) (including
adjustment of the number of shares issuable upon exercise of this Warrant) shall
be applicable after that event and be as nearly equivalent to the provisions
hereof as may be practicable.
(e) Other Transactions. In the event that the Company shall issue shares
to its shareholders as a result of a split-off, spin-off or the like, then the
Company shall only complete such issuance or other action if, as part thereof,
allowance is made to protect the economic interest of the Holder either by
increasing the number of Warrant Shares or by procuring that the Holder shall be
entitled, on economically proportionate terms, to acquire additional shares of
the spun-off or split-off entities.
(f) General Protection. The Company will not, by amendment of its
Certificate of Incorporation or through any reorganization, recapitalization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed hereunder, but
will at all times in good faith assist in the carrying out of all the provisions
hereof and in taking of all such actions and making all such adjustments as may
be necessary or appropriate in order to protect the rights of the Holder as set
forth herein against impairment.
4. Notice of Adjustments
(a) Upon the occurrence of each adjustment or readjustment pursuant to
Section 3, the Company at its expense shall promptly compute such adjustment or
readjustment in accordance with the terms hereof and provide notice to the
Holder signed by the Company's Chief Financial Officer setting forth, in
reasonable detail, the event requiring the adjustment or readjustment, the
amount of the adjustment or readjustment, the method by which such adjustment or
readjustment was calculated, and the number and class of Warrant Shares which
may be purchased after giving effect to such adjustment or readjustment.
93
(b) If at any time the Company shall offer for subscription pro rata to
the holders of its common stock (or other stock or securities at the time
receivable upon the exercise of this Warrant) any additional shares of any
class, other rights or any equity security of any kind, or there shall be any
public offering, capital reorganization or reclassification of the capital
shares of the Company, or consolidation or merger of the Company with, or sale
of all or substantially all of its assets to another company or there shall be a
voluntary or involuntary dissolution, liquidation or winding up of the Company,
or other transaction described in Section 3, then, in any one or more of said
cases, the Company shall give the Holder prior written notice, by registered or
certified mail, postage prepaid, of the date on which (i) a record shall be
taken for such subscription rights or (ii) such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up or other transaction shall take place, as the case may be. Such
notice shall also specify the date as of which the holders of record of shares
of common stock (or other stock or securities at the time receivable upon the
exercise of this Warrant) shall participate in such subscription rights, or
shall be entitled to exchange their securities for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up, etc. as the case may be. Such
written notice shall be given at least ten (10) days prior to the action in
question and not less than ten (10) days prior to the record date in respect
thereto.
5. Representations, Warranties, and Covenants of the Company
The Company represents, warrants, and covenants to the Holders as follows:
(a)The Company represents that all corporate actions on the part of the
Company, its officers, directors and shareholders necessary for the sale and
issuance of this Warrant and the Warrant Shares and the performance of the
Company's obligations hereunder were taken prior to and are effective as of the
effective date of this Warrant.
(b)The execution and delivery of this Warrant are not, and the issuance
of the Warrant Shares upon exercise of this Warrant in accordance with the terms
hereof will not be, inconsistent with the Company's Certificate of
Incorporation, do not contravene any material law, governmental rule or
regulation, judgment or order applicable to the Company, and, except for
consents that have already been obtained by the Company, do not and will not
conflict with or contravene any provision of, or constitute a default under, any
indenture, mortgage, contract or other instrument of which the Company is a
party or by which it is bound.
(c) The Company represents and covenants that at all times during the
Exercise Period there shall be reserved for issuance and delivery upon exercise
of this Warrant such number of Warrant Shares as is necessary for exercise in
full of this Warrant and, from time to time, it will take all steps necessary to
amend its Certificate of Incorporation to provide sufficient reserves of Warrant
Shares. All Warrant Shares issued pursuant to the exercise of this Warrant will,
upon their issuance, be validly issued and outstanding, fully paid and
94
nonassessable, free and clear of all liens and other encumbrances or
restrictions on sale and free and clear of all preemptive rights, except
restrictions arising (a) under applicable securities laws, (b) not by or through
the Company, or (c) by agreement between the Company and the Holder or its
successors.
6. Rights of Shareholders
(a)No holder of this Warrant shall be entitled, as a Warrant holder, to
vote or receive dividends or be deemed the holder of the Warrant Shares or any
other securities of the Company which may at any time be issuable on the
exercise hereof for any purpose, nor shall anything contained herein be
construed to confer upon the holder of this Warrant, as such, any of the rights
of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action (whether upon any
recapitalization, issuance of shares, reclassification of shares, change of par
value, consolidation, merger, conveyance, or otherwise) or to receive notice of
meetings, or to receive dividends or subscription rights or otherwise until this
Warrant shall have been exercised and the Warrant Shares purchasable upon the
exercise hereof shall have become deliverable, as provided herein.
(b) Notwithstanding the provisions of Section 6(a) hereof, the Warrant
Shares shall be deemed to have been issued in full to the Holder for the purpose
of calculating the Holder's pro-rata share of the Company's issued and
outstanding share capital under any rights offering by the Company.
7. Notices
All notices and other communications required or permitted hereunder
shall be in writing and shall be telecopied, emailed or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger.
Notices to the Company shall be sent to the principal office of the Company (or
at such other place as the Company shall notify the Holder hereof in writing).
Notices to the Holder shall be sent to the address of the Holder in the Books of
the Company (or at such other place as the Holder shall notify the Company in
writing).
Any notice sent in accordance with this Section 7 shall be effective (a)
if mailed, seven (7) business days after mailing, (b) if sent by messenger, upon
delivery, and (c) if sent via telecopier or email, upon transmission and
electronic confirmation of receipt or, if transmitted and received on a
non-business day, on the first business day following transmission and
electronic confirmation of receipt (provided, however, that any notice of change
of address shall only be valid upon receipt).
8. Transfer to Comply with the Securities Act of 1933
The Company may cause the following legend or one similar thereto to be
set forth on each certificate representing Warrant Shares or any other security
issued or issuable upon exercise of this Warrant, unless counsel for the Company
is of the opinion as to any such certificate that such legend is unnecessary:
95
The shares represented by this Certificate have not been registered under
the Securities Act of l933 (the "Act") and are "restricted securities" as that
term is defined in Rule 144 under the Act. The shares may not be offered for
sale, sold, or otherwise transferred except pursuant to an effective
registration statement under the Act or pursuant to an exemption from
registration under the Act, the availability of which is to be established to
the satisfaction of the Company.
9. Loss, Theft, Destruction or Mutilation of Warrant
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of any Warrant or share certificate,
and in case of loss, theft or destruction, of indemnity, or security reasonably
satisfactory to it, and upon reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender and cancellation of such Warrant
or share certificate, if mutilated, the Company will make and deliver a new
Warrant or share certificate of like tenor and dated as of such cancellation, in
lieu of such Warrant or share certificate.
10. Miscellaneous
10.1 Amendments and Waivers
Any term of this Warrant may be amended and the observance of any term
may be waived (either generally or in a particular instance and either
retroactively or prospectively) only with the written consent of the Company and
the Holder. Any amendment or waiver effected in accordance with this Section
10.1 shall be binding on the Holder, each future Holder and the Company.
10.2 Governing Law; Jurisdiction; Venue
This Warrant shall be governed by and construed under the laws of
Delaware, without regard to principles of conflict of laws. The Chancery Court
of Delaware shall have exclusive jurisdiction on all matters pertaining to this
Warrant.
10.3 Successors and Assigns; Transfer
The terms and conditions of this Warrant shall inure to the benefit of
and be binding on the respective successors and assigns of the parties. This
Warrant may be transferred or assigned without the consent of the Company or
other third parties pursuant to an Assignment in the form of Exhibit B hereto,
provided that such assignment shall be subject to and the approval of the
Company's directors.
96
IN WITNESS WHEREOF, the Company has executed this Warrant as of the date
first written above.
UNLTD VENTURES INCORPORATED
By:
--------------------------------
Print Name:
------------------------
Its:
-------------------------------
97
EXHIBIT A
Exhibit A
NOTICE OF EXERCISE
To: UNLTD Ventures Incorporated
The undersigned hereby irrevocably elects to purchase ____ Series A Preferred
Shares of UNLTD Ventures Incorporated issuable upon the exercise of the attached
Warrant and requests that certificates for such shares be issued in the name of
the undersigned and delivered to the address of the undersigned, at the address
stated below and, if such number of shares shall not be all the shares that may
be purchased pursuant to the attached Warrant, that a new Warrant evidencing the
right to purchase the balance of such shares be registered in the name of, and
delivered to, the undersigned at the address stated below.
Payment enclosed in the amount of $___________.
Dated: ________________
Name of Holder of Warrant:
----------------------------------------------
(please print)
Address: ________________________________________________________________
Signature: ______________________________________________________________
98
EXHIBIT B
ASSIGNMENT
For value received the undersigned sells, assigns and transfers to the
transferee named below the attached Warrant, together with all right, title and
interest, to hold by the transferee, subject to the terms and conditions under
which we held the same immediately before the execution hereof, and does
irrevocably constitute and appoint the corporate secretary or transfer agent of
UNLTD Ventures Incorporated (the "Company") as the undersigned's
attorney-in-fact, to transfer such Warrant on the books of the Company, with
full power of substitution in the premises, and I the transferee, do hereby
agree to accept and take the attached Warrant subject to the conditions
aforesaid.
Dated: __________________________
Name of Holder of Warrant:
----------------------------------------------
(please print)
Address: ________________________________________________________________
Signature: ______________________________________________________________
Name of transferee:
-----------------------------------------------------
(please print)
Address of transferee:
--------------------------------------------------
99
EXHIBIT R
UNLTD Share Certificate
100
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that _____________________________________ is the owner of
------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
_________________________________________ Dated: _______________
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
------------------------------------------------------------------------------
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
101
EXHIBIT S
UNLTD SHAREHOLDER REGISTER
COMMON STOCK
Shareholder Name Shares
--------------- --------
▇▇▇▇▇▇▇ ▇▇▇▇▇ 2,500,000
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ 2,500,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 500,000
▇▇▇, ▇▇▇▇▇ 20,000
▇▇▇, ▇▇▇▇ 20,000
▇▇▇▇▇▇, V. ▇▇▇▇▇ 13,333
▇▇▇▇▇▇, ▇▇▇▇ 6,667
▇▇▇▇▇▇, ▇▇▇ 6,667
Delure-Savage, ▇▇▇▇▇-▇▇▇ 66,667
Homes Unlimited/▇▇▇ ▇▇▇▇▇▇ 233,333
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 33,333
▇▇▇▇▇▇, ▇▇▇ 300,000
Dadwan, ▇▇▇▇▇▇▇▇▇▇ 12,500
Dadwan, ▇▇▇▇▇▇▇▇▇ 12,500
▇▇▇▇▇▇▇▇, Dr. ▇▇▇▇▇ 666,667
Gareth, ▇▇▇▇▇ 166,667
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 23,333
▇▇▇▇▇▇▇ ▇▇▇▇▇ 20,000
Lombarni, Len 10,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ 100,000
▇▇▇▇▇▇,▇▇▇▇▇ 20,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 30,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 100,000
▇▇▇▇▇, ▇▇▇▇ 50,000
▇▇▇▇▇, ▇▇▇▇▇▇▇ 100,000
▇▇▇▇▇▇▇, ▇▇▇▇▇ 5,000
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 10,000
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇. 20,000
▇▇▇, ▇▇▇▇▇▇ 83,333
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 66,000
Witzu M. 33,333
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 35,000
▇▇▇▇▇▇▇, ▇▇▇ 25,000
▇▇▇▇, ▇▇▇▇-▇▇▇▇▇▇ 10,000
Caro, Gad 2,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ 3,000
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 3,000
102
Shareholder Name Shares
--------------- --------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 2,000
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ 10,000
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 108,900
▇▇▇▇▇▇, ▇▇▇▇ 233,333
Wa, ▇▇▇▇▇ 3,153
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 6,680
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ 6,667
▇▇▇▇, ▇▇▇▇▇▇ 6,667
Astortno, ▇▇▇▇▇▇ 6,667
▇▇▇▇▇▇, ▇▇▇▇ 10,000
▇▇▇▇▇, ▇▇▇▇▇ 10,000
▇▇▇▇▇▇▇▇▇, ▇.▇. 10,000
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 30,000
▇▇▇▇▇▇▇, ▇▇▇▇ 66,667
▇▇▇▇▇ ▇▇▇▇▇▇▇ 20,000
▇▇▇▇▇▇▇, ▇▇▇ 20,000
Boaz Dor 750,000
▇▇▇▇ ▇▇▇▇▇▇ 944,986
▇▇▇▇ ▇▇▇ 944,986
Adi Plaschkes 445,198
Yifat Gurion 567,098
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 521,518
Eftan Investment Consulting Ltd. 377,888
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 287,259
▇▇▇ ▇▇▇▇▇▇▇▇▇ 287,259
▇▇▇▇▇ ▇▇▇▇▇▇ 211,999
M.M.T.K. Real Estate Ltd. 211,999
Activein Employee Stock
Ownership Plan 1,000,106
SERIES A PREFERRED STOCK
Shareholder Name Shares
--------------- --------
Xenia Venture Capital Ltd. 3,770,935
WARRANTS
Xenia Venture Capital Ltd has a warrant to purchase 428,768 shares of the
Corporation's Series A Preferred stock.
103
EXHIBIT T
104
UNLTD VENTURES INCORPORATED
CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF INCORPORATION
UNLTD Ventures Incorporated, organized and existing under and by virtue of
the General Corporation Law of the State of Delaware, does hereby certify:
FIRST: That at a meeting of the Directors of UNLTD Ventures Incorporated a
resolution was duly adopted n October __, 2008 setting forth proposed amendments
to the Certificate of Incorporation of said Corporation and declaring said
amendments to be advisable.
The resolution setting forth the proposed amendment is as follows:
RESOLVED, that the Certificate of Incorporation of this Corporation be is
amended:
(1) by changing Article I so that, as amended, Article I shall be and
read as follows:
The name of this Corporation will be: Activein, Inc.
(2) by changing Article IV so that, as amended, Article IV shall be and
read as follows:
The authorized capital stock of the Corporation shall consist of
50,000,000 shares of common stock, $0.0001 par value and
10,000,000 shares of preferred stock, $0.0001 par value.
(3) by changing Section 3 of Article VII so that, as amended, Section 3
of Article VII shall be and read as follows:
Meetings of the Board of Directors, regular or special, may be
held within or without Delaware upon such notice as may be
prescribed by the Bylaws of the Corporation. Attendance of a
director at a meeting shall constitute a waiver by him of notice
of such meeting unless he attends only for the express purpose of
objecting to the transaction of any business thereat on the
ground that the meeting is not lawfully called or convened. Any
one director or shareholders holding more than 10% of the shares
entitled to vote at any meeting of shareholders may call a
meeting of the Board of directors of the Corporation, and the
chairman of this Corporation's Board of Directors shall call such
a meeting upon such request.
(4) by changing Section 6 of Article VII so that, as amended, Section 6
of Article VII shall be and read as follows:
Until the date this Corporation's shares are publicly traded on
the OTC Bulletin board, the NASDAQ Stock Market or any national
stock exchange based in the United States:
105
o ▇▇. ▇▇▇▇ Dor can designate his replacement on the Board of Directors
in the event of his resignation; and
o Xenia Venture Capital Ltd. has the right to remove ▇▇▇▇ ▇▇▇▇▇, and/or
Avi Lior as directors and to designate the replacement on the Board of
Directors of any director so removed.
o Adi Plaskes, ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇ have the right to remove Eitan
Kyiet, and/or ▇▇▇▇ ▇▇▇▇▇▇ as directors and to designate the
replacement on the Board of Directors of any director so removed.
In all cases the right to appoint a director shall include the right to
remove and replace such director. Appointments, removals and replacements
shall be effected by furnishing written notification to the Corporation,
signed by the person having the right to appoint the director. Any notice
regarding the appointment, removal or replacement of a director shall be
delivered to the Corporation in writing, and shall become effective on the
date fixed in such notice, or upon the delivery thereof to the Corporation,
whichever is later.
(5) by changing Article X so that, as amended, Article X shall be and read as
follows:
When, with respect to any action to be taken by stockholders of this
Corporation, the laws of Delaware requires the affirmative vote of the
holders of more than a majority of the outstanding shares entitled to vote
thereon, or of any class or series, such action may be taken by the
affirmative vote of the holders of a majority of the outstanding shares
entitled to vote on such action.
Notwithstanding the above, until the date this Corporation's shares are
publicly traded on the OTC Bulletin Board, the NASDAQ Stock Market, or any
national stock exchange based in the United States, any action or
resolution of the Corporation's shareholders, or of the Corporation's Board
of Directors, regarding any of the following actions whether concerning the
Corporation itself, or Activein Ltd., shall require the consent of two
thirds of the Corporation's directors at any regular or special meeting or
the approval of Xenia Venture Capital Ltd.:
o an amendment to the Certificate of Incorporation;
o the entry into any new line of business or new business activity;
106
o a merger, consolidation or acquisition, or the sale, lease or other
disposal of all or substantially all of the Corporation's assets or
those of Activein Ltd.;
o a transactions with any officer, director, or any other party related,
directly or indirectly;
o the declaration and payment of any dividends or other distributions;
o the liquidation, dissolution or winding-up of the Corporation or of
Activein Ltd.;
o the constitution of any committee of the Board of Directors;
o the sale, license, contribution or disposition of the Corporation's
core intellectual property or that of Activein Ltd.;
o a change of domicile of Activein Ltd., whose domicile and base of
operations shall remain in Israel; or
o any change to the composition of the Board of Directors of Activein
Ltd.
SECOND: That thereafter, pursuant to resolution of its Board of Directors, a
special meeting of the stockholders of said Corporation was duly called and held
upon notice in accordance with Section 222 of the General Corporation Law of the
State of Delaware at which meeting the necessary number of shares as required by
statute were voted in favor of the amendment.
THIRD: That said amendments were duly adopted in accordance with the provisions
of Section 242 of the General Corporation Law of Delaware.
IN WITNESS WHEREOF, said Corporation has caused this certificate to be signed
this ____ day of October, 2008.
By:
-------------------------------
Authorized Officer
Title: President
------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
-------------------------------
107
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for ▇▇▇▇ ▇▇▇▇▇▇ is the owner of
944,986
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
108
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd.,
as Trustee for Eftan Investment Consulting Ltd. is the owner of
377,888
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
109
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for ▇▇▇▇ ▇▇▇ is the owner of
944,986
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
110
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd. ,
as Trustee for Adi Plaschkes is the owner of
445,198
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
111
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd.,
as Trustee for Yifat Gurion is the owner of
567,098
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
112
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd.,
as Trustee for ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is the owner of
521,518
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
113
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is the owner of
287,259
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
114
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for ▇▇▇ ▇▇▇▇▇▇▇▇▇ is the owner of
287,259
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
115
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for ▇▇▇▇▇ ▇▇▇▇▇▇ is the owner of
211,999
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
116
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd,
as Trustee for M.M.T.K Real Estate Ltd. is the owner o
211,999
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
117
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
UNLTD VENTURES INCORPORATED
This Certifies that ▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Trusts (2000) Ltd.,
as Trustee for Xenia Venture Capital Ltd. is the owner of
3,770,935
-------------------------------------------------------------------------------
Fully Paid and Non-Assessable Shares of Common Stock, $0.0001 par value, of
UNLTD VENTURES INCORPORATED
________________________________________ Dated: March 24, 2009
▇▇▇▇▇▇▇ ▇▇▇▇▇, PRESIDENT AND SECRETARY
The Corporation is authorized to issue 1,000,000 shares of Preferred Stock. The
Preferred shares may be issued from time to time, in one or more series, and
with such rights, preferences and limitations as may be determined from time to
time by the Corporation's Board of Directors. A copy of the designation of the
rights, preferences and limitations of any series of preferred stock established
by the Corporation will be sent, without charge, to any shareholder upon written
request to the Corporation
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