2 Exhibit 4.9
COMMON STOCK PURCHASE AGREEMENT
September 30, 2002
TABLE OF CONTENTS
PAGE
ARTICLE 1. PURCHASE AND SALE OF THE SHARES................................................................1
1.1 Purchase and Sale of the Shares................................................................1
1.2 Closing........................................................................................1
1.3 Delivery.......................................................................................1
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF SUPERCOM.....................................................2
2.1 Organization, Good Standing and Qualification..................................................2
2.2 Authorization..................................................................................2
2.3 Good Title to the Shares.......................................................................2
2.4 No Violations..................................................................................2
2.5 Brokers and Finders............................................................................2
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.................................................2
3.1 Authorization..................................................................................2
3.2 No Violations..................................................................................3
3.3 Investment Intent..............................................................................3
3.4 Legends........................................................................................3
3.5 Investment Experience and Counsel..............................................................4
3.6 Accredited Investor............................................................................4
3.7 Brokers and Finders............................................................................4
ARTICLE 4. CONDITIONS TO THE INVESTOR'S OBLIGATIONS AT CLOSING............................................4
4.1 Representations and Warranties.................................................................4
4.2 Performance....................................................................................4
4.3 Due Diligence..................................................................................4
4.4 Proceedings and Documents......................................................................4
ARTICLE 5. CONDITIONS TO SUPERCOM'S OBLIGATIONS AT CLOSING................................................5
5.1 Representations and Warranties.................................................................5
5.2 Payment of Purchase Price......................................................................5
ARTICLE 6. INDEMNIFICATION................................................................................5
6.1 Indemnification................................................................................5
(a) Indemnification by Supercom...........................................................5
(b) Indemnification by the Investor.......................................................5
(c) Limitations...........................................................................6
(d) Other Limitation......................................................................6
(e) Payment of Claims.....................................................................6
6.2 Right to Defend; Compromise of Claims; Contribution............................................6
6.3 Remedies.......................................................................................7
ARTICLE 7. MISCELLANEOUS..................................................................................7
7.1 Survival of Warranties.........................................................................7
7.2 Successors and Assigns.........................................................................7
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TABLE OF CONTENTS
(continued)
PAGE
7.3 Titles and Subtitles...........................................................................7
7.4 Notices........................................................................................7
7.5 Amendments and Waivers.........................................................................8
7.6 Severability...................................................................................8
7.7 Independence of Covenants and Representations and Warranties...................................8
7.8 Further Assurances.............................................................................8
7.9 Governing Law..................................................................................8
7.10 Counterparts...................................................................................8
7.11 Entire Agreement...............................................................................8
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COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is made as of
the 30th day of September, 2002, by and between Supercom Ltd., an Israeli
corporation ("Supercom"), and the investor listed on Exhibit A hereto (the
"Investor").
RECITALS
WHEREAS, Supercom is the holder of 3,075,676 shares (the "Shares") of
common stock, $.01 par value per share (the "Common Stock"), of InkSure
Technologies Inc., a Delaware corporation (the "Company") which Supercom desires
to sell to the Investor; and
WHEREAS, the Investor desires to purchase the Shares on the terms and
conditions set forth herein; and
WHEREAS, the parties wish to set out certain representations,
warranties, covenants and understandings with respect to the above matters.
PROVISIONS
In consideration of the foregoing recitals and the mutual covenants
herein, the undersigned parties agree as set forth herein.
ARTICLE 1. PURCHASE AND SALE OF THE SHARES
1.1 PURCHASE AND SALE OF THE SHARES. Subject to the terms and
conditions hereof, at the Closing (as defined below), Supercom will sell and
deliver, and the Investor will purchase from Supercom, the Shares.
1.2 CLOSING. Subject to the terms and conditions hereof, the closing of
the purchase and sale of the Shares pursuant to Section 1.1 (the "Closing")
shall take place on October 2, 2002, at the offices of ▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, LLP,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such other time
or place as the Company and the Investor may mutually agree (the "Closing
Date").
1.3 DELIVERY. At the Closing, subject to the terms and conditions
hereof, Supercom will deliver to the Investor the Shares to be purchased by the
Investor, against payment of the purchase price of an aggregate of $4,582,757.24
by bank check or wire transfer to the account designated by Supercom.
1
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF SUPERCOM
Supercom hereby represents and warrants to the Investor as of the
Closing:
2.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. Supercom is duly
organized, validly existing and in good standing under the laws of Israel and
has all requisite power and authority to enter into this Agreement and to carry
out the provisions hereof.
2.2 AUTHORIZATION. Supercom has the right, power and authority to enter
into and perform its obligations under this Agreement and the other agreements
contemplated hereby to which Supercom is a party. All corporate action on the
part of Supercom, its officers, directors and stockholders necessary for the
authorization, execution and delivery of this Agreement and the other agreements
contemplated hereby to which Supercom is party, the performance of all
obligations of Supercom hereunder, the sale and delivery of the Shares has been
taken. This Agreement constitutes the valid and legally binding obligation of
Supercom, enforceable in accordance with its terms, except (a) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of
general application affecting enforcement of creditors' rights generally, (b) as
limited by laws relating to the availability of specific performance, injunctive
relief, or other equitable remedies and (c) to the extent any indemnification
provisions of this Agreement may be limited by applicable federal or state
securities laws or by public policy.
2.3 GOOD TITLE TO THE SHARES. The Shares being purchased by the
Investor hereunder, when sold and delivered in accordance with the terms of this
Agreement, will be duly authorized and validly issued, fully paid and
nonassessable, with no personal liability attaching to the ownership thereof,
free and clear of any liens whatsoever, other than liens arising out of the acts
or omissions of the Investor, and with no restrictions on the voting rights
thereof and other incidents of record and beneficial ownership pertaining
thereto other than as provided for herein.
2.4 NO VIOLATIONS. The execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby will not
result in any violation on the part of Supercom or be in conflict with, or
constitute (with or without the passage of time and giving of notice) a default
on the part of Supercom under any instrument, contract, judgment, order, writ or
decree to which Supercom is a party or by which it is bound.
2.5 BROKERS AND FINDERS. Except for ▇▇▇▇ ▇▇▇▇▇▇▇'▇ consulting
arrangement with Supercom, which arrangement will not result in the specific
payment of any fee to ▇▇. ▇▇▇▇▇▇▇ by Supercom as a result of the closing of the
transactions contemplated by this Agreement, Supercom has not used or retained
any broker, investment banker, financial advisor, finder or agent in connection
with this Agreement or the transactions contemplated hereby.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF THE INVESTOR
The Investor hereby represents and warrants as of the Closing:
3.1 AUTHORIZATION. The Investor has the right, power and authority to
enter into and perform its obligations under this Agreement and the other
agreements contemplated hereby and
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thereby. All action on the part of the Investor and its officers, directors,
stockholders, partners, members or managers, as applicable, necessary for the
authorization, execution and delivery of this Agreement and the other agreements
contemplated hereby or thereby, and the performance of all obligations of such
Investor hereunder and thereunder, has been taken or will be taken prior to the
Closing. This Agreement constitutes a valid and legally binding obligation of
such Investor, enforceable in accordance with its terms, except (a) as limited
by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws
of general application affecting enforcement of creditors' rights generally, (b)
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies and (c) to the extent any
indemnification provisions of such agreements may be limited by applicable
federal or state securities laws or by public policy.
3.2 NO VIOLATIONS. The execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby will not
result in any violation on the part of such Investor or be in conflict with or
constitute (with or without the passage of time and giving of notice) a default
on the part of such Investor under any of its organizational or charter
documents, as applicable, or a default on the part of such Investor under any
instrument, contract, judgment, order, writ or decree, or an event that results
in the creation of any lien, charge or encumbrance upon any assets of such
Investor or the suspension, revocation, impairment, forfeiture, or nonrenewal of
any material permit, license, authorization, or approval applicable to such
Investor, its business or operations or any of its assets or properties.
3.3 INVESTMENT INTENT. The Investor will acquire the Shares for the
Investor's own account for investment and not with a view to, or in connection
with, any resale or other distribution of any part thereof, and the Investor has
no present intention of selling or otherwise distributing the same. The Investor
acknowledges that the Shares are not registered under the Act or other
applicable securities laws and that they may not be sold, transferred, offered
for sale, pledged, hypothecated or otherwise disposed of without registration
under such Act and other applicable securities laws, except pursuant to an
exemption from such registration available under the Act and other applicable
securities laws. In this connection, the Investor represents that the Investor
is familiar with Rule 144 of the Act, as presently in effect, and understands
the resale limitations imposed thereby and by the Act.
3.4 LEGENDS. It is understood that the certificates evidencing the
Shares may bear one or all of the following legends:
(i) "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND, ACCORDINGLY,
MAY NOT BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED EXCEPT (I) UPON
EFFECTIVE REGISTRATION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR (II) UPON AN EXEMPTION FROM SUCH
REGISTRATION REQUIREMENTS."
(ii) Any legend required by the Blue Sky laws of any other
state to the extent such laws are applicable to the shares represented by the
certificate so legended.
(iii) Any legend required by any of the agreements entered
into by the parties hereto as of the date hereof.
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3.5 INVESTMENT EXPERIENCE AND COUNSEL. The Investor is an investor in
securities of privately held companies, such as the Company, can bear the
economic risk of its investment, and has such knowledge and experience in
financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Shares. The Investor acknowledges that it has had
the opportunity to review this Agreement, the exhibits and schedules attached
hereto and thereto and the transactions contemplated by the Agreements with its
own legal counsel. The Investor is relying solely on its own counsel and not on
any statements or representations of the Company or Supercom or its agents for
legal advice with respect to this investment or the transactions contemplated by
this Agreement.
3.6 ACCREDITED INVESTOR. The Investor is an "accredited investor"
within the meaning of Rule 501 of Regulation promulgated under the Act, as
presently in effect. The Investor (i) has been afforded the opportunity to ask
questions of, and receive answers from, the officers and/or directors of the
Company, acting on its behalf, concerning the Company, and to obtain any
additional information, to the extent that the Company possesses such
information or can acquire it without unreasonable effort or expense, necessary
to verify the accuracy of the information furnished, and (ii) has availed itself
of such opportunity to the extent such Investor considers appropriate in order
to permit such Investor to evaluate the merits and risks of an investment in the
Company.
3.7 BROKERS AND FINDERS. The Investor has not used or retained any
broker, investment banker, financial advisor, finder or agent in connection with
this Agreement or the transactions contemplated hereby.
ARTICLE 4. CONDITIONS TO THE INVESTOR'S OBLIGATIONS AT CLOSING
The obligations of the Investor under Section 1.1 hereof are subject to
the fulfillment on or before the Closing Date of each of the following
conditions:
4.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of Supercom contained in Article 2 shall be true on and as of the Closing with
the same effect as though such representations and warranties had been made on
and as of the date of the Closing.
4.2 PERFORMANCE. Supercom shall have performed and complied with all
agreements, obligations and conditions contained in this Agreement that are
required to be performed or complied with by it on or before the Closing.
4.3 DUE DILIGENCE. The Investor shall be satisfied in its sole
discretion with the results of its due diligence investigation and review of the
Company and its Subsidiaries.
4.4 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated at or prior to the Closing and all
documents incident thereto shall be reasonably satisfactory in form and
substance to the Investor at the Closing and the Investor shall have received
all such counterpart original and certified or other copies of such documents as
such Investor may reasonably request.
4.5 RESIGNATION OF DIRECTORS. Avi ▇▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇ shall have
resigned from their positions as directors of the Company, effective as of the
date of the Closing.
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ARTICLE 5. CONDITIONS TO SUPERCOM'S OBLIGATIONS AT CLOSING
The obligations of Supercom to the Investor under this Agreement are
subject to the fulfillment or Supercom's express written waiver, on or before
the Closing, of each of the following conditions by such Investor:
5.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
of the Investor contained in Article 3 shall be true on and as of the Closing
with the same effect as though such representations and warranties had been made
on and as of such Closing.
5.2 PAYMENT OF PURCHASE PRICE. The Investor shall have delivered the
purchase price for the Shares in accordance with Section 1.3.
5.3 VOTING AGREEMENT. As a condition to the sale of the Shares to the
Investor, the Investor hereby agrees to be bound by all of the terms of the
Voting Agreement, dated as of March 4, 2002, among Supercom, the Company and the
holder of Series A Preferred Stock of the Company, a copy of which has been
provided to the Investor.
ARTICLE 6. INDEMNIFICATION
6.1 INDEMNIFICATION.
(a) INDEMNIFICATION BY SUPERCOM. In addition to all other rights
and remedies available to the Investor at law or in equity (subject to the
limitations contained in Section 6(c)), Supercom shall indemnify, defend and
hold harmless the Investor and its affiliates, stockholders, officers,
directors, employees, agents, representatives and permitted assigns from and
against any loss, liability, demand, claim, action, cause of action, cost,
damage, deficiency, penalty, fine or expense, including interest, penalties,
reasonable attorneys' fees and expenses and all reasonable amounts paid in
investigation, defense or settlement of any of the foregoing (collectively,
"Losses") which any such party may suffer, sustain or become subject to, as a
result of:
(i) any misrepresentation or breach of a representation or warranty
(when viewed individually or in the aggregate) on the part of Supercom under
Article 2; or
(ii) without duplication, any misrepresentation in or omission from
any of the representations or warranties contained in any of the certificates or
other documents furnished to the Investor by Supercom.
(b) INDEMNIFICATION BY THE INVESTOR. In addition to all other
rights and remedies available to Supercom at law or in equity, the Investor
shall indemnify, defend and hold harmless Supercom and its affiliates,
stockholders, officers, directors, employees, agents, representatives and
permitted assigns from and against any Losses which any such party may suffer,
sustain or become subject to, as a result of:
(i) any misrepresentation or breach of a representation or warranty
(when viewed individually or in the aggregate) on the part of the Investor under
Article 3; or
5
(ii) without duplication, any misrepresentation in or omission from
any of the representations or warranties contained in any of the certificates or
other documents furnished to Supercom by the Investor.
(c) LIMITATIONS. No claim for indemnification pursuant to this
Article 6 shall be made, other than pursuant to Section 2.5, unless the
aggregate Losses incurred by the party to be indemnified (the "Indemnified
Party") exceed $25,000, at which time all Losses (without regard to materiality
qualifiers) shall be subject to indemnification under this Article 6.
(d) OTHER LIMITATION. Notwithstanding the foregoing, and subject to
the following sentence, upon judicial determination, which is final and no
longer appealable, that the act or omission giving rise to the indemnification
hereinabove provided resulted primarily out of or was based primarily upon the
Indemnified Party's gross negligence, fraud or willful misconduct (unless such
action was based upon the Indemnified Party's reliance in good faith upon any of
the representations, warranties, covenants or promises made by the party
required to provide indemnification under paragraphs (a) or (b) above (the
"Indemnifying Party") by the Indemnified Party, the Indemnifying Party shall not
be responsible for any Losses sought to be indemnified in connection therewith,
and the Indemnifying Party shall be entitled to recover from the Indemnified
Party all amounts previously paid in full or partial satisfaction of such
indemnity, together with all costs and expenses of the Indemnifying Party
reasonably incurred in effecting such recovery, if any. The indemnity,
contribution and expense reimbursement obligations that the Indemnifying Party
has under this Section 6.1 shall be in addition to any liability that the
Indemnifying Party may otherwise have. The Indemnifying Party further agrees
that the indemnification and reimbursement commitments set forth in this
Agreement shall apply whether or not the Indemnified Party is a formal party to
any such lawsuits, claims or other proceedings.
(e) PAYMENT OF CLAIMS. Any indemnification of any Indemnified Party
by the Indemnifying Party pursuant to this Section 6.1 shall be effected by wire
transfer of immediately available funds from the Indemnifying Party to an
account designated by the Indemnified Party within 15 days after the
determination thereof.
6.2 RIGHT TO DEFEND; COMPROMISE OF CLAIMS; CONTRIBUTION. Each
Indemnifying Party shall have the right to compromise or defend, at its own
expense and by its own counsel reasonably satisfactory to such Indemnified
Party, any matter involving the asserted liability of any Indemnified Party;
provided, however, that no compromise of any claim shall be made without the
consent of the Indemnified Party unless such compromise results in the full and
unconditional release of all claims against the Indemnified Party by the party
asserting such claim. The opportunity to compromise or defend as herein provided
shall be a condition precedent to any liability of an Indemnifying Party under
the provisions of this Section 6.2. If any Indemnifying Party shall undertake to
compromise or defend any such asserted liability, it shall promptly notify the
Indemnified Party and any other Indemnifying Party of its intention to do so. An
Indemnified Party shall cooperate with the Indemnifying Party and its counsel at
the Indemnifying Party's expense in the defense against any such asserted
liability and in any compromise thereof. Such cooperation shall include, but not
be limited to, furnishing the Indemnifying Party with any books, records or
information reasonably requested by the Indemnifying Party and taking such
action as the Indemnifying Party may reasonably request to
6
mitigate or reduce any claim. After an Indemnifying Party has notified an
Indemnified Party of its intention to undertake to compromise or defend any
asserted liability, the Indemnifying Party shall not be liable for any
additional legal expenses incurred by the Indemnified Party unless the
Indemnifying Party fails to prosecute the defense of such claim. If the
Indemnifying Party shall desire to compromise any such asserted liability by the
payment of a liquidated amount which the party asserting such liability is
willing to accept in exchange for fully and unconditionally releasing all claims
against the Indemnified Party, and the Indemnified Party shall refuse to consent
to such compromise, then the Indemnifying Party's liability under this Article 6
with respect to such asserted liability shall be limited to the amount so
offered in compromise. Under no circumstances shall the Indemnified Party
compromise any asserted liability without the written consent of the
Indemnifying Party. Nothing contained herein shall be deemed to limit any right
of contribution Supercom may have against the Company under applicable law.
6.3 REMEDIES. The Parties shall each have and retain all other rights
and remedies existing in their favor at law or equity, including, without
limitation, any actions for specific performance and/or injunctive or other
equitable relief (including, without limitation, the remedy of rescission) to
enforce or prevent any violations of the provisions of this Agreement.
ARTICLE 7. MISCELLANEOUS
7.1 SURVIVAL OF WARRANTIES. The warranties, representations and
covenants of Supercom and the Investor contained in or made pursuant to this
Agreement shall survive the execution and delivery of this Agreement and the
Closing and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of the Investor or the Company.
7.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, the
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
7.3 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
7.4 NOTICES. Any notice, request, demand, waiver, consent, approval, or
other communication which is required or permitted to be given to a party
hereunder shall be in writing and shall be deemed given only if delivered to
such party personally or sent to such party by recognized overnight courier or
by registered or certified mail (return receipt requested), with postage and
registration or certification fees thereon prepaid, addressed to the party at
the address indicated for such party on the signature page hereof, or to such
other address or person as any party may have specified in a notice duly given
to the other party as provided herein. Such notice, request, demand, waiver,
consent, approval or other communication shall be deemed to have been given as
of the date so delivered.
7.5 AMENDMENTS AND WAIVERS. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular
7
instance and either retroactively or prospectively), only with the written
consent of Supercom and the Investor.
7.6 SEVERABILITY. If one or more provisions of this Agreement are held
to be invalid -and unenforceable in any jurisdiction, then, to the fullest
extent permitted by law, (i) the other provisions hereof shall remain in full
force and effect in such jurisdiction and shall be liberally construed in order
to carry out the intentions of the parties hereto as nearly as may be possible
and (ii) the invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability of such provision
in any other jurisdiction.
7.7 INDEPENDENCE OF COVENANTS AND REPRESENTATIONS AND WARRANTIES. All
covenants hereunder shall be given independent effect so that if a certain
action or condition constitutes a default under a certain covenant, the fact
that such action or condition is permitted by another covenant shall not affect
the occurrence of such default, unless expressly permitted under an exception to
such initial covenant. In addition, all representations and warranties hereunder
shall be given independent effect so that if a particular representation or
warranty proves to be incorrect or is breached, the fact that another
representation or warranty concerning the same or similar subject matter is
correct or is not breached will not affect the incorrectness of or a breach of a
representation and warranty hereunder.
7.8 FURTHER ASSURANCES. The parties agree, from time to time and
without further consideration, to execute and deliver such further documents and
take such further actions as reasonably may be required to implement and
effectuate the transactions contemplated in this Agreement.
7.9 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the substantive domestic laws of the State of New York, without
application of the conflicts of laws principles thereof.
7.10 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7.11 ENTIRE AGREEMENT. This Agreement and the other documents referred
to herein constitute the entire agreement among the parties with respect to the
subject matter hereof and thereof and no party shall be liable or bound to any
other party in any manner by any warranties, representations, or covenants
except as specifically set forth herein or therein.
[Signature Pages Follow]
8
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
COMPANY:
SUPERCOM LTD.
By: /s/ Avi ▇▇▇▇▇▇▇▇▇
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Name: Avi ▇▇▇▇▇▇▇▇▇ Title: CEO
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇ ▇▇▇▇▇▇ ▇▇., ▇.▇.▇. ▇▇▇▇
Raanana ▇▇▇▇▇, ▇▇▇▇▇▇
ICTS 1994 (U.S.A.), INC.
By: /s/ M. ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: M. ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇, ▇▇ ▇▇▇▇▇
9
EXHIBIT A
INVESTOR NUMBER OF SHARES
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ICTS 1994 (U.S.A.), INC 3,075,676
1
