Exhibit 10.4
SHARE PURCHASE AGREEMENT
This agreement (the "AGREEMENT"), is made by and between Voice Diary Inc., a
company incorporated under the laws of the state of Delaware (the "BUYER") and
Seed Money Holding (Voice Diary) LP (the "SELLER")
WHEAREAS: Seller is the owner of 46,025 (forty six thousand and twenty
five) Ordinary Shares of Voice Diary Ltd. (the "COMPANY"), each bearing a par
value of NIS 0.1; and
WHEAREAS: Seller wishes to sell to Buyer and Buyer wishes to purchase from
Seller, 46,025 (forty six thousand and twenty five) Ordinary Shares of the
Company, each bearing a par value of NIS 0.1 (the "PURCHASED SHARES"), all in
accordance with the terms and conditions set forth herein.
NOW THEREFOR , the parties, intending to be legally bound, hereby agree as
follows:
1. PREAMBLE AND CAPTIONS
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1.1. The preamble to this Agreement shall be deemed an integral part
thereof.
1.2. The captions in this Agreement shall not be deemed a part hereof as
they have been inserted for convenience and orientation only, and they shall not
affect the interpretation of this Agreement.
2. PURCHASE AND SALE OF SHARES
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2.1. Subject to and in accordance with the terms and conditions of this
Agreement, the Seller hereby sells, transfers, assigns and delivers the
Purchased Shares to the Buyer, and the Buyer hereby purchases the Purchased
Shares from the Seller.
2.2. As full and complete consideration for the Purchased Shares, the Buyer
will issue and sell to the Seller 421,607 (four hundred twenty one thousand six
hundred and seven) shares of Class A Common Stock of the Buyer, each bearing a
par value of US$ 0.01 (the "ISSUED STOCK").
2.3. Delivery. Each Seller shall, concurrently with the execution and
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delivery of this Agreement, execute and deliver share transfer deeds in form
sufficient to transfer all of the Seller's right, title and interest in and to
the Purchased Shares to the Buyer.
3. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLER
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The Seller hereby represents and warrants to the Buyer as follows:
3.1. Ownership. Seller is the beneficial and record owner of the Purchased
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Shares and has good and marketable title to the Purchased Shares, free and clear
of any mortgage, charge, pledge, lien or assignment or any other encumbrance or
security interest or arrangement of any nature whatsoever, free and clear of all
rights of first refusal, co sale right, options to purchase, proxies voting
trusts and any other voting agreements, calls or commitments of every kind.
3.2. No Additional Rights. The Purchased Shares constitute all of the
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shares, warrants, and securities in the Company owned by the Seller or to which
it has any rights, and it has no preemptive rights, convertible securities,
outstanding warrants, options or other rights to subscribe for, purchase or
acquire from the Company or any third party any shares of capital stock or
securities of the Company.
3.3. No Breach. The execution and performance of this Agreement and the
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consummation of the transactions contemplated hereunder will not result in a
breach of, nor will they constitute a default under, any agreement to which the
Seller is party.
3.4. Approvals. No approval or consent of any person, authority or entity is
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required in connection with the execution and delivery of this Agreement or the
performance of the Seller's obligations contemplated hereby.
3.5. Authorization. If the Seller is a corporation, it is duly organized and
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validly existing in the jurisdiction of its organization and has full power and
authority to enter into this Agreement. All actions on its part necessary for
the authorization, execution, delivery and performance by it of this Agreement
have been duly taken to authorize the execution and delivery by it, and this
Agreement constitutes its valid and legally binding obligation, enforceable in
accordance with its terms except (a) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors' rights, and (b) general principles of equity
that restrict the availability of equitable remedies.
3.6. No Public Market; Rule 144. The Seller understands that no public
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market now exists for any of the Issued Stock and that it is uncertain whether a
public market will ever exist for any such securities. The Seller further
acknowledges that because the Issued Stock have not been registered under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), the Issued Stock must
be held indefinitely unless subsequently registered under the Securities Act or
an exemption from such registration is available. It is aware of the provisions
of Rule 144 promulgated under the Securities Act, which permits limited resale
of shares purchased in a private placement under certain circumstances.
3.7. Restricted Stock. The Issued Stock are characterized as "RESTRICTED
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SECURITIES" under the federal securities laws inasmuch as they are being
acquired from the Buyer in a transaction not involving a public offering or in
reliance upon a safe harbor from the registration requirements of the act under
regulation S for offers and sales of securities that occur outside of the united
states, and such securities may be resold without registration under the Act
only in certain limited circumstances. It understands that the certificates
evidencing the Issued Stock will be printed with legends restricting transfer
except in compliance with applicable securities laws in the form of the
following or similar legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND MAY NOT BE OFFERED OR SOLD IN
THE UNITED STATES OR TO U.S. PERSONS OR FOR THE ACCOUNT OR BENEFIT OF A U.S.
PERSON (OTHER THAN DISTRIBUTORS AS DEFINED IN REGULATION S) DURING THE
DISTRIBUTION COMPLIANCE PERIOD AS DEFINED IN RULE 902 OF REGULATION S UNLESS THE
SHARES ARE REGISTERED UNDER THE ACT OR AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS IS AVAILABLE.".
Seller understands that any transfer agent of the Buyer will issue stop-transfer
instructions with respect to the Issued Stock unless any transfer thereof is
subsequently registered under the Act and applicable state and other securities
laws or unless an exemption from such registration is available.
3.8. The Seller's present intention is to acquire the Issued Stock for its
own account and further represents that the Issued Stock are being and will be
acquired by it for the purpose of investment and not with a view to distribution
or resale thereof. The acquisition by the Seller of the Issued Stock acquired
by it shall constitute a confirmation of this representation by such Seller.
3.9. Access to Information. The Seller acknowledges that it, during the
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course of this transaction and prior to the acquisition of any Issued Stock has
had the opportunity to ask questions of and receive answers from representatives
of the Buyer concerning the terms and conditions of this Agreement relating to
the Issued Stock, and to obtain additional information, documents, records and
books relative to the Buyer, its business, and an investment in Buyer. The
Seller acknowledges that the Buyer or any agent thereof has made no
representations or warranties except as explicitly set forth in this Agreement.
3.10. Previous Investments. By reason of the Seller's knowledge and
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experience in business and financial matters, including investments in
securities of companies in the development stage, it is able to fend for itself,
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 transactions contemplated herein.
3.11. Risks. The Seller understands that an investment in the Buyer involves
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a high degree of risk and is suitable only for shareholders who can afford a
loss of their entire investment and who have no need for liquidity from their
investment.
3.12. The Seller is either (i) an "accredited investor", as that term is
defined in Rule 501 of Regulation D promulgated under the Securities Act, or
(ii) not a "U.S. Person", as defined by Rule 902 of Regulation S promulgated
under the Securities Act, was not formed by a "U.S. Person" as defined by Rule
902 of Regulation S, was not organized under the laws of any United States
jurisdiction, is not holding the Issued Stock for the benefit of any US Person,
and was not formed for the purpose of investing in securities not registered
under the Securities Act. At the time the buy order for this transaction was
originated, the Seller was outside the United States.
All subsequent offers and sales of the Issued Stock will be made (i) outside the
United States in compliance with Rule 903 or Rule 904 of Regulation S, (ii)
pursuant to registration of the Issued Stock under the Securities Act, or (iii)
pursuant to an exemption from such registration. The Seller understands the
conditions of the exemption from registration afforded by Section 4(1) of the
Securities Act and acknowledges that there can be no assurance that it will be
able to rely on such exemption. The Seller will not engage in hedging
transactions with regard to the Issued Stock prior to the expiration of the
distribution compliance period specified in Rule 903 of Regulation S, unless in
compliance with the Securities Act.
3.13. The Seller, if not a natural person, was not formed for the specific
purpose of acquiring the securities offered in this Agreement.
4. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE BUYER
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The Buyer hereby represents and warrants to the Seller as follows:
4.1. Authorization by Buyer. By signing, all actions on the part of Buyer
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necessary for the authorization, execution, delivery, and performance by it of
this Agreement have been duly taken, and this Agreement constitutes a legal,
valid and binding obligation, enforceable against the Buyer in accordance with
its terms.
4.2. No Breach. The execution and performance of this Agreement and the
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consummation of the transactions contemplated hereunder will not result in a
breach of, nor will they constitute, a default under any agreement to which the
Buyer is party.
4.3. No Additional Representations. The Buyer is familiar with the Company,
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its property, its obligations and its activities. Buyer is, thus, purchasing the
Purchased Shares "AS IS", without having relied upon any representations and/or
warranties by the Seller, except those representations and warrants specifically
indicated herein.
4.4. Approvals. No approval or consent of any third party is required in
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connection with the execution and delivery of this Agreement on the consummation
of the transaction contemplated hereby.
5. STAND-OFF AGREEMENT
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In connection with any offering of the Buyer's equity securities, pursuant to an
effective registration statement, for such period (the "LOCK-UP PERIOD") as the
Buyer may request (such period not to exceed 180 days following the date of the
applicable offering), the Seller shall not, directly or indirectly, sell make
any short sale of, loan, hypothecate, pledge, offer, grant or sell any portion
or other contract for the purchase of, purchase any option or other contract for
the sale of, or otherwise dispose of or transfer, or agree to engage in any of
the foregoing transactions with respect to, any Issued Stock acquired hereunder
without the prior written consent of the Buyer. The Seller agrees to (i) have
any certificate or certificates representing his, her or its Issued Stock bear,
in addition to any other applicable securities legends, a legend stating that
the shares represented by that certificate may not be transferred by any means
whatsoever, without the agreement of the Buyer, during the Lock-Up Period; and
(ii) execute any and all agreements with underwriters representing the Buyer to
effect and perfect the foregoing. The Buyer may impose stop transfer
instructions with respect to the shares subject to the foregoing restrictions,
until the end of the Lock-Up Period.
6. CONDITIONS PRECEDENT TO BUYER'S PERFORMANCE
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The obligations of the Buyer pursuant this Agreement are subject to the
satisfaction, at any time following the date hereof, of all the conditions set
out below. The Buyer 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 the Buyer of any of its other rights or
remedies, at law or in equity, if the Seller shall be in default of any of its
representations, warranties, or covenants under this Agreement:
6.1. The Company shall have obtained the approval of the Chief Scientist of the
Ministry of Industry and Trade of the State of Israel, for all transactions
contemplated in this Agreement.
6.2. The Company shall have obtained the approval of the Investment Center of
the Ministry of Industry and Trade, for all transactions contemplated in
this Agreement.
6.3. The Company shall have obtained the approval of the Industry Development
Bank, for all transactions contemplated in this Agreement.
6.4. The Buyer shall have obtained the consent of the holders of 90% or more of
the share capital of the Company to sell their shares to the Buyer pursuant
to the terms and conditions of this Agreement. This Agreement shall not
become effective until, and shall be deemed to have immediately and
automatically come into effect at, such time that the Buyer notifies the
Seller of either (i) the satisfaction of all of the conditions set forth
above, (ii) the waiver, by the Buyer, of all conditions which were not
satisfied as of such date.
7. WAIVER AND CONSENTS
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7.1. Immediately following the consummation of the transactions contemplated
in this Agreement, Seller shall own no shares or securities in the Company, it
shall have no rights as a shareholder of the Company and no claims against the
Company in connection with the issuance and/or non-issuance of securities in the
Company.
7.2. The Seller hereby waives any right, title, interest in and to any
additional shares or other securities of the Company, whether pursuant to an
option agreement, warrant agreement, antidilution right, preemptive right or the
like, and hereby waive any other right to receive shares or other securities of
the Company or the Buyer (to the extent such rights exist), and agrees that the
Purchased Shares are the sum total of the shares or other securities of the
Company to which the Seller is entitled. The Seller hereby waives any and all
registration rights the Seller may have had in the Company, and acknowledges
that the Seller is not receiving herein any registration rights in and to the
Buyer's equities. The Seller hereby agrees and consents to the resolutions
adopting the Voice Diary Inc. 2002 Stock Option Plan. The execution of this
Agreement also serves as execution of the resolutions.
8. TAXATION
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Each Party shall bear the payment of any tax or levy, should such payment apply
to the Party, pursuant to the provision of any law, in its status of transferor
or transferee, depending on the case. Without derogating from the foregoing,
Seller, alone, will be responsible for payment of any capital gains tax, if any,
which may apply as a result of (i) the transfer and sale of the Purchased
Shares, and (ii) the issuance of Issued Stock by the Buyer, as contemplated
herein.
9. MISCELLANEOUS
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9.1. Successors and Assigns. Except as otherwise expressly provided herein,
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the provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
9.2. Entire Agreement. This Agreement and the exhibits attached hereto and
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the other documents delivered pursuant hereto constitute the full and entire
understanding and agreement between and among the parties with regard to the
subjects hereof and thereof.
9.3. Amendments. Any and all changes, amendments or additions to this
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Agreement shall require the prior written consent of all Parties, or else they
shall be deemed null and void.
9.4. Notices. Any notice, payment, report or other communication required
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or permitted to be given by one party to any other party by this Agreement shall
be in writing and addressed to the other party at its address as indicated
below, or to such other address as any addressee shall have theretofore
furnished to the other party by like notice. All notices shall be deemed to
have been given or delivered upon: (i) personal delivery; or (ii) three (3) days
after deposit in the United States mail by certified mail (return receipt
requested); or (iii) one (1) business day after deposit with any return receipt
express courier (prepaid); or (iv) one (1) business day after transmission by
facsimile.
9.5. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.6. Applicable Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of the State of New York applicable to contracts
between New York residents entered into and to be performed entirely within the
State of New York, except with respect to matters that by their nature would be
governed by Israeli Company Law, in which case, Israeli Company Law shall apply.
The parties irrevocably consent to the exclusive jurisdiction of any competent
court located within the city of New York, State of New York, with respect to
any and all disputed arising from this Agreement.
9.7. The parties hereto agree to provide a copy of this Agreement, after
execution, to the Company, and otherwise to maintain the confidentiality of the
terms hereof.
IN WITNESS WHEREOF, each of the undersigned has executed this Agreement as of
the date first written above.
Seller's Name: Seed Money Holding (Voice Diary) LP Buyer: VOICE DIARY INC.
Signature: /s/ Xxxx Xxxxxx Signature: /s/ Xxxx Xxxxxx
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By: Xxxx Xxxxxx, General Partner By: Xxxx Xxxxxx, President
Address: 0 Xxxx Xx., Address: 000 Xxxxxxx Xxxx
Modiim 00000 Xxxxxx Xxxxxxx XX 00000
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