EXHIBIT 99.2
UNITED MIZRAHI BANK LTD.
SECURED DEBENTURE
Made this 20th day of July 2005
By Ophthalmic Imaging Systems, a California corporation, of 221 Lathrop Way,
Suite I, Sacramento, CA 95815, USA (hereinafter referred to as "the Company")
In favour of United Mizrahi Bank Ltd (hereinafter referred to as the "Bank") in
accordance with the Company's bylaws and articles of incorporation and all the
other provisions that grant the Company power in such respect and in accordance
with a resolution of the Company's board of directors of July 20th, 2005.
Whereas the Company and/or Medivision Medical Imaging Ltd. (hereinafter referred
to as "Medivision"; the company and Medivision together shall referred to as the
"Client") has obtained and from time to time will obtain from the Bank credit,
documentary credit, various loans, current and other account overdrafts,
indemnities, bonds and guarantees for the Company or for others at the Company's
request, the discounting of bills, the grant of various banking facilities and
extensions and other miscellaneous banking services (hereinafter jointly and
severally referred to as the "Banking Services") on such terms as have been
and/or are in future from time to time agreed in respect of each banking
service.
And whereas it has been agreed between the Company and the Bank that the Company
will, by this Debenture, secure all its and/or Medivision's debts and
liabilities to the Bank of every type and kind whatsoever, whether in Israeli
currency or in any foreign currency whatsoever, as set out below, in addition to
all the collateral that has been and/or is in future given to the Bank.
Now therefore this Debenture witnesseth as follows -
1. (a) This Debenture has been issued to secure the full and punctual
payment of all the amounts, whether in Israeli shekels or in any
foreign currency, now and in future due to the Bank from the Company
and/or Medivision in any manner or way and for any reason, whether
or not the amounts are due from the Client in connection with the
provision of the Banking Services, whether due from the Client alone
or together with others, whether the Client has already become
liable for them or becomes liable for them in the
1
future, as debtor and/or guarantor and/or otherwise (including the
Client's liability in accordance with bills that have been or are in
future delivered to the Bank either by the Client or by third
parties for discounting or as security and/or pursuant to any other
liability of the Client to the Bank), that are now and/or in future
due, payable prior to or after realisation of the collateral hereby
given, absolutely or contingently due, directly or indirectly due,
due pursuant to the Client's original obligation or formulated in a
court judgment or otherwise -
* up to the sum of $ 2,000,000 (Two million Dollars)
plus interest, commissions and all expenses whatsoever, including
the costs of realisation, advocates' professional fees, insurance
fees, stamp duty and other payments pursuant to this Debenture, with
the addition of linkage of any type now or in future due from the
Client to the Bank in any way in respect of linked principal and
linked interest (all the aforegoing amounts being hereinafter
referred to as "the Secured Sums").
(b) Secured Sums that are now or in future due to the Bank from the
Client in any foreign currency shall be deemed secured by this
Debenture only insofar as, in respect of the transaction pursuant
whereto they are due, an appropriate permit from the competent
authorities in Israel is given in advance or after the event, so
long as such a permit is legally necessary.
2. The Client hereby undertakes to pay the Bank every one of the Secured
Sums:
(a) on its agreed due date, if it has been agreed between the Bank and
the Client that the particular amount is payable on a particular
date;
(b) at the end of seven days from the date of the Bank's sending its
first written demand to the Client, if a due date has not been
agreed as provided in paragraph (a) above.
3. (a) The Bank may decline to accept accelerated payment of the Secured
Sums or any of them prior to their due date.
The Client or anyone whose right might be impaired by the grant of
this Debenture or its realisation shall have no right pursuant to
section 13(b) of the Pledges Law, 5727-1967 or any other statute.
2
(b) In the event that the Bank agrees to the Client's application for
accelerated payment of any amount on account of the Secured Sums, it
may charge and collect from the Client interest until the due date
of the amount accelerated or interest for six months after the
payment, whichever is the shorter period.
4. (a) The Bank may compute interest on the Secured Sums at such rate as
has been or is in future from time to time agreed between it and the
Client. In cases in which the interest rate has not been agreed, the
Bank may fix the interest rate and give notice thereof to the
Client. The Client shall be charged such interest rates as aforesaid
and the Bank may add them to principal at the end of each quarter or
at the end of any other period, as determined by it.
(b) In the event of default in payment of all or any of the Secured
Sums, they shall bear default interest at the rate agreed upon in
the agreement for the provision of the Banking Services. In the
absence of a provision with regard to default interest in those
agreements, the Secured Sums shall bear interest at the maximum rate
prevailing at the Bank in respect of unauthorised withdrawals and
defaults on an approved overdraft account, but not less than 2% more
than the interest rate fixed in the agreement for the provision of
any banking service.
(c) In the event that the Bank becomes entitled to realise the
collateral under this Debenture it may increase the interest rates
of the Secured Sums to the maximum rate for the time being
prevailing at the Bank in respect of unauthorised withdrawals and
defaults on an approved overdraft account.
5. To secure the full and punctual discharge of all the Secured Sums, the
Company hereby grants to the Bank and its successors:
(a) a first charge and security interest over the whole enterprise and
all the equipment, assets, monies, general intangibles, property and
rights, including revenue therefrom, of every type whatsoever
without exception that the Company now or in future at any time has
in any way whatsoever, including its insurance rights in respect
thereof, and every right to compensation or indemnity that the
Company in future has against any third party by reason of the loss,
damage or expropriation of its property or any of it. Without
derogating from the aforesaid, the charge shall include any and all
inventory of the Company, wherever located, including any and
3
all raw materials, work-in-progress and finished goods and any and
all tangible personal assets and properties of the Company, wherever
located, including (without limitation) any and all accessions,
accessories, additions, deposit accounts, equipment, fixtures,
furnishings, goods, inventory, investment property, machinery,
materials, parts, proceeds, replacements, supplies, tools and
vehicles, whether or not located upon or affixed to any of the
foregoing (hereinafter referred to as the "Charged Assets"); and
(b) a first ranking fixed charge, pledge and security interest over the
Company's goodwill, as currently and at any time in future existing
(hereinafter referred to as the "Charged Goodwill");
(c) A first charge and security interest over any and all accounts
receivable of the Company, that the Company now or in the future has
in any way whatsoever, which shall include all accounts and other
rights to receive payments for goods and other products sold or
leased or for services rendered, whether or not earned by
performance, recognized by the referenced person or recorded on its
books and records, and irrespective of whether any may be
characterised as accounts, chattel paper, choses-in-action, contract
rights, general intangibles, instruments, invoices, notes, payment
intangibles or otherwise in any document, by any person or under any
applicable law; and all proceeds thereof;
(d) a first charge and security interest over all the rights, including
intellectual property rights, of the Company as set forth in
Appendix A (hereinafter referred to as the "Charged Intellectual
Property Rights").
(e) a fixed charge, pledge and security interest over the marine or air
bills of lading, documents of title in respect of goods, warehousing
certificates, delivery notes, goods, orders, documentary letters of
credit, postal receipts or other documents that are customary in
international trade and attest to title to goods or merchandise
(hereinafter referred to as "the documents"), that the Company now
or in the future has in any way whatsoever, including all the
insurance rights whatsoever against the Israeli Foreign Trade Risks
Corporation Ltd or any other insurance company and every right to
compensation or indemnity that the Company now or in future has
against third parties by reason of loss, damage or expropriation of
the goods or merchandise. On their being given to the Bank as
aforesaid they shall be deemed subject to a first ranking fixed
charge, pledge and security
4
interest in favour of the Bank in accordance with the terms and
conditions of this Debenture;
(f) a fixed charge, pledge and security interest over all those
securities, documents and bills of others, that the Company now or
in the future has in any way whatsoever (hereinafter referred to as
"the Charged Documents"). The Bank shall be relieved of having to do
any act whatsoever in connection with the Charged Documents and
shall not be liable for any damage occasioned in connection
therewith, and the Company undertakes to indemnify the Bank in the
event that a claim is made against the Bank by others in respect of
such damage. The Company hereby waives in advance any pleas of
prescription in respect of the Charged Documents;
(g) the "Charged Assets", the "Charged Goodwill", the "Charged
Intellectual Property Rights", the "Documents" and the "Charged
Documents", and every other charge mentioned in this clause is
hereinafter referred to as the "Charged Property".
6. The Company hereby warrants as follows:
(a) that the Charged Property is not charged or pledged to others or
attached in any way, save as set out below:
Laurus master fund Ltd. has a Subordinated Indebtedness to United
Bank Mizrahi.
(b) that the Charged Property is owned by it and in its sole possession
or in the possession of the Bank;
(c) that there is no legal, contractual or other restraint or condition
governing the transfer, charge or pledge of the Charged Property;
(d) that it may pledge or charge the Charged Property in any way
whatsoever;
(e) that no assignment of right or other transaction has been made that
derogates from the value of the Charged Property;
(f) that it received the necessary consents and/or waivers (if any) from
the shareholders or investors pursuant to the articles of
incorporation and bylaws of the Company or the various investment
agreements.
5
(g) that the Company is the owner and/or holds the rights of use under
license or agreement, of all the intellectual property required by
the Company for the purpose of its business;
(h) that to the best of its knowledge, the Company is not currently in
breach and there are no proceedings against it in connection with
any breach of any intellectual property rights of any third party;
7. The Company hereby undertakes to the Bank as follows:
(a) to keep the Charged Property in its possession;
(b) to use and deal with the Charged Property with the greatest of care
and to notify the Bank of any damage or fault occurring to it and to
repair any damage, defect or fault occurring to the Charged Property
by reason of its use or otherwise and to be liable to the Bank for
any such breakdown, damage, defect or fault as aforesaid;
(c) to allow the Bank's representative at any time to attend and examine
the condition of the Charged Property in situ;
(d) not, without obtaining the Bank's prior written consent, to sell,
lease out, move elsewhere or howsoever deliver up the Charged
Property or any of it, save for sales, transfers and leases of
business inventory made in the ordinary course of the Company's
business;
(e) not to sell, lease out, move elsewhere, deliver up or grant to
others any right to use the Charged Property without obtaining the
Bank's prior written consent;
(f) forthwith to notify the Bank of the imposition of an attachment over
the Charged Property and/or the Charged Assets and/or any of them
and forthwith to notify the attacher of the charge in favour of the
Bank and at the Company's expense forthwith and without delay to
take all steps in order to remove the attachment. If the Company
does not take such steps as aforesaid, the Bank may (but need not)
take all steps to remove the attachment, and the Company shall be
liable immediately to pay the Bank
6
all the expenses involved therein (including the professional fees
of the Bank's advocates);
(g) not howsoever to charge the Charged Property or any of it with
rights that are pari passu with or prior or inferior to the Bank's
rights and not to assign any right that the Company has in the
Charged Property without obtaining the Bank's prior written consent;
(h) to be responsible for the genuineness and accuracy of all
signatures, endorsements and particulars on bills, documents and
securities that have been and/or are in future given to the Bank as
collateral;
(i) to pay on due date all the taxes, municipal rates, levies and other
mandatory payments legally imposed over the Charged Property and to
furnish the Bank, on demand, with all the receipts for such
payments, and if the Company does not duly make such payments, the
Bank may make them at the Company's expense and charge it the
payments, plus expenses and interest at the maximum rate. Those
payments are secured by this Debenture;
(j) to keep books of account and permit the Bank or its representative
at any time to examine the books. The Company undertakes to assist
the Bank or its representatives and to give them on demand balance
sheets, documents and any information required by them, including
explanations in connection with the financial and operational state
of the Company and/or its business;
(k) the Company has attached hereto a full list of all its intellectual
property and shall submit to the Bank any update or variation to the
list that may occur.
8. Throughout the subsistence of this Debenture, the Company undertakes as
follows:
(a) deleted ;
(b) not howsoever to pay its shareholders (other than Medivision) any
loan or funds that the shareholders have lent or do in future lend
to the Company or any funds that they have invested and/or do in
future invest in the Company;
7
(c) not to give its shareholders any loan or credit whatsoever without
the Bank's written consent;
(d) to procure that its shareholders (other than Medivision) undertake
to the Bank not to demand or claim any such monies as aforesaid from
the Company and if for any reason amounts are nevertheless due to
them from the Company, to return the said amounts to the Bank for
them to be applied in discharge of the said amounts.
9. (a) The Company hereby undertakes at all times to keep the Charged
Property insured in its full value against all Elementary risks and
to transfer to the Bank, to the limit of this Debenture, the rights
deriving from the insurance certificates, duly to pay all the
insurance fees and to deliver to the Bank all the insurance
certificates and the receipts for payment of the insurance fees.
(b) Without prejudice to the aforegoing and in addition thereto the
Company undertakes to give the insurance company through which the
Charged Property is insured irrevocable instructions to transfer all
monies that are due to the Company pursuant to the Charged Property
insurance policy solely to the Bank. The Company further undertakes
to provide the Bank with the said insurance company's undertaking
and to notify the Bank of the date of termination of any insurance
policies taken out by it at least 30 days prior to their expiration.
(c) In each of the under-mentioned cases the Bank may, at its sole
discretion, insure the Charged Property in the name of the Bank and
charge the cost of the insurance fees to the Company's account:
(1) if the Charged Property is not insured to the satisfaction of
the Bank;
(2) if within 10 days of the execution of this Debenture the
Company does not provide the Bank with insurance certificates
in respect of the Charged Property to the Bank's absolute
satisfaction;
(3) if 30 days prior to the expiration of the Charged Property
insurance the Company does not provide the Bank with Charged
Property insurance certificates. In the event that the
insurance is arranged by
8
the Bank as aforesaid, the Bank shall not be liable for any
fault or defect discovered in connection with the insurance.
Amounts that are paid as such expenses and insurance fees as
aforesaid are secured pursuant to this Debenture.
(d) All the rights deriving from such property insurance as aforesaid,
including rights under the Property Tax and Compensation Law,
5721-1961 as in force from time to time or in accordance with any
other law, whether or not transferred to the Bank as aforesaid, are
hereby made subject to a first ranking fixed charge, pledge and
security interest in favour of the Bank.
(e) In connection with the Company's property insurance it hereby
appoints the Bank as its sole attorney in fact and grants it
exclusive rights, in the name of the Company, to negotiate, agree to
settlements and compromise with and waive and accept funds from
insurance companies and apply them in discharge of the Secured Sums.
The said power of attorney is irrevocable since third party rights
are dependent thereon. The Company shall have no complaints in
connection with settlements, waivers and compromises that the Bank
makes with insurance companies. The Bank will exercise it's rights
only if the company is no longer active or in the event that the
Bank is entitled to demand immediate repayment of the Secured Sums.
(f) The Company undertakes, on the Bank's first demand, to sign all
applications, documents and certificates necessary or desirable for
the performance of the Company's obligations contained in this
clause. The Company further undertakes not howsoever to cancel or
modify any of the aforegoing insurance conditions without the Bank's
prior written consent.
10. (a) The collateral that has been given to the Bank pursuant to this
Debenture is of perpetual character notwithstanding settlement of
all or any of the Company's accounts and it shall remain in force
until the Bank confirms in writing that this Debenture is void.
(b) Should the Bank have been or in future be given collateral or
guarantees for payment of the Secured Sums, all the collateral and
guarantees shall be independent of each other.
(c) Should the Bank compromise with or grant forbearance or a concession
to the Company, should the Bank alter the Company's obligations in
9
connection with the Secured Sums or release or waive other
collateral or guarantees, the same shall not alter the nature of the
collateral created pursuant to this Debenture and all the collateral
and obligations of the Company pursuant to this Debenture shall
remain in full force and effect.
11. The Bank shall have rights of possession, lien and set-off over all the
amounts, assets and rights, including securities, currency, gold, bank
notes and documents for goods, insurance policies, bills, cheques,
obligations, deposits, collateral and the proceeds thereof, that are at
the Bank at any time to or for the credit of the Company, including those
given for collection, security, safe keeping or otherwise. The Bank may
withhold the said assets until full discharge of the Secured Sums or sell
them and apply all or any of the proceeds of sale in discharge of the
Secured Sums.
In the event that the amounts that are set off are deposited in foreign
currency, the Company hereby grants the Bank authority and instructions to
sell the foreign currency balance at the rate obtainable for it by the
Bank.
12. The Bank may at any time charge any of the Company's accounts with it with
any amount now or in future due to it from the Company and apply any
amount that it receives from or for the Company to the credit of such
account as it deems fit and transfer any amount standing to the Company's
credit in any account with it to any other account with it as the Bank
deems fit.
13. Having regard to the fact that the amounts that are now and in future due
to the Bank from the Company on account of the Secured Sums can be both in
Israeli currency and in foreign currency, it is hereby agreed and declared
that the Bank and the receiver, as the case may be, may convert Israeli
currency in their possession to foreign currency as necessary for the full
or partial discharge of the Secured Sums that are due to the Bank in
foreign currency and convert foreign currency in their possession to
Israeli currency, at the official rates of exchange existing in Israel at
the time when any such conversions are actually made by either of them.
The expression "rate of exchange" means:
(a) in respect of the time when there is a restraint by Israeli law in
respect of the free use of foreign currency in Israel - the highest
amount of Israeli currency that an Israeli resident is required to
pay for a unit of the currency
10
of such debt to an entity duly licensed to trade in Israel in
foreign currency, together with the bank commission for such
transaction;
(b) in respect of the time when there is no such restraint - the highest
price for the purchase of a unit of the currency of such debt
existing at the Bank of Israel in respect of bank telegraphic
withdrawals on a city for the time being known as one of the
financial centres of the state in which the currency of the debt is
legal tender or on New York, at the option of the Bank, together
with the bank commission for such transaction.
14. Without prejudice to the generality of the provisions of this Debenture,
the Bank may in any of the under-mentioned cases call for the immediate
payment of all or any of the Secured Sums, without prior notice to the
Company:
(a) if the Client does not discharge to the Bank on the due date or
dates any of the Secured Sums due to it;
(b) if a voluntary winding-up resolution is passed by the Company and/or
Medivision or if a winding-up order is issued against it by the
court or if the court calls a creditors meeting for the purpose of
finding an arrangement with them or if the Company's name has been
removed or is about to be removed from any register operated by law;
(c) if a (provisional or permanent) receiver, receiver and manager or
liquidator is appointed over the Company's assets or any of them;
(d) if an attachment is imposed over all or any of the Company's assets
or over any of the collateral given by the Company to the Bank or if
any act of execution is taken against it;
(e) if the Company stops paying its debts or carrying on its business;
(f) if the work or a substantial part of it is stopped for two or more
months;
(g) if all or any of the Company's assets are burned, lost or otherwise
damaged;
(h) if it appears to the Bank, at its absolute discretion, that there
has been a change in the authority over the Company, in comparison
with the situation existing on the date hereof, by a voluntary share
transfer or otherwise,
11
save for the transfer of the authority in good faith to a transferee
who holds at least 10% of the company's shares on the date hereof,
and save for transfer of the authority to the shareholders of
Medvision.
(i) if a receivership or bankruptcy order is awarded against any of the
Company's guarantors (in the event that the Secured Sums are inter
alia also secured pursuant to guarantees) or in the event of the
death of a guarantor or in the case of a guardian being appointed
for the person or estate of a guarantor and the Company does not
provide the Bank within seven days of the occurrence of any of the
aforegoing with a guarantee and undertaking signed by a person or
entity agreed in advance by the Bank and in such terms as prescribed
by the Bank, pursuant whereto that person or entity will guarantee
the Bank the full and punctual payment of the said sums. The
provisions of this sub-clause shall also apply mutatis mutandis to
such person or entity as though that person or entity were the
original guarantor and also to their successors;
(j) if the Bank, at its absolute discretion, takes the view that a
material event has occurred that might impair the Company's
financial capacity;
(k) if, at the Bank's absolute discretion and in its exclusive
estimation there is a material deterioration in the value of the
collateral that has been given to secure payment of the Secured
Sums;
(l) if the Company is required to accelerate the discharge of debts that
it owes to other creditors;
(m) if the Company breaches or does not perform any of its obligations
that are contained in this Debenture and/or any agreement and/or
instrument and/or contract made in the past and/or future between
the Company and the Bank;
(n) if it transpires that any material warranty of the Company in this
Debenture and/or any contract made in the past and/or future between
the Company and the Bank is incorrect and/or inaccurate.
(o) if the Company alters its articles of incorporation or some of them
and does not give notice thereof to the Bank within 48 hours;
12
(p) if the Company passes a resolution to merge with another company,
(other than Medvision) whether as absorbing or target company, as
defined in the Companies Law, 5759-1999; and in the opinion of the
Bank the matter may adversely affect the ability of the company to
repay the credit
(q) if any license, consent, approval or registration of any of the
intellectual property rights of the Company is denied, becomes void,
suspended or is materially prejudiced, and has a material effect on
the Company.
(r) if it appears to the Bank that there has been a material change to
the business plan of the company or the type of business activity in
which the company engages without the Bank's prior written consent;
15. (a) In each of the cases set out in the preceding clause, the Bank may
take all the steps it deems fit in order to collect all the Secured
Sums, realise the collateral in any way that the law permits and
exercise all its rights pursuant to this Debenture, including
realising the Charged Property, in whole or parts and applying the
proceeds thereof in discharge of the Secured Sums, without the Bank
having to enforce or realise any other guarantees or collateral that
it might have.
(b) Upon the giving of such notice (if any) as may be required by law,
the Bank may, as the Company's attorney, for which purpose the
Company irrevocably appoints the Bank as its attorney, sell the
Charged Property and any part of it by auction, public sale, private
sale or otherwise, itself or through others and on conditions at the
Bank's absolute discretion, and the Bank may itself or by the court
or execution office realise the collateral granted to it pursuant to
this Debenture or otherwise by the appointment of a receiver or
receiver and manager on behalf of the Bank (and the Company agrees
in advance to any person or legal entity that the Bank appoints or
proposes as receiver and manager as aforesaid) and amongst his other
powers, he may:
(1) take possession of all or any of the Charged Property;
(2) manage the Company's business or take part in its management
as he deems fit;
13
(3) sell or let and/or agree to the sale or letting of the Charged
Property, in whole or parts, or otherwise transfer it on such
conditions as he deems fit;
(4) make any other arrangement in respect of all or any of the
Charged Property.
16. All income obtained by the receiver and manager from the Charged Property
and all proceeds obtained by the Bank and/or the receiver and manager from
the sale of the Charged Property or part of it shall be applied:
(a) firstly, in discharge of all expenses incurred in connection with
collecting the Secured Sums, including the expenses and remuneration
of the receiver or receiver and manager at such rate as fixed by the
Bank;
(b) secondly, in discharge of the further amounts that are due to the
Bank in consequence of the linkage conditions, the interest,
damages, commission and expenses now and in future due to the Bank
pursuant to this Debenture;
(c) thirdly, in discharge of the principal of the Secured Sums, or in
any other order of application as prescribed by the Bank.
17. In the event that at the time the Charged Property is realised the Secured
Sums have not yet fallen due or the Secured Sums are only due to the Bank
contingently, the Bank may collect from the proceeds of realisation an
amount sufficient to cover the Secured Sums and the amount that it
collects shall be charged to the Bank as collateral for them and be
retained by the Bank until their discharge.
18. Without derogating from the other provisions of this Debenture, no waiver,
forbearance, concession, silence or abstinence (hereinafter referred to as
"Waiver") on the part of the Bank in respect of the non-performance or
partial or incorrect performance of any of the Company's obligations
pursuant to this Debenture shall be construed as a Waiver by the Bank of
any right and it shall only be treated as acquiescence limited to the
specific instance in which it was given.
14
Any Waiver that the Bank grants to any party to a bill that the Bank holds
pursuant to this Debenture shall have no effect whatsoever on the
Company's obligations.
19. (a) If and insofar as the Company is made liable or treated as a
guarantor (hereinafter referred to as the "Guarantor Company"), the
Company hereby agrees that the Bank may:
(1) take (or refrain from taking) proceedings in accordance with
the law in order to realise the collateral and/or collect the
said amounts, without the Bank first being liable to apply to
the guaranteed debtors to discharge the said amounts that are
due from them to the Bank;
(2) stop, modify, increase, reduce or renew any credit or other
banking service that has been and/or is in future given to the
debtors;
(3) grant an extension of time and/or similar concession in
connection with the discharge of the said amounts;
(4) replace, renew, release, amend, refrain from performing or
realising collateral or other guarantees that the Bank now or
in future holds, whether received by it from the guaranteed
debtors or others;
(5) compromise with the guaranteed debtors or others.
(6) Change the interest rate or fees.
The guarantor Company hereby agrees that the doing of any of the
said acts by the Bank shall not vest it with any right to alter or
revoke its obligations to the Bank.
(b) Deleted.
20. The Company confirms that the Bank's books and accounts are acceptable to
it, shall be deemed correct and shall serve as conclusive evidence against
it of all their particulars, including as regards the computation of the
Secured Sums, the details of the bills and guarantees and the other
collateral and every other matter relating to this Debenture.
15
The expression "the Bank's books" means every statement or copy statement
and every loan contract or deed signed by the Company, and the expression
"accounts" means every record or copy record, whether entered or copied in
handwriting or typewriter or entered or copied by means of printing,
duplication or photocopying or by means of any electrical or electronic
technical instrument, including microfilm.
21. The Bank may at any time, at its discretion, without needing the Company's
consent, transfer to another this Debenture and the rights pursuant
hereto, including the collateral, in whole or parts, and any transferee
may also transfer the said rights without requiring further consent from
the Company. The transfer may be made by endorsement of the Debenture or
in such other manner as the Bank deems fit, provided that such transfer
shall be made to a Banking Corporation in Israel or abroad.
22. The Bank may deposit the collateral that has been or is in future given
pursuant to this Debenture or any of it with a bailee at its discretion at
the Company's expense and from time to time replace the bailee, and the
Bank may also register all or any of the said collateral with any legally
competent authority. The Bank is authorized to file financing statements
and otherwise register the charges, pledges and security interests herein
granted in any governmental office, and upon request by the Bank, the
Company will join in signing any such financing statement or other
registration (and hereby irrevocably appoints the Bank as its attorney in
fact to execute any such financing or other registration).
23. (a) The grant of this Debenture is without prejudice to the Bank's right
to collect the Secured Sums otherwise than by realisation of this
Debenture.
(b) The realisation of this Debenture shall be without prejudice to the
Bank's right to collect from the Company the remainder of the
Secured Sums that have not been discharged by realisation of the
Debenture.
24. All expenses in connection with this Debenture, its stamping and
registration, the realisation of the collateral (including the
professional fees of the Bank's advocates) and also insurance, bailment,
maintenance and repair of the Charged Property shall be paid by the
Company to the Bank on its first demand, plus interest at the maximum rate
prevailing at the Bank for the time being on unauthorised withdrawals and
defaults on approved overdraft accounts from the date of demand until full
discharge. Until their full discharge all the said expenses shall be
secured by this Debenture.
16
25. In this Debenture:
(a) "Bank" means United Mizrahi Bank Ltd and each one of its branches
existing on the date hereof and/or opened anywhere in the future and
also the Bank's successors and assigns;
(b) "bills" means promissory notes, bills of exchange, cheques,
undertakings, guarantees, collateral, bills of lading, deeds of
deposit and all other negotiable instruments;
(c) the recitals to this Debenture constitute an integral part of it;
(d) should this Debenture be signed by two or more persons, the
signatories shall be jointly and severally liable for the
performance of all the obligations pursuant to this Debenture.
26.
(a) Any notice posted by the Bank to the Company by registered or
ordinary mail at the address specified above, of which the Company
shall give the Bank written notice, shall be deemed duly received by
the Company within 48 hours of the time the letter containing the
notice was posted.
(b) The Company hereby irrevocably designates, appoints and empowers Mr.
Noam Allon in Israel, to receive for and on behalf of the Company
service of process issued out of the courts of the State of Israel
or by or on behalf of the Bank or in any other manner in any legal
action or proceedings arising out of or in connection with this
Debenture.
(c) If any process agent appointed pursuant to Clause 26(b) (or any
successor thereto) shall cease to exist for any reason where process
may be served, the company will forthwith appoint another process
agent with an office in Israel where process may be served and will
forthwith notify the Agent thereof.
27. The competent court in California is hereby vested with jurisdiction for
the purpose of this Debenture but the courts of the City of Tel-Aviv shall
also have jurisdiction over any dispute arising from or in connection with
the existence, the interpretation, the performance, enforcement or the
termination of this Debenture.
17
28. This Debenture shall be governed by, and construed in accordance with, the
laws of the State of Israel, without regard to its rules on conflicts of
laws or choice of law, except to the extent that the perfection or
registration of any charge, pledge or security interest hereunder, in
respect of any particular Changed Property, is governed by the law of a
jurisdiction other than the State of Israel.
29. Special conditions:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
AS WITNESS THE HAND OF THE COMPANY
----------------
The Company
Debenture Ois -
18
APPENDIX A
The charge shall also govern all the rights of the Company, inclusive of the
intellectual property rights, as currently and at any time in future existing,
whether or not they are registered, including where applications for
registration have been submitted in respect thereof, as well as:
(a) any know-how, inventions, patents, trademarks, models, designs, trade
names, copyrights, and technological processes and applications;
(b) Internet domain names, licenses, franchise agreements, user rights
agreements, drawings, computer software, trade secrets and customer lists;
all whether or not the rights of the Company were registered, or whether
the aforesaid rights are currently and at any time in future existing.
In respect of the aforesaid intellectual property rights, or any part thereof,
the Company undertakes to ensure that the Company itself, as well as any of its
subsidiaries:
(a) shall perform all the appropriate registrations and shall pay all the
costs and fees necessary to safeguard and protect the intellectual
property rights of the Company and/or of its subsidiaries and/or the
registration thereof;
(b) shall take all steps necessary, including legal action, to prevent any
third party from prejudicing these intellectual property rights;
(c) shall not sell, transfer, lease or grant a user license, save for any
license arrangements with a third party which is not an affiliated party,
made during the regular course of business and for fair consideration.
Debenture Ois -
19