Israel Technology Acquisition Corp. Givaat Shmuel Israel 54030
0
Xxxx Xxxxxx, 0xx Xxxxx
Givaat
Xxxxxx
Israel
54030
To:
Gemini
Israel Funds
0
Xxxxxxxxx Xxxxxx
Herzliya
Pituach 00000
Xxxxxx
Xxxxx
Ventures Ltd.
0
Xxxxxxxx Xxxxx Xx.
Xxxxx
Xxx
00000
Israel
June
19,
2006
CERTIFICATION
1. The
merger agreement (“Merger
Agreement”),
by and
among Israel Technology Acquisition Corp. (“ITAC”),
IXI
Mobile, Inc. (“IXI”)
and
ITAC Acquisition Subsidiary Corp., a wholly owned Subsidiary of ITAC, dated
as
of February 28, 2006, has been duly and validly executed by ITAC and is a
binding obligation of ITAC as of the date hereof.
2. Pursuant
to Section 5.1 of the Merger Agreement, IXI is required to obtain ITAC's prior
approval to certain transactions, including, without limitation, the
transactions contemplated by that certain Loan Agreement between IXI Mobile
(R&D) Ltd. (“IXI
Israel”),
a
wholly owned subsidiary of IXI, duly incorporated under the laws of the State
of
Israel, Southpoint Master Fund LP ("Southpoint")
and
IXI, in its capacity as guarantor thereunder, attached hereto as Exhibit
A
(collectively with all exhibits, schedules and ancillary documents thereto,
the
"Loan
Agreement")
and the
transactions contemplated by that certain Letter Agreement by and among IXI,
IXI
Israel and you attached hereto as Exhibit
B.
Consequently, ITAC hereby certifies that its Board of Directors (including
any
required committee or subgroup of the Board of Directors of ITAC) has, as of
the
date of this Certification, unanimously granted its approval to IXI to enter
into the Loan Agreement and the Letter Agreement. ITAC further certifies that
its Board of Directors (including any required committee or subgroup of the
Board of Directors of ITAC) has, as of the date of this Certification,
unanimously approved the execution by ITAC of this Certification.
3. Subject
to and conditioned upon the consummation of the ITAC/IXI Merger, ITAC hereby
certifies and agrees that: (i) all of IXI's and IXI Israel’s obligations,
agreements, undertakings, representations and warranties to you pursuant to
the
Letter Agreement and pursuant to the Loan Agreement, including, without
limitation, the obligations undertakings, representations and warranties to
you
pursuant to the combined provisions of the Letter Agreement and Sections 3.2
and
3.3 of the Loan Agreement (collectively, the "Assumed
Obligations"),
will
be assumed by ITAC in their entirety as of the Effective Time (as such term
is
defined in the Merger Agreement); (ii) as a result of ITAC's agreement in the
immediately preceding Section, you shall be entitled to, among other things:
(x)
convert each of your respective Conversion Amounts into shares of ITAC Stock
pursuant to the combined provisions of the Letter Agreement and Section 3.2(a)
and Sections 3.2(c) through (e) of the Loan Agreement, and (y) receive a total
amount of Two Hundred Forty Thousand (240,000) shares of ITAC Stock pursuant
to
the combined provisions of the Letter Agreement and Section 3.3(a) of the Loan
Agreement and, subject to your meeting the Conversion Inducement Threshold,
ITAC
Warrants pursuant to the combined provisions of the Letter Agreement and Section
3.3(b) of the Loan Agreement; (iii) prior to an Optional Conversion pursuant
to
Section 3.2(a) of the Loan Agreement and prior to the issuance of ITAC Stock
and/or ITAC Warrants pursuant to Section 3.3 of the Loan Agreement, ITAC shall
take any and all actions necessary to authorize and reserve a sufficient number
of shares of ITAC Stock to effect such Optional Conversion and such issuance
of
equity securities; (iv) any shares of ITAC Stock or ITAC Warrants issuable
to
you following the consummation of the ITAC/IXI Merger and the assumption by
ITAC
of the Assumed Obligations, will be issued to you as soon as practicable
following the Effective Time of the ITAC/IXI Merger; (v) upon delivery to you
of
any shares of ITAC Stock pursuant to the combined provisions of the Letter
Agreement and the Loan Agreement, such shares of ITAC Stock shall be duly
authorized, validly issued, fully paid and non-assessable; (vi) ITAC shall
provide you with representations and warranties substantially similar to the
representations and warranties provided by ITAC to IXI in Article IV of the
Merger Agreement; and (vii) ITAC shall grant to you registration rights with
respect to all shares of ITAC Stock which you may receive pursuant to the Loan
Agreement and this Certification; such registration rights being equivalent
to
those registration rights previously granted to you in connection with the
Merger Agreement.
4. ITAC
hereby represents and warrants to you as of the date hereof as
follows:
4.1 Authorization;
Binding Obligations.
ITAC has
all requisite corporate power and authority to execute and deliver this
Certification. Subject to the consummation of the ITAC/IXI Merger, ITAC will
have the corporate power and authority to perform its obligations pursuant
to
this Certification, including, but not limited to, the issuance to you of the
ITAC Stock and the ITAC Warrants pursuant to the combined provisions of the
Letter Agreement, the Loan Agreement and paragraph 3 hereof. All corporate
action on the part of ITAC, its officers, directors and stockholders necessary
for the authorization of this Certification have been taken. Subject to the
consummation of the ITAC/IXI Merger, all corporate action on the part of ITAC,
its officers, directors and stockholders necessary for the performance of ITAC’s
obligations hereunder, including, but not limited to, the issuance to you of
the
ITAC Stock and the ITAC Warrants will be taken in a timely manner.
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4.2
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Conflict;
Required Filings and
Consents.
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(a) The
Loan
Agreement and the Letter Agreement, after giving effect to this Certification
and the grant of approval by the Board of Directors of ITAC to IXI to enter
into
the Loan Agreement and the Letter Agreement, do not conflict with or give rise
to any right of termination under the Merger Agreement.
(b) The
execution and delivery of this Certification by ITAC do not, and, subject to
the
consummation of the ITAC/IXI Merger, the performance of ITAC's obligations
pursuant to this Certification shall not: (i) conflict with or violate ITAC’s
charter documents, or (ii) result in any breach of or constitute a default
(or
an event that with notice or lapse of time or both would become a default)
under, or materially impair ITAC’s rights or alter the rights or obligations of
any third party under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties or assets of ITAC pursuant to, any ITAC
contracts (as defined below), except, with respect to clause (ii), for any
such
conflicts, violations, breaches, defaults or other occurrences that would not,
individually and in the aggregate, have a Material Adverse Effect on
ITAC.
(c) No
consent, approval or authorization of, or declaration to or filing with, any
Person is required, or will be required, for the valid authorization, execution
and delivery by ITAC of this Certification or, subject to the consummation
of
the ITAC/IXI Merger, for the valid authorization, issuance and delivery to
you
of the ITAC Stock and the ITAC Warrants, other than those consents, approvals,
authorizations, declarations or filings which have been obtained or made, as
the
case may be or which will be obtained and made in a timely manner.
4.3 Representations
and Warranties in Connection with the ITAC/IXI Merger.
(a) ITAC
hereby confirms that (i) each representation and warranty of ITAC contained
in
the Merger Agreement that is qualified as to materiality was true and correct
as
of the date of the Merger Agreement and (ii) each representation and warranty
of
ITAC contained in the Merger Agreement that is not qualified as to materiality
was true and correct in all material respects as of the date of the Merger
Agreement.
(b) ITAC
hereby confirms that as of the date hereof, no event has occurred since the
date
of the Merger Agreement which, individually or in the aggregate, would cause
any
representation and warranty of ITAC contained in the Merger Agreement to be
incorrect in any material respect.
(c) Prior
to
the consummation of the ITAC/IX Merger, IXI is required to receive an opinion
of
Xxxxxxxx Xxxxxx, counsel for ITAC, containing opinions customary for similarly
structured transactions, including the authority of ITAC to enter into the
transactions called for by the Merger Agreement and the issuance of the
securities provided for in the Merger Agreement.
3
5. Capitalized
terms not otherwise defined herein shall have the meanings assigned them in
the
Loan Agreement.
6. Each
one
of you has read ITAC's final prospectus, dated July 12, 2005, and understands
that ITAC has established a trust fund ("Trust
Fund"),
in an
amount of $33,812,870 as of March 31, 2006, for the benefit of ITAC's public
stockholders and that ITAC may disburse monies from the Trust Fund only (i)
to
its public stockholders in the event they elect to convert their shares or
upon
ITAC's liquidation or (ii) to ITAC after it consummates a business combination.
For and in consideration of ITAC providing the foregoing Certification to you,
each one of you, by accepting this Certification, hereby, severally and not
jointly, agrees that it does not have any right, title, interest or claim of
any
kind in or to any monies in the Trust Fund ("Claim")
and
waives any Claim it may have in the future as a result of, or arising out of,
any negotiations, contracts or agreements with ITAC and will not seek recourse
against the Trust Fund for any reason whatsoever. For the avoidance of doubt,
this paragraph 7 shall not in any event be construed to constitute a waiver
of
any claim by any one of you against ITAC in the event that the ITAC/IXI Merger
is consummated. This provision shall survive termination of this Certification
for any reason whatsoever.
7. This
Certification is provided as an inducement for each one of you to enter into
the
Letter Agreement.
8. This
Certification shall be governed by and construed in accordance with the laws
of
Delaware without regard to the conflicts of laws provisions
thereof.
[Signature
Page Follows]
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By:
/s/
Xxxxxx Xxxxxxx
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Name: Xxxxxx Xxxxxxx
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Title: Chairman and Chief Executive Officer
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Accepted
as of the date hereof:
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GEMINI
ISRAEL III LIMITED PARTNERSHIP,
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by
its general partner Gemini Capital Associates III L.P.,
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by
its general partner Gemini Israel Funds Ltd.
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By:
/s/
Xxxxx Xxxxx
/s/
Xxxx Xxxx
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Name:
Xxxxx Xxxxx Xxxx
Xxxx
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Title:
CFO,
GP Managing
Partner
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GEMINI
ISRAEL III PARALLEL FUND LIMITED PARTNERSHIP,
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by
its general partner Gemini Capital Associates III, L.P.
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by
its general partner Gemini Israel Funds Ltd.
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By:
/s/
Xxxxx Xxxxx
/s/
Xxxx Xxxx
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Name:
Xxxxx Xxxxx Xxxx
Xxxx
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Title:
CFO,
GP
Managing Partner
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GEMINI
ISRAEL III OVERFLOW FUND LIMITED PARTNERSHIP,
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by
its general partner Gemini Capital Associates III L.P.,
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by
its general partner Gemini Israel Funds Ltd.
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By:
/s/
Xxxxx Xxxxx
/s/
Xxxx Xxxx
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Name:
Xxxxx Xxxxx Xxxx
Xxxx
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Title:
CFO,
GP
Managing Partner
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[SIGNATURE PAGE TO ITAC SP CERTIFICATION]
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GEMINI
PARTNER INVESTORS LIMITED PARTNERSHIP.
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by
its general partner Gemini Israel Funds Ltd.
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By:
/s/
Xxxxx Xxxxx
/s/
Xxxx Xxxx
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Name:
Xxxxx Xxxxx Xxxx
Xxxx
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Title:
CFO,
GP Managing
Partner
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XXXXX
VENTURES LTD.
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By:/s/
X. Xxxxx
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Name:
X. Xxxxx
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Title:
Chairman
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[SIGNATURE
PAGE TO ITAC SP
CERTIFICATION]
