UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 18, 2021
INDUSTRIAL TECH ACQUISITIONS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-39490 | 85-1316132 | ||
| (State
or other jurisdiction of incorporation) |
(Commission File Number) | (I.R.S.
Employer Identification No.) |
5090 Richmond Avenue, Suite 319 Houston, Texas |
77056 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (713) 599-1300
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☒ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Units, each consisting of one share of Class A Common Stock and one Redeemable Warrant | ITACU | The Nasdaq Stock Market LLC | ||
| Class A Common Stock, par value $0.0001 per share | ITAC | The Nasdaq Stock Market LLC | ||
| Warrants, each exercisable for one share of Class A Common Stock at a price of $11.50 per share | ITACW | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry Into A Material Definitive Agreement. |
Business Combination Agreement
This section describes the material provisions of the Business Combination Agreement (as defined below), but does not purport to describe all of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of the Business Combination Agreement, a copy of which is attached hereto as Exhibit 2.1. Stockholders of Industrial Tech Acquisitions, Inc. and other interested parties are urged to read the Business Combination Agreement in its entirety. Unless otherwise defined herein, the capitalized terms used below have the meanings given to them in the Business Combination Agreement.
General Terms and Effects; Merger Consideration
On March 18, 2021, Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), entered into a Business Combination Agreement (the “Business Combination Agreement”) with Arbe Robotics Ltd., an Israeli company (“Arbe”), and Autobot MergerSub, Inc., a Delaware corporation and a wholly owned subsidiary of Arbe (“Merger Sub”).
Pursuant to the Business Combination Agreement, at the closing (the “Closing”) of the transactions contemplated thereunder (collectively, the “Transaction”), and following the Recapitalization and the PIPE Investment (as each such term is defined and described below), (i) Merger Sub will merge with and into ITAC, with ITAC continuing as the surviving entity and a wholly owned subsidiary of Arbe (the “Merger”); (ii) the common stock of ITAC (including Class A common stock and Class B common stock) will be converted into ordinary shares of Arbe (“Company Ordinary Shares”) on a one-for-one basis; (iii) warrants to purchase ITAC common stock will be converted into warrants to purchase the same number of Company Ordinary Shares at the same exercise price and for the same exercise period; (iv) ITAC will become a wholly owned subsidiary of Arbe; and (v) ITAC will change its corporate name to Autobot HoldCo, Inc., and will have a restated certificate of incorporation appropriate for a private corporation.
Prior to the Closing, but subject to the completion of the Closing, Arbe will effect a recapitalization of its outstanding equity securities (the “Recapitalization”) so that the only class of outstanding equity of Arbe will be the Company Ordinary Shares (and certain options and warrants to be rolled over in connection with the Transaction). To effect the Recapitalization, (i) warrants to purchase Company Ordinary Shares (with certain exceptions) will be exercised in accordance with their terms; (ii) the preferred shares of Arbe (including Company preferred shares issuable upon exercise of certain warrants) will be converted into Company Ordinary Shares in accordance with their terms; (iii) Arbe will effect a recapitalization of the Company Ordinary Shares so that the holders of the Company Ordinary Shares (and options and warrants to acquire Company Ordinary Shares that are not converted to Company Ordinary Shares in the Recapitalization) will have shares (or the right to acquire shares, as applicable) valued at $10.00 per share having a total value of $525,000,000, plus the amount of any ITAC transaction expenses (other than expenses related to the PIPE Investment) in excess of $7,000,000, on a fully diluted basis (the ratio at which Company Ordinary Shares are recapitalized being referred to as the Conversion Ratio); and (iv) with respect to outstanding options and warrants to purchase Company Ordinary Shares, the number of Company Ordinary Shares issuable upon exercise of such security will be multiplied by the Conversion Ratio and the exercise price of such security will be multiplied by the Conversion Ratio. The Business Combination Agreement does not provide for any purchase price adjustments (other with respect to ITAC transaction expenses above $7,000,000, as described above, for which there is no post-closing adjustment).
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In addition, following the Recapitalization and prior to the effectiveness of the Merger (the “Effective Time”), ITAC has agreed to sell 10,000 000 shares of ITAC common stock at a price of $10.00 per share in the PIPE Investment, or alternatively, at the discretion of Arbe, the PIPE Investors (as defined below) will purchase 10,000,000 Company Ordinary Shares directly from Arbe at the same $10.00 per share price per Company Ordinary Share. The PIPE Investment will be effected subsequent to the Recapitalization and the shares issued in the PIPE Investment do not participate in the Recapitalization described above.
Representations and Warranties
The Business Combination Agreement contains a number of representations and warranties made by each of ITAC and Arbe as of the date of the Business Combination Agreement or other specified dates. Certain of the representations and warranties are qualified by materiality or Material Adverse Effect (as hereinafter defined), as well as information provided in the disclosure schedules to the Business Combination Agreement. As used in the Business Combination Agreement, “Material Adverse Effect” means, with respect to any specified person or entity, any fact, event, occurrence, change or effect that has individually or in the aggregate, a material adverse effect upon (i) the business, assets, Liabilities, results of operations, prospects or condition (financial or otherwise) of such person or entity and its subsidiaries, taken as a whole, or (ii) the ability of such person or entity or any of its subsidiaries on a timely basis to consummate the transactions contemplated by the Business Combination Agreement or the ancillary documents relating to the Business Combination Agreement to which such person or entity is a party or bound or to perform the obligations of such person or entity thereunder, in each case, subject to certain customary exceptions.
No Survival
The representations and warranties of the parties contained in the Business Combination Agreement terminate as of, and do not survive, the Closing, and there are no indemnification rights for another party’s breach. The covenants and agreements of the parties contained in the Business Combination Agreement do not survive the Closing, except those covenants and agreements to be performed after the Closing, which covenants and agreement will survive until fully performed.
Covenants of the Parties
Each party agreed in the Business Combination Agreement to use its commercially reasonable efforts to effect the Closing. The Business Combination Agreement also contains certain customary covenants by each of the parties during the period between the signing of the Business Combination Agreement and the earlier of the Closing or the termination of the Business Combination Agreement in accordance with its terms (the “Interim Period”), including those relating to: (1) the provision of access to their properties, books and personnel; (ii) the operation of their respective businesses in the ordinary course of business; (iii) the provision of financial statements by Arbe to ITAC; (iv) ITAC’s public filings; (v) no insider trading; (vi) notifications of certain breaches, consent requirements or other matters; (vii) efforts to consummate the Closing; (viii) further assurances; (ix) public announcements; and (x) confidentiality. Each party also agreed during the Interim Period not to solicit or enter into any inquiry, proposal or offer, or any indication of interest in making an offer or proposal for an alternative competing transactions, to notify the others as promptly as practicable in writing of the receipt of any inquiries, proposals or offers, requests for information or requests relating to an alternative competing transaction or any requests for non-public information relating to such transaction, and to keep the other party informed of the status of any such inquiries, proposals, offers or requests for information. The Business Combination Agreement also contains certain customary post-Closing covenants regarding (a) maintenance of books and records; (b) indemnification of directors and officers and the purchase of tail directors’ and officers’ liability insurance; and (c) use of trust account proceeds.
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In addition, Arbe agreed to obtain its required shareholder approvals in the manner required under its organizational documents and applicable law for, among other things: (i) the adoption and approval of the Business Combination Agreement and the Transaction (including, to the extent required, the Recapitalization and the issuance of securities of Arbe pursuant to the Business Combination Agreement (including, if applicable, in connection with the PIPE Investment)); (ii) the approval of the restated Company organizational documents, which will have been approved by Arbe’s directors, including one of Arbe’s A or B directors; and (iii) the appointment of the members of the post-Closing board of directors of Arbe comprised as set forth in the Business Combination Agreement and as described below (the “Post-Closing Board”), and agreed to enforce the Voting Agreements (as defined and described below) in connection therewith.
The parties made customary covenants regarding the registration statement on Form F-4 to be filed by Arbe (the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”), to register the Company Ordinary Shares and the warrants to purchase Company Ordinary Shares to be issued under the Business Combination Agreement to the holders of ITAC common stock and the Company Ordinary Shares issuable upon exercise or conversion of the warrants to purchase Company Ordinary Shares that were outstanding prior to the Effective Time. The Registration Statement also will contain the ITAC proxy statement to seek the consent of ITAC’s stockholders to, among other things, (i) adopt the Business Combination Agreement and the Transaction; (ii) approve the PIPE Investment and the issuance of ITAC securities in the PIPE Investment; and (iii) approve the amended certificate of incorporation of ITAC in connection with the Merger.
Prior to the effectiveness of the Registration Statement, Arbe also agreed to file with the SEC an additional registration statement on Form F-1 under the Securities Act covering the sale by the holders of the Company Ordinary Shares which are outstanding immediately following the Recapitalization, and, for the avoidance of doubt, prior to and excluding any Company Ordinary Shares to be issued to the PIPE Investors and any other securities of Arbe to be registered pursuant to the Registration Statement referenced above, and the issuance of Company Ordinary Shares upon exercise of continuing warrants to purchase Company Ordinary Shares.
The parties agreed that the Post-Closing Board will consist of seven directors, consisting of four directors designated prior to the Closing by Arbe, at least two of whom will be considered independent under the requirements of The Nasdaq Capital Market (“Nasdaq”), one director designated prior to the Closing by ITAC, and two independent directors (under Nasdaq requirements) mutually agreed by Arbe and ITAC; provided, however, that the composition of the Post-Closing Board will comply with all requirements of Israeli law and Nasdaq. The parties further agreed to take commercially reasonable action so that the individuals serving as the chief executive officer and chief financial officer of Arbe immediately after the Closing will be the same individuals (in the same office) as that of Arbe immediately prior to the Closing (unless, at its sole discretion, Arbe desires to appoint another qualified person to either such role, in which case, such other person identified by Arbe will serve in such role). Prior to the Closing, Arbe agreed to use its reasonable best efforts to cause certain mutually agreed persons to enter into employment agreements, in each case effective as of the Closing, in form and substance reasonably acceptable to Arbe and ITAC.
ITAC and Arbe agreed to use their commercially reasonable efforts to satisfy the conditions of the PIPE Investors’ closing obligations contained in the Subscription Agreements (as defined below) and to consummate the transactions contemplated thereby.
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Conditions to Closing
The Business Combination Agreement contains customary conditions to Closing, including the following mutual conditions of the parties (unless waived): (i) approval of the shareholders of ITAC and Arbe; (ii) approvals of any required governmental authorities and completion of any antitrust expiration periods; (iii) receipt of specified third party consents; (iv) no law or order preventing the Transaction; (v) the Registration Statement having been declared effective by the SEC; (vi) no material uncured breach by the other party; (vii) no occurrence of a Material Adverse Effect with respect to the other party; (viii) the satisfaction of the $5,000,001 minimum net tangible asset test by Arbe or ITAC; (ix) approval of Arbe’s Nasdaq listing application; and (x) reconstitution of the Post-Closing Board as contemplated under the Business Combination Agreement.
In addition, unless waived by Arbe, the obligations of Arbe and Merger Sub to consummate the Transaction are subject to the satisfaction of the following additional Closing conditions, in addition to the delivery by ITAC of customary certificates and other Closing deliverables: (i) the representations and warranties of ITAC being true and correct as of the date of the Business Combination Agreement and as of the Closing (subject to certain materiality qualifiers); (ii) ITAC having performed in all material respects its obligations and complied in all material respects with its covenants and agreements under the Business Combination Agreement required to be performed or complied with by it on or prior to the date of the Closing; (iii) absence of any Material Adverse Effect with respect to ITAC since the date of the Business Combination Agreement which is continuing and uncured; (iv) the execution of the Founder Lock-Up Agreement (as defined and described below) by ITAC’s sponsor, Industrial Tech Partners, LLC (the “Sponsor”); and (v) at the Closing, ITAC will have at least $100,000,000 in cash and cash equivalents, including funds remaining in the trust account (after giving effect to the completion and payment of any redemptions) and the proceeds of any PIPE Investment (including any PIPE Investment directly into Arbe, as described above), prior to paying any of ITAC’s expenses and liabilities due at the Closing.
Unless waived by ITAC, the obligations of ITAC to consummate the Transaction are subject to the satisfaction of the following additional Closing conditions, in addition to the delivery by Arbe and Merger Sub of customary certificates and other Closing deliverables: (i) the representations and warranties of Arbe and Merger Sub being true and correct as of the date of the Business Combination Agreement and as of the Closing (subject to certain materiality qualifiers); (ii) Arbe and Merger Sub having performed in all material respects their respective obligations and complied in all material respects with their respective covenants and agreements under the Business Combination Agreement required to be performed or complied with by them on or prior to the date of the Closing; (iii) absence of any Material Adverse Effect with respect to Arbe or Merger Sub since the date of the Business Combination Agreement which is continuing and uncured; (iv) the Lock-Up Agreements (as described below) shall be in full force and effect as of the Closing; and (v) non-competition agreements (in a form to be mutually agreed prior to Closing) having been executed and delivered by certain executive officers of Arbe and be in full force and effect as of the Closing.
Termination
The Business Combination Agreement may be terminated under certain customary and limited circumstances at any time prior to the Closing, including: (i) by mutual written consent of ITAC and Arbe; (ii) by either ITAC or Arbe if any of the conditions to Closing have not been satisfied or waived by August 31, 2021; (iii) by either ITAC or Arbe if a governmental authority of competent jurisdiction has issued an order or taken any other action permanently restraining, enjoining or otherwise prohibiting the Transaction, and such order or other action has become final and non-appealable; (iv) by either ITAC or Arbe in the event of the other party’s uncured breach, if such breach would result in the failure of a closing condition (and so long as the terminating party is not also in breach under the Business Combination Agreement); (v) by ITAC if there has been a Material Adverse Effect on Arbe and its subsidiaries on a consolidated basis following the date of the Business Combination Agreement that is uncured and continuing; (vi) by Arbe if there has been a Material Adverse Effect on ITAC following the date of the Business Combination Agreement that is uncured and continuing; and (vii) by either ITAC or Arbe if Arbe holds a special meeting of its shareholders to approve the Business Combination Agreement and the Transaction and such approval is not obtained.
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If the Business Combination Agreement is terminated, all further obligations of the parties under the Business Combination Agreement (except for certain obligations related to publicity, confidentiality, fees and expenses, trust fund waiver, no recourse, termination and general provisions) will terminate, and no party to the Business Combination Agreement will have any further liability to any other party thereto except for liability for fraud or for willful breach of the Business Combination Agreement prior to termination. The Business Combination Agreement does not provide for any termination fees.
Trust Account Waiver
Arbe and Merger Sub each agreed that they and their affiliates will not have any right, title, interest or claim of any kind in or to any monies in ITAC’s trust account held for its public stockholders, and agreed not to, and waived any right to, make any claim against the trust account (including any distributions therefrom) other than in connection with the Closing.
Governing Law
The Business Combination Agreement is governed by the laws of the State of New York and the parties are subject to exclusive jurisdiction of federal and state courts located in the State of New York (and any appellate courts thereof).
A copy of the Business Combination Agreement is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the Business Combination Agreement is qualified in its entirety by reference thereto.
The Business Combination Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date of such agreement or other specific dates. The assertions embodied in those representations, warranties and covenants were made for purposes of the contract among the respective parties and are subject to important qualifications and limitations agreed to by the parties in connection with negotiating such agreement. The Business Combination Agreement has been filed with this Current Report on Form 8-K in order to provide investors with information regarding its terms. It is not intended to provide any other factual information about ITAC, Arbe, Merger Sub or any other party to the Business Combination Agreement. In particular, the representations, warranties, covenants and agreements contained in the Business Combination Agreement, which were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to the Business Combination Agreement, may be subject to limitations agreed upon by the contracting parties (including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Business Combination Agreement instead of establishing these matters as facts) and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors and reports and documents filed with the SEC. Investors should not rely on the representations, warranties, covenants and agreements, or any descriptions thereof, as characterizations of the actual state of facts or condition of any party to the Business Combination Agreement. In addition, the representations, warranties, covenants and agreements and other terms of the Business Combination Agreement may be subject to subsequent waiver or modification. Moreover, information concerning the subject matter of the representations and warranties and other terms may change after the date of the Business Combination Agreement, which subsequent information may or may not be fully reflected in ITAC’s public disclosures.
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Related Agreements
This section describes the material provisions of certain additional agreements entered into or to be entered into pursuant to or in connection with the Business Combination Agreement (the “Ancillary Agreements”), but does not purport to describe all of the terms thereof. The following summary is qualified in its entirety by reference to the complete text of each of the Ancillary Agreements, copies of each of which are attached hereto as exhibits. Stockholders and other interested parties are urged to read such Ancillary Agreements in their entirety.
Voting Agreements
Simultaneously with the execution and delivery of the Business Combination Agreement, ITAC and Arbe have entered into Voting Agreements, (collectively, the “Voting Agreements”), with shareholders of Arbe required to approve the Transaction. Under the Voting Agreements, each Arbe shareholder party thereto agreed to vote all of such shareholder’s shares of Arbe in favor of the Business Combination Agreement and the Transaction and to otherwise take certain other actions in support of the Business Combination Agreement and the Transaction and the other matters submitted to the Arbe shareholders for their approval in the manner and subject to the conditions set forth in the Voting Agreements, and provide a proxy to Arbe to vote such Arbe shares accordingly. The Voting Agreements prevent transfers of the Arbe shares held by the Arbe shareholders party thereto between the date of the Voting Agreement and the date of Closing, except for certain permitted transfers where the recipient also agrees to comply with the Voting Agreement.
A copy of the form of Voting Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the form of Voting Agreement is qualified in its entirety by reference thereto.
Lock-Up Agreements
Simultaneously with the execution and delivery of the Business Combination Agreement, certain significant and/or insider Arbe shareholders each entered into a Lock-Up Agreement with Arbe (collectively, the “Lock-Up Agreements”). Pursuant to the Lock-Up Agreements, each Arbe shareholder party thereto agreed not to, during the period commencing from the Closing and ending on the one (1) year anniversary of the Closing (subject to early release if the closing price of the Company Ordinary Shares equals or exceeds $12.00 per share for any 20 out of 30 trading days commencing 150 days after the Closing and also subject to early release if Arbe consummates a liquidation, merger, share exchange or other similar transaction with an unaffiliated third party that results in all Arbe shareholders having the right to exchange their equity holdings in Arbe for cash, securities or other property): (i) lend, offer, pledge, hypothecate, encumber, donate, assign, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any restricted securities, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the restricted securities, or (iii) publicly disclose the intention to do any of the foregoing, whether any such transaction described in clauses (i), (ii) or (iii) above is to be settled by delivery of restricted securities or other securities, in cash or otherwise (in each case, subject to certain limited permitted transfers where the recipient takes the shares subject to the restrictions in the Lock-Up Agreement).
A copy of the form of Lock-Up Agreement is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the form of Lock-Up Agreement is qualified in its entirety by reference thereto.
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Founder Lock-Up Agreement
Simultaneously with the execution and delivery of the Business Combination Agreement, the Sponsor and Arbe entered into a letter agreement (the “Founder Lock-Up Agreement”) pursuant to which the Sponsor agreed to certain enhanced price-based lock-up restrictions with respect to the Company Ordinary Shares that it will receive in exchange its 1,905,900 Class B ordinary shares of ITAC that it currently holds (the “Founder Shares”). Specifically, 952,950 of the Founder Shares will be deemed fully vested upon completion of the Closing and will not be subject to any enhanced lock-up restrictions (but will continue to be subject to the restrictions set forth in the existing lock-up letter agreement dated as of September 8, 2020). The remaining Founder Shares owned by the Sponsor as of the Closing (such shares, the “Price Based Lock-Up Shares”) will be subject to the following post-Closing lock-up restrictions (the “Enhanced Lock-Up Restrictions”) for a period of up to three years following the Closing Date (such three (3)-year period, the “Enhanced Lock-Up Period”): (i) 50% of the Price Based Lock-Up Shares will vest and no longer be subject to the Enhanced Lock-Up Restrictions if, at any time during the Enhanced Lock-Up Period, the volume weighted average price (as defined below) of the Company Ordinary Shares for 20 consecutive trading days on the primary exchange on which such securities are then listed or quoted (the “20-Day VWAP”) equals or exceeds $12.50 per share (subject to equitable adjustment); and (ii) the remaining Price Based Lock-Up Shares will vest and no longer be subject to the Enhanced Lock-Up Restrictions if, at any time during the Enhanced Lock-Up Period, the 20-Day VWAP of the Company Ordinary Shares equals or exceeds $15.00 per share (subject to equitable adjustment). In the event that all Price Based Lock-Up Shares have not become vested during the Enhanced Lock-Up Period in accordance with the provisions described above, all such remaining Price Based Lock-Up Shares will be deemed vested and released from the Enhanced Lock-Up Restrictions on the first day following the end of the Enhanced Lock-Up Period. The Price Based Lock-Up Shares are also subject to early release if during the Enhanced Lock-Up Period, Arbe is subject to a going private transaction, the Company Ordinary Shares cease to be listed on a national securities exchange or with respect to certain mergers, equity sales or asset sales by Arbe after the Closing that result in a change of control of control of Arbe.
The Sponsor also agreed in the Founder Lock-Up Agreement to vote in favor of and otherwise support the Transaction.
A copy of the Founder Lock-Up Agreement is filed as Exhibit 10.3 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the Founder Lock-Up Agreement is qualified in its entirety by reference thereto.
First Amendment to Founder Registration Rights Agreement
Simultaneously with the execution and delivery of the Business Combination Agreement, Arbe, ITAC and the Sponsor entered into the First Amendment to Registration Rights Agreement (the “Amendment to Founder Registration Rights Agreement”), which amended that certain Registration Rights Agreement, dated as of September 8, 2020, by and between ITAC and the Sponsor, pursuant to which ITAC granted certain registration rights to the Sponsor with respect to ITAC’s securities. Pursuant to the Amendment to Founder Registration Rights Agreement, which will become effective as of the Closing, Arbe will assume the obligations of ITAC under the original Registration Rights Agreement, and, among other things, Arbe will be added as a party thereto and the Amendment to Founder Registration Rights Agreement will reflect the issuance of Company Ordinary Shares and warrants to purchase Company Ordinary Shares pursuant to the Business Combination Agreement.
A copy of the Founder Registration Rights Agreement is filed as Exhibit 10.4 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the Founder Registration Rights Agreement is qualified in its entirety by reference thereto
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PIPE Investment
Simultaneously with the execution of the Business Combination Agreement, ITAC and Arbe entered into subscription agreements (collectively, the “Subscription Agreements”) with certain investors (the “PIPE Investors”) for an aggregate of $100,000,000 for 10,000,000 shares of ITAC’s Class A common stock, par value $0.0001 per share (or at Arbe’s sole election, Company Ordinary Shares (the “PIPE Shares”), at a price of $10.00 per share in a private placement to be consummated simultaneously with the closing of the Transaction (the “PIPE Investment”). The consummation of the transactions contemplated by the Subscription Agreements is conditioned on the concurrent Closing and other customary closing conditions. Among other things, each PIPE Investor agreed in the Subscription Agreement that it and its affiliates will not have any right, title, interest or claim of any kind in or to any monies in ITAC’s trust account held for its public stockholders, and agreed not to, and waived any right to, make any claim against the trust account (including any distributions therefrom). In addition, Arbe granted certain customary resale registration rights to the PIPE Investors in the Subscription Agreements.
A copy of the form of Subscription Agreement is filed as Exhibit 10.5 to this Current Report on Form 8-K and is incorporated herein by reference, and the foregoing description of the form of Subscription Agreement is qualified in its entirety by reference thereto.
| Item 3.02 | Unregistered Sales of Equity Securities. |
The disclosure set forth above under the heading “PIPE Investment” in Item 1.01 of this Current Report is incorporated by reference into this Item 3.02. The shares of ITAC Class A common stock to be issued to the PIPE Investors will not be registered under the Securities Act in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and/or Regulation D promulgated thereunder.
ADDITIONAL INFORMATION
General
Arbe Robotics Ltd., an Israeli company (“Arbe”) intends to file with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form F-4 (as amended, the “Registration Statement”), which will include a preliminary proxy statement of Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), and a prospectus in connection with the proposed business combination (the “Transaction”) involving Arbe, ITAC and Autobot MergerSub, Inc., a Delaware corporation and a wholly owned subsidiary of Arbe (“Merger Sub”). The definitive proxy statement and other relevant documents will be mailed to stockholders of ITAC as of a record date to be established for voting on the Transaction and related matters. Stockholders of ITAC and other interested persons are advised to read, when available, the preliminary proxy statement, and amendments thereto, and the definitive proxy statement in connection with ITAC’s solicitation of proxies for the special meeting of its stockholders to be held to approve the Transaction and related matters because these documents will contain important information about ITAC, Arbe, Merger Sub and the Transaction. Stockholders of ITAC will also be able to obtain copies of the Registration Statement and the proxy statement/prospectus, without charge, once available, on the SEC’s website at www.sec.gov or by directing a request to ITAC by contacting E. Scott Crist, Chief Executive Officer, c/o Industrial Tech Acquisitions, Inc., 5090 Richmond Avenue, Suite 319, Houston, Texas 77056, at (713) 599-1300 or at scott@texasventures.com.
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Participants in the Solicitation
ITAC, Arbe and certain of their respective directors, executive officers, other members of management and employees, under SEC rules, may be deemed to be participants in the solicitation of proxies from the shareholders of ITAC in favor of the approval of the Transaction. Stockholders of ITAC and other interested persons may obtain more information regarding the names and interests in the Transaction of ITAC’s directors and officers in ITAC’s filings with the SEC. Additional information regarding the interests of such potential participants will also be included in the Registration Statement and other relevant documents when they are filed with the SEC. Free copies of these documents may be obtained at the SEC’s website, https://www.sec.gov/edgar/searchedgar/companysearch.html, or as provided in the preceding paragraph.
Forward-Looking Statements
Certain statements made herein contain, and certain oral statements made by representatives of ITAC, Arbe and their respective affiliates from time to time may contain, “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. The actual results of ITAC and Arbe may differ from their expectations, estimates and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as “expect,” “estimate,” “project,” “budget,” “forecast,” “anticipate,” “intend,” “plan,” “may,” “will,” “could,” “should,” “believes,” “predicts,” “potential,” “might” and “continues,” and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, expectations of ITAC and Arbe with respect to future performance and anticipated financial impacts of the Transaction and related matters, the satisfaction of the closing conditions to the Transaction and the timing of the completion of the Transaction. These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from expected results. Most of these factors are outside of the control of ITAC or Arbe and are difficult to predict. Factors that may cause such differences include, but are not limited to: (i) the expected timing and likelihood of completion of the Transaction, including the risk that the Transaction may not close due to one or more closing conditions to the Transaction in the Business Combination Agreement not being satisfied or waived on a timely basis or otherwise, or that the required approval of the Business Combination Agreement and related matters by the shareholders of Arbe and ITAC are not obtained; (ii) a default by one or more of the investors in the PIPE Investment on its commitment, and ITAC’s failure to retain sufficient cash in its trust account or find replacement financing in order to meet the $100,000,000 minimum cash condition in the Business Combination Agreement; (iii) the occurrence of any event, change or other circumstances that could give rise to the termination of the Business Combination Agreement; (iv) the ability of Arbe to meet Nasdaq listing standards following the Transaction and in connection with the consummation thereof; (v) costs related to the Transaction; (vi) the occurrence of a material adverse change with respect to the financial position, performance, operations or prospects of Arbe or ITAC; (vi) the disruption of Arbe management time from ongoing business operations due to the Transaction; (vii) announcements relating to the Transaction having an adverse effect on the market price of ITAC's securities; (viii) the effect of the Transaction and the announcement thereof on the ability of Arbe to retain customers and retain and hire key personnel and maintain relationships with its suppliers and customers and on its operating results and businesses generally; (ix) the failure of Arbe to meet projected development and production targets; (x) changes in applicable laws or regulations, including laws and regulations affecting the market for Arbe’s products; (xi) the possibility that the combined company may be adversely affected by other economic, business, and/or competitive factors, or the continuing effects of the COVID-19 pandemic, the worsening thereof or other future pandemics; and (xii) other risks and uncertainties, including those to be identified in the proxy statement/prospectus (when available) relating to the Transaction, including those under “Risk Factors,” “Cautionary Note Concerning Forward-Looking Statements” and “Arbe Management’s Discussion and Analysis of Financial Condition and Results of Operations” therein, and in other filings with the SEC by ITAC or Arbe. ITAC and Arbe caution that the foregoing list of factors is not exclusive. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements relate only to the date they were made, and readers are cautioned not to place undue reliance upon any forward-looking statements. ITAC and Arbe undertake no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise, subject to applicable law.
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Disclaimer
This Current Report on Form 8-K and the exhibits hereto do not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the Transaction and related matters. This Current Report on Form 8-K also shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any states or jurisdictions in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended, or an exemption therefrom.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| * | The exhibits and schedules to this Exhibit have been omitted in accordance with Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish supplementally to the SEC a copy of all omitted exhibits and schedules upon its request. |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: March 24, 2021
| INDUSTRIAL TECH ACQUISITIONS, INC. | |||
| By: | /s/ E. Scott Crist | ||
| Name: | E. Scott Crist | ||
| Title: | Chief Executive Officer and Chairman | ||
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Exhibit 2.1
BUSINESS COMBINATION AGREEMENT
by and among
ARBE ROBOTICS LTD.
as the Company,
AUTOBOT MERGERSUB, INC.
as Merger Sub,
and
INDUSTRIAL TECH ACQUISITIONS, INC.
as ITAC
Dated as of March 18, 2021
Table of Contents
| Article I MERGER | 7 | |
| 1.1 | Merger | 7 |
| 1.2 | Effective Time | 7 |
| 1.3 | Effect of the Merger | 7 |
| 1.4 | Organizational Documents of the Company and the Surviving Company | 8 |
| 1.5 | Directors and Officers of the Company | 8 |
| 1.6 | Effect of Merger on Merger Sub Common Stock | 8 |
| 1.7 | Effect of Merger on Issued Securities of ITAC | 8 |
| 1.8 | Effect of Merger on Company Securities | 10 |
| 1.9 | ITAC Securities and Certificates | 11 |
| 1.10 | Taking of Necessary Action; Further Action | 11 |
| 1.11 | Tax Consequences | 11 |
| 1.12 | Certain Adjustments | 12 |
| Article II CLOSING | 12 | |
| 2.1 | Closing | 12 |
| Article III REPRESENTATIONS AND WARRANTIES OF ITAC | 12 | |
| 3.1 | Organization and Standing | 12 |
| 3.2 | Authorization; Binding Agreement | 13 |
| 3.3 | Governmental Approvals | 13 |
| 3.4 | Non-Contravention | 13 |
| 3.5 | Capitalization | 14 |
| 3.6 | SEC Filings and ITAC Financials | 15 |
| 3.7 | Absence of Certain Changes | 16 |
| 3.8 | Compliance with Laws | 17 |
| 3.9 | Actions; Orders; Permits | 17 |
| 3.10 | Taxes and Returns | 17 |
| 3.11 | Employees and Employee Benefit Plans | 18 |
| 3.12 | Properties | 18 |
| 3.13 | Material Contracts | 18 |
| 3.14 | Transactions with Affiliates | 18 |
| 3.15 | Investment Company Act | 19 |
| 3.16 | Finders and Brokers | 19 |
| 3.17 | Certain Business Practices | 19 |
| 3.18 | Insurance | 19 |
| 3.19 | Information Supplied | 20 |
| 3.20 | Independent Investigation | 20 |
| 3.21 | Trust Account | 20 |
| 3.22 | Company Representations | 21 |
| 3.23 | No Other Representation | 21 |
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| Article IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY | 22 | |
| 4.1 | Organization and Standing | 22 |
| 4.2 | Authorization; Binding Agreement | 22 |
| 4.3 | Capitalization | 23 |
| 4.4 | Subsidiaries | 24 |
| 4.5 | Merger Sub | 25 |
| 4.6 | Governmental Approvals | 25 |
| 4.7 | Non-Contravention | 25 |
| 4.8 | Financial Statements | 26 |
| 4.9 | Absence of Certain Changes | 28 |
| 4.10 | Compliance with Laws | 28 |
| 4.11 | Company Permits | 28 |
| 4.12 | Litigation | 28 |
| 4.13 | Material Contracts | 28 |
| 4.14 | Intellectual Property | 30 |
| 4.15 | Privacy | 33 |
| 4.16 | Taxes and Returns | 33 |
| 4.17 | Real Property | 35 |
| 4.18 | Personal Property | 36 |
| 4.19 | Employee Matters | 36 |
| 4.20 | Benefit Plans | 37 |
| 4.21 | Environmental Matters | 38 |
| 4.22 | Transactions with Related Persons | 39 |
| 4.23 | Insurance | 39 |
| 4.24 | Books and Records | 40 |
| 4.25 | Top Customers and Vendors | 40 |
| 4.26 | Certain Business Practices | 40 |
| 4.27 | Investment Company Act | 41 |
| 4.28 | PIPE Investment | 42 |
| 4.29 | Finders and Brokers | 42 |
| 4.30 | Information Supplied | 42 |
| 4.31 | Independent Investigation | 42 |
| 4.32 | Disclosure | 43 |
| 4.33 | No Other Representations or Warranties; No Reliance | 43 |
| Article V COVENANTS | 43 | |
| 5.1 | Access and Information | 43 |
| 5.2 | Conduct of Business of the Company and Merger Sub | 44 |
| 5.3 | Conduct of Business of ITAC | 47 |
| 5.4 | Annual and Interim Financial Statements | 49 |
| 5.5 | ITAC Public Filings | 49 |
| 5.6 | No Solicitation | 50 |
| 5.7 | No Trading | 50 |
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| 5.8 | Notification of Certain Matters | 50 |
| 5.9 | Efforts | 51 |
| 5.10 | Further Assurances | 50 |
| 5.11 | The Registration Statement | 52 |
| 5.12 | Public Announcements | 54 |
| 5.13 | Confidential Information | 55 |
| 5.14 | Documents and Information | 56 |
| 5.15 | Post-Closing Board and Executive Officers | 57 |
| 5.16 | Indemnification of Directors and Officers; Tail Insurance | 57 |
| 5.17 | Trust Account Proceeds | 57 |
| 5.18 | PIPE Investment | 57 |
| 5.19 | F-1 Registration Statement | 58 |
| 5.20 | Employment Agreements | 58 |
| Article VI CLOSING CONDITIONS | 59 | |
| 6.1 | Conditions to Each Party’s Obligations | 59 |
| 6.2 | Conditions to Obligations of the Company and Merger Sub | 60 |
| 6.3 | Conditions to Obligations of ITAC | 62 |
| 6.4 | Frustration of Conditions | 63 |
| Article VII TERMINATION AND EXPENSES | 63 | |
| 7.1 | Termination | 63 |
| 7.2 | Effect of Termination | 65 |
| 7.3 | Fees and Expenses | 65 |
| Article VIII WAIVERS AND Releases | 65 | |
| 8.1 | Waiver of Claims Against Trust | 65 |
| Article IX MISCELLANEOUS | 66 | |
| 9.1 | Notices | 66 |
| 9.2 | Binding Effect; Assignment | 66 |
| 9.3 | Non-Survival of Representations, Warranties | 67 |
| 9.4 | Third Parties | 67 |
| 9.5 | [Reserved] | 67 |
| 9.6 | Governing Law; Jurisdiction | 67 |
| 9.7 | WAIVER OF JURY TRIAL | 67 |
| 9.8 | Specific Performance | 68 |
| 9.9 | Severability | 68 |
| 9.10 | Amendment | 68 |
| 9.11 | Waiver | 68 |
| 9.12 | Entire Agreement | 69 |
| 9.13 | Interpretation | 69 |
| 9.14 | Counterparts | 70 |
| 9.15 | Legal Representation | 70 |
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| Article X DEFINITIONS | 70 | |
| 10.1 | Certain Definitions | 70 |
| 10.2 | Section References | 81 |
INDEX OF EXHIBITS
| Exhibit | Description | |
| Exhibit A | List of holders of Continuing Warrants and Company Ordinary Shares issuable upon exercise of Continuing Warrants | |
| Exhibit B | Form of Restated ITAC Certificate | |
| Exhibit C | Form of Lock-Up Agreement | |
| Exhibit D | List of Company’s executive officers party to Non-Competition Agreements | |
| Exhibit E | Founder Registration Rights Agreement Amendment | |
| Exhibit F | Founder Lock-Up Agreement | |
| Exhibit G | Form of Voting Agreement |
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BUSINESS COMBINATION AGREEMENT
This Business Combination Agreement (this “Agreement”) is made and entered into as of March 18, 2021 by and among (i) Arbe Robotics Ltd., an Israeli company (the “Company”); (ii) Autobot MergerSub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and (iii) Industrial Tech Acquisitions, Inc., a Delaware corporation ( “ITAC”), The Company, Merger Sub and ITAC are each sometimes referred to herein individually as a “Party” and, collectively, as the “Parties.”
RECITALS:
WHEREAS, the Company is engaged in the development or products aimed at road safety through 4D ultra high-resolution imaging and related applications of its 4D technology;
WHEREAS, the Parties desire and intend to effect a business combination transaction whereby Merger Sub will merge with and into ITAC, with ITAC continuing as the surviving entity (the “Merger” and, together with the other transactions contemplated by this Agreement and the Ancillary Documents (as defined below), the “Transactions”), as a result of which, (i) prior to, but contingent upon, the Closing of the Merger, pursuant to a recapitalization (the actions described in this clause (i), collectively, the “Recapitalization”) approved by the Company’s shareholders, (a) each outstanding warrant (collectively, the “Outstanding Company Warrants”) to purchase Company Ordinary Shares or Company Preferred Shares (other than any Outstanding Company Warrants which (1) are not required by their terms to be exercised in connection with the Transactions, all of which are listed on Exhibit A, and (2) are not exercised at the election of the holder thereof prior to the consummation of the Recapitalization, all of which unexercised warrants being referred to as the “Continuing Warrants”) shall be exercised in accordance with their respective terms (all such Outstanding Company Warrants so exercised, the “Exercising Warrants”); (b) immediately following such exercise, each outstanding preferred share, with a nominal value of NIS 0.01 per share, of the Company (“Company Preferred Shares”), including for the avoidance of doubt, Company Preferred Shares issued upon exercise of Exercising Warrant, shall become and be converted into ordinary shares, with a nominal value of NIS 0.01 per share, of the Company (“Company Ordinary Shares”) in accordance with the Amended and Restated Company Articles of Association of the Company currently in effect (the “Existing Articles”); and (c) immediately following such conversion, but for the avoidance of doubt prior to the Effective Time, each then outstanding Company Ordinary Share shall, as a result of the Recapitalization, become and be converted into such number Company Ordinary Shares as is determined by multiplying (1) such Company Ordinary Share by (2) the quotient obtained by dividing (A) the sum of (i) $525,000,000, plus (ii) on a dollar-for-dollar basis equal to the amount by which the ITAC Transaction Expenses (other than expenses relating to the PIPE Investment) exceed $7.0 million, by (B) $10.00, and subsequently dividing such quotient by (C) the sum of (i) the number of Company Ordinary Shares then outstanding and (ii) without duplication, the number of Company Ordinary Shares issuable upon the exercise of all then outstanding (x) Continuing Warrants and (y) options to purchase shares of Company Ordinary Shares (including, any options granted subsequent to the date of this Agreement pursuant to Section 5.2(b)(ii)) (collectively, the “Outstanding Company Options”), (but excluding, in each instance, for the avoidance of doubt, any Company Ordinary Shares issued or issuable in connection with the PIPE Investment), and taking such quotient to five decimal places, which ratio is referred to as the “Conversion Ratio,” with all fractional Company Ordinary Shares being rounded up to the next higher integral number of Company Ordinary Shares (such that following such Recapitalization, for the avoidance of doubt, the Company Ordinary Shares shall be valued at $10.00 per share), and (d) as a result of the Recapitalization, each Continuing Warrant and each Continuing Company Option shall be adjusted to reflect the Recapitalization as set forth in Section 1.8; (ii) as more thoroughly described in Article I, immediately following the consummation of the Recapitalization, Merger Sub shall, at the Effective Time, be merged with and into ITAC, which shall continue as a wholly-owned subsidiary of the Company, and in connection therewith, (A) as more thoroughly described in Section 1.7(a), each share of ITAC Class A common stock, par value $0.0001 per share (“ITAC Class A Stock”), and each share of ITAC Class B common stock, par value $0.0001 per share (“ITAC Class B Stock,” and, together with the ITAC Class A Stock, the “ITAC Common Stock”), in each instance, issued and outstanding immediately prior to the Effective Time, including shares of ITAC Class A Stock issued in a PIPE Investment to be consummated immediately prior to the Effective Time, shall no longer be outstanding and shall automatically be cancelled, in exchange for the right of the holder thereof to receive an equal number of Company Ordinary Shares, and (B) as more thoroughly described in Section 1.7(c), each ITAC Warrant will be exchanged for the right to receive a warrant to purchase the same number of Company Ordinary Shares (each a “Company Warrant”) at the same exercise price during the same exercise period as the ITAC Warrant being exchanged; and (iii) the certificate of incorporation of ITAC shall be amended and restated in the form of Exhibit B (the “Restated ITAC Certificate”) and each issued and outstanding share of common stock, par value $0.01 per share, of Merger Sub shall become and be converted into one share of common stock, par value $0.01 per share, of ITAC (“New ITAC Common Stock”), and the corporate name of ITAC shall be changed to Autobot HoldCo, Inc., with the result that the Surviving Company is a direct, wholly-owned subsidiary of the Company;
5
WHEREAS, prior to the filing of the Registration Statement, the Company shall enter into each of the following agreements which will automatically become effective as of the Effective Time: (a) a Lock-Up Agreement between the Company and each of the Significant Company Shareholders (as defined on Exhibit C), in the form of Exhibit C (the “Lock-Up Agreement”), and (b) a Non-Competition and Non-Solicitation Agreement with the Company’s executive officers named in Exhibit D in a form to be mutually agreed upon prior to the filing of the Registration Statement, (the “Non-Competition Agreement”);
WHEREAS, prior to the filing of the Registration Statement, the Company, ITAC and the Sponsor shall enter into (a) an amendment to the Registration Rights Agreement, dated as of September 8, 2020 (the “Founder Registration Rights Agreement”), by and between ITAC and the Sponsor, in the form of Exhibit E (the “Founder Registration Rights Agreement Amendment”), pursuant to which the Company shall assume the obligations of ITAC under the Founder Registration Rights Agreement, which will become effective as of the Effective Time, and (b) a lock-up agreement, in the form of Exhibit F (the “Founder Lock-Up Agreement”);
WHEREAS, prior to or simultaneously with the execution and delivery of this Agreement, in connection with the PIPE Investment (as defined herein), ITAC and the Company have entered into subscription agreements with certain investors in a private placement to purchase ITAC Class A Stock or, at the Company’s sole election, an equal number of Company Ordinary Shares, in each instance, to be consummated immediately following the Recapitalization and prior to the Effective Time;
WHEREAS, the Company has received voting and support agreements in the form attached as Exhibit G hereto (collectively, the “Voting Agreements”) signed by the Company, officers and directors of the Company and the Significant Company Shareholders, indicating the agreement of such Company shareholders to approve the Merger and the other Transactions contemplated by this Agreement;
WHEREAS, for United States federal income tax purposes, the parties intend that the Merger will qualify as a “reorganization” within the meaning of Section 368 of the Code, and the Treasury Regulations promulgated thereunder, and that this Agreement be, and hereby is, adopted as a “plan of reorganization” for purposes of Section 368 of the Code and Treasury Regulations Section 1.368-2(g) and 1.368-3(a);
6
WHEREAS, the boards of directors of ITAC, Merger Sub and the Company have each (a) determined that the Transactions are fair, advisable and in the best interests of their respective companies and security holders, and (b) approved this Agreement and the Transactions, upon the terms and subject to the conditions set forth herein; and
WHEREAS, certain capitalized terms used herein are defined in 9.15 hereof.
NOW, THEREFORE, in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and the representations, warranties, covenants and agreements contained in this Agreement, and intending to be legally bound hereby, the Parties hereto agree as follows:
Article
I
MERGER
1.1 Merger. At the Effective Time, and subject to and upon the terms and conditions of this Agreement, and in accordance with the applicable provisions of the Delaware General Corporation Law (the “Delaware Law”), ITAC and Merger Sub shall consummate the Merger, pursuant to which Merger Sub shall be merged with and into ITAC with ITAC being the surviving entity (the “Surviving Company”), following which the separate corporate existence of Merger Sub shall cease and ITAC shall continue as the surviving entity.
1.2 Effective Time. ITAC and Merger Sub shall cause the Merger to be consummated by filing a certificate of merger in form and substance reasonably acceptable to ITAC and the Company (the “Certificate of Merger”) with the Secretary of State of the State of Delaware (the time of such filing, or such later time as may be specified in the Certificate of Merger, being the “Effective Time”) pursuant to the Delaware Law. The Certificate of Merger shall provide that upon the filing of the Certificate of Merger, the certificate of incorporation of the Surviving Company shall be the Restated ITAC Certificate.
1.3 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the Certificate of Merger and the Delaware Law. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the property, rights, privileges, agreements, powers and franchises, debts, Liabilities, duties and obligations of Merger Sub and ITAC shall become the property, rights, privileges, agreements, powers and franchises, debts, Liabilities, duties and obligations of the Surviving Company (including all rights and obligations with respect to the Trust Account), which shall include the assumption by the Surviving Company of any and all agreements, covenants, duties and obligations of Merger Sub and ITAC set forth in this Agreement and the Ancillary Documents to be performed after the Effective Time, and the Surviving Company shall continue its existence as a wholly-owned Subsidiary of the Company. Upon the effectiveness of the Merger, the directors and officers of Merger Sub shall become the directors and officers of the Surviving Company, and the by-laws of Merger Sub shall become the by-laws of the Surviving Company.
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1.4 Organizational Documents of the Company and the Surviving Company. Prior to or in connection with the Recapitalization, the Existing Articles shall be amended and restated in form and substance mutually agreeable to ITAC and the Company following approval by the Company’s board of directors and shareholders (the “Restated Company Articles”), such amendment and restatement to the articles of association of the Company (i) to provide for the Recapitalization as described in the Recitals and this Article I, and (ii) to remain in effect until from and after its adoption through the Effective Time and until amended in accordance with the terms thereof and the Israeli Companies Law, 5759-1999 (the “Israeli Companies Law”).
1.5 Directors and Officers of the Company. At the Effective Time, (i) the executive officers of the Company shall continue as the executive officers of the Company, each to hold office in accordance with the Restated Company Articles and (ii) the directors of the Company shall be comprised of the individuals determined in the manner set forth in Section 5.15, to continue in such capacity until their respective successors are duly elected or appointed and qualified.
1.6 Effect of Merger on Merger Sub Common Stock. Each outstanding share of common stock, $0.01 par value per share, of Merger Sub shall become and be converted into one share of New ITAC Common Stock, and the Surviving Company shall be a direct wholly-owned Subsidiary of the Company.
1.7 Effect of Merger on Issued Securities of ITAC.
(a) ITAC Common Stock. At the Effective Time, following the effectiveness of the Recapitalization, by virtue of the Merger and without any action on the part of any Party or the holders of securities of ITAC, the Company or Merger Sub, each share of ITAC Common Stock issued and outstanding prior to the Effective Time, including shares of ITAC Common Stock issued in the PIPE Investment (but, for the avoidance of doubt, excluding any Cancelled Shares), shall become and be converted into the right to receive an one Company Ordinary Share. For the avoidance of doubt, if the Company elects to issue Company Ordinary Shares directly to a PIPE Investor, the Company shall issue one Company Ordinary Share for each share of ITAC Class A Stock otherwise subscribed for, and such issuance shall be in lieu of obligation of ITAC to issue ITAC Class A Shares to the PIPE Investors.
(b) ITAC Units. At the Effective Time, following the effectiveness of the Recapitalization, by virtue of the Merger and without any action on the part of any Party or the holders of securities of ITAC, the Company or Merger Sub, every issued and outstanding ITAC Unit outstanding immediately prior to the Effective Time shall be automatically detached, and (i) each share of ITAC Class A Stock forming part of the Unit shall become and be converted into the right to receive one Company Ordinary Share pursuant to Section 1.7(a) of this Agreement and (ii) the redeemable ITAC Warrant forming part of the Unit shall become and be converted into the right to receive one Company Warrant to purchase one Company Ordinary Share at an exercise price equal to the exercise price of the ITAC Warrants pursuant to Section 1.7(c).
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(c) ITAC Warrants. At the Effective Time, following the effectiveness of the Recapitalization, by virtue of the Merger and without any action on the part of any Party or the holders of securities of ITAC, the Company or Merger Sub, each outstanding ITAC Public Warrant and ITAC Private Warrant, including all ITAC Warrants that were included in the ITAC Units, shall cease to be outstanding and shall automatically be canceled and retired and shall cease to exist, and shall become and be converted into the right to receive a Company Warrant to purchase an equal number of Company Ordinary Shares at an exercise price equal to the exercise price of the ITAC Warrants, with the public or private nature of the ITAC Warrants being preserved in the Company Warrants. Each Company Warrants shall have, and be subject to, substantially the same terms and conditions set forth in the ITAC Warrants, except that in each case they shall represent the right to acquire Company Ordinary Shares in lieu of ITAC Common Stock. At or prior to the Effective Time, the Company shall take all corporate action necessary to reserve for future issuance, and shall maintain such reservation for so long as any of the Company Warrants remain outstanding, a sufficient number of Company Ordinary Shares for delivery upon the exercise of such Company Warrants.
(d) Cancellation of Share Capital Owned by ITAC. At the Effective Time, by virtue of the Merger and without any action on the part of any Party or the holders of securities of ITAC, the Company or Merger Sub, each share of ITAC Common Stock, and any other share of capital stock of ITAC, (i) that are owned by ITAC as treasury shares, (ii) owned by any direct or indirect wholly-owned Subsidiary of ITAC or (iii) that is issued or outstanding and owned directly or indirectly by the Company or Merger Sub immediately prior to the Effective Time (collectively, the “Cancelled Shares”), shall be automatically canceled and extinguished without any conversion thereof or payment or other consideration therefor.
(e) Transfers of Ownership. Subject in all instances to Section 1.9, if any Company Ordinary Shares are to be issued in a name other than the name in which the certificate surrendered in exchange therefor is registered, it will be a condition of the issuance thereof that the certificate so surrendered will be properly endorsed (or accompanied by an appropriate instrument of transfer) and otherwise in proper form for transfer and that the person requesting such exchange will have paid to the Company or any agent designated by it any transfer or other Taxes required by reason of the issuance of a certificate for securities of the Company in any name other than that of the registered holder of the certificate surrendered, or established to the satisfaction of ITAC or any agent designated by it that such tax has been paid or is not payable.
(f) Transfer Agent. Prior to the Closing, the Company shall appoint, and enter into an agreement with, Continental Stock Transfer & Trust Company (“Continental”) to act as (i) the transfer agent for the Company Ordinary Shares issuable hereunder, and (ii) the warrant agent for the Company Warrants issuable hereunder, in each instance, upon surrender of any underlying certificates or book-entry shares, as applicable. As soon as practicable following the Effective Time, the Company shall cause Continental to record the issuance on the stock records of the Company of the amount of Company Ordinary Shares and Company Warrants issuable hereunder.
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(g) No Liability; No Further Ownership Rights. Notwithstanding anything to the contrary in this Section 1.7, none of the Company, ITAC or Merger Sub or any Party hereto shall be liable to any Person for any amount properly paid to a public official pursuant to any applicable abandoned property, escheat or similar Law. All consideration issuable in accordance with the consummation of the Merger shall be deemed to have been paid in full satisfaction of all rights pertaining to any ITAC Securities and from and after the Effective Time, the holders thereof shall have no right other than to receive the consideration to be paid in connection with the Merger in accordance with this Section 1.7. At the close of business on the day on which the Effective Time occurs, the share transfer books of ITAC shall be closed, and there shall be no further registration of transfers on the share transfer books of the Surviving Company or the Company of the ITAC Securities that were outstanding immediately prior to the Effective Time.
(h) No Dissenters Rights. No dissenter’s rights, appraisal rights or other similar rights shall be available with respect to the Merger or the other Transactions contemplated by this Agreement.
(i) Withholding Rights. The Company or Continental, as applicable, shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of an ITAC Security, such amounts as it is required to deduct and withhold with respect to such payments under the Code or any other provision of state, local or foreign Tax Law. Any such amounts so deducted and withheld shall be paid over to the applicable Governmental Authority in accordance with applicable Law and shall be treated for all purposes of this Agreement as having been paid to the former holder of ITAC Securities, in respect of which such deduction and withholding was made.
(j) Fractional Shares. No fractional Company Ordinary Shares shall be issued to holders of ITAC Securities. All fractional Company Ordinary Shares shall be rounded to the next higher integral number of Company Ordinary Shares.
1.8 Effect of Merger on Company Securities. Prior to Closing (effective immediately prior to the Effective Time and the transactions described in Section 1.7), the Company shall effect the Recapitalization. For the avoidance of doubt, all Company Ordinary Shares, Continuing Warrants and Continuing Company Options, in each instance, outstanding prior to the consummation of the Merger shall remain outstanding following the consummation of the Merger and shall in no way be affected by the Merger. For the avoidance of doubt, each Continuing Warrant and each Continuing Company Option, in each instance, outstanding immediately prior to (and as part of) the consummation of the Recapitalization shall, without any action on the part of the holder thereof and in accordance with the provisions of the Continuing Warrant or Continuing Company Option, become a warrant or an option to purchase such number of Company Ordinary Shares, in each instance determined by (i) multiplying the number of Company Ordinary Shares issuable upon such exercise of such security by the Conversion Ratio and (ii) dividing the exercise price of such security by the Conversion Ratio. No fractional Company Ordinary Shares shall be issued to holders of Company Ordinary Shares. All fractional Company Ordinary Shares shall be rounded to the next higher integral number of Company Ordinary Shares, and the adjusted purchase price or exercise price shall be computed to two decimal places.
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1.9 ITAC Securities and Certificates.
(a) All securities issued upon the surrender of ITAC Securities in accordance with the terms hereof shall be deemed to have been issued in full satisfaction of all rights pertaining to such securities, provided that any restrictions on the sale and transfer of ITAC Securities shall also apply to the Company Ordinary Shares and Company Warrants so issued in exchange. To the extent that such ITAC Securities are represented by physical certificates, the holders of such ITAC Securities will be provided a letter of transmittal to send their certificated ITAC Securities to the transfer agent and warrant agent for the Company Ordinary Shares and Company Warrants, which is the same as the transfer agent and warrant agent for ITAC Securities, and such transfer agent or warrant agent will, upon receipt of completed documentation, issue the Company Ordinary Shares and Company Warrants that are issuable in respect of the holder’s ITAC Securities. To the extent that the ITAC Securities are held in book entry, the issuance of Company Ordinary Shares or Company Warrants will automatically be made by the transfer agent and warrant agent.
(b) In the event any certificates shall have been lost, stolen or destroyed, the Company shall issue in exchange for such lost, stolen or destroyed certificates or securities, as the case may be, upon the making of an affidavit of that fact by the holder thereof, such securities, as may be required pursuant to Section 1.7; provided, however, that the Company may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificates to deliver a bond in such sum as it may reasonably direct as indemnity against any claim that may be made against the Company with respect to the certificates alleged to have been lost, stolen or destroyed.
1.10 Taking of Necessary Action; Further Action. If, at any time after the Effective Time, any further action is necessary or desirable to carry out the purposes of this Agreement and to vest the Surviving Company with full right, title and possession to all assets, property, rights, privileges, powers and franchises of ITAC and Merger Sub, the officers and directors of ITAC and Merger Sub are fully authorized in the name of their respective entities to take, and will take, all such lawful and necessary action, so long as such action is not inconsistent with this Agreement.
1.11 Tax Consequences. The Merger is intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code and corresponding provisions of state and local Tax law, and this Agreement is intended to constitute, and is adopted by the parties as, a “plan of reorganization” within the meaning of Treasury Regulation §§ 1.368-2(g) and 1.368-3. The parties agree that (i) each party hereto shall cause all Tax Returns relating to the Merger to be filed on the basis of treating the Merger as a “reorganization” within the meaning of Section 368(a) of the Code and corresponding provisions of state and local Tax law, and (ii) none of the parties shall take, nor permit their respective Affiliates to take any action or position that reasonably would be expected to cause the Merger to fail to qualify as a reorganization within the meaning of Section 368(a) of the Code and corresponding provisions of state and local Law, in each case unless otherwise required by applicable Law.
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1.12 Certain Adjustments. Notwithstanding any provision of this Article I to the contrary (but excluding in all instances any action taken as part of the Recapitalization), if, between the effectiveness of the Recapitalization and the Effective Time, (a) the outstanding Company Ordinary Shares shall have been increased, decreased, changed into or exchanged for a different number of shares or different class, in each case, by reason of any reclassification, recapitalization, stock split (including reverse stock split), split-up, combination or exchange or readjustment of shares, (b) a stock dividend or dividend payable in any other securities of the Company shall be declared with a record date within such period, or (c) any similar event shall have occurred, then in each case the shares of Company Ordinary Shares issuable hereunder in exchange for ITAC Securities shall be appropriately adjusted to provide the holders thereof the same economic effect as contemplated by this Agreement prior to such event.
Article
II
CLOSING
2.1 Closing. Subject to the satisfaction or waiver of the conditions set forth in Article VI, the consummation of the transactions contemplated by this Agreement (the “Closing”) shall take place at the offices of Ellenoff Grossman & Schole LLP, 1345 Avenue of the Americas, New York, New York 10105, on the second (2nd) Business Day after all the Closing conditions to this Agreement have been satisfied or waived at 10:00 a.m. local time, or at such other date, time or place (including remotely) as ITAC and the Company may agree (the date and time at which the Closing is actually held being the “Closing Date”).
Article
III
REPRESENTATIONS AND WARRANTIES OF ITAC
Except as set forth in (i) the disclosure schedules delivered by ITAC to the Company on the date hereof (the “ITAC Disclosure Schedules”), the Section numbers of which are numbered to correspond to the Section numbers of this Agreement to which they refer, or (ii) the SEC Reports that are filed with SEC prior to the date hereof (other than any disclosures contained or referenced therein under the captions “Risk Factors,” “Forward-Looking Statements,” “Quantitative and Qualitative Disclosures About Market Risk,” and any other disclosures contained or referenced therein of information, factors, or risks that are predictive, cautionary, or forward-looking in nature), ITAC represents and warrants to the Company and Merger Sub, as of the date hereof and as of the Closing, as follows:
3.1 Organization and Standing. ITAC is a corporation incorporated, validly existing and in good standing under the Laws of the Delaware. ITAC has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted. ITAC is duly qualified or licensed and in good standing to do business in each jurisdiction in which the character of the property owned, leased or operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified or licensed or in good standing can be cured without material cost or expense. ITAC has heretofore made available to the Company accurate and complete copies of its Organizational Documents, each as currently in effect. ITAC is not in violation of any provision of its Organizational Documents in any material respect.
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3.2 Authorization; Binding Agreement. ITAC has all requisite corporate power and authority to execute and deliver this Agreement and each Ancillary Document to which it is a party, to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby, subject to obtaining the Required ITAC Shareholder Approval. The execution and delivery of this Agreement and each Ancillary Document to which it is a party and the consummation of the transactions contemplated hereby and thereby (a) have been duly and validly authorized by the board of directors of ITAC and (b) other than the Required ITAC Shareholder Approval, no other corporate proceedings on the part of ITAC are necessary to authorize the execution and delivery of this Agreement and each Ancillary Document to which it is a party or to consummate the transactions contemplated hereby and thereby. This Agreement has been, and each Ancillary Document to which ITAC is a party shall be when delivered, duly and validly executed and delivered by ITAC and, assuming the due authorization, execution and delivery of this Agreement and such Ancillary Documents by the other parties hereto and thereto, constitutes, or when delivered shall constitute, the valid and binding obligation of ITAC, enforceable against ITAC in accordance with its terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization and moratorium laws and other laws of general application affecting the enforcement of creditors’ rights generally or by any applicable statute of limitation or by any valid defense of set-off or counterclaim, and the fact that equitable remedies or relief (including the remedy of specific performance) are subject to the discretion of the court from which such relief may be sought (collectively, the “Enforceability Exceptions”).
3.3 Governmental Approvals. Except as otherwise described in Schedule 3.3, no Consent of or with any Governmental Authority, on the part of ITAC is required to be obtained or made in connection with the execution, delivery or performance by ITAC of this Agreement and each Ancillary Document to which it is a party or the consummation by ITAC of the transactions contemplated hereby and thereby, other than (a) pursuant to Consents to be obtained pursuant to the Antitrust Laws expressly contemplated by this Agreement, (b) such other filings expressly contemplated by this Agreement, (c) any filings required to be made with Nasdaq or the SEC with respect to the Transactions, (d) applicable requirements, if any, of the Securities Act, the Exchange Act, and/ or any state “blue sky” securities Laws, and the rules and regulations thereunder, and (e) such other Consents, filings or notifications where the failure to obtain or make such Consents or to make such filings or notifications, would not reasonably be expected to have a Material Adverse Effect on ITAC.
3.4 Non-Contravention. Except as otherwise described in Schedule 3.4, the execution and delivery by ITAC of this Agreement and each Ancillary Document to which it is a party, the consummation by ITAC of the transactions contemplated hereby and thereby, and compliance by ITAC with any of the provisions hereof and thereof, will not (a) conflict with or violate any provision of ITAC’s Organizational Documents, (b) subject to obtaining the Consents from Governmental Authorities referred to in Section 3.3 hereof, and the waiting periods referred to therein having expired, and any condition precedent to such Consent or waiver having been satisfied, conflict with or violate any Law, Order or Consent applicable to ITAC or any of its properties or assets, or (c) (i) violate, conflict with or result in a breach of, (ii) constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, (iii) result in the termination, withdrawal, suspension, cancellation or modification of, (iv) accelerate the performance required by ITAC under, (v) result in a right of termination or acceleration under, (vi) give rise to any obligation to make payments or provide compensation under, (vii) result in the creation of any Lien upon any of the properties or assets of ITAC under, (viii) give rise to any obligation to obtain any third party Consent or provide any notice to any Person or (ix) give any Person the right to declare a default, exercise any remedy, claim a rebate, chargeback, penalty or change in delivery schedule, accelerate the maturity or performance, cancel, terminate or modify any right, benefit, obligation or other term under, any of the terms, conditions or provisions of, any ITAC Material Contract, except for any deviations from any of the foregoing clauses (b) or (c) that would not reasonably be expected to have a Material Adverse Effect on ITAC.
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3.5 Capitalization.
(a) ITAC is authorized to issue 1,000,000 shares of Preferred Stock, par value $0.0001 per share, none of which are outstanding, 100,000,000 shares of ITAC Class A Stock, of which 6,933,322 shares are issued and outstanding, and 20,000,000 shares of ITAC Class B Stock, of which 1,902,900 shares are issued and outstanding. The issued and outstanding ITAC Securities as of the date of this Agreement are set forth on Schedule 3.5(a). All outstanding shares of ITAC Common Stock are duly authorized, validly issued, fully paid and non-assessable and not subject to or issued in violation of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the Delaware Law, ITAC’s Organizational Documents or any Contract to which ITAC is a party. None of the outstanding ITAC Securities has been issued in violation of any applicable securities Laws. Prior to giving effect to the transactions contemplated by this Agreement, ITAC does not have any Subsidiaries or own any equity interests in any other Person and ITAC does not have any right or obligation pursuant to any Contract or otherwise to acquire any equity interests in any other Person.
(b) Except as set forth in Schedule 3.5(a) or Schedule 3.5(b) and except with respect to the Subscription Agreements relating to the PIPE Investment, including any Subscription Agreement for the PIPE Investment subsequent to the date of this Agreement, there are no (i) outstanding options, warrants, puts, calls, convertible securities, preemptive or similar rights, (ii) bonds, debentures, notes or other Indebtedness having general voting rights or that are convertible or exchangeable into securities having such rights or (iii) subscriptions or other rights, agreements, arrangements, Contracts or commitments of any character (other than this Agreement and the Ancillary Documents), (A) relating to the issued or unissued shares of ITAC or (B) obligating ITAC to issue, transfer, deliver or sell or cause to be issued, transferred, delivered, sold or repurchased any options or shares or securities convertible into or exchangeable for such shares of ITAC, or (C) obligating ITAC to grant, extend or enter into any such option, warrant, call, subscription or other right, agreement, arrangement or commitment for such capital shares of ITAC. Other than the Redemption or as expressly set forth in this Agreement, there are no outstanding obligations of ITAC to repurchase, redeem or otherwise acquire any shares of ITAC or to provide funds to make any investment (in the form of a loan, capital contribution or otherwise) in any Person. Except as set forth in Schedule 3.5(b), there are no shareholders agreements, voting trusts or other agreements or understandings to which ITAC is a party with respect to the voting of any shares of ITAC.
(c) All Indebtedness of ITAC as of the date of this Agreement is disclosed on Schedule 3.5(c). No Indebtedness of ITAC contains any restriction upon: (i) the prepayment of any of such Indebtedness, (ii) the incurrence of Indebtedness by ITAC or (iii) the ability of ITAC to grant any Lien on its properties or assets.
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(d) Since the date of formation of ITAC, and except as contemplated by this Agreement, ITAC has not declared or paid any distribution or dividend in respect of its shares and has not repurchased, redeemed or otherwise acquired any of its shares, and ITAC’s board of directors has not authorized any of the foregoing.
3.6 SEC Filings and ITAC Financials.
(a) ITAC, since the IPO, has filed all forms, reports, schedules, statements, registration statements, prospectuses and other documents required to be filed or furnished by ITAC with the SEC under the Securities Act and/or the Exchange Act, together with any amendments, restatements or supplements thereto, and will file all such forms, reports, schedules, statements and other documents required to be filed subsequent to the date of this Agreement. Except to the extent available on the SEC’s web site through EDGAR, ITAC has delivered to the Company copies in the form filed with the SEC of all of the following: (i) ITAC’s annual reports on Form 10-K for each fiscal year of ITAC beginning with the first year ITAC was required to file such a form, (ii) ITAC’s quarterly reports on Form 10-Q for each fiscal quarter that ITAC was required to file such reports in order to disclose its quarterly financial results, (iii) all other forms, reports, registration statements, prospectuses and other documents (other than preliminary materials) filed by ITAC with the SEC (the forms, reports, registration statements, prospectuses and other documents referred to in clauses (i), (ii) and (iii) above, whether or not available through EDGAR, are, collectively, the “SEC Reports”) and (iv) all certifications and statements required by (A) Rules 13a-14 or 15d-14 under the Exchange Act, and (B) 18 U.S.C. §1350 (Section 906 of SOX) with respect to any report referred to in clause (i) above (collectively, the “Public Certifications”). The SEC Reports (x) were prepared in all material respects in accordance with the requirements of the Securities Act and the Exchange Act, as the case may be, and the rules and regulations thereunder and (y) did not, as of their respective effective dates (in the case of SEC Reports that are registration statements filed pursuant to the requirements of the Securities Act) and at the time they were filed with the SEC (in the case of all other SEC Reports) contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The Public Certifications are each true as of their respective dates of filing. As used in this Section 3.6, the term “file” shall be broadly construed to include any manner permitted by SEC rules and regulations in which a document or information is furnished, supplied or otherwise publicly made available to the SEC. (A) ITAC Units, ITAC Class A Ordinary Shares and ITAC Public Warrants are registered pursuant to Section 12(b) of the Exchange Act and are listed on Nasdaq, (B) ITAC has not received any written deficiency notice from Nasdaq relating to the continued listing requirements of such ITAC Securities, (C) there are no Actions pending or, to the Knowledge of ITAC, threatened against ITAC by the Financial Industry Regulatory Authority with respect to any intention by such entity to suspend, prohibit or terminate the quoting of such ITAC Securities on Nasdaq and (D) all ITAC Securities are in compliance with all of the applicable corporate governance rules of Nasdaq. There is no Action, proceeding or investigation pending or, to the Knowledge of ITAC, threatened against ITAC by Nasdaq or the SEC with respect to any intention by such entity to deregister any ITAC Securities or prohibit or terminate the listing of any ITAC Securities on Nasdaq. The Purchaser has taken no action that is designed to terminate the registration of the ITAC Securities under the Exchange Act. ITAC has not received any written or, to ITAC’s Knowledge, oral deficiency notice from Nasdaq relating to the continued listing requirements of the ITAC Securities.
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(b) The financial statements and notes of ITAC contained or incorporated by reference in the SEC Reports (the “ITAC Financials”), fairly present in all material respects the financial position and the results of operations, changes in shareholders’ equity, and cash flows of ITAC at the respective dates of and for the periods referred to in such financial statements, all in accordance with (i) GAAP methodologies applied on a consistent basis throughout the periods involved and (ii) Regulation S-X or Regulation S-K, as applicable (except as may be indicated in the notes thereto and for the omission of notes and audit adjustments in the case of unaudited quarterly financial statements to the extent permitted by Regulation S-X or Regulation S-K, as applicable). The ITAC Financials, including any notes and schedules thereto, (i) complied as to form in all material respects with the rules and regulations of the SEC with respect thereto as of their respective dates; (ii) were prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto or, in the case of the unaudited statements, as permitted by Rule 8-03 of Regulation S-X of the SEC or as may be permitted by the SEC for Quarterly Reports on Form 10-Q); and (iii) fairly presented in all material respects in accordance with applicable requirements of GAAP (subject, in the case of the unaudited statements, to normal year-end audit adjustments) the financial position of ITAC, as of their respective dates and the results of operations and the cash flows of ITAC, for the periods presented therein.
(c) Except as and to the extent reflected or reserved against in ITAC Financials, ITAC has not incurred any Liabilities or obligations of the type required to be reflected on a balance sheet in accordance with GAAP that are not adequately reflected or reserved on or provided for in ITAC Financials, other than Liabilities arising in the ordinary course of business since September 30, 2020, all of which shall be accurately reflected or reserved against in the ITAC Financials filed as part of the SEC Reports subsequent to date of this Agreement.
(d) ITAC has established and maintains a system of “internal controls over financial reporting” (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) as required by Rule 13a-15 under the Exchange Act and the listing standards of Nasdaq. ITAC’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) are reasonably designed to ensure that all material information required to be disclosed by ITAC in the reports that it files under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that all such material information is accumulated and communicated to ITAC’s management as appropriate to allow timely decisions. As an Emerging Growth Company, ITAC is not required to provide auditor attestation to its internal controls. This representation is qualified to the extent that, if ITAC’s internal controls were reviewed by its independent auditors, such auditors would determine that ITAC’s disclosure controls and procedures and internal controls over financial reporting are not effective; provided, however, that ITAC has, to the extent practical, taken steps to remediate any such deficiencies which were brought to its attention by its auditors.
3.7 Absence of Certain Changes. ITAC has, (a) since its formation, conducted no business other than its formation, the public offering of its securities (and the related private offerings), public reporting and its search for an initial Business Combination as described in the IPO Prospectus (including the investigation of the Target Companies and the negotiation and execution of this Agreement) and related activities and (b) since the consummation of the IPO, not been subject to a Material Adverse Effect.
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3.8 Compliance with Laws. ITAC is, and has since its formation been, in compliance with all Laws applicable to it and the conduct of its business except for such noncompliance which would not reasonably be expected to have a Material Adverse Effect on ITAC, and ITAC has not received written notice alleging any violation of applicable Law in any material respect by ITAC.
3.9 Actions; Orders; Permits. There is no pending or, to the Knowledge of ITAC, threatened Action to which ITAC is subject which would reasonably be expected to have a Material Adverse Effect on ITAC. There is no material Action that ITAC has pending against any other Person. ITAC is not subject to any material Orders of any Governmental Authority, nor are any such Orders pending. ITAC holds all Permits necessary to lawfully conduct its business as presently conducted, and to own, lease and operate its assets and properties, all of which are in full force and effect, except where the failure to hold such Permit or for such Permit to be in full force and effect would not reasonably be expected to have a Material Adverse Effect on ITAC.
3.10 Taxes and Returns.
(a) ITAC has or will have timely filed, or caused to be timely filed, all material Tax Returns required to be filed by it, which such Tax Returns are true, accurate, correct and complete in all material respects, and has paid, collected or withheld, or caused to be paid, collected or withheld, all material Taxes required to be paid, collected or withheld, other than such Taxes for which adequate reserves in ITAC Financials have been established in accordance with GAAP. Schedule 3.10(a) sets forth each jurisdiction where ITAC files or is required to file a Tax Return. There are no audits, examinations, investigations or other proceedings pending against ITAC in respect of any Tax, and ITAC has not been notified in writing of any proposed Tax claims or assessments against ITAC (other than, in each case, claims or assessments for which adequate reserves in ITAC Financials have been established in accordance with GAAP or are immaterial in amount). There are no Liens with respect to any Taxes upon any of ITAC’s assets, other than Permitted Liens. ITAC has no outstanding waivers or extensions of any applicable statute of limitations to assess any material amount of Taxes. There are no outstanding requests by ITAC for any extension of time within which to file any Tax Return or within which to pay any Taxes shown to be due on any Tax Return.
(b) Since the date of its formation, ITAC has not (i) changed any Tax accounting methods, policies or procedures except as required by a change in Law, (ii) made, revoked, or amended any material Tax election, (iii) filed any amended Tax Returns or claim for refund or (iv) entered into any closing agreement affecting or otherwise settled or compromised any material Tax Liability or refund.
(c) ITAC does not have any Liability for the Taxes of another Person (i) under any applicable Tax Law, (ii) as a transferee or successor, or (iii) by contract, indemnity or otherwise (excluding commercial agreements entered into in the ordinary course of business, the primary purpose of which is not the sharing of Taxes).
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(d) ITAC is Tax resident only in its jurisdiction of formation.
(e) ITAC does not have a permanent establishment (within the meaning of an applicable Tax treaty) or otherwise has an office or fixed place of business in a country other than the country in which it is organized.
(f) The Sponsor is Tax resident only in its jurisdiction of formation. No member of the Sponsor is a Tax resident of Israel. To the Knowledge of ITAC, no shareholder of ITAC that holds 5% or more of ITAC’s share capital is a Tax resident of Israel.
3.11 Employees and Employee Benefit Plans. ITAC does not (a) have any paid employees or (b) maintain, sponsor, contribute to or otherwise have any Liability under, any Benefit Plans.
3.12 Properties. ITAC does not own, license or otherwise have any right, title or interest in any material Intellectual Property.ITAC does not own or lease any material real property or Personal Property.
3.13 Material Contracts.
(a) Except as set forth on Schedule 3.13(a), other than this Agreement and the Ancillary Documents, there are no Contracts to which ITAC is a party or by which any of its properties or assets may be bound, subject or affected, which (i) creates or imposes a Liability greater than $100,000, (ii) may not be cancelled by ITAC on less than sixty (60) days’ prior notice without payment of a material penalty or termination fee or (iii) prohibits, prevents, restricts or impairs in any material respect any business practice of ITAC as its business is currently conducted, any acquisition of material property by ITAC, or restricts in any material respect the ability of ITAC from engaging in business as currently conducted by it or from competing with any other Person (together with the Trust Agreement, each, a “ITAC Material Contract”). All ITAC Material Contracts have been made available to the Company other than those that are exhibits to the SEC Reports.
(b) With respect to each ITAC Material Contract: (i) the ITAC Material Contract was entered into at arms’ length and in the ordinary course of business; (ii) the ITAC Material Contract is legal, valid, binding and enforceable in all material respects against ITAC and, to the Knowledge of ITAC, the other parties thereto, and is in full force and effect (except, in each case, as such enforcement may be limited by the Enforceability Exceptions); (iii) ITAC is not in breach or default in any material respect, and no event has occurred that with the passage of time or giving of notice or both would constitute such a breach or default in any material respect by ITAC, or permit termination or acceleration by the other party, under such ITAC Material Contract; and (iv) to the Knowledge of ITAC, no other party to any ITAC Material Contract is in breach or default in any material respect, and no event has occurred that with the passage of time or giving of notice or both would constitute such a breach or default by such other party, or permit termination or acceleration by ITAC under any ITAC Material Contract.
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3.14 Transactions with Affiliates. Schedule 3.14 sets forth a true, correct and complete list of the Contracts and arrangements that are in existence as of the date of this Agreement under which there are any existing or future Liabilities or obligations between ITAC and any (a) present or former director, officer or employee or Affiliate of ITAC, or any immediate family member of any of the foregoing, or (b) record or beneficial owner of more than five percent (5%) of ITAC’s outstanding capital stock as of the date hereof.
3.15 Investment Company Act. ITAC is not an “investment company” or a Person directly or indirectly “controlled” by or acting on behalf of an “investment company,” or required to register as an “investment company,” in each case within the meaning of the Investment Company Act.
3.16 Finders and Brokers. Except as set forth on Schedule 3.16, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission from ITAC, the Company or any of their respective Affiliates in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of ITAC.
3.17 Certain Business Practices.
(a) Neither ITAC, nor any of its Representatives acting on its behalf, has (i) used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees, to foreign or domestic political parties or campaigns or violated any provision of the U.S. Foreign Corrupt Practices Act of 1977 or any other local or foreign anti-corruption or bribery Law, (iii) made any other unlawful payment or (iv) since the formation of ITAC, directly or indirectly, given or agreed to give any unlawful gift or similar benefit in any material amount to any customer, supplier, governmental employee or other Person who is or may be in a position to help or hinder ITAC or assist it in connection with any actual or proposed transaction.
(b) The operations of ITAC are and have been conducted at all times in material compliance with money laundering statutes in all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Authority, and no Action involving ITAC with respect to any of the foregoing is pending or, to the Knowledge of ITAC, threatened.
(c) None of ITAC or any of its directors or officers, or, to the Knowledge of ITAC, any other Representative acting on behalf of ITAC is currently identified on the specially designated nationals or other blocked person list or otherwise the subject of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”), and ITAC has not, since its formation, directly or indirectly, used any funds, or loaned, contributed or otherwise made available such funds to any Subsidiary, joint venture partner or other Person, in connection with any sales or operations in any other country or territory subject to OFAC sanctions or for the purpose of financing the activities of any Person the subject of, or otherwise in violation of, any U.S. sanctions administered by OFAC, in each case, in violation of applicable sanctions.
3.18 Insurance. Schedule 3.18 lists all insurance policies (by policy number, insurer, coverage period, coverage amount, annual premium and type of policy) held by ITAC relating to ITAC or its business, properties, assets, directors, officers and employees, copies of which have been provided to the Company. All premiums due and payable under all such insurance policies have been timely paid and ITAC is otherwise in material compliance with the terms of such insurance policies. All such insurance policies are in full force and effect, and to the Knowledge of ITAC, there is no threatened termination of, or material premium increase with respect to, any of such insurance policies. There have been no insurance claims made by ITAC. ITAC has reported to its insurers all claims and pending circumstances that would reasonably be expected to result in a claim, except where such failure to report such a claim would not be reasonably likely to have a Material Adverse Effect on ITAC.
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3.19 Information Supplied. None of the information supplied or to be supplied by ITAC expressly for inclusion or incorporation by reference: (a) in any Current Report on Form 8-K, and any exhibits thereto or any other report, form, registration or other filing made with any Governmental Authority (including the SEC) or stock exchange (including Nasdaq) with respect to the transactions contemplated by this Agreement or any Ancillary Documents or (b) in the Registration Statement or in any amendment to any of documents identified in (a) and (b), will, when filed, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. None of the information supplied or to be supplied by ITAC expressly for inclusion or incorporation by reference in any of the Signing Press Release, the Signing Filing, the Closing Filing and the Closing Press Release will, when filed or distributed, as applicable, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. Notwithstanding the foregoing, ITAC makes no representation, warranty or covenant with respect to any information supplied by or on behalf of the Company or any of its Affiliates.
3.20 Independent Investigation. ITAC has conducted its own independent investigation, review and analysis of the business, results of operations, condition (financial or otherwise) or assets of the Company and Merger Sub and acknowledges that it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and data of the Target Companies and Merger Sub for such purpose. ITAC acknowledges and agrees that: (a) in making its decision to enter into this Agreement and to consummate the transactions contemplated hereby, it has relied solely upon its own investigation and the express representations and warranties of the Company and Merger Sub set forth in this Agreement (including the related portions of the Company Disclosure Schedules) and in any certificate delivered to ITAC pursuant hereto, and the information provided by or on behalf of the Company for the Registration Statement; and (b) none of the Company, Merger Sub or their respective Representatives have made any representation or warranty as to the Target Companies or Merger Sub or this Agreement or the transactions contemplated hereby, except as expressly set forth in this Agreement (including the related portions of the Company Disclosure Schedules) or in any certificate delivered to ITAC pursuant hereto, or with respect to the information provided by or on behalf of the Company for the Registration Statement.
3.21 Trust Account. As of the date of this Agreement, ITAC has at least $75,750,000 (the “Trust Amount”) in the Trust Account, with such funds invested in United States Government securities or money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act of 1940 and held in trust by the Trustee pursuant to the Trust Agreement. The Trust Agreement is in full force and effect and is a legal, valid and binding obligation of ITAC and the Trustee, enforceable in accordance with its terms subject to the Enforceability Exceptions. The Trust Agreement has not been terminated, repudiated, rescinded, amended, supplemented or modified, in any respect, and no such termination, repudiation, rescission, amendment, supplement or modification is contemplated. There are no side letters and there are no agreements, Contracts, with the Trustee or any other Person that would (i) cause the description of the Trust Agreement in the SEC Reports to be inaccurate in any material respect or (ii) entitle any Person (other than holders of Class A Ordinary Shares who from and after the date hereof shall have exercised their redemption rights) to any portion of the proceeds in the Trust Account. Prior to the Closing, none of the funds held in the Trust Account may be released except (A) to pay any Tax obligation, including franchise Tax, owed by ITAC as a result of assets of ITAC or interest or other income earned on the Trust Account and up to $50,000 to pay dissolution expenses, and (B) to redeem Class A Ordinary Shares pursuant to the redemption rights. There are no Actions pending or, to the Knowledge of ITAC, threatened with respect to the Trust Account.
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3.22 Company Representations. ITAC, on behalf of itself and its Affiliates, acknowledges and agrees that neither the Company nor any of its Affiliates has made any warranty, express or implied to ITAC, as to the prospects of the business of the Company and its Subsidiaries or its profitability, or with respect to any forecasts, projections or business plans prepared by or on behalf of ITAC or its Affiliates and delivered to ITAC for its review of the Company’s and its Subsidiaries’ business or the negotiation and execution of this Agreement. Except as otherwise expressly set forth in this Agreement, ITAC acknowledges that the Company will be furnished “AS IS, WHERE IS,” AND, SUBJECT TO THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ARTICLE IV, WITH ALL FAULTS AND WITHOUT ANY OTHER REPRESENTATION OR WARRANTY OF ANY NATURE WHATSOEVER, EXPRESS OR IMPLIED, ORAL OR WRITTEN, AND, IN PARTICULAR, WITHOUT ANY IMPLIED WARRANTY OR REPRESENTATION AS TO CONDITION, MERCHANTABILITY OR SUITABILITY FOR ANY PURPOSE.
3.23 No Other Representation. Except for the representations and warranties contained in this Article III, neither ITAC nor any other Person or entity on behalf of ITAC has made or makes any representation or warranty, whether express or implied, with respect to ITAC, its Affiliates or their respective businesses, affairs, assets, liabilities, financial condition, results of operations, future operating or financial results, estimates, projections, forecasts, plans or prospects (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, plans or prospects) or with respect to the accuracy or completeness of any other information provided or made available to the Company, its Affiliates or any of their Representatives by or on behalf of ITAC. Neither ITAC nor any other Person or entity on behalf of ITAC has made or makes any representation or warranty, whether express or implied, with respect to any projections, forecasts, estimates or budgets made available to the Company, its Affiliates or any of their representatives of future revenues, future results of operations (or any component thereof), future cash flows or future financial condition (or any component thereof) of any of the Purchaser or its Affiliates, whether or not included in any management presentation. ITAC, on behalf of itself and its Affiliates, acknowledges and agrees that, except for the representations and warranties contained in Article IV, neither the Company nor any other Person or entity on behalf of the Company has made or makes, and ITAC and its Affiliates have not relied upon, any representation or warranty, whether express or implied, with respect to the Company, the Target Companies, the business thereof, their Affiliates or their respective businesses, affairs, assets, Liabilities, financial condition, results of operations, future operating or financial results, estimates, projections, forecasts, plans or prospects (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, plans or prospects), whether or not included in any management presentation, or with respect to the accuracy or completeness of any information provided or made available to ITAC or any of its officer, directors, employees, agents, representatives, lender, Affiliates or any other Person acting on its behalf by or on behalf of the Company’s officers, directors, employees, agents, representatives, lenders or Affiliates.
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Article
IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth in the disclosure schedules delivered by the Company to ITAC on the date hereof (the “Company Disclosure Schedules”), the Section numbers of which are numbered to correspond to the Section numbers of this Agreement to which they refer, the Company hereby represents and warrants to ITAC, as of the date hereof and as of the Closing, as follows:
4.1 Organization and Standing. The Company is a company duly organized, validly existing under the Israeli Companies Law and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted. Each other Target Company is a corporation or other entity duly formed, validly existing and in good standing under the Laws of its jurisdiction of organization and has all requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being and as proposed to be conducted except as would materially and adversely impact the consolidated business and operations of the Company and the Target Companies. Each Target Company is duly qualified or licensed and in good standing in the jurisdiction in which it is incorporated or registered and in each other jurisdiction where it does business or operates to the extent that the character of the property owned, or leased or operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified or licensed or in good standing can be cured without material cost or expense. Schedule 0 lists each Target Company and all jurisdictions in which each Target Company is qualified to conduct business and all names other than its legal name under which each Target Company does business. The Company has provided to ITAC accurate and complete copies of the Organizational Documents of each Target Company, each as amended to date and as currently in effect. A correct and complete list of the directors or managers (as applicable) and officers of each Target Company is set forth on Schedule 4.1. Except as set forth in Schedule 4.1, no Person has any right to designate any director, officer, manager or general partner of any Target Company. The Company is not in violation of any provisions of, and no other Target Company is in violation of any material provision of, its Organizational Documents.
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4.2 Authorization; Binding Agreement. Each of the Company and Merger Sub has all requisite corporate power and authority to execute and deliver this Agreement and each Ancillary Document to which it is a party, to perform the Company’s obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and each Ancillary Document to which (a) the Company is a party and the consummation of the transactions contemplated hereby and thereby, have been duly and validly authorized by the board of directors of the Company in accordance with the Company’s Organizational Documents and the Israeli Companies Law, and (b) Merger Sub is a party and the consummation of the transactions contemplated hereby and thereby, have been duly and validly authorized by the board of directors of Merger Sub and by the Company as sole shareholder of Merger Sub in accordance with Merger Sub’s Organizational Documents, the Delaware Law, any other applicable Law and any Contract to which Merger Sub or the Company is a party or bound. No other corporate proceedings on the part of the Company or Merger Sub are necessary to authorize the execution and delivery of this Agreement and each Ancillary Document to which it is a party or to consummate the transactions contemplated hereby and thereby other than the approval of this Agreement and the Transaction by the Company’s shareholders as required by the Existing Articles and the Israeli Companies Law (the “Required Company Shareholder Approval”). Other than the Required Company Shareholder Approval, there is no shareholder of the Company or any Target Company whose Consent (other than as set forth in the Existing Articles) is required for the execution of this Agreement by the Company and the performance by the Company of its obligations under this Agreement and the Ancillary Documents. This Agreement has been, and each Ancillary Document to which the Company or Merger Sub is a party shall be when delivered, duly and validly executed and delivered by the Company or Merger Sub, as applicable, and assuming the due authorization, execution and delivery of this Agreement and any such Ancillary Document by the other parties hereto and thereto, constitutes, or when delivered shall constitute, the legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, subject to the Required Company Shareholder Approval and the Enforceability Exceptions. The Voting Agreements delivered by the Company include holders of Company Ordinary Shares and Company Preferred Shares representing at least the Required Company Shareholder Approval, and such Voting Agreements are in full force and effect subject to the Enforceability Exception.
4.3 Capitalization.
(a) Schedule 4.3(a) sets forth, as of the date hereof, the number of authorized, issued and outstanding shares of each class or series of share capital of the Company, and the conversion rights of each class or series of Preferred Shares, all as set forth in the Existing Articles. All of the outstanding shares and other equity interests of the Company have been duly authorized, are fully paid and non-assessable and not in violation of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the Israeli Companies Law, any other applicable Law, the Company’s Organizational Documents or any Contract to which the Company is a party or by which the Company or its securities are bound. The Company does not, directly or indirectly, hold any of its shares or other equity interests in treasury.
(b) No Company Ordinary Shares or Company Warrants are reserved for issuance to officers, directors, employees and consultants of the Company pursuant to any Benefit Plan except as set forth in Schedule 4.3(b). Except as set forth in Schedule 4.3(b) or with respect to the Recapitalization, there are no outstanding Company Convertible Securities, and there are no preemptive rights or rights of first refusal or first offer, nor are there any Contracts, commitments, arrangements or restrictions to which the Company is a party or bound relating to any equity securities of the Company, whether or not outstanding. There are no outstanding or authorized equity appreciation, phantom equity or similar rights with respect to the Company. The Company is not party to any voting trusts, proxies, shareholder agreements or any other agreements or understandings with respect to the voting of the Company’s equity interests. Except as set forth in the Company’s Organizational Documents or Schedule 4.3(b) or with respect to the Recapitalization, there are no outstanding contractual obligations of the Company to repurchase, redeem or otherwise acquire any of its equity interests or securities, nor has the Company granted any registration rights to any Person with respect to its equity securities. All of the issued and outstanding securities of the Company have been granted, offered, sold and issued in compliance with all applicable securities Laws. As a result of the consummation of the transactions contemplated by this Agreement, except as expressly contemplated by this Agreement including with regard to the Recapitalization, no equity interests of the Company are issuable and no rights in connection with any interests, warrants, rights, options or other securities of the Company accelerate or otherwise become triggered (whether as to vesting, exercisability, convertibility or otherwise).
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(c) Except as disclosed in the Company Financials or as set forth on Schedule 4.3(c), since December 31, 2019, the Company has not declared or paid any distribution or dividend in respect of its equity interests and has not repurchased, redeemed or otherwise acquired any equity interests of the Company, and the board of directors of the Company has not authorized any of the foregoing.
(d) No shareholder of the Company has any rights of appraisal with respect to the Recapitalization or the Merger, whether pursuant to the Existing Articles, the Israeli Companies Law or any agreement between the Company and such shareholder.
4.4 Subsidiaries.
(a) Merger Sub is authorized to issue 100 shares of common stock, par value $0.01 per shares, all of which are owned by the Company. Schedule 4.4(a) sets forth the name of each other direct or indirect Subsidiary of the Company, and with respect to each Subsidiary (a) its jurisdiction of organization, (b) its authorized shares or other equity interests (if applicable), and (c) the number of issued and outstanding shares or other equity interests and the record holders and beneficial owners thereof. All of the outstanding equity securities of each Subsidiary of the Company are duly authorized and validly issued, fully paid and non-assessable (if applicable), and were offered, sold and delivered in compliance with all applicable securities Laws, and owned by one or more of the Target Companies free and clear of all Liens (other than those, if any, imposed by such Subsidiary’s Organizational Documents). There are no Contracts to which the Company or any of its Affiliates is a party or bound with respect to the voting (including voting trusts or proxies) of the equity interests of any Subsidiary of the Company other than the Organizational Documents of any such Subsidiary. There are no outstanding or authorized options, warrants, rights, agreements, subscriptions, convertible securities or commitments to which any Subsidiary of the Company is a party or which are binding upon any Subsidiary of the Company providing for the issuance or redemption of any equity interests of any Subsidiary of the Company. There are no outstanding equity appreciation, phantom equity, profit participation or similar rights granted by any Subsidiary of the Company. No Subsidiary of the Company has any limitation, whether by Contract, Order or applicable Law, on its ability to make any distributions or dividends to its equity holders or repay any debt owed to another Target Company, except as provided in Schedule 4.4(a). Except for the equity interests of the Subsidiaries listed on Schedule 4.4(a) and as provided in Section 4.4(b), the Company does not own or have any rights to acquire, directly or indirectly, any equity interests of, or otherwise Control, any Person. Except as set forth in Schedule 4.4(a), the Company owns all of the outstanding equity securities of the Subsidiaries, free and clear of all Liens, either directly or indirectly through one or more other Subsidiaries.
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(b) No Target Company is a participant in any joint venture, partnership or similar arrangement and no Target Company owns any equity interests of any Person (other than the Company’s Subsidiaries) except as set forth in Schedule 4.4(b). There are no outstanding contractual obligations of a Target Company to provide funds to, or make any investment (in the form of a loan, guaranty, capital contribution or otherwise) in, any other Person. Schedule 4.4(b) sets forth with respect to each Person described in this Section 4.4(b), the name of the Person, the nature of the agreement, the amount invested, advanced or committed by any Target Company, the equity interest of the Company in such Person and any provisions which affect any change in such equity interest, the nature and the amount of the financial commitment of any Target Company, any obligations of any Target Company to any such Person and the rights of any Target Company with respect to the control, management, or rights of any such Person and any other material information relating to the agreement between the Company and any such Person.
4.5 Merger Sub. Since its formation, Merger Sub has not engaged in any business activities other than as contemplated by this Agreement, does not own directly or indirectly any ownership, equity, profits or voting interest in any Person and has no assets or Liabilities except those incurred in connection with this Agreement and the Ancillary Documents to which it is a party and the Transactions, and, other than this Agreement and the Ancillary Documents to which it is a party, Merger Sub is not party to or bound by any Contract.
4.6 Governmental Approvals. Except as otherwise described in Schedule 4.6, no Consent of or with any Governmental Authority on the part of any Target Company is required to be obtained or made in connection with the execution, delivery or performance by the Company or Merger Sub of this Agreement or any Ancillary Documents or the consummation by the Company or Merger Sub of the transactions contemplated hereby or thereby other than (a) such Consents expressly contemplated by this Agreement, (b) applicable requirements of and filings under the Israeli Securities Law, 1968, and the rules and regulations thereunder or any other similar Laws, (c) pursuant to Consents to be obtained pursuant to the Antitrust Laws expressly contemplated by this Agreement and (d) those Consents, the failure of which to obtain prior to the Closing would not individually or in the aggregate reasonably be expected to have a Material Adverse Effect on the Company or any Target Company or the ability of the Company or Merger Sub to perform its obligations under this Agreement or the Ancillary Documents to which it is a party.
4.7 Non-Contravention. Except as otherwise described in Schedule 4.7, the execution and delivery by the Company and Merger Sub (or any other Target Company, as applicable) of this Agreement and each Ancillary Document to which such Person is a party, and the consummation by any Target Company of the transactions contemplated hereby and thereby and compliance by such Person with any of the provisions hereof and thereof, will not (a) conflict with or violate any provision of any such Person’s Organizational Documents, (b) subject to obtaining the Consents from Governmental Authorities referred to in Section 4.6 hereof, the waiting periods referred to therein having expired, and any condition precedent to such Consent or waiver having been satisfied, conflict with or violate any Law, Order or Consent applicable to such Person or any of its material properties or assets, or (c) (i) violate, conflict with or result in a breach of, (ii) constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, (iii) result in the termination, withdrawal, suspension, cancellation or modification of, (iv) accelerate the performance required by such Person under, (v) result in a right of termination or acceleration under, (vi) give rise to any obligation to make payments or provide compensation under, (vii) result in the creation of any Lien upon any of the properties or assets of such Person under, (viii) give rise to any obligation to obtain any third party Consent or provide any notice to any Person or (ix) give any Person the right to declare a default, exercise any remedy, claim a rebate, chargeback, penalty or change in delivery schedule, accelerate the maturity or performance, cancel, terminate or modify any right, benefit, obligation or other term under, any of the terms, conditions or provisions of any Company Material Contract, except in cases of clauses (b) and (c), as would not individually or in the aggregate reasonably be expected to be have a Material Adverse Effect on the Company or Merger Sub.
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4.8 Financial Statements.
(a) As used herein, the term “Company Financials” means the consolidated audited financial statements of the Target Companies (including, in each case, any related notes thereto), consisting of the consolidated balance sheets of the Target Companies as of December 31, 2020 and December 31, 2019, and the related consolidated statements of loss and comprehensive loss, changes in shareholders’ equity and cash flows for the years then ended, each audited in accordance with PCAOB auditing standards by a PCAOB registered independent auditor. True and correct copies of the Company Financials have been provided to ITAC; provided, however, that the Company Financials delivered prior to the execution of this Agreement represent draft financials (the “Draft Financials”). The Company Financials, including for the avoidance of doubt, the Draft Financials and the Audited Financials, (i) accurately reflect the books and records of the Target Companies as of the times and for the periods referred to therein, (ii) were prepared in accordance with Accounting Standards, consistently applied throughout and among the periods involved (except that the unaudited statements exclude the footnote disclosures and other presentation items required for GAAP and exclude year-end adjustments which will not be material in amount), (iii) comply with all applicable accounting requirements under the Securities Act and the rules and regulations of the SEC thereunder, and (iv) fairly present in all material respects the consolidated financial position of the Target Companies as of the respective balance sheet dates and the consolidated results of the operations and cash flows of the Target Companies for the periods indicated in accordance with GAAP. No Target Company has ever been subject to the reporting requirements of Sections 13(a) and 15(d) of the Exchange Act. The Company shall use commercially reasonable efforts to deliver the audited Company Financials (the “Audited Financials”) for the year ended December 31, 2020 not later than twenty-one (21) days from the date of this Agreement or such earlier date as may be necessary to include the Audited Financials in the Registration Statement, as hereinafter defined. The Audited Financials shall not reflect any material adverse change in Company’s consolidated net loss or comprehensive loss, working capital, shareholders’ equity or cash flows from operations from that shown on the Draft Financials.
(b) Each Target Company maintains books and records reflecting its assets and Liabilities in all material respects and maintains proper and adequate internal accounting controls that provide reasonable assurance that (i) such Target Company does not maintain any off-the-book accounts and that such Target Company’s assets are used in accordance with such Target Company’s management directives, (ii) material transactions of the Target Companies are executed with management’s authorization, (iii) transactions are recorded as necessary to permit preparation of the financial statements of such Target Company in accordance with applicable Accounting Standards, (iv) the reporting of such Target Company’s assets is compared with existing assets at the intervals required by applicable Accounting Standards and verified in accordance therewith for actual amounts, and (v) accounts, notes and other receivables and inventory are recorded accurately, and proper and adequate procedures are implemented to effect the collection of accounts, notes and other receivables on a current and timely basis, in each instance, in accordance with applicable Accounting Standards. All of the financial books and records of the Target Companies are complete and accurate in all material respects and have been maintained in the ordinary course consistent with past practice and in accordance with applicable Laws. No Target Company has been subject to or involved in any material fraud that involves management or other employees who have a significant role in the internal controls over financial reporting of any Target Company. To the Knowledge of the Company, since January 1, 2019, no Target Company or its Representatives has received any written complaint, allegation, assertion or claim regarding the accounting or auditing practices, procedures, methodologies or methods of any Target Company or its internal accounting controls, including any material written complaint, allegation, assertion or claim that any Target Company has engaged in questionable accounting or auditing practices.
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(c) The Target Companies do not have any Indebtedness other than the Indebtedness set forth on Schedule 4.8(c). Except as disclosed on Schedule 4.8(c), no Indebtedness of any Target Company contains any restriction upon (i) the prepayment of any of such Indebtedness, (ii) the incurrence of Indebtedness by any Target Company, or (iii) the ability of the Target Companies to grant any Lien on their respective properties or assets.
(d) Except as set forth on Schedule 4.8(d), no Target Company is subject to any Liabilities or obligations (whether or not required to be reflected on a balance sheet prepared in accordance with GAAP), including any off-balance sheet obligations or any “variable interest entities” (within the meaning Accounting Standards Codification 810), except for those that are either (i) reflected or reserved on or provided for in accordance with applicable Accounting Standards in the consolidated balance sheet of the Company and its Subsidiaries as of December 31, 2020 contained in the Company Financials or (ii) not material or that were incurred after December 31, 2020 in the ordinary course of business consistent with past practice (other than Liabilities for breach of any Contract or violation of any Law).
(e) All accounts receivables, whether or not accrued, and whether or not billed, of the Target Companies (the “Accounts Receivable”) arose from sales actually made or services actually performed in the ordinary course of business and represent valid obligations to a Target Company arising from its business. None of the Accounts Receivable are subject to any material right of recourse, defense, deduction, return of goods, counterclaim, offset, or set off on the part of the obligor in excess of any amounts reserved therefore on the Company Financials. All of the Accounts Receivable are, to the Knowledge of the Company, fully collectible according to their terms in amounts not less than the aggregate amounts thereof carried on the books of the Target Companies (net of reserves) within ninety (90) days.
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4.9 Absence of Certain Changes. Except as set forth on Schedule 4.9 or for actions expressly contemplated by this Agreement, and except for COVID-19 Actions which in the reasonable judgment of the Company are required to be taken or implemented by the Company or any of the other Target Companies since December 31, 2020, each Target Company has (a) conducted its business only in the ordinary course of business consistent with past practice, and (b) not been subject to a Material Adverse Effect.
4.10 Compliance with Laws. Except as set forth on Schedule 4.10, no Target Company is in material conflict or material non-compliance with, or in material default or violation of, nor has any Target Company received, since January 1, 2019, any written or, to the Knowledge of the Company, oral notice of any material conflict or non-compliance with, or material default or violation of, any applicable Laws by which it or any of its properties, assets, employees, business or operations are or were bound or affected.
4.11 Company Permits. Each Target Company holds all Permits necessary to lawfully conduct in all material respects its business as presently conducted and as currently contemplated to be conducted, and to own, lease and operate its assets and properties (collectively, the “Company Permits”). The Company has made available to ITAC true, correct and complete copies of all material Company Permits, all of which material Company Permits are listed on Schedule 4.11. To the Knowledge of the Company, there is no employee of a Target Company who is required to be licensed by a Governmental Authority in order for the Target Company to conduct is business in the normal course. All of the Company Permits are in full force and effect, and no suspension or cancellation of any of the Company Permits is pending or, to the Company’s Knowledge, threatened except where the failure thereof will not have a Material Adverse Effect. No Target Company is in violation in any material respect of the terms of any Company Permit, and no Target Company has received any written or, to the Knowledge of the Company, oral notice of any Actions relating to the revocation or modification of any material Company Permit.
4.12 Litigation. Except as described on Schedule 4.12, there is no (a) Action of any nature currently pending or, to the Company’s Knowledge, threatened, nor, to the Company’s Knowledge, is there any basis for any Action; or (b) Order now pending or outstanding or that was rendered by a Governmental Authority in the past three (3) years, in either case of (a) or (b) by or against any Target Company, its current or former directors, officers or equity holders (provided, that any litigation involving the directors, officers or equity holders of a Target Company must be related to the Target Company’s business, equity securities or assets), its business, equity securities or assets. The items listed on Schedule 4.12, if finally determined adverse to the Target Companies, will not have, either individually or in the aggregate, a Material Adverse Effect upon any Target Company. In the past three (3) years, to the Knowledge of the Company, none of the current officers or directors of any Target Company have been charged with, indicted for, arrested for, or convicted of any felony or any crime involving fraud.
4.13 Material Contracts.
(a) Schedule 4.13(a) sets forth a true, correct and complete list of, and the Company has made available to ITAC, true, correct and complete copies of, each Contract to which any Target Company is a party or by which any Target Company, or any of its properties or assets are bound or affected (each Contract required to be set forth on Schedule 4.13(a) a “Company Material Contract”) that:
(i) contains covenants that limit in any material manner the ability of any Target Company (A) to compete in any line of business or with any Person or in any geographic area or to sell, or provide any service or product or solicit any Person, including any non-competition covenants, employee and customer non-solicit covenants, exclusivity restrictions, rights of first refusal or most-favored pricing clauses or (B) to purchase or acquire an interest in any other Person;
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(ii) involves any joint venture, profit-sharing, partnership, limited liability company, strategic relationship or other similar agreement or arrangement relating to the formation, creation, operation, management or control of any partnership or joint venture or strategic relationship;
(iii) involves any agreement relating to the supply of product to, the purchase of product for, or the performance of services by or to any Target Company, in each instance, which are material to the consolidated business and operations of the Target Companies;
(iv) involves any exchange traded, over the counter or other swap, cap, floor, collar, futures contract, forward contract, option or other derivative financial instrument or Contract, based on any commodity, security, instrument, asset, rate or index of any kind or nature whatsoever, whether tangible or intangible, including currencies, interest rates, foreign currency and indices;
(v) evidences Indebtedness (whether incurred, assumed, guaranteed or secured by any asset) of any Target Company having an outstanding principal amount in excess of $500,000;
(vi) involves the acquisition or disposition, directly or indirectly (by merger or otherwise), of assets with an aggregate value in excess of $500,000 (other than in the ordinary course of business consistent with past practice) or shares or other equity interests of any Target Company or another Person;
(vii) relates to any merger, consolidation or other business combination with any other Person or the acquisition or disposition of any other entity or its business or material assets or the sale of any Target Company, its business or material assets;
(viii) by its terms, individually or with all related Contracts, calls for aggregate payments or receipts by the Target Companies under such Contract or Contracts of at least $500,000 per year or $1,000,000 in the aggregate;
(ix) is with any Top Customer or Top Vendor;
(x) obligates the Target Companies to provide continuing indemnification or a guarantee of obligations of a third party after the date hereof in excess of $500,000;
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(xi) is between any Target Company and any directors, officers or employees of a Target Company (other than at-will employment arrangements with employees entered into in the ordinary course of business consistent with past practice), including all non-competition, severance and indemnification agreements, or any Related Person;
(xii) obligates the Target Companies to make any capital commitment or expenditure in excess of $500,000 (including pursuant to any joint venture, limited partnership or a strategic relationship agreement);
(xiii) relates to a material settlement entered into within three (3) years prior to the date of this Agreement under which any Target Company has outstanding obligations (other than customary confidentiality obligations);
(xiv) provides another Person (other than another Target Company or any manager, director or officer of any Target Company) with a power of attorney; or
(xv) relates to the development, ownership, licensing or use of any material Intellectual Property by, to or from any Target Company, other than Off-the-Shelf Software.
(b) Except as disclosed in Schedule 4.13(b), with respect to each Company Material Contract: (i) such Company Material Contract is valid and binding and enforceable in all material respects against the Target Company party thereto and, to the Knowledge of the Company, each other party thereto, and is in full force and effect (except, in each case, as such enforcement may be limited by the Enforceability Exceptions); (ii) the consummation of the transactions contemplated by this Agreement will not affect the validity or enforceability of any Company Material Contract; (iii) no Target Company is in breach or default in any material respect, and, to the Knowledge of the Company, no event has occurred that with the passage of time or giving of notice or both would constitute a material breach or default by any Target Company, or permit termination or acceleration by the other party thereto, under such Company Material Contract; (iv) to the Knowledge of the Company, no other party to such Company Material Contract is in breach or default in any material respect, and no event has occurred that with the passage of time or giving of notice or both would constitute such a material breach or default by such other party, or permit termination or acceleration by any Target Company, under such Company Material Contract; (v) no Target Company has received written, or, to the Knowledge of the Company, oral notice of an intention by any party to any such Company Material Contract to terminate such Company Material Contract or amend the terms thereof, other than modifications in the ordinary course of business that do not adversely affect any Target Company in any material respect; and (vi) no Target Company has waived any material rights under any such Company Material Contract.
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4.14 Intellectual Property.
(a) Schedule 4.14(a)(i) sets forth: (i) all Patents and pending Patent applications, Trademarks and service mark registrations and pending applications, Copyright registrations and pending applications and registered Internet Assets in which a Target Company is the owner, applicant or assignee (“Company Registered IPV”), specifying as to each item, as applicable: (A) the nature of the item, including the title, (B) the owner of the item, (C) the jurisdictions in which the item is issued or registered or in which an application for issuance or registration is pending, and (D) the issuance, registration or application numbers and dates; and (ii) all material unregistered Software owned or purported to be owned by a Target Company. Schedule 4.14(a)(ii) sets forth all material Intellectual Property licenses, sublicenses and other agreements or permissions (“Company IP Licenses”) (other than “shrink wrap,” “click wrap,” and “off the shelf” software agreements and other agreements for Intellectual Property commercially available on reasonable terms to the public generally with license, maintenance, support and other fees of less than $100,000 per year (collectively, “Off-the-Shelf Software”), under which a Target Company is a licensee. Each Target Company owns, free and clear of all Liens (other than Permitted Liens), has valid and enforceable rights in, and has the unrestricted right to use, sell, license, transfer or assign, all Intellectual Property currently used, licensed or held for use by such Target Company, and previously used or licensed by such Target Company, except for the Intellectual Property that is the subject of the Company IP Licenses or that such Target Company otherwise has the right to use.
(b) Each Target Company has a valid and enforceable license to use all Intellectual Property that is the subject of the Company IP Licenses applicable to such Target Company. The Company IP Licenses include all of the licenses, sublicenses and other agreements or permissions reasonably necessary to operate the Target Companies as presently conducted. Each Target Company has performed all obligations imposed on it in the Company IP Licenses, has made all payments required to date, and such Target Company is not, nor, to the Knowledge of the Company, is any other party thereto, in material breach or default thereunder, nor has any material event occurred that with notice or lapse of time or both would constitute a material default thereunder. All registrations for Copyrights, Patents, Trademarks and Internet Assets that are owned by or exclusively licensed to any Target Company are, to the Knowledge of the Company, valid and in force with all applicable maintenance fees paid, and all applications to register any Copyrights, Patents and Trademarks are pending and in good standing, and where applicable, each Target Company has disclosed to the applicable government office or agency all material prior art known by such Target Company in connection with Patents and Patent Applications.
(c) Schedule 4.14(c) sets forth all material licenses, sublicenses and other agreements or permissions under which a Target Company is the licensor, other than agreements entered into with customers of a Target Company in the ordinary course of business (each, an “Outbound IP License”), and for each such Outbound IP License, describes (i) the applicable Intellectual Property licensed, (ii) the licensee under such Outbound IP License, and (iii) any royalties, license fees or other compensation due to a Target Company, if any. Each Target Company has performed in all material respects all obligations imposed on it in the Outbound IP Licenses, and such Target Company is not, nor, to the Knowledge of the Company, is any other party thereto, in breach or default thereunder, nor has any event occurred that with notice or lapse of time or both would constitute a default thereunder.
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(d) No Action is pending or, to the Company’s Knowledge, threatened against a Target Company that challenges the validity, enforceability, ownership, or right to use, sell, license or sublicense any Intellectual Property currently owned by or licensed to the Target Companies. No Target Company has received any written notice or claim asserting that any infringement, misappropriation, violation, dilution or unauthorized use of the Intellectual Property of any other Person is or may be occurring or has or may have occurred, as a consequence of the business activities of any Target Company. There are no Orders to which any Target Company is a party that (i) restrict the rights of a Target Company to use, transfer, license or enforce any Intellectual Property owned by a Target Company, or (ii) other than the Outbound IP Licenses, grants any third Person any right with respect to any Intellectual Property owned by a Target Company. To the Knowledge of the Company, no Target Company is currently infringing, or has, in the past, infringed, misappropriated or violated any Intellectual Property of any other Person in any material respect in connection with the ownership, use or license of any Intellectual Property owned or purported to be owned by a Target Company or, to the Knowledge of the Company, otherwise in connection with the conduct of the respective businesses of the Target Companies. To the Company’s Knowledge, no third party is infringing upon, misappropriating or otherwise violating any Intellectual Property owned by any Target Company (“Company IP”) in any material respect.
(e) All Persons including each Target Company’s officers, directors, employees, consultants, advisors and independent contractors who independently or jointly contributed to or otherwise participated in the authorship, invention, creation, improvement, modification or development of any material Company IP (each such person, a “Creator”) have (i) agreed to maintain the confidentiality of the trade secrets of the applicable Target Company and (ii) assigned to such Target Company by way of present assignment of exclusive ownership of all Intellectual Property Rights authored, invented, created, improved, modified, or developed by such Person on behalf of a Target Company in the course of such Creator’s employment or other engagement with such Target Company. No current or former officers, employees or independent contractors of a Target Company have claimed any ownership interest in any Intellectual Property owned by a Target Company. To the Knowledge of the Company, there has been no violation of a Target Company’s policies or practices related to protection of Company IP or any confidentiality or nondisclosure Contract relating to the Intellectual Property owned by a Target Company. Each Target Company has taken reasonable security measures in order to protect the secrecy, confidentiality and value of the material Company IP. There are no current or, to the Company’s knowledge, threatened, claims from any Creator for compensation or remuneration for inventions invented, copyright works created or any similar claim, including under Israeli Patents Law, 1967.
(f) Except as set forth in Schedule 4.14(f), no facilities of a university, college, other educational institution or research center was used in the development of any material Intellectual Property owned or, to the Knowledge of the Company, licensed by the Company. Except as set forth in Schedule 4.14(f), to the Knowledge of the Company, no employee, consultant or independent contractor of the Company who was involved in, or who contributed to, the creation or development of any Company Owned Intellectual Property Rights, was under restrictions resulting from his/her relations with any government, university, college or other educational institution or research center that would result in any government, university, college or other educational institution or research center having an ownership interest in any Company Owned Intellectual Property Rights, nor has any such person created or developed any Company Owned Intellectual Property Rights with any Governmental Grant.
(g) The consummation of any of the transactions contemplated by this Agreement will not result in the material breach, material modification, cancellation, termination, suspension of, or acceleration of any payments with respect to, or release of source code because of (i) any Contract providing for the license or other use of Intellectual Property owned by a Target Company, or (ii) any Company IP License.
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4.15 Privacy.
(a) Each Target Company is in compliance in all material respects with all applicable Laws and Contract requirements relating to privacy, personal data protection, and the collection, processing and use of personal information and its own privacy policies and guidelines (the “Data Security Requirements”). The Transactions contemplated by this Agreement will not result in any material liabilities in connection with any Data Security Requirements.
(b) To the Knowledge of the Company, (i) no Person has obtained unauthorized access to third party information and Personal Information in the possession of any Target Company, nor has there been any other material compromise of the security, confidentiality or integrity of such information or data, which required disclosure or notification under applicable Data Security Requirements, and (ii) no written complaint relating to an improper use or disclosure of, or a breach in the security of, any such Personal Information has been received by a Target Company.
(c) Since December 31, 2018, each Target Company has taken commercially reasonable steps to protect and maintain the confidential nature of the Personal Information provided to such Target Company by any Person and secure any such Personal Information from loss, theft, unauthorized access, use, modification, disclosure or other misuse.
(d) None of the Target Companies has received any notice of any claims, investigations (including investigations by a Governmental Authority), or alleged violations of Laws with respect to Personal Information possessed by the Target Companies.
4.16 Taxes and Returns. Except as set forth on Schedule 4.15:
(a) Each Target Company has or will have timely filed, or caused to be timely filed, all Tax Returns required to be filed by it (taking into account all available extensions), which Tax Returns are true, accurate, correct and complete in all material respects, and has paid, collected or withheld, or caused to be paid, collected or withheld, all material Taxes required to be paid, collected or withheld, other than such Taxes for which adequate reserves in the Company Financials have been established. Each Target Company has complied in all material respects with all applicable Laws relating to Tax. There are no audits, examinations, investigations or other proceedings pending against any Target Company in respect of any Tax, and no Target Company has been notified in writing of any proposed Tax claims or assessments against such Target Company (other than, in each case, claims or assessments for which adequate reserves in Company Financials have been established in accordance with GAAP or are immaterial in amount). There are no Liens with respect to any Taxes upon any of Company’s assets, other than Permitted Liens. No Target Company has outstanding waivers or extensions of any applicable statute of limitations to assess any material amount of Taxes. There are no outstanding requests by any Target Company for any extension of time within which to file any Tax Return or within which to pay any Taxes shown to be due on any Tax Return.
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(b) No Target Company has any Liability for the Taxes of another Person (other than another Target Company) (i) under any applicable Tax Law, (ii) as a transferee or successor, or (iii) by contract, indemnity or otherwise (excluding commercial agreements entered into in the ordinary course of business, the primary purpose of which is not the sharing of Taxes).
(c) Each Target Company has collected or withheld all Taxes currently required to be collected or withheld by it, and all such Taxes have been paid to the appropriate Government Authority, except where the failure to collect, withhold or pay will not have a Material Adverse Effect.
(d) No Target Company has been a real property corporation (Igud Mekarke’in) within the meaning of such term under Section 1 of the Israeli Land Taxation Law (Appreciation and Acquisition), 5723-1963.
(e) Any Target Company required to be registered for purposes of Israeli value added tax is duly registered and has complied with all requirements concerning Israeli value added Tax (“VAT”). Each Target Company (i) has not made any exempt transactions (as defined in the Israel Value Added Tax Law of 1975) and there are no circumstances by reason of which there might not be an entitlement to full credit of all VAT chargeable or paid on inputs, supplies, and other transactions and imports made by it, (ii) if and to the extent applicable, has collected and timely remitted to the relevant taxing authority all output VAT which it is required to collect and remit, to the extent required under any applicable Law and (iii) has not received a refund for input VAT for which it is not entitled under any applicable Law. No non-Israeli Target Company is required to register in Israel for Israeli VAT purposes. Each Target Company required to register for VAT under the laws of any country other than Israel has so registered and has collected and paid over to the taxing authority all VAT required to be collected and paid over.
(f) No Target Company is benefiting (or has benefited) from any grants, exemption, tax holiday, reduced tax rates or accelerated depreciation under the Israeli Capital Investment Encouragement Law – 1959, including but not limited to Preferred Technological Enterprise, Preferred Enterprise, Benefitted Enterprise and Approved Enterprise Status.
(g) No Target Company has performed or was part of any action or transaction that is classified as a “reportable transaction” under Section 131(g) of the Israeli Income Tax Ordinance New Version, 1961, as amended, and the rules and regulations promulgated thereunder (the “Ordinance”), a “reportable opinion” under Sections 131D of the Ordinance, or a “reportable position” under Section 131E of the Ordinance or any similar provision under any other local or foreign Tax Law, and including with respect to VAT.
(h) Each Foreign Plan that is intended to qualify as a capital gains route plan under Section 102 of the Ordinance has received a favorable determination or approval letter from the Israel Tax Authority (“ITA”) or is otherwise deemed approved by passage of time without objection by the ITA.
(i) No Target Company is subject to any restrictions or limitations pursuant to Part E2 of the Ordinance or pursuant to any Tax ruling made with reference to the provisions of such Part E2 or otherwise.
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(j) Each Target Company is in compliance in all material respects with all applicable transfer pricing laws and regulations, and the prices for any property or services provided by or to any Target Company are arm’s length prices for purposes of the applicable laws, including Treasury Regulations promulgated under Section 482 of the Code and Section 85A to the Ordinance and the Income Tax Regulations (Determination of Market Terms) 2006 and including to the extent required, the execution and maintenance of contemporaneous documentation substantiating the transfer pricing practices and methodology of the Target Companies.
(k) Each Target Company is Tax resident only in its jurisdiction of formation.
(l) No Target Company has a permanent establishment (within the meaning of an applicable Tax treaty) or otherwise has an office or fixed place of business in a country other than the country in which it is organized.
(m) No Target Company organized or formed under the laws of a jurisdiction outside of the United States (i) is a “surrogate foreign corporation” or “expatriated entity” within the meaning of Section 7874 of the Code (or any corresponding or similar provision of state, local or non-U.S. Tax Law) or is treated as a U.S. corporation for U.S. federal Tax purposes by reason of the application of Sections 269B or 7874(b) of the Code (or any corresponding or similar provision of state, local or non-U.S. Tax Law) or (ii) was created or organized in the United States such that such entity would be taxable in the United States as a domestic entity pursuant to the dual charter provision of Treasury Regulation Section 301.7701-5(a) (or any corresponding or similar provision of state, local or non-U.S. Tax Law).
(n) No Target Company will be required to include any item of income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any (i) change in method of accounting for a taxable period ending on or prior to the Closing Date; (ii) installment sale made prior to the Closing Date; (iii) prepaid amount received on or prior to the Closing Date; or (iv) use of an improper method of accounting for a taxable period on or prior to the Closing Date. No Target Company has made an election pursuant to Section 965(h) of the Code.
4.17 Real Property. No Target Company owns or has ever owned any real property or any interest in real property (other than the leasehold interests in the Company Real Property Leases). Schedule 4.17 contains a complete and accurate list of all premises currently leased or subleased by a Target Company for the operation of the business of a Target Company, and of all current leases, lease guarantees, agreements and documents related thereto, including all amendments, terminations and modifications thereof or waivers thereto (collectively, the “Company Real Property Leases”). The Company has provided to ITAC a true and complete copy of each of the Company Real Property Leases. The Company Real Property Leases are valid, binding and enforceable in accordance with their terms and are in full force and effect. To the Knowledge of the Company, no event has occurred which (whether with or without notice, lapse of time or both or the happening or occurrence of any other event) would constitute a default on the part of a Target Company or any other party under any of the Company Real Property Leases, and no Target Company has received notice of any such condition.
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4.18 Personal Property. Each item of Personal Property which is currently owned, used or leased by a Target Company with a book value or fair market value of greater than $100,000) is set forth on Schedule 4.18, along with, to the extent applicable, a list of lease agreements, lease guarantees, security agreements and other agreements related thereto, including all amendments, terminations and modifications thereof or waivers thereto (“Company Personal Property Leases”). Except as set forth in Schedule 4.18, all such items of Personal Property are in good operating condition and repair (reasonable wear and tear excepted consistent with the age of such items), and are suitable for their intended use in the business of the Target Companies. The operation of each Target Company’s business as it is now conducted or presently proposed to be conducted is not dependent upon the right to use the Personal Property of Persons other than a Target Company, except for such Personal Property that is owned, leased or licensed by, or otherwise contracted to, a Target Company. The Company has provided to ITAC a true and complete copy of each of the Company Personal Property Leases, and in the case of any oral Company Personal Property Lease, a written summary of the material terms of such Company Personal Property Lease. The Company Personal Property Leases are valid, binding and enforceable in accordance with their terms and are in full force and effect. To the Knowledge of the Company, no event has occurred which (whether with or without notice, lapse of time or both or the happening or occurrence of any other event) would constitute a default on the part of a Target Company or any other party under any of the Company Personal Property Leases, and no Target Company has received notice of any such condition.
4.19 Employee Matters.
(a) Except as set forth in Schedule 4.19(a) and except for extension orders applicable to all employees in Israel, no Target Company is a party to any collective bargaining agreement or other Contract covering any group of employees, labor organization or other representative of any of the employees of any Target Company and the Company has no Knowledge of any activities or proceedings of any labor union or other party to organize or represent such employees. There has not occurred or, to the Knowledge of the Company, been threatened any strike, slow-down, picketing, work-stoppage, or other similar labor activity with respect to any such employees. No current officer or key employee of a Target Company has provided such Target Company written notice of his or her plan to terminate his or her employment with any Target Company.
(b) Except as set forth in Schedule 4.19(b), each Target Company (i) is and has been in compliance in all material respects with all applicable Laws and the employment agreements listed in such Schedule 4.19(b) respecting employment and employment practices, terms and conditions of employment, health and safety and wages and hours, and other Laws relating to discrimination, disability, labor relations, hours of work, payment of wages and overtime wages, pay equity, immigration, workers compensation, working conditions, employee scheduling, occupational safety and health, family and medical leave, and employee terminations, and has not received written notice that there is any pending Action involving unfair labor practices against a Target Company, (ii) is not liable for any material past due arrears of wages or any material penalty for failure to comply with any of the foregoing, and (iii) is not liable for any material payment to any Governmental Authority with respect to unemployment compensation benefits, social security or other benefits or obligations for employees, independent contractors or consultants (other than routine payments to be made in the ordinary course of business and consistent with past practice). There are no Actions pending or, to the Knowledge of the Company, threatened against a Target Company brought by or on behalf of any applicant for employment, any current or former employee, any Person alleging to be a current or former employee, or any Governmental Authority, relating to any such Law, or alleging breach of any express or implied contract of employment, wrongful termination of employment, or alleging any other discriminatory, wrongful or tortious conduct in connection with the employment relationship.
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(c) Except as set forth in Schedule 4.19(c), each Target Company employee has entered into the Company’s standard form of employee non-disclosure, inventions and restrictive covenants agreement with a Target Company (whether pursuant to a separate agreement or incorporated as part of such employee’s overall employment agreement), a copy of which has been made available to ITAC by the Company.
(d) Except as set forth on Schedule 4.19(d), all of the independent contractors that are involved in the development of intellectual property of the Company are a party to a written Contract with a Target Company. Except as set forth on Schedule 4.19(d), each such independent contractor has entered into customary covenants regarding confidentiality and assignment of inventions and copyrights in such Person’s agreement with a Target Company, a copy of which has been provided to ITAC by the Company. For the purposes of applicable Law, all independent contractors who are currently, since the Company’s organization have been, engaged by a Target Company are bona fide independent contractors and not employees of a Target Company. Each independent contractor is terminable on fewer than thirty (30) days’ notice, without any obligation of any Target Company to pay severance or a termination fee.
4.20 Benefit Plans.
(a) Set forth on Schedule 4.20(a) is a true and complete list of each Foreign Plan of a Target Company (each, a “Company Benefit Plan”). No Target Company has ever maintained or contributed to (or had an obligation to contribute to) any Benefit Plan, whether or not subject to ERISA, which is not a Foreign Plan.
(b) With respect to each Company Benefit Plan which covers any current or former officer, director, consultant or employee (or beneficiary thereof) of a Target Company, the Company has made available to ITAC accurate and complete copies, if applicable, of: (i) all plan documents and related trust agreements or annuity Contracts (including any amendments, modifications or supplements thereto), and written descriptions of any Company Benefit Plans which are not in writing; (ii) the most recent annual and periodic accounting of plan assets; (iii) the most recent actuarial valuation; and (iv) all communications with any Governmental Authority concerning any matter that is still pending or for which a Target Company has any outstanding Liability or obligation.
(c) With respect to each Company Benefit Plan: (i) such Company Benefit Plan has been administered and enforced in all material respects in accordance with its terms and the requirements of all applicable Laws, and has been maintained, where required, in good standing with applicable regulatory authorities and Governmental Authorities; (ii) no breach of fiduciary duty has occurred; (iii) no Action is pending, or to the Company’s Knowledge, threatened (other than routine claims for benefits arising in the ordinary course of administration); (iv) all contributions, premiums and other payments (including any special contribution, interest or penalty) required to be made with respect to a Company Benefit Plan have been timely made; (v) all benefits accrued under any unfunded Company Benefit Plan have been paid, accrued, or otherwise adequately reserved in accordance with GAAP and are reflected on the Company Financials; and (vi) no Company Benefit Plan provides for retroactive increases in contributions, premiums or other payments in relation thereto. No Target Company has incurred any obligation in connection with the termination of, or withdrawal from, any Company Benefit Plan.
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(d) Except as set forth in Schedule 4.20(d), the consummation of the transactions contemplated by this Agreement and the Ancillary Documents will not: (i) entitle any individual to severance pay, unemployment compensation or other benefits or compensation under any Company Benefit Plan or under any applicable Law; or (ii) accelerate the time of payment or vesting, or increase the amount of any compensation due, or in respect of, any director, employee or independent contractor of a Target Company.
(e) Except to the extent required by applicable Law, no Target Company provides health or welfare benefits to any former or retired employee or is obligated to provide such benefits to any active employee following such employee’s retirement or other termination of employment or service.
4.21 Environmental Matters. Except as set forth in Schedule 4.21:
(a) Each Target Company is and, to the Company’s Knowledge, for the past two years, has been in compliance in all material respects with all applicable Environmental Laws, including obtaining, maintaining in good standing, and complying in all material respects with all Permits required for its business and operations by Environmental Laws (“Environmental Permits”), and no Action is pending or, to the Company’s Knowledge, threatened in writing to revoke, modify, or terminate any such Environmental Permit, and, to the Company’s Knowledge, no facts, circumstances, or conditions currently exist that would be reasonably expected to adversely affect such continued compliance with Environmental Permits.
(b) No Target Company is the subject of any outstanding Order or Contract with any Governmental Authority or other Person in respect of any (i) Environmental Laws, (ii) Remedial Action, or (iii) Release or threatened Release of a Hazardous Material, in each case, that has not been resolved or that would be reasonably expected to result in a material liability.
(c) No Action is pending, or to the Company’s Knowledge, threatened in writing against any Target Company or any assets of a Target Company alleging either or both that a Target Company may be in material violation of any Environmental Law or Environmental Permit or may have any material Liability under any Environmental Law.
(d) No Target Company has manufactured, treated, stored, disposed of, arranged for or permitted the disposal of, generated, handled or Released any Hazardous Material, in a manner that has given or would reasonably be expected to give rise to any material Liability or material obligation under applicable Environmental Laws.
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(e) The Company has provided to ITAC all final and non-privileged environmentally related site assessments, audits, studies, reports, analysis and results of investigations that have been performed in respect of the currently or previously owned, leased, or operated properties of any Target Company.
4.22 Transactions with Related Persons. Except as set forth on Schedule 4.22, no Target Company nor any of its Affiliates, nor any officer, director or 5% beneficial owner of the equity of a Target Company or any of its Affiliates, nor any immediate family member of any of the foregoing (whether directly or indirectly through an Affiliate of such Person) (each of the foregoing, a “Related Person”) is presently, or in the past three (3) years has been, a party to any transaction with a Target Company, including any Contract or other arrangement (a) providing for the furnishing of services by (other than as officers, directors or employees of the Target Company), (b) providing for the rental of real property or Personal Property or the license of Intellectual Property from, (c) granting or receiving any right or interest in any asset of a Target Company to or from, or (d) otherwise requiring payments to (other than for services or expenses as directors, officers or employees of the Target Company in the ordinary course of business consistent with past practice) any Related Person or any Person in which any Related Person has an interest as an owner, officer, manager, director, trustee or partner or in which any Related Person has any direct or indirect interest (other than the ownership of securities representing no more than two percent (2%) of the outstanding voting power or economic interest of a publicly traded company). Except as set forth on Schedule 4.22, no Target Company is party to any Contract with any Related Person, and no Related Person owns any real property or Personal Property, or right, tangible or intangible which is used in the business of any Target Company. The assets of the Target Companies do not include any receivable or other obligation from a Related Person, and the liabilities of the Target Companies do not include any payable or other obligation or commitment to any Related Person. Schedule 4.22 specifically identifies those Contracts, arrangements or commitments set forth on such Schedule 4.22 that cannot be terminated upon sixty (60) days’ notice by the Target Companies without cost or penalty. All material transactions since the incorporation of the Company between the Company and Related Persons that require approvals pursuant to Sections 268 to 284 of the Israeli Companies Law, or pursuant to the Existing Articles have been duly approved. To the Company’s Knowledge, no officer or director of any Target Company: (i) has any direct or indirect financial interest in, or is an officer, director, manager, employee or consultant of, (A) any competitor, supplier, licensor, distributor, lessor, independent contractor or customer of any Target Company or (B) any other entity in any material business arrangement or relationship with any Target Company; provided, however, that the ownership of securities listed on any national securities exchange representing less than 2% of the outstanding voting power of any Person shall not be deemed to be a “financial interest” in any such Person; (ii) has any interest in any property, asset or right used by the Target Company for the business; (iii) has outstanding any Indebtedness owed to any Target Company; or (iv) has received any funds from the Target Company since the date of the Latest Balance Sheet, except for employment-related compensation received in the ordinary course of business.
4.23 Insurance.
(a) Schedule 4.23(a) lists all insurance policies held by a Target Company relating to a Target Company or its business, properties, assets, directors, officers and employees, copies of which have been provided to ITAC. All premiums due and payable under all such insurance policies have been timely paid and the Target Companies are otherwise in material compliance with the terms of such insurance policies. To the Knowledge of the Company, each such insurance policy (i) is legal, valid, binding, enforceable and in full force and effect and (ii) will continue to be legal, valid, binding, enforceable, and in full force and effect on identical terms following the Closing. To the Knowledge of the Company, there is no threatened termination of, or material premium increase with respect to, any of such insurance policies. No Target Company has any self-insurance or co-insurance programs. In the past three (3) years, no Target Company has received any notice from, or on behalf of, any insurance carrier relating to or involving any adverse change or any change other than in the ordinary course of business, in the conditions of insurance, any refusal to issue an insurance policy or non-renewal of a policy.
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(b) Schedule 4.23(b) identifies each individual insurance claim in excess of $100,000 made by a Target Company in the past five (5) years. Each Target Company has reported to its insurers all claims and pending circumstances that would reasonably be expected to result in a claim, except where such failure to report such a claim would not be reasonably likely to be material to the Target Companies. To the Knowledge of the Company, no event has occurred, and no condition or circumstance exists, that would reasonably be expected to (with or without notice or lapse of time) give rise to or serve as a basis for the denial of any such insurance claim. No Target Company has made any claim against an insurance policy as to which the insurer is denying coverage.
4.24 Books and Records. All of the financial books and records of the Target Companies are complete and accurate in all material respects and have been maintained in the ordinary course consistent with past practice and in accordance with applicable Laws.
4.25 Top Customers and Vendors. Schedule 4.25 lists, by dollar volume received or paid, as applicable, for each of the years ended December 31, 2020 and 2019, the ten (10) largest customers of the Target Companies (the “Top Customers”) and the ten largest vendors of goods or services to the Target Companies (the “Top Vendors”). The relationships of each Target Company with such vendors and customers are good commercial working relationships and (i) no Top Vendor or Top Customer within the last twelve (12) months has cancelled or otherwise terminated or advised any Target Company or its plan or intention to terminate any material relationships of such Person with a Target Company, (ii) no Top Vendor or Top Customer has during the last twelve (12) months decreased materially its material relationships with a Target Company, (iii) no Target Company has within the past two (2) years been engaged in any material dispute with any Top Vendor or Top Customer.
4.26 Certain Business Practices.
(a) No Target Company, nor any of their respective Representatives acting on their behalf has (i) used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees, to foreign or domestic political parties or campaigns or violated any provision of the U.S. Foreign Corrupt Practices Act of 1977 or the equivalent Laws of Israel or of the country in which the Target Company is located or conducts business, (iii) otherwise made, offered, promised, authorized, paid or received any improper payment in violation of any Anti-Corruption Laws, or (iv) otherwise made any unlawful payment.
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(b) To the Knowledge of the Company, the operations of each Target Company are and have been conducted at all times in compliance in all material respects with money laundering statutes in all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Authority, and no Action involving a Target Company with respect to the any of the foregoing is pending.
(c) No Target Company or any of their respective directors or officers, or, to the Knowledge of the Company, any other Representative acting on behalf of a Target Company is currently identified on the specially designated nationals or other blocked person list or otherwise the subject of any U.S. sanctions administered by OFAC, and no Target Company has, directly or indirectly, used any funds, or loaned, contributed or otherwise made available such funds to any Subsidiary, joint venture partner or other Person, in connection with any sales or operations in any country or territory subject to OFAC sanctions or for the purpose of financing the activities of any Person the subject of, or otherwise in violation of, any U.S. sanctions administered by OFAC, in each case, in violation of applicable sanctions, since the Company’s organization. Since January 1, 2016, and except where the failure to be, or to have been, in compliance with such Laws has not been or would not, individually or in the aggregate, reasonably be expected to be material to the Company taken as a whole, neither the Target Companies nor, to the Company’s knowledge, any of their Representatives, or any other Persons acting for or on behalf of any of the foregoing, is or has been (i) a Person named on any Sanctions List and Export Control Laws-related list of designated Persons maintained by a Governmental Authority; (ii) located, organized or resident in a country or territory which is itself the subject of or target of any Sanctions and Export Control Laws; (iii) an entity 50-percent or more owned, directly or indirectly, by one or more Persons described in clause (i) or (ii); or (iv) otherwise engaging in dealings with or for the benefit of any Person described in clauses (i) through (iii).
(d) No Target Company has received any written notice that there is any investigation, allegation, request for information, or other inquiry by any Governmental Authority regarding an actual or possible violation of the Anti-Corruption Laws.
(e) No Target Company is, or is required to be, registered with the Israeli Ministry of Defense as a security exporter. Except as set forth in Schedule 4.26(e), the business of the Target Companies and Merger Sub does not involve the use or development of, or engagement in, encryption technology, or other technology whose development, commercialization, marketing or export is restricted under Israeli Law, and the business of the Target Companies does not require any Target Company to obtain a license from the Israeli Ministry of Economy and/or the Israeli Ministry of Defense or an authorized body thereof pursuant to Section 2(a) of the Israeli Control of Products and Services Declaration (Engagement in Encryption), 1974 or other legislation regulating the development, commercialization, marketing or export of technology or financing the activities of any Person the subject of, or otherwise in violation of, any U.S. sanctions administered by OFAC, in each case, in violation of applicable sanctions, in the last five (5) fiscal years.
4.27 Investment Company Act. No Target Company is an “investment company” or a Person directly or indirectly “controlled” by or acting on behalf of an “investment company,” or required to register as an “investment company,” in each case within the meaning of the Investment Company Act.
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4.28 PIPE Investment. The Company shall use its commercially reasonable efforts to satisfy the conditions of the PIPE Investors closing obligations contained in the Subscription Agreements, and consummate the transactions contemplated thereby including any Subscription Agreements entered into among the Company, ITAC and one or more PIPE Investors subsequent to the date of this Agreement. The Company shall not terminate, or amend or waive in any manner, any Subscription Agreement without ITAC’s prior written consent, other than (i) as expressly provided for by the terms of the Subscription Agreements or (ii) to reflect any permitted assignments or transfers of the Subscription Agreements by the applicable PIPE Investors pursuant to the Subscription Agreements.
4.29 Finders and Brokers. Except as set forth in Schedule 4.28, no broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission from ITAC, the Target Companies or any of their respective Affiliates in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of any Target Company.
4.30 Information Supplied. None of the information supplied or to be supplied by the Company or Merger Sub expressly for inclusion or incorporation by reference: (a) in any current report on Form 8-K, and any exhibits thereto or any other report, form, registration or other filing made with any Governmental Authority (including the SEC) or stock exchange (including Nasdaq) with respect to the transactions contemplated by this Agreement or any Ancillary Documents; (b) in the Registration Statement or in any amendment to any of documents identified in (a) and (b), will, when filed, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. None of the information supplied or to be supplied by the Company or Merger Sub expressly for inclusion or incorporation by reference in any of the Signing Press Release, the Signing Filing, the Closing Press Release and the Closing Filing will, when filed or distributed, as applicable, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. Notwithstanding the foregoing, the Company makes no representation, warranty or covenant with respect to any information supplied by or on behalf of ITAC or its Affiliates.
4.31 Independent Investigation. The Company acknowledges and agrees that: (a) in making its decision to enter into this Agreement and to consummate the transactions contemplated hereby, it has relied solely upon its own investigation and the express representations and warranties of the ITAC set forth in this Agreement (including the related portions of the ITAC Disclosure Schedules) and in any certificate delivered to the Company pursuant hereto, and the information provided by or on behalf of ITAC for the Registration Statement; and (b) none of the ITAC or its Representatives have made any representation or warranty as to the ITAC or this Agreement or the transactions contemplated hereby, except as expressly set forth in this Agreement (including the related portions of the ITAC Disclosure Schedules) or in any certificate delivered to the Company pursuant hereto, or with respect to the information provided by or on behalf of ITAC for the Registration Statement.
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4.32 Disclosure. No representations or warranties by the Company in this Agreement (as modified by the Company Disclosure Schedules) or the Ancillary Documents, (a) contains or will contain any untrue statement of a material fact, or (b) omits or will omit to state, when read in conjunction with all of the information contained in this Agreement, the Company Disclosure Schedules and the Ancillary Documents, any fact necessary to make the statements or facts contained therein not materially misleading.
4.33 No Other Representations or Warranties; No Reliance. Except for the representations and warranties contained in this Article IV, neither the Company nor any other Person or entity on behalf of the Company has made or makes any representation or warranty, whether express or implied, with respect to the Company, its Affiliates, its business or operations, or any of their respective businesses, affairs, assets, liabilities, financial condition, results of operations, future operating or financial results, estimates, projections, forecasts, plans or prospects (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, plans or prospects) or with respect to the accuracy or completeness of any other information provided or made available to ITAC, its Affiliates or any of its Representatives by or on behalf of the Company. Neither the Company nor any other Person on behalf of the Company has made or makes any representation or warranty, whether express or implied, to ITAC with respect to any projections, forecasts, estimates or budgets made available to ITAC, their Affiliates or any of their Representatives of future revenues, future results of operations (or any component thereof), future cash flows or future financial condition (or any component thereof) of any of the Company, its Affiliates or its business, whether or not included in any management presentation. The Company, on behalf of itself and its Affiliates, acknowledges and agrees that, except for the representations and warranties contained in Article III, neither ITAC nor any other Person or entity on behalf of ITAC has made or makes, and the Company and its Affiliates have not relied upon, any representation or warranty, whether express or implied, with respect to ITAC, its Affiliates or its respective businesses, affairs, assets, Liabilities, financial condition, results of operations, future operating or financial results, estimates, projections, forecasts, plans or prospects (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, plans or prospects) or with respect to the accuracy or completeness of any other information provided or made available to the Company or its Affiliates or any of their Representatives by or on behalf of ITAC.
Article
V
COVENANTS
5.1 Access and Information
(a) During the period from the date of this Agreement and continuing until the earlier of (i) the termination of this Agreement in accordance with Section 7.1, or (ii) the Closing (the “Interim Period”), subject to Section 5.13 and the Confidentiality Agreement, each of the Company and Merger Sub shall give, and shall cause its Representatives to give (subject, in each instance to (x) compliance with applicable Law, (y) the Company’s desire to maintain attorney-client privilege or other similar right at its sole discretion, and (z) the consent of or other conditions required by a Contract counterparty or service provider), ITAC and its Representatives, at reasonable times during normal business hours and upon reasonable intervals and notice, reasonable access to all offices and other facilities and to all employees, properties, Contracts, commitments, books and records, financial and operating data and other information (including Tax Returns, internal working papers, client files, client Contracts and director service agreements), of or pertaining to the Target Companies as ITAC or its Representatives may reasonably request regarding the Target Companies and their respective businesses, assets, Liabilities, financial condition, prospects, operations, management, employees and other aspects (including monthly unaudited financial statements) and cause each of the Representatives of the Company and Merger Sub to reasonably cooperate with ITAC and its Representatives in their investigation; provided, however, that ITAC and its Representatives shall conduct any such activities in such a manner as not to unreasonably interfere with the business or operations of the Target Companies or Merger Sub.
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(b) During the Interim Period, subject to Section 5.13 and the Confidentiality Agreement, ITAC shall give (subject, in each instance to (x) compliance with applicable Law, (y) ITAC’s desire to maintain attorney-client privilege or other similar right at its sole discretion, and (z) the consent of or other conditions required by a Contract counterparty or service provider), and shall cause its Representatives to give, the Company, Merger Sub and their respective Representatives, at reasonable times during normal business hours and upon reasonable intervals and notice, reasonable access to all offices and other facilities and to all employees, properties, Contracts, commitments, books and records, financial and operating data and other information (including Tax Returns, internal working papers, client files, client Contracts and director service agreements), of or pertaining to ITAC or its Subsidiaries, as the Company, Merger Sub or their respective Representatives may reasonably request regarding ITAC, its Subsidiaries and their respective businesses, assets, Liabilities, financial condition, prospects, operations, management, employees and other aspects (including unaudited quarterly financial statements, including a consolidated quarterly balance sheet and income statement, a copy of each material report, schedule and other document filed with or received by a Governmental Authority pursuant to the requirements of applicable securities Laws, and independent public accountants’ work papers (subject to the consent or any other conditions required by such accountants, if any)) and cause each of ITAC’s Representatives to reasonably cooperate with the Company and Merger Sub and their respective Representatives in their investigation; provided, however, that the Company and its Representatives shall conduct any such activities in such a manner as not to unreasonably interfere with the business or operations of ITAC or any of its Subsidiaries.
5.2 Conduct of Business of the Company and Merger Sub.
(a) Unless ITAC shall otherwise consent in writing (such consent not to be unreasonably withheld, conditioned or delayed), during the Interim Period, except (A) as expressly contemplated by this Agreement, including but not limited with regard to the Recapitalization, (B) as required by Law (including any COVID-19 Measures) or (C) as set forth on Schedule 5.2, the Company and Merger Sub shall, and shall cause their respective Subsidiaries to, use commercially reasonable efforts to (i) except for COVID-19 Actions which in the reasonable judgment of the Company are required to be taken or implemented by the Company or any of the other Target Companies during the Interim Period, conduct their respective businesses, in all material respects, in the ordinary course of business consistent with past practice, (ii) comply with all Laws applicable to the Target Companies and their respective businesses, assets and employees, and (iii) preserve intact, in all material respects, their respective business organizations.
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(b) Without limiting the generality of Section 5.2(a) and except (A) as contemplated by the terms of this Agreement, including but not limited with regard to the Recapitalization, (B) as required by Law (including any COVID-19 Measures) or (C) as set forth on Schedule 5.2, during the Interim Period, without the prior written consent of ITAC (such consent not to be unreasonably withheld, conditioned or delayed), except for COVID-19 Actions which in the reasonable judgment of the Company are required to be taken or implemented by the Company or any of the other Target Companies during the Interim Period, neither the Company nor Merger Sub shall, and each shall cause the Target Companies to not:
(i) amend, waive or otherwise change, in any respect, its Organizational Documents;
(ii) except in connection with the exercise, adjustment or replacement of options and warrants outstanding as of the date of this Agreement or the grant of options to employees in the ordinary course of business consistent with past practices, authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any of its equity securities or any options, warrants, commitments, subscriptions or other similar rights to acquire or sell any of its equity securities, or other securities, including any securities convertible into or exchangeable for any of its shares or other equity securities or securities of any class and any other equity-based awards, or engage in any hedging transaction with a third Person with respect to such securities;
(iii) except for with regards to the Recapitalization, split, combine, recapitalize or reclassify any of its shares or other equity interests or issue any other securities in respect thereof or pay or set aside any dividend or other distribution (whether in cash, equity or property or any combination thereof) in respect of its equity interests, or directly or indirectly redeem, purchase or otherwise acquire or offer to acquire any of its securities;
(iv) incur, create, assume, prepay or otherwise become liable for any Indebtedness (directly, contingently or otherwise) in excess of $500,000 individually or $1,000,000 in the aggregate, make a loan or advance to or investment in any third party (other than advancement of expenses to employees in the ordinary course of business consistent with past practice), or guarantee or endorse any Indebtedness, Liability or obligation of any Person in excess of $500,000 individually or $1,000,000 in the aggregate;
(v) increase the wages, salaries or compensation of its employees other than in the ordinary course of business, consistent with past practice, or materially increase other benefits of employees generally, or enter into, establish, materially amend or terminate any Company Benefit Plan with, for or in respect of any consultant, officer, manager director or employee engaged or employed as of the date of this Agreement, in each case, other than as required by applicable Law, pursuant to the terms of any Benefit Plans or in the ordinary course of business consistent with past practice;
(vi) other than with regard to the Recapitalization, make or rescind any material election relating to Taxes, settle any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes, file any amended Tax Return or claim for refund, or make any material change in its accounting or Tax policies or procedures, in each case except as required by applicable Law or in compliance with GAAP or otherwise, in each case if such action would be reasonably expected to materially increase the present or future Tax liability of ITAC or any of the Target Companies;
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(vii) terminate, waive or assign to Person that is not a Target Company any material right under, any Company Material Contract or enter into any Contract that would be a Company Material Contract, in any case outside of the ordinary course of business consistent with past practice;
(viii) fail to maintain its books, accounts and records in all material respects in the ordinary course of business consistent with past practice;
(ix) establish any Subsidiary or enter into any new line of business without the consent to ITAC;
(x) revalue any of its material assets or make any change in accounting methods, principles or practices, except to the extent required to comply with GAAP and after consulting with such Party’s outside auditors;
(xi) waive, release, assign, settle or compromise any material claim, action or proceeding (including any suit, action, claim, proceeding or investigation relating to this Agreement or the transactions contemplated hereby), other than waivers, releases, assignments, settlements or compromises that involve only the payment of monetary damages (and not the imposition of equitable relief on, or the admission of wrongdoing by, such Party or its Affiliates) not in excess of $500,000 (individually or in the aggregate), or otherwise pay, discharge or satisfy any Actions, Liabilities or obligations, unless such amount has been reserved in the Company Financials;
(xii) close or materially reduce its activities;
(xiii) acquire, including by merger, consolidation, acquisition of equity interests or assets, or any other form of business combination, any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount of assets outside the ordinary course of business consistent with past practice;
(xiv) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization;
(xv) sell, lease, license, transfer, exchange or swap, mortgage or otherwise pledge or encumber (including securitizations), or otherwise dispose of any material portion of its properties, assets or rights;
(xvi) enter into any agreement, understanding or arrangement with respect to the voting of equity securities of any Target Company;
(xvii) enter into, amend, waive or terminate (other than terminations in accordance with their terms) any transaction with any Related Person (other than compensation and benefits and advancement of expenses, in each case, provided in the ordinary course of business consistent with past practice); or
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(xviii) authorize or agree to do any of the foregoing actions.
5.3 Conduct of Business of ITAC.
(a) Unless the Company shall otherwise consent in writing (such consent not to be unreasonably withheld, conditioned or delayed), during the Interim Period, except as expressly contemplated by this Agreement or as set forth on Schedule 5.3, ITAC shall, and shall cause its Subsidiaries to use commercially reasonable efforts to, (i) conduct their respective businesses, in all material respects, in the ordinary course of business consistent with past practice, (ii) comply with all Laws applicable to ITAC and its Subsidiaries and their respective businesses, assets and employees, and (iii) preserve intact, in all material respects, their respective business organizations, to keep available the services of their respective managers, directors, officers, employees and consultants, and to preserve the possession, control and condition of their respective material assets, all as consistent with past practice.
(b) Without limiting the generality of Section 5.3(a) and except as contemplated by the terms of this Agreement (including as contemplated by the PIPE Investment) or as set forth on Schedule 5.3, during the Interim Period, without the prior written consent of the Company (such consent not to be unreasonably withheld, conditioned or delayed), ITAC shall not, and shall cause its Subsidiaries to not:
(i) amend, waive or otherwise change, in any respect, its Organizational Documents;
(ii) authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any of its equity securities or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any of its equity securities, or other securities, including any securities convertible into or exchangeable for any of its equity securities or other security interests of any class and any other equity-based awards, or engage in any hedging transaction with a third Person with respect to such securities;
(iii) split, combine, recapitalize or reclassify any of its shares or other equity interests or issue any other securities in respect thereof or pay or set aside any dividend or other distribution (whether in cash, equity or property or any combination thereof) in respect of its shares or other equity interests, or directly or indirectly redeem, purchase or otherwise acquire or offer to acquire any of its securities;
(iv) incur, create, assume, prepay or otherwise become liable for any Indebtedness (directly, contingently or otherwise) in excess of $100,000 (individually or in the aggregate), make a loan or advance to or investment in any third party, or guarantee or endorse any Indebtedness, Liability or obligation of any Person (provided, that this Section 5.3(b)(iv) shall not prevent ITAC from borrowing funds necessary to finance its ordinary course administrative costs and expenses and Transaction Expenses incurred in connection with the consummation of the Transactions, including the PIPE Investment;
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(v) make or rescind any material election relating to Taxes, settle any claim, action, suit, litigation, proceeding, arbitration, investigation, audit or controversy relating to Taxes, file any amended Tax Return or claim for refund, or make any material change in its accounting or Tax policies or procedures, in each case except as required by applicable Law or in compliance with GAAP;
(vi) amend, waive or otherwise change the Trust Agreement in any manner;
(vii) terminate, waive or assign any material right under any ITAC Material Contract or enter into any Contract that would be a ITAC Material Contract;
(viii) fail to maintain its books, accounts and records in all material respects in the ordinary course of business consistent with past practice;
(ix) establish any Subsidiary or enter into any new line of business;
(x) fail to use commercially reasonable efforts to keep in force insurance policies or replacement or revised policies providing insurance coverage with respect to its assets, operations and activities in such amount and scope of coverage as are currently in effect;
(xi) revalue any of its material assets or make any change in accounting methods, principles or practices, except to the extent required to comply with GAAP, and after consulting ITAC’s outside auditors;
(xii) waive, release, assign, settle or compromise any claim, action or proceeding (including any suit, action, claim, proceeding or investigation relating to this Agreement or the transactions contemplated hereby), other than waivers, releases, assignments, settlements or compromises that involve only the payment of monetary damages (and not the imposition of equitable relief on, or the admission of wrongdoing by, ITAC or its Subsidiary) not in excess of $200,000 (individually or in the aggregate), or otherwise pay, discharge or satisfy any Actions, Liabilities or obligations, unless such amount has been reserved in ITAC Financials;
(xiii) acquire, including by merger, consolidation, acquisition of equity interests or assets, or any other form of business combination, any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount of assets outside the ordinary course of business;
(xiv) make capital expenditures in excess of $100,000 individually for any project (or set of related projects) or $250,000 in the aggregate (excluding for the avoidance of doubt, incurring any Transaction Expenses);
(xv) adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization (other than with respect to the Merger);
(xvi) voluntarily incur any Liability or obligation (whether absolute, accrued, contingent or otherwise) in excess of $100,000 individually or $250,000 in the aggregate (excluding the incurrence of any Transaction Expenses) other than pursuant to the terms of a Contract in existence as of the date of this Agreement or entered into in the ordinary course of business or in accordance with the terms of this Section 5.3 during the Interim Period;
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(xvii) sell, lease, license, transfer, exchange or swap, mortgage or otherwise pledge or encumber (including securitizations), or otherwise dispose of any material portion of its properties, assets or rights;
(xviii) enter into any agreement, understanding or arrangement with respect to the voting of its equity securities or any agreement that if entered into prior to the date hereof would be required to be disclosed on Schedule 3.14;
(xix) take any action that would reasonably be expected to significantly delay or impair the obtaining of any Consents of any Governmental Authority to be obtained in connection with this Agreement; or
(xx) authorize or agree to do any of the foregoing actions.
5.4 Annual and Interim Financial Statements.
(a) During the Interim Period, within forty-five (45) calendar days following the end of each three-month quarterly period or such earlier date as such financial statements need to be available for inclusion in the Registration Statement, the Company shall deliver to ITAC unaudited consolidated financial statements, including a consolidated balance sheet, consolidated statement of operations and comprehensive income (loss), changes in shareholders’ equity, consolidated statements of cash flows and notes to financial statements prepared in accordance with GAAP. If the form of the Registration Statement requires inclusion of such interim financial statements in the Registration Statement, the Company will also provide comparable financial statements for the prior year and the interim financial statements shall comply with Rules 8-03 and 8-04 of Regulation S-X.
(b) During the Interim Period, the Company shall provide ITAC, within thirty (30) days after the end each calendar month with financial information for the month and the year to date in such form as ITAC may reasonably request.
(c) During the Interim Period, the Company will also promptly deliver to ITAC copies of any audited financial statements of the Target Companies that a certified public accountant of any Target Company may issue.
5.5 ITAC Public Filings. During the Interim Period, ITAC will keep current and timely file all of its public filings with the SEC and otherwise comply in all material respects with applicable securities Laws and shall use its commercially reasonable efforts prior to the Merger to maintain the listing of ITAC Units, ITAC Class A Stock and ITAC Public Warrants on Nasdaq. During the Interim Period, ITAC shall provide the Company with a reasonable review period prior to making any public filing period with the SEC and, with respect filings that relate to this Agreement and the Merger, will consider in good faith any suggestion or revision that may be proposed by the Company or its representatives.
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5.6 No Solicitation.
(a) For purposes of this Agreement, (i) an “Acquisition Proposal” means any inquiry, proposal or offer, or any indication of interest in making an offer or proposal, from any Person or group at any time relating to an Alternative Transaction, and (ii) an “Alternative Transaction” means (A) with respect to the Company and Merger Sub and their respective Subsidiaries, a transaction (other than the transactions contemplated by this Agreement including for the avoidance of doubt the Recapitalization) concerning the sale of (x) all or any material part of the business or assets of any Target Companies (other than in the ordinary course of business consistent with past practice) or (y) any of the shares or other equity interests or profits of any Target Companies, in any case, whether such transaction takes the form of a sale of shares or other equity interests, assets, merger, consolidation, issuance of debt securities, management Contract, joint venture or partnership, or otherwise (subject, in each instance, to actions otherwise expressly permitted by this Agreement, including Sections 5.2 and 5.3) and (B) with respect to ITAC and its Affiliates, a transaction (other than the transactions contemplated by this Agreement) concerning a Business Combination for ITAC.
(b) During the Interim Period, in order to induce the other Parties to continue to commit to expend management time and financial resources in furtherance of the transactions contemplated hereby, each Party shall not, and shall cause its Representatives to not, without the prior written consent of the Company or ITAC, as applicable, directly or indirectly, (i) solicit, assist, initiate or facilitate the making, submission or announcement of, or intentionally encourage, any Acquisition Proposal, (ii) furnish any non-public information regarding such Party or its Affiliates or their respective businesses, operations, assets, Liabilities, financial condition, prospects or employees to any Person or group (other than a Party to this Agreement or their respective Representatives) in connection with or in response to an Acquisition Proposal, (iii) engage or participate in discussions or negotiations with any Person or group with respect to, an Acquisition Proposal or potential Acquisition Proposal, (iv) approve, endorse or recommend, or publicly propose to approve, endorse or recommend, any Acquisition Proposal, (v) negotiate or enter into any letter of intent, agreement in principle, acquisition agreement or other similar agreement related to any Acquisition Proposal, or (vi) release any third Person from, or waive any provision of, any confidentiality agreement to which such Party is a party with the intention of facilitating an Acquisition Proposal.
(c) Each Party shall notify the others as promptly as practicable (and in any event within 72 hours) orally and in writing of the receipt by such Party or any of its Representatives of (i) any bona fide inquiries, proposals or offers, requests for information or requests for discussions or negotiations regarding or constituting any Acquisition Proposal or any bona fide inquiries, proposals or offers, requests for information or requests for discussions or negotiations that could be reasonably expected to result in an Acquisition Proposal, and (ii) any request for non-public information relating to such Party or its Affiliates, specifying in each case, the material terms and conditions thereof (including a copy thereof if in writing or a written summary thereof if oral) and the identity of the party making such inquiry, proposal, offer or request for information. Each Party shall keep the others promptly informed of the status of any such inquiries, proposals, offers or requests for information. During the Interim Period, each Party shall, and shall cause its Representatives to, immediately cease and cause to be terminated any solicitations, discussions or negotiations with any Person with respect to any Acquisition Proposal and shall, and shall direct its Representatives to, cease and terminate any such solicitations, discussions or negotiations.
5.7 No Trading. The Company and Merger Sub each acknowledge and agree that it is aware, and that their respective Affiliates are aware (and each of their respective Representatives is aware or, upon receipt of any material nonpublic information of ITAC, will be advised) of the restrictions imposed by U.S. federal securities laws and the rules and regulations of the SEC and Nasdaq promulgated thereunder or otherwise (the “Federal Securities Laws”) and other applicable foreign and domestic Laws on a Person possessing material nonpublic information about a publicly traded company. The Company and Merger Sub each hereby agree that, while it is in possession of such material nonpublic information, it shall not purchase or sell any securities of ITAC, communicate such information to any third party other than to its representatives in connection with the transactions contemplated hereunder who understand the confidential nature of the information and the restrictions on selling securities when in possession of material non-public information, knowingly take any other action with respect to ITAC in violation of such Laws, or knowingly aid, assist, cause or encourage any third party to do any of the foregoing.
5.8 Notification of Certain Matters. During the Interim Period, each Party shall give prompt notice to the other Parties if such Party or its Affiliates: (a) fails in any material respect to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it or its Affiliates hereunder; (b) receives any notice or other communication in writing from any third party (including any Governmental Authority) alleging (i) that the Consent of such third party is or may be required in connection with the transactions contemplated by this Agreement or (ii) any material non-compliance with any Law by such Party or its Affiliates; (c) receives any written notice or other communication from any Governmental Authority in connection with the transactions contemplated by this Agreement; (d) discovers any fact or circumstance that, or becomes aware of the occurrence or non-occurrence of any event the occurrence or non-occurrence of which, would reasonably be expected to cause or result in any of the conditions to set forth in Article VI not being satisfied or the satisfaction of those conditions being materially delayed; or (e) becomes aware of the commencement or threat, in writing, of any Action against such Party or any of its Affiliates, or any of their respective material properties or assets, or, to the Knowledge of such Party, any officer, director, partner, member or manager, in his, her or its capacity as such, of such Party or of its Affiliates with respect to the consummation of the transactions contemplated by this Agreement. No such notice shall constitute an acknowledgement or admission by the Party providing the notice regarding whether or not any of the conditions to the Closing have been satisfied or in determining whether or not any of the representations, warranties or covenants contained in this Agreement have been breached.
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5.9 Efforts.
(a) Subject to the terms and conditions of this Agreement, each Party shall use its commercially reasonable efforts, and shall use commercially reasonable efforts to cooperate with the other Parties, to take, or cause to be taken, all actions and to do, or cause to be done, all things reasonably necessary, proper or advisable under applicable Laws and regulations to consummate the transactions contemplated by this Agreement (including the receipt of all applicable Consents of Governmental Authorities) and to comply as promptly as practicable with all requirements of Governmental Authorities applicable to the transactions contemplated by this Agreement.
(b) In furtherance and not in limitation of Section 5.9(a), to the extent required under any Laws that are designed to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade (“Antitrust Laws”), each Party hereto agrees to make any required filing or application under Antitrust Laws, as applicable, at such Party’s sole cost and expense, with respect to the transactions contemplated hereby as promptly as practicable, to supply as promptly as reasonably practicable any additional information and documentary material that may be reasonably requested pursuant to Antitrust Laws and to take all other actions reasonably necessary, proper or advisable to cause the expiration or termination of the applicable waiting periods under Antitrust Laws as soon as practicable, including by requesting early termination of the waiting period provided for under the Antitrust Laws. Each Party shall, in connection with its efforts to obtain all requisite approvals and authorizations for the transactions contemplated by this Agreement under any Antitrust Law, use its commercially reasonable efforts to: (i) cooperate in all respects with each other Party or its Affiliates in connection with any filing or submission and in connection with any investigation or other inquiry, including any proceeding initiated by a private Person; (ii) keep the other Parties reasonably informed of any communication received by such Party or its Representatives from, or given by such Party or its Representatives to, any Governmental Authority and of any communication received or given in connection with any proceeding by a private Person, in each case regarding any of the transactions contemplated by this Agreement; (iii) permit a Representative of the other Parties and their respective outside counsel to review any communication given by it to, and consult with each other in advance of any meeting or conference with, any Governmental Authority or, in connection with any proceeding by a private Person, with any other Person, and to the extent permitted by such Governmental Authority or other Person, give a Representative or Representatives of the other Parties the opportunity to attend and participate in such meetings and conferences; (iv) in the event a Party’s Representative is prohibited from participating in or attending any meetings or conferences, the other Parties shall keep such Party promptly and reasonably apprised with respect thereto; and (v) use commercially reasonable efforts to cooperate in the filing of any memoranda, white papers, filings, correspondence or other written communications explaining or defending the transactions contemplated hereby, articulating any regulatory or competitive argument, and/or responding to requests or objections made by any Governmental Authority.
(c) As soon as reasonably practicable following the date of this Agreement, the Parties shall reasonably cooperate with each other and use (and shall cause their respective Affiliates to use) their respective commercially reasonable efforts to prepare and file with Governmental Authorities requests for approval of the transactions contemplated by this Agreement and shall use all commercially reasonable efforts to have such Governmental Authorities approve the transactions contemplated by this Agreement. Each Party shall give prompt written notice to the other Parties if such Party or any of its Representatives receives any notice from such Governmental Authorities in connection with the transactions contemplated by this Agreement, and shall promptly furnish the other Parties with a copy of such Governmental Authority notice. If any Governmental Authority requires that a hearing or meeting be held in connection with its approval of the transactions contemplated hereby, whether prior to the Closing or after the Closing, each Party shall arrange for Representatives of such Party to be present for such hearing or meeting. If any objections are asserted with respect to the transactions contemplated by this Agreement under any applicable Law or if any Action is instituted (or threatened to be instituted) by any applicable Governmental Authority or any private Person challenging any of the transactions contemplated by this Agreement or any Ancillary Document as violative of any applicable Law or which would otherwise prevent, materially impede or materially delay the consummation of the transactions contemplated hereby or thereby, the Parties shall use their commercially reasonable efforts to resolve any such objections or Actions so as to timely permit consummation of the transactions contemplated by this Agreement and the Ancillary Documents, including in order to resolve such objections or Actions which, in any case if not resolved, could reasonably be expected to prevent, materially impede or materially delay the consummation of the transactions contemplated hereby or thereby. In the event any Action is instituted (or threatened to be instituted) by a Governmental Authority or private Person challenging the transactions contemplated by this Agreement, or any Ancillary Document, the Parties shall, and shall cause their respective Representatives to, reasonably cooperate with each other and use their respective commercially reasonable efforts to contest and resist any such Action and to have vacated, lifted, reversed or overturned any Order, whether temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts consummation of the transactions contemplated by this Agreement or the Ancillary Documents.
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(d) Prior to the Closing, each Party shall use its commercially reasonable efforts to obtain any Consents of Governmental Authorities or other third Persons as may be necessary for the consummation by such Party or its Affiliates of the transactions contemplated by this Agreement or required as a result of the execution or performance of, or consummation of the transactions contemplated by, this Agreement by such Party or its Affiliates, and the other Parties shall provide reasonable cooperation in connection with such efforts. With respect to the Company, during the Interim Period, the Company, and Merger Sub shall take all actions reasonably necessary to cause the Company to qualify as “foreign private issuer” as such term is defined under Exchange Act Rule 3b-4 and to maintain such status through the Closing.
5.10 Further Assurances. The Parties hereto shall further cooperate with each other and use their respective commercially reasonable efforts to take or cause to be taken all actions, and do or cause to be done all things, necessary, proper or advisable on their part under this Agreement and applicable Laws to consummate the transactions contemplated by this Agreement as soon as reasonably practicable, including preparing and filing as soon as practicable all documentation to effect all necessary notices, reports and other filings.
5.11 The Registration Statement.
(a) As promptly as practicable after the date hereof, the Company shall prepare, and the Company shall file (with ITAC’s assistance) with the SEC a registration statement on Form F-4 (as amended or supplemented from time to time, and including the Proxy Statement contained therein, the “Registration Statement”) in connection with the registration under the Securities Act of the Company’s Ordinary Shares and the Company Warrants to be issued under this Agreement to the holders of ITAC Common Stock and the Company Ordinary Shares issuable upon exercise or conversion of the Company Warrants outstanding prior to the Effective Time, which Registration Statement will also contain a proxy statement of ITAC (as amended, the “Proxy Statement”) for the purpose of soliciting proxies from ITAC stockholders for the matters to be acted upon at the Special Meeting and providing the Public Shareholders an opportunity in accordance with ITAC’s Organizational Documents and the IPO Prospectus to have their ITAC Class A Stock redeemed (the “Redemption”) in conjunction with the stockholder vote on the ITAC Stockholder Approval Matters. The Proxy Statement shall include proxy materials for the purpose of soliciting proxies from ITAC stockholders to vote, at a special meeting of ITAC stockholders to be called and held for such purpose (the “ITAC Special Meeting”), in favor of resolutions approving (i) the adoption and approval of this Agreement and the Transactions, (ii) the approval of the issuance of ITAC Securities in the PIPE Investment, by ITAC stockholders in accordance with ITAC’s Organizational Documents, the Delaware Law and the rules and regulations of the SEC and Nasdaq, if applicable, (iii) the approval of the Restated ITAC Certificate, (iv) such other matters as the Company and ITAC shall hereafter mutually determine to be necessary or appropriate in order to effect the Transactions (the approvals described in foregoing clauses (i), (ii), (iii) and (iv)), collectively, the “ITAC Stockholder Approval Matters”), and (v) the adjournment of the ITAC Special Meeting, if necessary or desirable in the reasonable determination of ITAC. In connection with the Registration Statement and the Merger, the Company shall (w) assist ITAC in obtaining Nasdaq approval of the Merger and the change of control resulting from the Merger, (x) file any listing application necessary for the listing of the Company on Nasdaq as successor issuer to ITAC, (y) file a registration statement (the “1934 Act Registration Statement”) pursuant to the Securities Exchange Act of 1934 and request effectiveness of the 1934 Act Registration Statement concurrently with the effectiveness of the Company’s listing of its securities on Nasdaq, and (z) the Company shall provide ITAC with evidence reasonably requested by ITAC that the Company qualifies as a foreign private issuer pursuant to Rule 3b-4 of the Exchange Act, failing which the Registration Statement shall be filed on a Form S-4.
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(b) The Company shall obtain the Required Company Shareholder Approval in the manner required by the Existing Articles and the Israeli Companies Law for (i) the adoption and approval of this Agreement and the Transactions (including to the extent required, the issuance of Company Securities pursuant to this Agreement, including the PIPE Investment), in accordance with the Existing Articles and the Israeli Companies Law and, to the extent applicable, regulations of the SEC and Nasdaq, (ii) the approval of the Restated Company Articles and the Recapitalization; (iii) the adoption and approval of a new Equity Incentive Plan for the Company in a substantially form to be agreed to prior to the filing of the Registration Statement (the “Equity Plan”), which will provide that the total awards under such Equity Plan will be a number of Company Ordinary Shares equal to the sum of (a) five percent (5%) of the aggregate number of Company Ordinary Shares issued and outstanding immediately after the Closing, plus (b) such number Company Ordinary Shares issuable pursuant to any outstanding equity incentives or Continuing Company Options which are outstanding immediately prior to the Recapitalization, (iv) the appointment of the members of the Post-Closing Company Board of Directors in accordance with Section 5.15 hereof, (v) the issuance of Company Ordinary Shares and Company Warrants pursuant to this Agreement, including (x) the Company Ordinary Shares issued in connection with the PIPE Investment, (y) the Company Ordinary Shares issuable pursuant to the Recapitalization, and (z) the Company Ordinary Shares issuable upon exercise of the Company Warrants, the Continuing Warrants and Continuing Company Options; and (vi) such other matters as the Company and ITAC shall hereafter mutually determine to be necessary or appropriate in order to effect the Transactions (the approvals described in foregoing clauses (i) through (vi), collectively, the “Company Shareholder Approval Matters”), and (vii) the adjournment of the Special Meeting, if necessary or desirable in the reasonable determination of the Company. The Company shall use its reasonable best efforts to solicit from the holders of Company Ordinary Shares and Company Preferred Shares proxies or written consents in favor of the Company Shareholder Approval Matters, and to take all other actions necessary or advisable to secure the Required Company Shareholder Approval, including enforcing the Voting Agreements.
(c) ITAC and the Company shall cooperate and provide the other Party (and its counsel) with a reasonable opportunity to review and comment on the Registration Statement and any amendment or supplement thereto prior to filing the same with the SEC. The Registration Statement shall include such information concerning the Target Companies and their equity holders, officers, directors, employees, assets, Liabilities, condition (financial or otherwise), business and operations that may be required or appropriate for inclusion in the Registration Statement, or in any amendments or supplements thereto, which information provided by the Company shall be true and correct and not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not materially misleading. In connection with the Registration Statement and the Proxy Statement, the Company and ITAC will file with the SEC financial and other information about the Transactions in accordance with applicable Law and applicable proxy solicitation and registration statement rules, ITAC’s Organizational Documents, the Israeli Companies Law, the Delaware Law and the rules and regulations of the SEC and Nasdaq.
(d) ITAC and the Company shall take any and all reasonable and necessary actions required to satisfy the requirements of the Securities Act, the Exchange Act and other applicable Laws in connection with the Registration Statement, the Special Meeting and the Redemption. Each of ITAC and the Company shall, and shall cause each of its Subsidiaries to, make their respective directors, officers and employees, upon reasonable advance notice, available to the Company and ITAC and their respective Representatives in connection with the drafting of the public filings with respect to the transactions contemplated by this Agreement, including the Registration Statement, and responding in a timely manner to comments from the SEC. Each Party shall promptly correct any information provided by it for use in the Registration Statement (and other related materials) if and to the extent that such information is determined to have become false or misleading in any material respect or as otherwise required by applicable Laws. ITAC and the Company shall amend or supplement the Registration Statement and cause the Registration Statement, as so amended or supplemented, to be filed with the SEC and to be disseminated to ITAC’s shareholders, in each case as and to the extent required by applicable Laws and subject to the terms and conditions of this Agreement and ITAC’s Organizational Documents.
(e) ITAC and the Company, with the assistance of the other Parties, shall promptly respond to any SEC comments on the Registration Statement and shall otherwise use their commercially reasonable efforts to cause the Registration Statement to “clear” comments from the SEC and become effective. The Company shall provide ITAC with copies of any written comments, and shall inform ITAC of any material oral comments, that the Company or its Representatives receive from the SEC or its staff with respect to the Registration Statement, the Special Meeting and the Redemption promptly after the receipt of such comments and shall give ITAC a reasonable opportunity under the circumstances to review and comment on any proposed written or material oral responses to such comments.
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(f) As soon as practicable following the Registration Statement “clearing” comments from the SEC and becoming effective, ITAC (with the reasonable cooperation of the Company) shall distribute the Proxy Statement to ITAC’s shareholders and, pursuant thereto, shall call the Special Meeting in accordance with the Delaware Law for a date no later than thirty (30) days following the effectiveness of the Registration Statement. After the Registration Statement is declared effective under the Securities Act, ITAC shall solicit proxies from the ITAC stockholders to vote in favor of the ITAC Stockholder Approval Matters, as approved by the ITAC board of directors, which approval shall also be included in the Registration Statement.
(g) If on the date for which the ITAC Special Meeting is scheduled, ITAC has not received proxies representing a sufficient number of shares to obtain the Required ITAC Shareholder Approval, whether or not a quorum is present, ITAC may make one or more successive postponements or adjournments of the Special Meeting. ITAC may also adjourn the ITAC Special Meeting to establish a quorum or if the ITAC stockholders have elected to redeem a number of shares of ITAC Common Stock as of such time that would reasonably be expected to result in the condition set forth in Section 6.2(f) not being satisfied. Notwithstanding the foregoing, without the consent of the Company, in no event shall ITAC adjourn the ITAC Special Meeting for more than fifteen (15) Business Days later than the most recently adjourned meeting or to a date that is beyond four (4) Business Days prior to the Outside Date. Except as otherwise required by applicable Law, ITAC covenants that none of the ITAC board of directors (including any committee thereof) or ITAC shall withdraw, withhold or modify, or publicly propose a change to any recommendation in support of the Transactions.
(h) ITAC and the Company shall comply with all applicable Laws, any applicable rules and regulations of Nasdaq, ITAC’s Organizational Documents, the Existing Articles and this Agreement in the preparation, filing and distribution of the Registration Statement and Proxy Statement, the listing on Nasdaq, any solicitation of proxies thereunder, the calling and holding of the Special Meeting and the Redemption.
(i) The Company (with reasonable cooperation from ITAC) shall take such steps as are necessary for the listing of the Company Ordinary Shares and the Company Public Warrants on Nasdaq, as a successor issuer, and shall provide such information as is necessary to obtain Nasdaq approval of such listing.
5.12 Public Announcements.
(a) The Parties agree that, during the Interim Period, no public release, filing or announcement concerning this Agreement or the Ancillary Documents or the transactions contemplated hereby or thereby shall be issued by any Party or any of their Affiliates or any of their respective representatives without the prior written consent (not be unreasonably withheld, conditioned or delayed) of ITAC and the Company, except as such release or announcement may be required by applicable Law or the rules or regulations of any securities exchange, in which case the applicable Party shall use commercially reasonable efforts to allow the other Party reasonable time to comment on, and arrange for any required filing with respect to, such release or announcement in advance of such issuance.
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(b) The Parties shall mutually agree upon and, as promptly as practicable after the execution of this Agreement (but in any event within four (4) Business Days thereafter), issue a press release announcing the execution of this Agreement (the “Signing Press Release”). Promptly after the issuance of the Signing Press Release, ITAC shall file a current report on Form 8-K (the “Signing Filing”) with the Signing Press Release and a description of this Agreement as required by Federal Securities Laws, which the Company shall review, comment upon and approve (which approval shall not be unreasonably withheld, conditioned or delayed) prior to filing (with the Company reviewing, commenting upon and approving such Signing Filing in any event no later than the third (3rd) Business Day after the execution of this Agreement). The Parties shall mutually agree upon and, as promptly as practicable after the Closing (but in any event within four (4) Business Days thereafter), issue a press release announcing the consummation of the transactions contemplated by this Agreement (the “Closing Press Release”). Promptly after the issuance of the Closing Press Release, the Company shall file a current report on Form 8-K (the “Closing Filing”) with the Closing Press Release and a description of the Closing as required by Federal Securities Laws which the Sponsor shall review, comment upon and approve (which approval shall not be unreasonably withheld, conditioned or delayed) prior to filing. In connection with the preparation of the Signing Press Release, the Signing Filing, the Closing Filing, the Closing Press Release, or any other report, statement, filing notice or application made by or on behalf of a Party to any Governmental Authority or other third party in connection with the transactions contemplated hereby, each Party shall, upon request by any other Party, furnish the Parties with all information concerning themselves, their respective directors, officers and equity holders, and such other matters as may be reasonably necessary or advisable in connection with the transactions contemplated hereby, or any other report, statement, filing, notice or application made by or on behalf of a Party to any third party and/ or any Governmental Authority in connection with the transactions contemplated hereby. From and after the Effective Time, any matter requiring ITAC approval shall require the approval of the Sponsor.
5.13 Confidential Information.
(a) The Company and Merger Sub agree that during the Interim Period and, in the event that this Agreement is terminated in accordance with Article VII, for a period of two (2) years after such termination, they shall, and shall cause their respective Representatives to: (i) treat and hold in strict confidence any ITAC Confidential Information, and will not use for any purpose (except in connection with the consummation of the transactions contemplated by this Agreement or the Ancillary Documents, performing their obligations hereunder or thereunder or enforcing their rights hereunder or thereunder or to comply with applicable Law, Order or Action), nor directly or indirectly disclose, distribute, publish, disseminate or otherwise make available to any third party any of ITAC Confidential Information without ITAC’s prior written consent; and (ii) in the event that the Company, Merger Sub, or any of their respective Representatives, during the Interim Period or, in the event that this Agreement is terminated in accordance with Article VII, for a period of two (2) years after such termination, becomes compelled to disclose any ITAC Confidential Information by Law, Order or Action, (A) provide ITAC to the extent legally permitted with prompt written notice of such requirement so that ITAC or an Affiliate thereof may seek, at ITAC’s cost, a protective Order or other remedy or waive compliance with this Section 5.13(a), and (B) in the event that such protective Order or other remedy is not obtained, or ITAC waives compliance with this Section 5.13(a), furnish only that portion of such ITAC Confidential Information which is legally required to be provided as advised by outside counsel and to exercise its commercially reasonable efforts to obtain assurances that confidential treatment will be accorded such ITAC Confidential Information. In the event that this Agreement is terminated and the transactions contemplated hereby are not consummated, the Company and Merger Sub shall, and shall cause their respective Representatives to, promptly deliver to ITAC or destroy (at the Company’s election) any and all copies (in whatever form or medium) of ITAC Confidential Information and destroy all notes, memoranda, summaries, analyses, compilations and other writings related thereto or based thereon; provided, however, that the Company and Merger Sub and their respective Representatives shall be entitled to keep any records required by applicable Law or bona fide record retention policies; and provided, further, that any ITAC Confidential Information that is not returned or destroyed shall remain subject to the confidentiality obligations set forth in this Agreement.
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(b) ITAC hereby agrees that during the Interim Period and, in the event that this Agreement is terminated in accordance with Article VII, for a period of two (2) years after such termination, it shall, and shall cause its Representatives to: (i) treat and hold in strict confidence any Company Confidential Information, and will not use for any purpose (except in connection with the consummation of the transactions contemplated by this Agreement or the Ancillary Documents, performing its obligations hereunder or thereunder or enforcing its rights hereunder or thereunder or to comply with applicable Law, Order or Action)), nor directly or indirectly disclose, distribute, publish, disseminate or otherwise make available to any third party any of the Company Confidential Information without the Company’s prior written consent; and (ii) in the event that ITAC or any of its Representatives, during the Interim Period or, in the event that this Agreement is terminated in accordance with Article VII, for a period of two (2) years after such termination, becomes compelled to disclose any Company Confidential Information by Law, Order or Action, (A) provide the Company to the extent legally permitted with prompt written notice of such requirement so that the Company may seek, at the Company’s sole expense, a protective Order or other remedy or waive compliance with this Section 5.13(b) and (B) in the event that such protective Order or other remedy is not obtained, or the Company waives compliance with this Section 5.13(b), furnish only that portion of such Company Confidential Information which is legally required to be provided as advised by outside counsel and to exercise its commercially reasonable efforts to obtain assurances that confidential treatment will be accorded such Company Confidential Information. In the event that this Agreement is terminated and the transactions contemplated hereby are not consummated, ITAC shall, and shall cause its Representatives to, promptly deliver to the Company or destroy (at ITAC’s election) any and all copies (in whatever form or medium) of Company Confidential Information and destroy all notes, memoranda, summaries, analyses, compilations and other writings related thereto or based thereon; provided, however, that ITAC and its Representatives shall be entitled to keep any records required by applicable Law or bona fide record retention policies; and provided, further, that any Company Confidential Information that is not returned or destroyed shall remain subject to the confidentiality obligations set forth in this Agreement. Notwithstanding the foregoing, ITAC and its Representatives shall be permitted to disclose any and all Company Confidential Information to the extent required by the Federal Securities Laws.
5.14 Documents and Information. After the Closing Date, the Company shall, and shall cause its Subsidiaries (including the Target Companies) to, until the fifth (5th) anniversary of the Closing Date, retain all books, records and other documents pertaining to the business of ITAC and the Target Companies in existence on the Closing Date.
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5.15 Post-Closing Board and Executive Officers.
(a) The Parties shall take all necessary action, including causing the directors of the Company to resign, so that effective as of the Effective Time, the Company’s board of directors (the “Post-Closing Company Board of Directors”), subject to the Restated Company Articles, will consist of seven directors, consisting of four directors designated prior to the Closing by the Company, at least two of whom shall be considered independent under Nasdaq requirements; one director designated prior to the Closing by ITAC, and two independent directors (under Nasdaq requirements) mutually agreed on by the Company and ITAC; provided, however, that the composition of the Post-Closing Company Board of Directors shall comply with all requirements of the Israeli Companies Law and Nasdaq.
(b) The Parties shall take commercially reasonable action so that the individuals serving as the chief executive officer and chief financial officer, respectively, of the Company immediately after the Closing will be the same individuals (in the same office) as that of the Company immediately prior to the Closing (unless, at its sole discretion, the Company desires to appoint another qualified person to either such role, in which case, such other person identified by the Company shall serve in such role).
5.16 Indemnification of Directors and Officers; Tail Insurance.
(a) The Parties agree that all rights to exculpation, indemnification and advancement of expenses existing in favor of the current or former directors and officers of ITAC and the Company, and each Person who served as a director, officer, member, trustee or fiduciary of another corporation, partnership, joint venture, trust, pension or other employee benefit plan or enterprise at the request of ITAC or the Company (the “D&O Indemnified Persons”) as provided in ITAC’s or Company’s Organizational Documents or under any indemnification, employment or other similar agreements between any D&O Indemnified Person and ITAC or the Company, as applicable, in each case as in effect on the date of this Agreement, shall survive the Closing and continue in full force and effect in accordance with their respective terms to the extent permitted by applicable Law. For a period of six (6) years after the Effective Time, the Company shall cause the Organizational Documents of the Company to contain provisions no less favorable with respect to exculpation and indemnification of and advancement of expenses to D&O Indemnified Persons than are set forth as of the date of this Agreement in the Organizational Documents of ITAC and the Company, to the extent permitted by applicable Law. The provisions of this Section 5.16 shall survive the Closing and are intended to be for the benefit of, and shall be enforceable by, each of the D&O Indemnified Persons and their respective heirs and representatives, each of whom shall be a third-party beneficiary of the provisions of this Section 5.16(a). The Company shall not have any obligation under this Section 5.16 to any D&O Indemnified Person when and if a court of competent jurisdiction shall determine, in a final, non-appealable judgement, that the indemnification of such D&O Indemnified Person in the manner contemplated hereby is prohibited by applicable Law.
(b) The Company shall obtain at or prior to the Closing, and fully pay the premium for a “tail” directors and officers liability insurance policy that provides coverage for a seven-year period from and after the Effective Time for events occurring at or prior to the Effective Time (i) for ITAC’s directors, officers and other persons covered by ITAC’s current directors and officers liability policy which is substantially equivalent to and in any event not less favorable in the aggregate than ITAC’s existing policy or, if substantially equivalent insurance coverage is unavailable, the best available coverage, and (ii) for the benefit of the Company’s directors and officers, equivalent coverage, to the extent available, (collectively, the “D&O Tail Insurance”). The Company shall maintain the D&O Tail Insurance in full force and effect, and continue to honor the obligations thereunder, and the Company shall timely pay or cause to be paid all premiums with respect to the D&O Tail Insurance.
(c) The Company shall not have any obligation under this Section to any D&O Indemnified Persons when and if a court of competent jurisdiction shall ultimately determine (and such determination shall have become final and non-appealable) that the indemnification of such D&O Indemnified Person in the manner contemplated hereby is prohibited by applicable Law.
5.17 Trust Account Proceeds. The Parties agree that after the Closing, the funds in the Trust Account, after taking into account payments for the Redemption, and any proceeds received by ITAC or the Company from the PIPE Investment shall first be used to pay the Company’s and ITAC’s accrued expenses, including ITAC’s deferred expenses of the IPO, any loans made by the Sponsor to ITAC, and the expenses incurred by the Parties in connection with the negotiation, execution and performed by the Parties of their respective obligations under this Agreement and the transactions contemplated hereby, included the Registration Statement, the Proxy Statement and the PIPE Transaction; provided, that the ITAC Transaction Expenses (other than expenses relating to the PIPE Transaction) shall not exceed $7.0 million; provided, that to the extent that such ITAC Transaction Expenses exceed $7.0 million, the amount of such excess shall be added to $525,000,000 in computing the Conversion Ratio as provided in the second Recital. Any remaining cash in the Trust Account will be distributed to the Company or a Target Company designated by the Company.
5.18 PIPE Investment.
(a) Prior to the effective date of the Registration Statement, ITAC and the Company shall have executed subscription agreements (each, a “Subscription Agreement”) among ITAC, the Company and investors (the “PIPE Investors”) for an aggregate of One Hundred Million U.S. Dollars ($100,000,000) in connection with a private placement in ITAC or the Company, in each instance, to be consummated immediately prior to the Effective Time (the “PIPE Investment”). Each of the Subscription Agreements, when executed by ITAC and the Company, shall have been duly authorized, executed and delivered by ITAC and constitute the valid and binding obligation of ITAC and the Company, enforceable against ITAC and the Company, and, to the Knowledge of ITAC and the Company, the other parties thereto, in accordance with its terms, subject to the Enforceability Exceptions. True and complete original or signed copies of each of the Subscription Agreements have been delivered to ITAC and the Company on or prior to such effective date, and there will have been no conditions to closing of the transactions contemplated therein other than the conditions (if any) specifically stated therein. For the avoidance of doubt, (i) any Company Ordinary Shares issued in connection with the PIPE Investment shall be issued following the consummation of the Recapitalization but prior to the Effective Time, and (ii) accordingly, the number of Company Ordinary Shares, purchase price per share and other terms of the PIPE Investment shall not be affected in any manner by the Recapitalization.
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(b) ITAC and the Company shall use their commercially reasonable efforts to satisfy the conditions of the PIPE Investors closing obligations contained in the Subscription Agreements, and consummate the transactions contemplated thereby. Neither ITAC nor the Company shall terminate, or amend or waive in any manner, any Subscription Agreement without the prior written consent of the other Party, such consent not to be unreasonably withheld, delayed or conditioned, other than (i) as expressly provided for by the terms of the Subscription Agreements or (ii) to reflect any permitted assignments or transfers of the Subscription Agreements by the applicable PIPE Investors pursuant to the Subscription Agreements. Additionally, during the Interim Period, ITAC and the Company may, but shall not be required to, enter into and consummate additional Subscription Agreements with additional PIPE Investors, including in the event that there is an actual or threatened material breach or default by a PIPE Investor under a Subscription Agreement, or either ITAC or the Company reasonably believes in good faith that such PIPE Investor otherwise is not willing or able to consummate the transactions contemplated thereby upon the satisfaction of the conditions of such PIPE Investor’s closing obligations thereunder, which additional Subscription Agreements shall become part of the PIPE Investment hereunder; provided, that the terms of such additional Subscription Agreements shall not, without the Company’s or ITAC’s prior written consent, be different than those set forth in the Subscription Agreements. If ITAC and the Company seek such additional Subscription Agreements, ITAC and the Company shall, and shall cause their respective Representatives to, cooperate with each other and their respective Representatives in connection with such additional Subscription Agreements and use their respective reasonable efforts to cause such additional Subscription Agreements to be executed and the transactions contemplated thereby to occur (including having the Company’s senior management participate in any investor meetings and roadshows as reasonably requested by ITAC). For avoidance of doubt, any Company Ordinary Shares issued in connection with the PIPE Investment shall be issued following the consummation of the Recapitalization (and the number of Company Ordinary Shares, purchase price per share and other terms of the Subscription Agreement shall not be modified in any way by the Recapitalization or the Conversion Ratio).
5.19 F-1 Registration Statement. Prior to the effectiveness of the Registration Statement, the Company shall file a registration statement on Form F-1 (the “F-1 Registration Statement”), covering the (i) sale by the holders of the Company Ordinary Shares which are outstanding immediately following the Recapitalization, and, for the avoidance of doubt, prior to and excluding any Company Ordinary Shares to be issued to the PIPE Investors and any other securities of the Company to be registered pursuant to the Registration Statement in accordance with Section 5.11, and (ii) the issuance of Company Ordinary Shares upon exercise of Continuing Warrants. The Company will use its commercially reasonably efforts to obtain effectiveness of the F-1 Registration Statement on or about the date of the Effective Time. The parties shall use commercially reasonable efforts to cause the securities covered by this Section 5.19 to be approved for listing on the Nasdaq concurrently with the securities covered by Section 5.11 and the parties hereto shall use the same efforts with respect to the F-1 Registration Statement that is required by Section 5.11 with respect to the Registration Statement.
5.20 Employment Agreements. Prior to the Closing, the Company shall use its reasonable best efforts to cause the persons set forth on Schedule 5.20 to enter into employment agreements, in each case effective as of the Closing, in form and substance reasonably acceptable to the Company and ITAC, between each such person and the applicable Target Company, as noted in Schedule 5.20.
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Article
VI
CLOSING CONDITIONS
6.1 Conditions to Each Party’s Obligations. The obligations of each Party to consummate the Transactions shall be subject to the satisfaction or written waiver (where permissible) by the Company and ITAC of the following conditions:
(a) Required Shareholder Approval.
(i) The ITAC Stockholder Approval Matters shall have been submitted to the vote of the shareholders of ITAC at the Special Meeting in accordance with the Proxy Statement and each ITAC Stockholder Approval Matter shall have been approved by the requisite vote of the stockholders of ITAC at the Special Meeting in accordance with ITAC’s Organizational Documents, applicable Law and the Proxy Statement (the “Required ITAC Shareholder Approval”).
(ii) The Company Shareholder Approval Matters shall have been approved by the requisite vote of the shareholders of the Company either (x) at a special meeting of shareholders or (y) by a written consent in lieu of a meeting, in either case in accordance with the Existing Articles and Israeli Law.
(b) Antitrust Laws. Any waiting period (and any extension thereof) applicable to the consummation of this Agreement under any Antitrust Laws shall have expired or been terminated.
(c) Requisite Regulatory Approvals. All Consents required to be obtained from or made with any Governmental Authority in order to consummate the transactions contemplated by this Agreement that are set forth in Schedule 6.1(c) shall have been obtained or made.
(d) Requisite Consents. The Consents required to be obtained from or made with any third Person (other than a Governmental Authority) in order to consummate the transactions contemplated by this Agreement that are set forth in Schedule 6.1(d) shall have each been obtained or made.
(e) No Law or Order. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) or Order that is then in effect and which has the effect of making the transactions or agreements contemplated by this Agreement illegal or which otherwise prevents or prohibits consummation of the transactions contemplated by this Agreement.
(f) Registration Statement. The Registration Statement shall have been declared effective by the SEC and shall remain effective as of the Closing, and no stop order or similar order shall be in effect with respect to the Registration Statement.
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(g) Net Tangible Assets Test. Upon the Closing, after giving effect to the Redemption and the PIPE Investment, ITAC or the Company shall have net tangible assets of at least $5,000,001.
(h) Nasdaq Listing. The Company’s initial listing application with Nasdaq in connection with the transactions contemplated by this Agreement shall have been approved, and the Company Ordinary Shares and the Company Warrants shall have been approved for listing on Nasdaq subject to official notice of issuance and the listing application shall cover (a) all of the Company Ordinary Shares that are issued and outstanding upon completion of the Merger, are issuable upon exercise of all Company Warrants outstanding at the Effective Time, and all Continuing Company Options and the Company Ordinary Shares issuable pursuant to the Equity Plan, and (b) all of the publicly-traded Company Warrants to the extent required by Nasdaq.
(i) Composition of the Board. The members of the Post-Closing Company Board of Directors shall have been elected or appointed as of the Closing in accordance with the requirements of Section 5.15.
(j) Recapitalization; Amendment to Company Articles. Prior to the Effective Time, the Company shall (i) have consummated the Recapitalization, and (ii) provide evidence that the Company’s stockholders have adopted the Restated Company Articles in form and substance mutually agreeable to ITAC and the Company, and shall have provided ITAC with evidence of such adoption.
6.2 Conditions to Obligations of the Company and Merger Sub. In addition to the conditions specified in Section 6.1, the obligations of the Company and Merger Sub to consummate the Transactions are subject to the satisfaction or written waiver (by the Company) of the following conditions:
(a) Representations and Warranties. (i) The representations and warranties of ITAC set forth in Sections 3.5(a) and (b) (Capitalization) of this Agreement shall be true and correct in all respects as of the date of this Agreement and as of the Effective Time, as though made as of such time (except to the extent any such representation and warranty expressly speaks as of another specified time, in which case as of such time), except where the failure of such representations and warranties to be so true and correct is de minimis, and (ii) the representation contained in Section 3.7(b) (Absence of MAE) shall be true and correct in all respects as of the date of this Agreement and as of the Effective Time, as though made as of such time, (iii) the representations and warranties of ITAC set forth in Section 3.1 (Organization and Standing and Corporate Power), Section 3.2 (Authorization; Binding Agreement), Section 3.9 (Compliance with Laws; Permits), Section 3.6 (SEC Filing and ITAC Financials) and Section 3.16 (Finders and Brokers) (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect or similar qualifiers), shall be true and correct in all material respects as of the date of this Agreement and as of the Effective Time, as though made as of such time (except to the extent any such representation and warranty speaks as of another specified time, in which case as of such time), and (iv) all of the other representations and warranties of ITAC set forth in this Agreement (shall be true and correct on and as of the Closing Date as if made on the Closing Date, except for (A) those representations and warranties that address matters only as of a particular date (which representations and warranties shall have been accurate as of such date), and (B) any failures to be true and correct that (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect or other similar qualifiers), individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on, or with respect to, ITAC.
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(b) Agreements and Covenants. ITAC shall have performed in all material respects all of its obligations and complied in all material respects with all of its agreements and covenants under this Agreement to be performed or complied with by it on or prior to the Closing Date.
(c) No Material Adverse Effect. No Material Adverse Effect shall have occurred with respect to ITAC since the date of this Agreement which is continuing and uncured.
(d) Founder Lock-Up. The Founder Lock-Up shall be in full force and effect in accordance with the terms thereof as of the Closing Date.
(e) Closing Deliveries.
(i) Officer’s Certificate. ITAC shall have delivered to the Company a certificate, dated the Closing Date, signed by an executive officer of ITAC in such capacity, certifying as to the satisfaction of the conditions specified in Sections 6.2(a), 6.2(b) and 6.2(c) with respect to ITAC.
(ii) Secretary Certificate. ITAC shall have delivered to the Company a certificate from its secretary or other executive officer certifying as to, and attaching, (A) copies of ITAC’s Organizational Documents as in effect as of the Closing Date (immediately prior to the Effective Time), (B) the resolutions of ITAC’s board of directors authorizing and approving the execution, delivery and performance of this Agreement and each of the Ancillary Documents to which it is a party or by which it is bound, and the consummation of the transactions contemplated hereby and thereby, (C) evidence that the Required ITAC Shareholder Approval has been obtained and (D) the incumbency of officers authorized to execute this Agreement or any Ancillary Document to which ITAC is or is required to be a party or otherwise bound.
(iii) Good Standing. ITAC shall have delivered to the Company a good standing certificate (or similar documents applicable for such jurisdictions) for ITAC certified as of a date no earlier than five (5) days prior to the Closing Date from the proper Governmental Authority of ITAC’s jurisdiction of organization and from each other jurisdiction in which ITAC is qualified to do business as a foreign entity as of the Closing, in each case to the extent that good standing certificates or similar documents are generally available in such jurisdictions.
(f) Minimum Cash Requirement. The aggregate amount of cash and cash equivalents of ITAC at the Closing, including cash not redeemed from the Trust Account and cash raised in the PIPE Investment (which, for the avoidance of doubt, solely for purposes of this Section 6.2(f), shall include any cash paid to the Company if the Company exercises its right to directly issue Company Ordinary Shares pursuant to the Subscription Agreements) will not be less than $100 million (after giving effect to redemptions of ITAC’s public stockholders, but prior to the payment of ITAC’s or the Company’s Transaction Expenses or other liabilities due at the Closing).
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6.3 Conditions to Obligations of ITAC. In addition to the conditions specified in Section 6.1, the obligations of ITAC to consummate the Transactions are subject to the satisfaction or written waiver (by ITAC) of the following conditions:
(a) Representations and Warranties. (i) The representations and warranties of the Company set forth in Sections 4.3(a) and (b) (Capitalization) of this Agreement shall be true and correct in all respects as of the date of this Agreement and as of the Effective Time, as though made as of such time (except to the extent any such representation and warranty expressly speaks as of another specified time, in which case as of such time), except where the failure of such representations and warranties to be so true and correct is de minimis, (ii) the representation contained in Section 4.9(b) (Absence of MAE) shall be true and correct in all respects as of the date of this Agreement and as of the Effective Time, as though made as of such time, (iii) the representations and warranties of the Company set forth in Section 4.1 (Organization and Standing), Section 4.2 (Authorization; Binding Agreement), Section 4.10 (Compliance with Laws; Permits), and Section 4.29 (Finders and Brokers) (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect or similar qualifiers), shall be true and correct in all material respects as of the date of this Agreement and as of the Effective Time, as though made as of such time (except to the extent any such representation and warranty speaks as of another specified time, in which case as of such time) and (iv) all of the other representations and warranties of the Company set forth in this Agreement (shall be true and correct on and as of the Closing Date as if made on the Closing Date, except for (A) those representations and warranties that address matters only as of a particular date (which representations and warranties shall have been accurate as of such date), and (B) any failures to be true and correct that (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect or other similar qualifiers), individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on, or with respect to, the Company or any Target Companies.
(b) Agreements and Covenants. The Company and Merger Sub shall have performed in all material respects all of their respective obligations and complied in all material respects with all of their respective agreements and covenants under this Agreement to be performed or complied with by them on or prior to the Closing Date.
(c) No Material Adverse Effect. No Material Adverse Effect shall have occurred with respect to the Target Companies on a consolidated basis since the date of this Agreement which is continuing and uncured.
(d) Certain Ancillary Documents. Each of the Lock-Up Agreement and the Non-Competition Agreement, shall be in full force and effect in accordance with the terms thereof as of the Closing.
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(e) Closing Deliveries.
(i) Officer’s Certificate. ITAC shall have received a certificate from the Company, dated as the Closing Date, signed by an executive officer of the Company in such capacity, certifying as to the satisfaction of the conditions specified in Sections 6.3(a), 1.1(a) and 1.1(b) with respect to the Target Companies.
(ii) Company Secretary Certificate. The Company shall have delivered to ITAC a certificate from its secretary or other executive officer certifying as to the validity and effectiveness of, and attaching, (A) copies of its Organizational Documents as in effect as of the Closing Date (immediately prior to the Effective Time), (B) the resolutions of its board of directors authorizing and approving the execution, delivery and performance of this Agreement and each Ancillary Document to which it is a party or bound, and the consummation of the Transactions, (C) the resolutions of the shareholders as to approval of Company Shareholders Approval Matters, and (D) the incumbency of its officers authorized to execute this Agreement or any Ancillary Document to which it is or is required to be a party or otherwise bound.
(iii) Good Standing. The Company shall have delivered to ITAC good standing certificates (or similar documents applicable for such jurisdictions approving that the relevant company is active) for each Target Company certified as of a date no earlier than five (5) days prior to the Closing Date from the proper Governmental Authority of the Target Company’s jurisdiction of organization and from each other jurisdiction in which the Target Company is qualified to do business as a foreign corporation or other entity as of the Closing, in each case to the extent that good standing certificates or similar documents are generally available in such jurisdictions.
6.4 Frustration of Conditions. Notwithstanding anything contained herein to the contrary, no Party may rely on the failure of any condition set forth in this Article VI to be satisfied if such failure was caused by the failure of such Party or its Affiliates to comply with or perform any of its covenants or obligations set forth in this Agreement.
Article
VII
TERMINATION AND EXPENSES
7.1 Termination. This Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Closing as follows:
(a) by mutual written consent of ITAC and the Company;
(b) by written notice by ITAC or the Company if any of the conditions to the Closing set forth in Article VI have not been satisfied or waived by August 31, 2021 (the “Outside Date”); provided, however, that the right to terminate this Agreement under this Section 7.1(a) shall not be available to a Party if the breach or violation by such Party or its Affiliates of any representation, warranty, covenant or obligation under this Agreement was the cause of, or resulted in, the failure of the Closing to occur on or before the Outside Date;
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(c) by written notice by either ITAC or the Company if a Governmental Authority of competent jurisdiction shall have issued an Order or taken any other action permanently restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement, and such Order or other action has become final and non-appealable; provided, however, that the right to terminate this Agreement under this Section 7.1(c) shall not be available to a Party if the breach or violation by such Party or its Affiliates of any representation, warranty, covenant or obligation under this Agreement in any material respect was the cause of, or resulted in, such action by such Governmental Authority;
(d) by written notice by the Company to ITAC, if (i) there has been a breach by ITAC of any of its representations, warranties, covenants or agreements contained in this Agreement, or if any representation or warranty of ITAC shall have become untrue or inaccurate, in any case, which would result in a failure of a condition set forth in Section 6.2(a) or Section 6.2(b) to be satisfied (treating the Closing Date for such purposes as the date of this Agreement or, if later, the date of such breach), and (ii) the breach or inaccuracy is incapable of being cured or is not cured within the earlier of (A) twenty (20) days after written notice of such breach or inaccuracy is provided to ITAC by the Company or (B) the Outside Date; provided, that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.1(c) if at such time the Company or Merger Sub is in material uncured breach of its representations, warranties or covenants in this Agreement;
(e) by written notice by ITAC to the Company, if (i) there has been a breach by the Company or Merger Sub of any of their respective representations, warranties, covenants or agreements contained in this Agreement, or if any representation or warranty of such Parties shall have become untrue or inaccurate, in any case, which would result in a failure of a condition set forth in Section 6.3(a) or Section 6.3(a) to be satisfied (treating the Closing Date for such purposes as the date of this Agreement or, if later, the date of such breach), and (ii) the breach or inaccuracy is incapable of being cured or is not cured within the earlier of (A) twenty (20) days after written notice of such breach or inaccuracy is provided to the Company by ITAC or (B) the Outside Date; provided, that ITAC shall not have the right to terminate this Agreement pursuant to this Section 7.1(d) if at such time ITAC is in material uncured breach of its representations, warranties or covenants in this Agreement;
(f) by written notice by ITAC to the Company, if there shall have been a Material Adverse Effect on the Target Companies on a consolidated basis following the date of this Agreement which is uncured and continuing;
(g) by written notice by the Company to ITAC, if there shall have been a Material Adverse Effect following the date of this Agreement which is uncured and continuing; or
(h) by written notice by either ITAC or the Company to the other if the Special Meeting is held (including any adjournment or postponement thereof) and has concluded, ITAC’s or the Company’s shareholders have duly voted, and the Required ITAC Shareholder Approval or Company Shareholder Approval was not obtained.
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7.2 Effect of Termination. This Agreement may only be terminated in the circumstances described in Section 7.1 and pursuant to a written notice delivered by the applicable Party to the other applicable Parties, which sets forth the basis for such termination, including the provision of Section 7.1 under which such termination is made. In the event of the valid termination of this Agreement pursuant to Section 7.1, this Agreement shall forthwith become void, and there shall be no Liability on the part of any Party or any of their respective Representatives, and all rights and obligations of each Party shall cease, except: (i) Sections 5.13, 7.3, 8.1, Article X and this Section 7.2 shall survive the termination of this Agreement, and (ii) nothing herein shall relieve any Party from Liability for any Fraud Claim against such Party, in either case, prior to termination of this Agreement (in each case of clauses (i) and (ii) above, subject to Section 8.1). Without limiting the foregoing, and except as provided in Sections 7.3 and this Section 7.2 (but subject to Section 8.1, and subject to the right to seek injunctions, specific performance or other equitable relief in accordance with Section 9.8 prior to the valid termination of this Agreement), the Parties’ sole right prior to the Closing with respect to any breach of any representation, warranty, covenant or other agreement contained in this Agreement by another Party or with respect to the transactions contemplated by this Agreement shall be the right, if applicable, to (i) seek equitable relief in accordance with Section 9.8, or (ii) terminate this Agreement pursuant to Section 7.1.
7.3 Fees and Expenses. Subject to Section 8.1, all Transaction Expenses incurred in connection with this Agreement and the Transactions contemplated hereby shall be paid by the Party incurring such expenses; provided, however, that, at or following the Closing, all expenses payable by the Company and ITAC shall be payable by the Company or Merger Sub and may be paid from the Trust Account; provided, however, that the ITAC Transaction Expenses payable by the Company and Merger Sub (other than expenses relating to the PIPE Investment, which are not subject to this limitation) shall not exceed $7.0 million, subject to Section 5.17.
Article
VIII
WAIVERS AND Releases
8.1 Waiver of Claims Against Trust. Reference is made to the IPO Prospectus. Each of the Company and Merger Sub hereby represents and warrants that it has read the IPO Prospectus and understands that ITAC has established the Trust Account containing the proceeds of the IPO and the overallotment securities acquired by ITAC’s underwriters and from certain private placements occurring simultaneously with the IPO (including interest accrued from time to time thereon) for the benefit of ITAC’s public shareholders (including overallotment shares acquired by ITAC’s underwriters) (the “Public Shareholders”) and that, except as otherwise described in the IPO Prospectus, ITAC may disburse monies from the Trust Account only: (a) to the Public Shareholders in the event they elect to redeem their ITAC Class A Stock in connection with the consummation of ITAC’s initial business combination (as such term is used in the IPO Prospectus) (“Business Combination”) or in connection with an amendment to ITAC’s Organizational documents to extend ITAC’s deadline to consummate a Business Combination, (b) to the Public Shareholders if ITAC fails to consummate a Business Combination within fifteen (15) months after the closing of the IPO, subject to extension as described in the Prospectus relating to ITAC’s IPO and any further extensions which may be approved by ITAC’s stockholders, (c) with respect to any interest earned on the amounts held in the Trust Account, amounts necessary to pay for any taxes and up to $50,000 of interest to pay dissolution expenses, and (d) to ITAC after or concurrently with the consummation of a Business Combination. For and in consideration of ITAC entering into this Agreement and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the Company and Merger Sub hereby agrees on behalf of itself and its Affiliates that, notwithstanding anything to the contrary in this Agreement, none of the Company or Merger Sub nor any of their respective Affiliates do now or shall at any time hereafter have any right, title, interest or claim of any kind in or to any monies in the Trust Account or distributions therefrom, or make any claim against the Trust Account (including any distributions therefrom), regardless of whether such claim arises as a result of, in connection with or relating in any way to, this Agreement or any other matter, and regardless of whether such claim arises based on contract, tort, equity or any other theory of legal liability (collectively, the “Released Claims”). Each of the Company and Merger Sub on behalf of itself and its Affiliates hereby irrevocably waives any Released Claims that any such Party or any of its Affiliates may have against the Trust Account (including any distributions therefrom) now or in the future and will not seek recourse against the Trust Account (including any distributions therefrom) for any reason whatsoever (including for an alleged breach of this Agreement or any other agreement with ITAC or its Affiliates). The Company and Merger Sub each agrees and acknowledges that such irrevocable waiver is material to this Agreement and specifically relied upon by ITAC and its Affiliates to induce the Company to enter in this Agreement, and each of the Company and Merger Sub further intends and understands such waiver to be valid, binding and enforceable against such Party and each of its Affiliates under applicable Law. To the extent that the Company or Merger Sub or any of their respective Affiliates commences any Action based upon, in connection with, relating to or arising out of any matter relating to ITAC or its Representatives, which proceeding seeks, in whole or in part, monetary relief against ITAC or its Representatives, each of the Company and Merger Sub hereby acknowledges and agrees that its and its Affiliates’ sole remedy shall be against funds held outside of the Trust Account and that such claim shall not permit such Party or any of its Affiliates (or any Person claiming on any of their behalves or in lieu of them) to have any claim against the Trust Account (including any distributions therefrom) or any amounts contained therein. In the event that the Company or Merger Sub or any of their respective Affiliates commences any Action based upon, in connection with, relating to or arising out of any matter relating to ITAC or its Representatives which proceeding seeks, in whole or in part, relief against the Trust Account (including any distributions therefrom) or the Public Shareholders, whether in the form of money damages or injunctive relief, ITAC and its Representatives, as applicable, shall be entitled to recover from the Company, Merger Sub and their respective Affiliates, as applicable, the associated legal fees and costs in connection with any such Action, in the event ITAC or its Representatives, as applicable, prevails in such Action. This Section 8.1 shall survive termination of this Agreement for any reason and continue indefinitely.
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Article
IX
MISCELLANEOUS
9.1 Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered (i) in person, (ii) by facsimile (if a facsimile number is given) email or other electronic means, with affirmative confirmation of receipt, (iii) two (2) Business Days after being sent, if sent by reputable, internationally recognized overnight courier service that provides evidence of delivery or attempted delivery or (iv) four (4) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in each case to the applicable Party at the following addresses (or at such other address for a Party as shall be specified by like notice):
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If to ITAC at or prior to the Closing, to:
Industrial Tech Acquisitions, Inc.
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with a copy (which will not constitute notice) to:
Ellenoff Grossman & Schole LLP
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If to the Company or Merger Sub:
Arbe Robotics Ltd.
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with a copy (which will not constitute notice) to:
DLA Piper LLP (US)
Erdinast, Ben Nathan, Toledano & Co.
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9.2 Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns. This Agreement shall not be assigned by operation of Law or otherwise without the prior written consent of ITAC and the Company, and any assignment without such consent shall be null and void; provided that no such assignment shall relieve the assigning Party of its obligations hereunder.
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9.3 Non-Survival of Representations, Warranties. The representations and warranties of the Company, Merger Sub and ITAC contained in this Agreement or in any certificate or instrument delivered by or on behalf of the Company, Merger Sub or ITAC pursuant to this Agreement shall not survive the Closing, and from and after the Closing, the Company, Merger Sub and ITAC and their respective Representatives shall not have any further obligations, nor shall any claim be asserted or action be brought against the Company, Merger Sub or ITAC or their respective Representatives with respect thereto. The covenants and agreements made by the Company, Merger Sub and ITAC in this Agreement or in any certificate or instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such covenants or agreements, shall not survive the Closing, except for those covenants and agreements contained herein and therein that by their terms apply or are to be performed in whole or in part after the Closing (which such covenants shall survive the Closing and continue until fully performed in accordance with their terms). Nothing in this Section 9.3 shall be construed to modify or otherwise affect the provisions of Section 5.16, Section 5.17 and Article VIII.
9.4 Third Parties. Except for the rights of the D&O Indemnified Persons set forth in Section 5.16 and of the Sponsor under Section 9.15, who the Parties acknowledge and agree are express third party beneficiaries of this Agreement for such purposes, nothing contained in this Agreement or in any instrument or document executed by any party in connection with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any Person that is not a Party hereto or thereto or a successor or permitted assign of such a Party.
9.5 [Reserved]
9.6 Governing Law; Jurisdiction. This Agreement shall be governed by, construed and enforced in accordance with the Laws of the State of New York without regard to the conflict of laws principles thereof. All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in any state or federal court located in New York, New York (or in any appellate court thereof) (the “Specified Courts”). Each Party hereto hereby (a) submits to the exclusive jurisdiction of any Specified Court for the purpose of any Action arising out of or relating to this Agreement brought by any Party hereto and (b) irrevocably waives, and agrees not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated hereby may not be enforced in or by any Specified Court. Each Party agrees that a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each Party irrevocably consents to the service of the summons and complaint and any other process in any other Action relating to the transactions contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such Party at the applicable address set forth in Section 9.1. Nothing in this Section 9.6 shall affect the right of any Party to serve legal process in any other manner permitted by Law.
9.7 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.7.
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9.8 Specific Performance. Each Party acknowledges that the rights of each Party to consummate the transactions contemplated hereby are unique, recognizes and affirms that in the event of a breach of this Agreement by any Party, money damages may be inadequate and the non-breaching Parties may have not adequate remedy at law, and agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by an applicable Party in accordance with their specific terms or were otherwise breached. Accordingly, prior to the valid termination of this Agreement, each Party shall be entitled to seek an injunction or restraining order to prevent breaches of this Agreement and to seek to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such Party may be entitled under this Agreement, at law or in equity.
9.9 Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction, such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid, legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out, so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
9.10 Amendment. This Agreement may be amended, supplemented or modified only by execution of a written instrument signed by ITAC, the Company and Merger Sub.
9.11 Waiver. Each of ITAC and the Company on behalf of itself and its Affiliates may in its sole discretion (i) extend the time for the performance of any obligation or other act of any other non-Affiliated Party hereto, (ii) waive any inaccuracy in the representations and warranties by such other non-Affiliated Party contained herein or in any document delivered pursuant hereto and (iii) waive compliance by such other non-Affiliated Party with any covenant or condition contained herein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Party or Parties to be bound thereby (including by the ITAC Representative in lieu of such Party to the extent provided in this Agreement). Notwithstanding the foregoing, no failure or delay by a Party in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder.
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9.12 Entire Agreement. This Agreement and the documents or instruments referred to herein, including any Exhibits, annexes and Schedules attached hereto, which Exhibits, annexes and Schedules are incorporated herein by reference, together with the Ancillary Documents, embody the entire agreement and understanding of the Parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, representations, warranties, covenants or undertakings, other than those expressly set forth or referred to herein or the documents or instruments referred to herein, which collectively supersede all prior or contemporaneous oral or written agreements and the understandings among the Parties with respect to the subject matter contained herein.
9.13 Interpretation. The table of contents and the Article and Section headings contained in this Agreement are solely for the purpose of reference, are not part of the agreement of the Parties and shall not in any way affect the meaning or interpretation of this Agreement. In this Agreement, unless the context otherwise requires: (a) any pronoun used shall include the corresponding masculine, feminine or neuter forms, and words in the singular form, including any defined terms, include the plural and vice versa; (b) reference to any Person includes such Person’s successors and assigns but, if applicable, only if such successors and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity; (c) any accounting term used and not otherwise defined in this Agreement or any Ancillary Document has the meaning assigned to such term in accordance with GAAP, based on the accounting principles used by the applicable Person; (d) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding or succeeding such term and shall be deemed in each case to be followed by the words “without limitation”; (e) the words “herein,” “hereto,” and “hereby” and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and not to any particular Section or other subdivision of this Agreement; (f) the word “if” and other words of similar import when used herein shall be deemed in each case to be followed by the phrase “and only if”; (g) the term “or” means “and/or”; (h) any reference to the term “ordinary course” or “ordinary course of business” shall be deemed in each case to be followed by the words “consistent with past practice”; (i) any agreement, instrument, insurance policy, Law or Order defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument, insurance policy, Law or Order as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes, regulations, rules or orders) by succession of comparable successor statutes, regulations, rules or orders and references to all attachments thereto and instruments incorporated therein; (j) except as otherwise indicated, all references in this Agreement to the words “Section,” “Article,” “Schedule” and “Exhibit” are intended to refer to Sections, Articles, Schedules and Exhibits to this Agreement; and (k) the term “Dollars” or “$” means United States dollars and NIS means Israeli New Israeli Shekel. Any reference in this Agreement or any Ancillary Document to a Person’s (i) directors shall include any member of such Person’s governing body, (ii) officers shall include any Person filling a substantially similar position for such Person or (iii) shareholders or shareholders shall include any applicable owners of the equity interests of such Person, in whatever form. The Parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement. To the extent that any Contract, document, certificate or instrument is represented and warranted to by the Company to be given, delivered, provided or made available by the Company, in order for such Contract, document, certificate or instrument to have been deemed to have been given, delivered, provided and made available to ITAC or its Representatives, such Contract, document, certificate or instrument shall have been posted to the electronic data site maintained on behalf of the Company for the benefit of ITAC and its Representatives and ITAC and its Representatives have been given access to the electronic folders containing such information.
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9.14 Counterparts. This Agreement may be executed and delivered (including by facsimile or other electronic transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.
9.15 Legal Representation. The Parties agree that, notwithstanding the fact that Ellenoff Grossman & Schole LLP (“EGS”) may have, prior to Closing, jointly represented ITAC and the Sponsor in connection with this Agreement, the Ancillary Documents and the Transactions, and has also represented ITAC, the Sponsor and/or their respective Affiliates in connection with matters other than the Transaction that is the subject of this Agreement, EGS will be permitted in the future, after Closing, to represent ITAC, the Sponsor or their respective Affiliates in connection with matters in which such Persons are adverse to the Company, ITAC or any of their respective Affiliates, including any disputes arising out of, or related to, this Agreement. The Company and Merger, who are or have the right to be represented by independent counsel in connection with the Transactions contemplated by this Agreement, hereby agree, in advance, to waive (and to cause their Affiliates to waive) any actual or potential conflict of interest that may hereafter arise in connection with EGS’s future representation of one or more of the Sponsor or its Affiliates in which the interests of such Person are adverse to the interests of the Company, Merger Sub and/or ITAC or any of their respective Affiliates, including any matters that arise out of this Agreement or that are substantially related to this Agreement or to any prior representation by EGS of the Sponsor, ITAC or any of their respective Affiliates. The Parties acknowledge and agree that, for the purposes of the attorney-client privilege, Sponsor shall be deemed the client of EGS with respect to the negotiation, execution and performance of this Agreement and the Ancillary Documents. All such communications shall remain privileged after the Closing and the privilege and the expectation of client confidence relating thereto shall belong solely to the Sponsor, shall be controlled by the Sponsor Representative and shall not pass to or be claimed by the Company or ITAC; provided, further, that nothing contained herein shall be deemed to be a waiver by the Company, ITAC or any of their respective Affiliates of any applicable privileges or protections that can or may be asserted to prevent disclosure of any such communications to any third party.
Article
X
DEFINITIONS
10.1 Certain Definitions. For purpose of this Agreement, the following capitalized terms have the following meanings:
“Accounting Principles” means in accordance with GAAP as in effect at the date of the financial statement to which it refers or if there is no such financial statement, then as of the Closing Date, using and applying the same accounting principles, practices, procedures, policies and methods (with consistent classifications, judgments, elections, inclusions, exclusions and valuation and estimation methodologies) used and applied by the Target Companies in the preparation of the latest audited Company Financials.
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“Action” means any notice of noncompliance or violation, or any claim, demand, charge, action, suit, litigation, audit, settlement, complaint, stipulation, assessment or arbitration, or any request (including any request for information), inquiry, hearing, proceeding or investigation, by or before any Governmental Authority.
“Affiliate” means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with such Person. For the avoidance of doubt, Sponsor shall be deemed to be an Affiliate of ITAC prior to the Closing.
“Ancillary Documents” means the Lock-Up Agreement, Voting Agreements, the Non-Competition Agreement, the Founders Registration Rights Agreement Amendment, the Equity Plan and the Restated Company Articles, the Voting Agreements and the other agreements, certificates and instruments to be executed or delivered by any of the Parties hereto in connection with or pursuant to this Agreement.
“Benefit Plans” of any Person means any and all deferred compensation, executive compensation, incentive compensation, equity purchase or other equity-based compensation plan, employment or consulting, severance or termination pay, holiday, vacation or other bonus plan or practice, hospitalization or other medical, life or other insurance, supplemental unemployment benefits, profit sharing, pension, or retirement plan, program, agreement, commitment or arrangement, and each other employee benefit plan, program, agreement or arrangement, including each “employee benefit plan” as such term is defined under Section 3(3) of ERISA, maintained or contributed to or required to be contributed to by a Person for the benefit of any employee or terminated employee of such Person, or with respect to which such Person has any Liability, whether direct or indirect, actual or contingent, whether formal or informal, and whether legally binding or not, and shall include any Foreign Plan.
“Business Day” means any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in Israel or in New York, New York are authorized to close for business, excluding as a result of “stay at home,” “shelter-in-place,” “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems, including for wire transfers, of commercially banking institutions in New York, New York are generally open for use by customers on such day.
“Code” means the Internal Revenue Code of 1986, as amended, and any successor statute thereto, as amended. Reference to a specific section of the Code shall include such section and any valid treasury regulation promulgated thereunder.
“Company Confidential Information” means all confidential or proprietary documents and information concerning the Target Companies or Merger Sub or any of their respective Representatives, furnished in connection with this Agreement or the transactions contemplated hereby; provided, however, that Company Confidential Information shall not include any information which, (i) at the time of disclosure by ITAC or its Representatives, is generally available publicly and was not disclosed in breach of this Agreement or the Confidentiality Agreement, or (ii) at the time of the disclosure by the Company or Merger Sub, or their respective Representatives to ITAC or its Representatives was previously known by such receiving party without violation of Law or any confidentiality obligation by the Person receiving such Company Confidential Information.
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“Company Ordinary Shares” means the ordinary shares, with a nominal value of NIS 0.01 per share, of the Company, along with any equity securities paid as dividends or distributions after the Closing with respect to such shares or into which such shares are exchanged or converted after the Closing.
“Company Preferred Shares” means the preference shares with a nominal value of NIS 0.01 per share, of the Company.
“Consent” means any consent, approval, waiver, authorization or Permit of, or notice to or declaration or filing with any Governmental Authority or any other Person.
“Confidentiality Agreement” means the non-disclosure agreement dated , 2020, by and between the Company and ITAC.
“Contracts” means all contracts, agreements, binding arrangements, bonds, notes, indentures, mortgages, debt instruments, purchase order, licenses, franchises, leases and other instruments or obligations of any kind, written or, to the extent legally binding, oral (in each instance, including any amendments and other modifications thereto).
“Control” of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract, or otherwise. “Controlled,” “Controlling” and “under common Control with” have correlative meanings. Without limiting the foregoing a Person (the “Controlled Person”) shall be deemed Controlled by (a) any other Person (i) owning beneficially, as meant in Rule 13d-3 under the Exchange Act, securities entitling such Person to cast ten percent (10%) or more of the votes for election of directors or equivalent governing authority of the Controlled Person or (ii) entitled to be allocated or receive ten percent (10%) or more of the profits, losses, or distributions of the Controlled Person; (b) an officer, director, general partner, partner (other than a limited partner), manager, or member (other than a member having no management authority that is not a Person described in clause (a) above) of the Controlled Person; or (c) a spouse, parent, lineal descendant, sibling, aunt, uncle, niece, nephew, mother-in-law, father-in-law, sister-in-law, or brother-in-law of an Affiliate of the Controlled Person or a trust for the benefit of an Affiliate of the Controlled Person or of which an Affiliate of the Controlled Person is a trustee.
“Copyrights” means any works of authorship, mask works and all copyrights therein, including all renewals and extensions, copyright registrations and applications for registration and renewal, and non-registered copyrights.
“COVID 19” means SARS CoV 2 or COVID 19, and any evolutions or mutations thereof or related or associated epidemics, pandemics or disease outbreaks.
“COVID-19 Actions” means all actions taken, planned, or planned to be taken in response to events, occurrences, conditions, circumstances, or developments arising directly or indirectly as a result of COVID-19, its impact on economic conditions, its impact on the operations of the Company or any of the other Target Companies, risks to the health and safety of any Person or the recovery from COVID-19 (including, if applicable, actions taken, planned or planned to be taken to reopen and restore the level of business activities of the Company or any Target Company).
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“COVID-19 Measures” means any quarantine, ‘shelter in place,’ ‘stay at home,’ workforce reduction, social distancing, shut down, closure, sequester, safety or similar Law, Order, directive, guideline, pronouncement, or recommendation promulgated by any Governmental Authority, including the World Health Organization, in each case, in connection with or in response to COVID-19.
“Environmental Law” means any Law in any way relating to (a) the protection of human health and safety, as each relates to exposure to Hazardous Materials, (b) the protection, preservation or restoration of the environment and natural resources (including air, water vapor, surface water, groundwater, drinking water supply, surface land, subsurface land, plant and animal life or any other natural resource), or (c) the exposure to, or the use, storage, recycling, treatment, generation, transportation, processing, handling, labeling, production, release or disposal of Hazardous Materials.
“Environmental Liabilities” means, in respect of any Person, all Liabilities, obligations, Remedial Actions, Actions, Orders, losses, damages, costs, and expenses (including all reasonable fees, disbursements, and expenses of counsel, experts, and consultants and costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand by any other Person or in response to any violation of Environmental Law, whether known or unknown, accrued or contingent, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, to the extent based upon, related to, or arising under or pursuant to any Environmental Law, Environmental Permit, Order, or Contract with any Governmental Authority or other Person, that relates to any environmental, health or safety condition, violation of Environmental Law, or a Release or threatened Release of Hazardous Materials.
“ERISA” means the U.S. Employee Retirement Income Security Act of 1974, as amended.
“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.
“Export Control Laws” means U.S. and non-U.S. export control, economic sanctions, trade embargoes, import, and anti-boycott laws, including but not limited to the U.S. Export Administration Regulations (the “EAR,” 15 C.F.R. § 730 et seq.), the International Traffic in Arms Regulations (the “ITAR,” 22 C.F.R. § 120 et seq.), or the U.S. economic sanctions administered by the Office of Foreign Assets Control (“OFAC,” 31 C.F.R. Part 500 et seq.)
“Foreign Plan” means any plan, fund (including any superannuation fund) or other similar program or arrangement established or maintained outside the United States by the Company or any one or more of its Subsidiaries primarily for the benefit of employees of the Company or such Subsidiaries residing outside the United States, which plan, fund or other similar program or arrangement provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code, and includes any plans that are required by the laws of a country other than the United States.
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“Fraud Claim” means any claim based common law fraud under New York Law.
“GAAP” means generally accepted accounting principles as in effect in the United States of America.
“Governmental Authority” means any federal, state, local, foreign or other governmental, quasi-governmental or administrative body, instrumentality, department or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, regulatory body or other similar regulatory or dispute-resolving panel or body.
“Hazardous Material” means any waste, gas, liquid or other substance or material that is defined, listed or designated as a “hazardous substance,” “pollutant,” “contaminant,” “hazardous waste,” “regulated substance,” “hazardous chemical,” or “toxic chemical” (or by any similar term) under any Environmental Law, or any other material regulated, or that could result in the imposition of Liability, under any Environmental Law, including petroleum and its by-products, asbestos, polychlorinated biphenyls, radon, mold, and urea formaldehyde insulation.
“Indebtedness” of any Person means, without duplication, (a) all indebtedness of such Person for borrowed money (including the outstanding principal and accrued but unpaid interest), (b) all obligations for the deferred purchase price of property or services (other than trade payables incurred in the ordinary course of business consistent with past practices), (c) any other indebtedness of such Person that is evidenced by a note, bond, debenture, credit agreement or similar written instrument, (d) all obligations of such Person under leases that are or should be classified as capital leases in accordance with GAAP (as applicable to such Person), (e) all obligations of such Person for the reimbursement of any obligor on any line or letter of credit, banker’s acceptance, guarantee or similar credit transaction, in each case, regardless of whether such instrument has been drawn or claimed against, (f) all interest rate and currency swaps, caps, collars and similar agreements or hedging devices under which payments are obligated to be made by such Person, whether periodically or upon the happening of a contingency, (g) all obligations secured by an Lien on any property of such Person, (h) any premiums, prepayment fees or other penalties, fees, costs or expenses associated with payment of any Indebtedness of such Person and (i) all obligation described in clauses (a) through (h) above of any other Person which is directly or indirectly guaranteed by such Person or which such Person has agreed (contingently or otherwise) to purchase or otherwise acquire or in respect of which it has otherwise assured a creditor against loss.
“Intellectual Property” means all of the following as they exist in any jurisdiction throughout the world: Patents, Trademarks, Copyrights, Trade Secrets, Internet Assets, Software, Company IP Licenses and other intellectual property.
“Internet Assets” means any all registered domain names.
“Investment Company Act” means the U.S. Investment Company Act of 1940, as amended.
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“IPO” means the initial public offering of ITAC Units pursuant to the IPO Prospectus.
“IPO Prospectus” means the final prospectus of ITAC, dated as of September 8, 2020, and filed with the SEC on September 10, 2020 (File No. 333-424339).
“ITAC Confidential Information” means all confidential or proprietary documents and information concerning ITAC or any of its Representatives; provided, however, that ITAC Confidential Information shall not include any information which, (i) at the time of disclosure by the Company, Merger Sub, or any of their respective Representatives, is generally available publicly and was not disclosed in breach of this Agreement or the Confidentiality Agreement, or (ii) at the time of the disclosure by ITAC or its Representatives to the Company or any of its Representatives, was previously known by such receiving party without violation of Law or any confidentiality obligation by the Person receiving such ITAC Confidential Information. For the avoidance of doubt, from and after the Closing, ITAC Confidential Information will include the confidential or proprietary information of the Target Companies.
“ITAC Private Warrants” means the warrants issued in a private placement to the Sponsor by ITAC at the time of the consummation of the IPO, entitling the holder thereof to purchase one (1) ITAC Common Stock per warrant at a purchase price of $11.50 per share.
“ITAC Public Warrants” means one whole warrant that was included in as part of each ITAC Unit, entitling the holder thereof to purchase one (1) share of ITAC Class A Stock at a purchase price of $11.50 per share.
“ITAC Securities” means ITAC Units, ITAC Common Stock and ITAC Warrants, collectively.
“ITAC Transaction Expenses” means Transaction Expenses incurred by ITAC. For the absence of doubt, cost of the D&O Tail Insurance, is not an ITAC Transaction Expense.
“ITAC Units” means the units issued in the IPO (including overallotment units acquired by ITAC’s underwriter) consisting of one (1) share of ITAC Class A Stock, and one (1) ITAC Public Warrant.
“ITAC Warrants” means ITAC Private Warrants and ITAC Public Warrants, collectively.
“Knowledge” means, with respect to (i) the Company, the actual knowledge of any executive officer or director of the Company, after reasonable inquiry, or (ii) any other Party, (A) if an entity, the actual knowledge of its directors and executive officers of such Person, after reasonable inquiry, or (B) if a natural person, the actual knowledge of such Party after reasonable inquiry.
“Law” means any federal, state, local, municipal, foreign or other law, statute, legislation, principle of common law, ordinance, code, edict, decree, proclamation, treaty, convention, rule, regulation, directive, requirement, writ, injunction, settlement, Order or Consent that is or has been issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into effect by or under the authority of any Governmental Authority.
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“Liabilities” means any and all liabilities, Indebtedness, Actions or obligations of any nature (whether absolute, accrued, contingent or otherwise, whether known or unknown, whether direct or indirect, whether matured or unmatured, whether due or to become due and whether or not required to be recorded or reflected on a balance sheet under GAAP), including Tax liabilities due or to become due.
“Lien” means any mortgage, pledge, security interest, attachment, right of first refusal, option, proxy, voting trust, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof), restriction (whether on voting, sale, transfer, disposition or otherwise), any subordination arrangement in favor of another Person, or any filing or agreement to file a financing statement as debtor under the Uniform Commercial Code or any similar Law, in each instance, other than Permitted Liens.
“Material Adverse Effect” means, with respect to any specified Person, any fact, event, occurrence, change or effect that has individually or in the aggregate, a material adverse effect upon (a) the business, assets, Liabilities, results of operations, prospects or condition (financial or otherwise) of such Person and its Subsidiaries, taken as a whole, or (b) the ability of such Person or any of its Subsidiaries on a timely basis to consummate the transactions contemplated by this Agreement or the Ancillary Documents to which it is a party or bound or to perform its obligations hereunder or thereunder; provided, however, that any such fact, event, occurrence, change or effect directly or indirectly attributable to, resulting from, relating to or arising out of the following (by themselves or when aggregated with any other, changes or effects) shall not be deemed to be, constitute, or be taken into account when determining whether there has or may, would or could have occurred a Material Adverse Effect: (i) changes generally affecting the financial or securities markets or general economic or political conditions in the country or region in which such Person or any of its Subsidiaries do business, or the U.S. or global financial markets, including interest rates or currency exchange rates, trade tariffs or changes therein or the outbreak or escalation of war or acts of terrorism (including cyberterrorism); (ii) changes, conditions or effects that generally affect the industries in which such Person or any of its Subsidiaries operate; (iii) changes in GAAP or other applicable accounting principles or mandatory changes in the regulatory accounting requirements applicable to any industry in which such Person and its Subsidiaries principally operate; (iv) conditions caused by acts of God, terrorism, war (whether or not declared), other force majeure events or natural disaster, including pandemics (COVID-19 variations included) or any COVID-19 Actions or COVID-19 Measures, or any change in such COVID 19 Measures or the interpretation or enforcement thereof; (v) any failure in and of itself by such Person and its Subsidiaries to meet any internal or published budgets, projections, forecasts or predictions of financial performance for any period (provided that the underlying cause of any such failure may be considered in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur to the extent not excluded by another exception herein) (vi), with respect to ITAC, the consummation and effects of the Redemption; (vii) the execution, delivery, announcement or pendency of this Agreement and the Transactions (including as a result of the identities of the Parties and including the loss (or threatened loss) of any employee, other than a Person named in Schedule 6.3(g), supplier, distributor or customer or other commercial relationship resulting therefrom); (viii) any action or failure to act required or prohibited to be taken by a Party pursuant to the terms of this Agreement or action or omission taken or omitted to be taken at the written request, or with the written consent, of the other Party; or (ix) any change or proposed change in any Law or the interpretation thereof (including any COVID-19 Measures); provided further, however, that any event, occurrence, fact, condition, or change referred to in clauses (i) - (iv) immediately above shall be taken into account in determining whether a Material Adverse Effect has occurred but solely to the extent that such event, occurrence, fact, condition, or change has a disproportionate effect on such Person or any of its Subsidiaries compared to other participants in the industries in which such Person or any of its Subsidiaries primarily conducts its businesses. Notwithstanding the foregoing, with respect to ITAC, the amount of the Redemption shall not be deemed to be a Material Adverse Effect on or with respect to ITAC.
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“Nasdaq” means the Nasdaq Capital Market.
“Order” means any order, decree, ruling, judgment, injunction, writ, determination, binding decision, verdict, judicial award or other action that is or has been made, entered, rendered, or otherwise put into effect by or under the authority of any Governmental Authority.
“Organizational Documents” means, with respect to any Person, its certificate of incorporation and bylaws, memorandum and articles of association or similar organizational documents, in each case, as amended.
“Patents” means any patents, patent applications and, including the inventions, designs, methods, processes, compositions of matter, and improvements described and claimed therein, patentable inventions, and other patent rights (including any divisionals, provisionals, non-provisionals, continuations, continuations-in-part, substitutions, or reissues thereof, whether or not patents are issued on any such applications and whether or not any such applications are amended, modified, withdrawn, or refiled).
“PCAOB” means the U.S. Public Company Accounting Oversight Board (or any successor thereto).
“Permits” means all federal, state, local or foreign or other third-party permits, grants, easements, consents, approvals, authorizations, exemptions, licenses, franchises, concessions, ratifications, permissions, clearances, confirmations, endorsements, waivers, certifications, designations, ratings, registrations, qualifications or orders of any Governmental Authority or any other Person.
“Permitted Liens” means (a) Liens for Taxes or assessments and similar governmental charges or levies, which either are (i) not delinquent or (ii) being contested in good faith and by appropriate proceedings, and adequate reserves have been established with respect thereto, (b) other Liens imposed by operation of Law arising in the ordinary course of business for amounts which are not due and payable and as would not in the aggregate materially adversely affect the value of, or materially adversely interfere with the use of, the property subject thereto, (c) Liens on goods in transit incurred pursuant to documentary letters of credit, in each case arising in the ordinary course of business, (d) Liens arising under this Agreement or any Ancillary Document, (e) statutory Liens of landlords, lessors or renters in each instance, which do not and would not reasonably be expected to impair, individually or in the aggregate, in any material respect the access to or operations of the relevant property, (f) Liens of carriers, warehousemen, mechanics, materialmen, workmen, repairmen and other Liens imposed by Law that are not yet due and payable or that are being contested in good faith; (g) Liens incurred or deposits made in the ordinary course of business and on a basis consistent with past practice in connection with workers’ compensation, unemployment insurance or other types of social security; (h) defects or imperfections of title, encroachments, easements, declarations, conditions, covenants, rights-of-way, restrictions and other charges, instruments or encumbrances or other defects affecting title to real estate (including any leasehold or other interest therein), in each instance, which do not and would not reasonably be expected to impair, individually or in the aggregate, in any material respect the access to or operations of the relevant property; (i) Liens not created by the Company or any Target Company that affect the underlying fee interest of any real property utilized by such person, in each instance, which do not and would not reasonably be expected to impair, individually or in the aggregate, in any material respect the access to or operations of the relevant property; (j) zoning ordinances, variances, conditional use permits and similar regulations, permits, approvals and conditions with respect to real property, in each instance, which do not and would not reasonably be expected to impair, individually or in the aggregate, in any material respect the access to or operations of the relevant property; and (k) Liens to be released at Closing.
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“Person” means an individual, corporation, partnership (including a general partnership, limited partnership or limited liability partnership), limited liability company, association, trust or other entity or organization, including a government, domestic or foreign, or political subdivision thereof, or an agency or instrumentality thereof.
“Personal Information” means information that identifies, relates to, or describes, is reasonably capable of being associate with, or could reasonably be linked, directly or indirectly, with a particular individual.
“Personal Property” means any machinery, equipment, tools, vehicles, furniture, leasehold improvements, office equipment, plant, parts and other tangible personal property.
“Release” means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, or leaching into the indoor or outdoor environment, or into or out of any property.
“Remedial Action” means all actions to (i) clean up, remove, treat, or in any other way address any Hazardous Material, (ii) prevent the Release of any Hazardous Material so it does not endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (iii) perform pre-remedial studies and investigations or post-remedial monitoring and care, or (iv) correct a condition of noncompliance with Environmental Laws.
“Representatives” means, as to any Person, such Person’s Affiliates and the respective managers, directors, officers, employees, independent contractors, consultants, advisors (including financial advisors, counsel and accountants), agents and other legal representatives of such Person or its Affiliates.
“Sanctions List” means the U.S. Department of the Treasury, Office of Foreign Assets Control (OFAC) List of Specially Designated Nationals and Blocked Persons, Foreign Sanctions Evaders List, Sectoral Sanctions Identifications List, and the U.S. Department of Commerce, Bureau of Industry and Security Denied Persons List, Unverified List and Entity List, as well as other restricted party lists issued by a Governmental Authority, as such other lists are applicable.
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“SEC” means the U.S. Securities and Exchange Commission (or any successor Governmental Authority).
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Software” means any computer software programs, including all source code, object code, and documentation related thereto and all software modules, tools and databases.
“SOX” means the U.S. Sarbanes-Oxley Act of 2002, as amended.
“Sponsor” means Industrial Tech Partners, LLC.
“Subsidiary” means, with respect to any Person, any corporation, partnership, association or other business entity of which (i) if a corporation, a majority of the total voting power of capital shares entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (ii) if a partnership, association or other business entity, a majority of the partnership or other similar ownership interests thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof, a Person or Persons will be deemed to have a majority ownership interest in a partnership, association or other business entity if such Person or Persons will be allocated a majority of partnership, association or other business entity gains or losses or will be or control the managing director, managing member, general partner or other managing Person of such partnership, association or other business entity. A Subsidiary of a Person will also include any variable interest entity which is consolidated with such Person under applicable accounting rules.
“Target Company” means each of the Company and its direct and indirect Subsidiaries.
“Tax Return” means any return, declaration, report, claim for refund, information return or other documents (including any related or supporting schedules, statements or information) filed or required to be filed in connection with the determination, assessment or collection of any Taxes or the administration of any Laws or administrative requirements relating to any Taxes.
“Taxes” means (a) all direct or indirect federal, state, local, foreign and other net income, gross income, gross receipts, sales, use, value-added, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, social security and related contributions due in relation to the payment of compensation to employees, excise, severance, stamp, occupation, premium, property, windfall profits, alternative minimum, estimated, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts with respect thereto, (b) any Liability for payment of amounts described in clause (a) whether as a result of being a member of an affiliated, consolidated, combined or unitary group for any period or otherwise through operation of law and (c) any Liability for the payment of amounts described in clauses (a) or (b) as a result of any tax sharing, tax group, tax indemnity or tax allocation agreement with, or any other express or implied agreement to indemnify, any other Person.
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“Trade Secrets” means any trade secrets, confidential business information, concepts, ideas, designs, research or development information, processes, procedures, techniques, technical information, specifications, operating and maintenance manuals, engineering drawings, methods, know-how, data, mask works, discoveries, inventions, modifications, extensions, improvements, and other proprietary rights (whether or not patentable or subject to copyright, trademark, or trade secret protection).
“Trademarks” means any trademarks, service marks, trade dress, trade names, brand names, internet domain names, designs, logos, or corporate names (including, in each case, the goodwill associated therewith and any common law rights therein), whether registered or unregistered, and all registrations and applications for registration and renewal thereof.
“Transaction Expenses” means all fees and expenses of any of the Target Companies and ITAC incurred or payable as of the Closing and not paid prior to the Closing in connection with the consummation of the transactions contemplated hereby, including any amounts payable to professionals (including investment bankers, brokers, finders, attorneys, accountants and other consultants and advisors) retained by or on behalf of ITAC and any Target Company, including any all deferred expenses (including fees and commissions payable to underwriter if ITAC’s IPO).
“Trust Account” means the trust account established by ITAC with the proceeds from the IPO and a private placement pursuant to the Trust Agreement in accordance with the IPO Prospectus.
“Trust Agreement” means that certain Investment Management Trust Agreement, dated as of September 11, 2020, as it may be amended (including to accommodate the Merger), by and between ITAC and the Trustee.
“Trustee” means Continental Stock Transfer & Trust Company, in its capacity as trustee under the Trust Agreement.
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10.2 Section References. The following capitalized terms, as used in this Agreement, have the respective meanings given to them in the page number as set forth below adjacent to such terms:
| 1934 Act Registration Statement | 54 |
| Accounts Receivable | 27 |
| Acquisition Proposal | 50 |
| Agreement | 5 |
| Alternative Transaction | 50 |
| Antitrust Laws | 52 |
| Business Combination | 68 |
| Certificate of Merger | 7 |
| Closing | 12 |
| Closing Date | 12 |
| Closing Filing | 57 |
| Closing Press Release | 57 |
| Company | 5 |
| Company Benefit Plan | 37 |
| Company Financials | 26 |
| Company IP | 32 |
| Company IP Licenses | 31 |
| Company Material Contract | 29 |
| Company Permits | 28 |
| Company Personal Property Leases | 36 |
| Company Real Property Leases | 35 |
| Company Registered IP | 30 |
| Company Shareholder Approval Matters | 55 |
| Continental | 9 |
| Continuing Warrants | 5 |
| Conversion Ratio | 5 |
| Creator | 32 |
| D&O Indemnified Persons | 59 |
| D&O Tail Insurance | 60 |
| Delaware Law | 7 |
| Effective Time | 7 |
| Enforceability Exceptions | 13 |
| Environmental Permit | 38 |
| Equity Plan | 54 |
| Exercising Warrants | 5 |
| Existing Articles | 5 |
| F-1 Registration Statement | 61 |
| Federal Securities Laws | 51 |
| Founder Lock-Up Agreement | 6 |
| Founder Registration Rights Agreement | 6 |
| Founder Registration Rights Agreement Amendment | 6 |
| Interim Period | 43 |
| Israeli Companies Law | 8 |
| ITA | 34 |
| ITAC | 5 |
| ITAC Class A Stock | 6 |
| ITAC Class B Stock | 6 |
| ITAC Common Stock | 6 |
| ITAC Disclosure Schedules | 12 |
| ITAC Financials | 16 |
| ITAC Material Contract | 18 |
| ITAC Special Meeting | 54 |
| ITAC Stockholder Approval Matters | 54 |
| Lock-Up Agreement | 6 |
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| Merger | 5 |
| Merger Sub | 5 |
| New ITAC Common Stock | 6 |
| Non-Competition Agreement | 6 |
| OFAC | 19 |
| Off-the-Shelf Software | 31 |
| Ordinance | 34 |
| Outbound IP License | 31 |
| Outside Date | 66 |
| Party | 5 |
| PIPE Investment | 60 |
| PIPE Investors | 60 |
| Post-Closing Company Board of Directors | 59 |
| Proxy Statement | 53 |
| Public Certifications | 15 |
| Public Shareholders | 68 |
| Recapitalization | 5 |
| Redemption | 54 |
| Registration Statement | 53 |
| Related Person | 39 |
| Released Claims | 69 |
| Required Company Shareholder Approval | 23 |
| Required ITAC Shareholder Approval | 62 |
| Restated Company Articles | 8 |
| Restated ITAC Certificate | 6 |
| SEC Reports | 15 |
| Signing Filing | 57 |
| Signing Press Release | 57 |
| Specified Courts | 71 |
| Subscription Agreement | 60 |
| Surviving Company | 7 |
| Top Customers | 40 |
| Top Vendors | 40 |
| Transactions | 5 |
| Voting Agreements | 7 |
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each Party hereto has caused this Agreement to be signed and delivered by its respective duly authorized officer as of the date first written above.
| ITAC: | ||
| INDUSTRIAL TECH ACQUISITIONS, INC | ||
| By: | /s/ E. Scott Crist | |
| Name: E. Scott Crist | ||
| Title: CEO | ||
| The Company: | ||
| ARBE ROBOTICS LTD. | ||
| By: | /s/ Kobi Marenko | |
| Name: Kobi Marenko | ||
| Title: CEO | ||
| Merger Sub: | ||
| AUTOBOT MERGERSUB, INC. | ||
| By: | /s/ Kobi Marenko | |
| Name: Kobi Marenko | ||
| Title: CEO | ||
{Signature Page to Business Combination Agreement}
Exhibit 10.1
VOTING AND SUPPORT AGREEMENT
This Voting and Support Agreement (this “Agreement”) is made as of March 18, 2021, by and among (i) Arbe Robotics Ltd., an Israeli company (“Arbe”), (ii) Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), and (iii) the undersigned shareholder of Arbe (“Holder”). Any capitalized term used but not defined in this Agreement will have the meaning ascribed to such term in the Business Combination Agreement (as defined below).
WHEREAS, on or about the date hereof, Arbe, Autobot MergerSub, Inc., a Delaware corporation and a wholly-owned subsidiary of Arbe (“Merger Sub”) and ITAC, have entered into that certain Business Combination Agreement (as amended from time to time in accordance with the terms thereof, the “Business Combination Agreement”) pursuant to which (and subject to the terms and conditions set forth therein) Merger Sub will merge with and into ITAC, with ITAC continuing as the surviving entity (the “Merger”), and as a result of which, among other matters, all of the issued and outstanding capital stock of ITAC as of the Effective Time shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, in exchange for the right to receive the ordinary shares, with a nominal value of NIS 0.01 per share, of Arbe as set forth in the Business Combination Agreement, all upon the terms and subject to the conditions set forth in the Business Combination Agreement;
WHEREAS, as of the date hereof, the Holder is the record and “beneficial owner” (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended (together with the rules and regulations promulgated thereunder, the “Exchange Act”)) of and is entitled to dispose of and vote the Company Ordinary Shares and\or Company Preferred Shares set forth on the signature page of this Agreement which shares and any additional Company Ordinary Shares and\or Company Preferred Shares (or any securities convertible into or exercisable or exchangeable for Company Ordinary Shares or Company Preferred Shares) in which the Holder acquires record or beneficial ownership after the date hereof, including by purchase, as a result of a share dividend, share split, recapitalization, combination, reclassification, exchange or change of such shares, or upon exercise or conversion of any securities, the “Shares”);
WHEREAS, the Board of Directors of Arbe has (a) approved and declared advisable the Business Combination Agreement, the Ancillary Documents, the Recapitalization, the Merger and the other transactions contemplated by any such documents (collectively, the “Transactions”), (b) determined that the Transactions are fair to and in the best interests of Arbe and its shareholders (the “Arbe Shareholders”) and (c) recommended the approval and the adoption by each of Arbe Shareholders of the Business Combination Agreement and the Recapitalization, which provide for the adoption of the Restated Company Articles, and the other Company Shareholder Approval Matters; and
WHEREAS, as a condition to the willingness of ITAC to enter into the Business Combination Agreement, and as an inducement and in consideration therefor, and in view of the valuable consideration to be received by Holder thereunder, and the expenses and efforts to be undertaken by Arbe and ITAC to consummate the Transactions, Arbe, ITAC and Holder desire to enter into this Agreement in order for Holder to provide certain assurances to ITAC regarding the manner in which Holder is bound hereunder, in its capacity as a shareholder of Arbe, to vote the Shares during the period from and including the date hereof through and including the date on which this Agreement is terminated in accordance with its terms (the “Voting Period”) with respect to the Business Combination Agreement, the Merger, the Ancillary Documents and the Transactions.
NOW, THEREFORE, in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and intending to be legally bound hereby, the parties hereby agree as follows:
1. Covenant to Vote in Favor of Transactions. Holder agrees, with respect to all of the Shares, during the Voting Period, the Holder will:
(a) at each meeting of Arbe Shareholders or any class or series thereof, and in each written consent or resolutions of any of Arbe Shareholders in which Holder is entitled to vote or consent, Holder hereby unconditionally and irrevocably agrees to be present for such meeting and vote (in person or by proxy), or consent to any action by written consent or resolution with respect to, as applicable, the Shares (i) in favor of, and adopt the Merger, the Business Combination Agreement, the Recapitalization, the authorization of Company Ordinary Shares and Company Warrants to be issued pursuant to the Recapitalization, the Business Combination agreement, the PIPE Investments, and all of the other Transactions explicitly set forth in the Business Combination Agreement; (ii) in favor of any other Ancillary Documents requiring shareholder approval the form of which is attached as an exhibit to the Business Combination Agreement on the date of execution thereof; (iii) in favor of the Restated Company Articles provided the Restated Company Articles have been approved by the Company’s board of directors with the approval of either the Class A Director or the Class B Director, as defined in the Existing Articles, such approval being referred to as the “Special Majority”; (iv) in favor of any other Company Shareholder Approval Matters which have been approved following the date hereof by the Special Majority, (v) in favor of the adjournment of the Special Meeting, if necessary or desirable in the reasonable determination of Arbe, (vi) in favor of the election of directors pursuant to Section 5.15 of the Business Combination Agreement, provided that the exercise of Arbe’s designation rights under that section has been approved by the Company’s board of directors, and (vii) to vote the Shares in opposition to: (A) any Acquisition Proposal and any and all other proposals (x) for the acquisition of Arbe, (y) that could reasonably be expected to delay or impair the ability of Arbe to consummate the Merger, the Business Combination Agreement or any of the Transactions, or (z) which are in competition with or materially inconsistent with the Business Combination Agreement; (B) any change in the present capitalization or corporate structure of Arbe which is inconsistent with the Recapitalization and the Business Combination Agreement; or (C) any other action or proposal involving any Target Company that is intended, or would reasonably be expected, to prevent, impede, interfere with, delay, postpone or adversely affect in any material respect the Transactions or would reasonably be expected to result in any of the conditions to the Closing under the Business Combination Agreement not being fulfilled;
(b) except for transfers as permitted by, and in accordance with, Section 3(b) below, not to deposit, and to cause its Affiliates not to deposit, except as provided in this Agreement, any Shares owned by Holder or his/her/its Affiliates in a voting trust or subject any Shares to any arrangement or agreement with respect to the voting of such Shares, unless specifically requested to do so by ITAC and Arbe in connection with the Business Combination Agreement, the Ancillary Documents and any of the Transactions;
(c) except as contemplated by the Business Combination Agreement or the Ancillary Documents, make, or in any manner participate in, directly or indirectly, a “solicitation” of “proxies” or consents (as such terms are used in the rules of the SEC) or powers of attorney or similar rights to vote, or seek to advise or influence any Person with respect to the voting of, any shares of Arbe capital stock in connection with any vote or other action with respect to the Transactions, other than to recommend that shareholders of Arbe vote in favor of adoption of the Business Combination Agreement and the Transactions and any other proposal the approval of which is a condition to the obligations of the Arbe or ITAC under the Business Combination Agreement (and any actions required in furtherance thereof and otherwise as expressly provided by Section 1 of this Agreement); and
(d) without limiting Section 1(a) above, to approve and consent to the Recapitalization and the Restated Company Articles (as provided in Section 1(a)(iii)) and the exercise of Warrants and the conversion of Company Preferred Shares (including any Company Preferred Shares issued upon exercise of any Warrants) in accordance with the terms of the Existing Articles and the terms of the Warrants pursuant to the Recapitalization, any such conversion to be made in connection with, and prior to, the effectiveness of the Merger.
2. Grant of Proxy. During the Voting Period, Holder, with respect to all of the Shares, hereby irrevocably grants to, and appoints, Arbe and any designee of Arbe (determined in Arbe’s sole discretion) as Holder’s attorney-in-fact and proxy, with full power of substitution and resubstitution, for and in Holder’s name, to vote, or cause to be voted (including by proxy or written consent, if applicable) any Shares owned (whether beneficially or of record) by Holder, solely on the matters and in the manner specified in Section 1 above. The proxy and attorney-in-fact granted by Holder pursuant to this Section 2 are irrevocable and are granted in consideration of Arbe entering into this Agreement and Arbe and ITAC entering into the Business Combination Agreement and incurring certain related fees and expenses. Holder hereby affirms that such irrevocable proxy is coupled with an interest by reason of the Business Combination Agreement and, except upon the termination of this Agreement in accordance with Section 5(a), is intended to be irrevocable. The proxy and power of attorney granted hereunder shall terminate upon the termination of this Agreement. Holder and Arbe each agrees that Arbe shall exercise (and shall not fail to exercise) its rights as attorney-in-fact and proxy in accordance with the provisions of Section 1 of this Agreement.
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3. Other Covenants.
(a) No Transfers. Holder agrees that during the Voting Period it shall not, and shall cause its Affiliates not to, without the joint written consent of ITAC and Arbe, (A) offer for sale, sell (including short sales), transfer, tender, pledge, encumber, assign or otherwise dispose of (including by gift) (collectively, a “Transfer”), or enter into any contract, option, derivative, hedging or other agreement or arrangement or understanding (including any profit-sharing arrangement) with respect to, or consent to, a Transfer of, any or all of the Shares; (B) grant any proxies or powers of attorney with respect to any or all of the Shares; or (C) permit to exist any lien of any nature whatsoever (other than those imposed by this Agreement, applicable securities Laws or Arbe’s Existing Articles, as in effect on the date hereof) with respect to any or all of the Shares; or (D) take any action that would have the effect of preventing, impeding, interfering with or adversely affecting Holder’s ability to perform its obligations under this Agreement. Arbe hereby agrees that it shall not permit any Transfer of the Shares in violation of this Agreement. Holder agrees with, and covenants to, ITAC that Holder shall not request that Arbe register the Transfer (book-entry or otherwise) of any certificate or uncertificated interest representing any Shares during the term of this Agreement without the prior written consent of ITAC, and Arbe hereby agrees that it shall not effect any such Transfer.
(b) Permitted Transfers. Section 3(a) shall not prohibit a Transfer of Shares by Holder (i) to any family member or trust for the benefit of any family member, (ii) to any shareholder, member or partner of Holder, if an entity, (iii) to any Affiliate of Holder or a Permitted Transferee (as defined in the Existing Articles), (iv) to any person or entity if and to the extent required by any non-consensual Order, by divorce decree or by will, intestacy or other similar Applicable Law so long as, in the case of the foregoing clauses (i), (ii), (iii) and (iv), the assignee or transferee agrees to be bound by the terms of this Agreement and executes and delivers to the parties hereto a written consent and joinder memorializing such agreement. Nothing in this Agreement shall prohibit direct or indirect transfers of a minority equity interest in a Shareholder as long as such transfer or transfers do not individually or in the aggregate change, modify, limit or otherwise affect in any manner the right or ability to the persons presently controlling the Shareholder to continue to control the Shareholder. During the term of this Agreement, Arbe will not register or otherwise recognize the transfer (book-entry or otherwise) of any Shares or any certificate or uncertificated interest representing any of Holder’s Shares, except as permitted by, and in accordance with, this Section 3(b).
(c) Changes to Shares. In the event of a stock dividend or distribution, or any change in the share capital of Arbe by reason of any stock dividend or distribution, stock split, recapitalization (including the Recapitalization), combination, conversion, exchange of shares or the like, the term “Shares” shall be deemed to refer to and include the Shares as well as all such stock dividends and distributions and any securities into which or for which any or all of the Shares may be changed or exchanged or which are received in such transaction. Holder agrees, during the Voting Period, to notify Arbe and ITAC promptly in writing of any changes in Holder’s ownership of Arbe securities.
(d) Compliance with Business Combination Agreement. Holder agrees that, during the Voting Period, Holder will not take or agree or commit to take any action that would make any representation and warranty of Holder contained in this Agreement inaccurate in any material respect, except for transfers as permitted by, and in accordance with, Section 3(b) above.
(e) Registration Statement. During the Voting Period, Holder agrees to provide to Arbe, ITAC and their respective Representatives any information regarding Holder or the Shares that is reasonably requested by Arbe, ITAC or their respective Representatives for inclusion in the Registration Statement.
(f) Publicity. Holder shall not issue any press release or otherwise make any public statements with respect to the Transactions or the transactions contemplated herein without the prior written approval of ITAC and Arbe, unless such information was already made available publicly by ITAC or Arbe. Nothing herein shall (a) restrict Holder’s right to furnish or disclose to its limited partners, members or shareholders, any information with respect to the Transactions or the transactions contemplated herein or (b) grant Holder any right to disclose information which Holder is prohibited from disclosing pursuant to a non-disclosure agreement. Holder understands that, prior to the announcement by ITAC and Arbe, the Business Combination Agreement and related agreements and the terms thereof constitute material non-public information and may not be used or disclosed by the Holder. Holder hereby authorizes ITAC and Arbe to publish and disclose in any announcement or disclosure required by the SEC or Nasdaq (including all documents and schedules filed with the SEC in connection with the foregoing), Holder’s identity and ownership of the Shares and the nature of Holder’s commitments and agreements under this Agreement, the Business Combination Agreement and any other Ancillary Documents.
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4. Representations and Warranties of Holder. Holder hereby represents and warrants to ITAC as follows, except to the extent set forth in a schedule delivered by Holder to the Company and ITAC prior to the execution by the Holder of this Agreement:
(a) Binding Agreement. Holder (i) if a natural person, is of legal age to execute this Agreement and is legally competent to do so and (ii) if not a natural person, is (A) a corporation, limited liability company, company or partnership duly organized and validly existing under the laws of the jurisdiction of its organization and (B) has all necessary power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. If Holder is not a natural person, the execution and delivery of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby by Holder has been duly authorized by all necessary corporate, limited liability or partnership action on the part of Holder, as applicable. This Agreement, assuming due authorization, execution and delivery hereof by the other parties hereto, constitutes a legal, valid and binding obligation of Holder, enforceable against Holder in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s rights, and to general equitable principles). Holder understands and acknowledges that ITAC is entering into the Business Combination Agreement in reliance upon the execution and delivery of this Agreement by Holder.
(b) Ownership of Shares. As of the date hereof, Holder has beneficial ownership over the type and number of the Shares set forth under Holder’s name on the signature page hereto, is the lawful owner of such Shares, has the sole power to vote or cause to be voted such Shares, and has good and valid title to such Shares, free and clear of any and all pledges, mortgages, encumbrances, charges, proxies, voting agreements, liens, adverse claims, options, security interests and demands of any nature or kind whatsoever, other than those imposed by this Agreement, applicable securities Laws or Arbe’s Existing Articles. There are no claims for finder’s fees or brokerage commission or other like payments in connection with this Agreement or the transactions contemplated hereby payable by Arbe or ITAC pursuant to arrangements made by Holder. Except for the Shares and other securities of Arbe set forth under Holder’s name on the signature page hereto, as of the date of this Agreement, Holder is not a beneficial owner or record holder of any: (i) equity securities of Arbe, (ii) securities of Arbe having the right to vote on any matters on which the holders of equity securities of Arbe may vote or which are convertible into or exchangeable for, at any time, equity securities of Arbe or (iii) options, warrants or other rights to acquire from Arbe any equity securities or securities convertible into or exchangeable for equity securities of Arbe.
(c) No Conflicts. Other than the filings, notices and reports pursuant to, in compliance with or required to be made under the Exchange Act, if any, no filing with, or notification to, any Governmental Authority, and no consent, approval, authorization or permit of any other person is necessary for the execution of this Agreement by Holder, the performance of its obligations hereunder or the consummation by it of the transactions contemplated hereby, which, if required, has not been obtained prior to the date hereof. None of the execution and delivery of this Agreement by Holder, the performance of its obligations hereunder or the consummation by it of the transactions contemplated hereby shall (i) conflict with or result in any breach of the certificate of incorporation, bylaws or other comparable organizational documents of Holder, if applicable, (ii) result in, or give rise to, a violation or breach of or a default under any of the terms of any Contract or obligation to which Holder is a party or by which Holder or any of the Shares or its other assets may be bound, or (iii) violate any applicable Law or Order, except for any of the foregoing in clauses (i) through (iii) as would not reasonably be expected to impair Holder’s ability to perform its obligations under this Agreement in any material respect.
(d) No Inconsistent Agreements. Holder hereby covenants and agrees that, except for this Agreement, Holder (i) has not entered into, nor will enter into at any time while this Agreement remains in effect, any voting agreement or voting trust with respect to the Shares inconsistent with Holder’s obligations pursuant to this Agreement, (ii) has not granted, nor will grant at any time while this Agreement remains in effect, a proxy, a consent or power of attorney with respect to the Shares and (iii) has not entered into any agreement or knowingly taken any action (nor will enter into any agreement or knowingly take any action) that would make any representation or warranty of Holder contained herein untrue or incorrect in any material respect or have the effect of preventing Holder from performing any of its material obligations under this Agreement.
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5. Miscellaneous.
(a) Termination. Notwithstanding anything to the contrary contained herein, this Agreement shall automatically terminate, and none of Arbe, ITAC or Holder shall have any rights or obligations hereunder, upon the earliest to occur of (i) the mutual written consent of Arbe, ITAC and Holder, (ii) the Effective Time (following the performance of the obligations of the parties hereunder required to be performed at or prior to the Effective Time) (iii) the date of termination of the Business Combination Agreement in accordance with its terms, (iv) at the election of Holder, any amendment to the Business Combination Agreement or any waiver of any provision of the Business Combination Agreement which amendment or waiver is adverse to Holder in a manner disproportionate to the other Arbe’s shareholders as a whole and which has not been approved by a Special Majority, and (v) if the Outside Date is extended for a period of more than thirty (30) days unless such further extension has received the approval of a Special Majority. The Current Shareholders shall mean the shareholders of Arbe immediately prior to the Effective Time, excluding any Company Ordinary Shares issued to the PIPE Investors. The termination of this Agreement shall not prevent any party hereunder from seeking any remedies (at law or in equity) against another party hereto or relieve such party from liability for such party’s material breach of, or fraud committed in connection with, this Agreement prior to such termination. Notwithstanding anything to the contrary herein, the provisions of this Section 5(a) shall survive the termination of this Agreement.
(b) Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns. Except for transfers as permitted by, and in accordance with, Section 3(b) above, this Agreement and all obligations of Holder are personal to Holder and may not be assigned, transferred or delegated by Holder at any time without the prior written consent of Arbe and ITAC, and any purported assignment, transfer or delegation without such consent shall be null and void ab initio.
(c) Third Parties. Nothing contained in this Agreement or in any instrument or document executed by any party in connection with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any person that is not a party hereto or thereto or a successor or permitted assign of such a party.
(d) Governing Law; Jurisdiction. This Agreement and any dispute or controversy arising out of or relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of law principles thereof. All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in any state or federal court located in the County of New York in the State of New York (or in any appellate courts thereof) (the “Specified Courts”). Each party hereto hereby (i) submits to the exclusive jurisdiction of any Specified Court for the purpose of any Action arising out of or relating to this Agreement brought by any party hereto and (ii) irrevocably waives, and agrees not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated hereby may not be enforced in or by any Specified Court. Each party agrees that a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party irrevocably consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party at the applicable address set forth or referred to in Section 5(g). Nothing in this Section 5(d) shall affect the right of any party to serve legal process in any other manner permitted by applicable law.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5(e).
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(f) Interpretation. The titles and subtitles used in this Agreement are for convenience only and are not to be considered in construing or interpreting this Agreement. In this Agreement, unless the context otherwise requires: (i) any pronoun used shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa; (ii) the term “including” (and with correlative meaning “include”) shall be deemed in each case to be followed by the words “without limitation”; (iii) the words “herein,” “hereto,” and “hereby” and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and not to any particular section or other subdivision of this Agreement; and (iv) the term “or” means “and/or”. The parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.
(g) Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given (i) when delivered in person, (ii) by email or other electronic means, with affirmative confirmation of receipt, (iii) one Business Day after being sent, if sent by reputable, nationally recognized international overnight courier service or (iv) five (5) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in each case to the applicable party at the following addresses (or at such other address for a party as shall be specified by like notice):
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If to ITAC: Industrial Tech Acquisitions, Inc. Suite 319 Houston, TX 77056 Attn: E. Scott Crist, Chief Executive Officer Email: scott@texasventures.com |
with a copy (which will not constitute notice) to: Ellenoff Grossman & Schole LLP mgray@egsllp.com |
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If to Arbe: Arbe Robotics Ltd. HaHashmonaim Street 107 Tel Aviv-Yafo, Israel Attn: Kobi Marenko, CEO |
with a copy (which will not constitute notice) to: DLA Piper LLP (US) 1251 Avenue of the Americas New York, NY 100200 Attn: Jon Venick
Erdinast, Ben Nathan, Toledano & Co. 4 Berkowitz St. Tel Aviv, 6423806, Israel Attn: Shay Dayan Facsimile No.: 972-3-7770101 Telephone No.: 972-3-7770111 Email: shayd@ebnlaw.co.il |
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| If to Holder, to: the address set forth under Holder’s name on the signature page hereto, with a copy (which will not constitute notice) to Goldfarb Seligman & Co., Ampa Tower, 98 Yigal Alon Street, Tel Aviv 6789141, Israel, Attention: Ido Zemach (ido.zemach@goldfarb.com) and Yoni R. Henner (yoni.henner@goldfarb.com) and, if not the party sending the notice, each of ITAC and Arbe (and each of their copies for notices hereunder). | ||
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(h) 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 instance, and either retroactively or prospectively) only, in the case of an amendment, with the written consent of Arbe, ITAC and the Holder, or, in the case of a waiver, with the written consent of the party against whom the waiver is to be effective. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof. No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed to be or construed as a waiver of any other provisions hereof by such party, nor shall any such waiver be deemed to be or construed as a further or continuing waiver of any such term, condition, or provision.
(i) Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction, such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid, legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other jurisdiction, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out, so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(j) Specific Performance. Holder acknowledges that its obligations under this Agreement are unique, recognizes and affirms that in the event of a breach of this Agreement by Holder, money damages will be inadequate and that ITAC will not have adequate remedy at law, and agrees that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed Holder in accordance with their specific terms or were otherwise breached. Accordingly, ITAC shall be entitled to an injunction or restraining order to prevent breaches of this Agreement by Holder and to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such party may be entitled under this Agreement, at law or in equity.
(k) Expenses. Each party shall be responsible for its own fees and expenses (including the fees and expenses of investment bankers, accountants and counsel, if applicable) in connection with the entering into of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby; provided, that in the event of any Action arising out of or relating to this Agreement, the non-prevailing party in any such Action will pay its own expenses and the reasonable documented out-of-pocket expenses, including reasonable attorneys’ fees and costs, reasonably incurred by the prevailing party. Notwithstanding the foregoing, Arbe will pay the reasonable legal fees of Goldfarb Seligman & Co. (“Goldfarb”) in connection with Goldfarb’s representation of certain Holders in connection with the Transaction. Such fees and expenses shall be paid by Arbe directly to Goldfarb. The Company acknowledges that the tax invoice shall be addressed to the applicable Holder or one of its affiliates as the recipient of the legal services.
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(l) No Partnership, Agency or Joint Venture. This Agreement is intended to create a contractual relationship among Holder, ITAC and Arbe, and is not intended to create, and does not create, any agency, partnership, joint venture or any like relationship among the parties hereto or among any other Arbe shareholders entering into voting agreements with ITAC or Arbe. Holder is not affiliated with any other holder of securities of Arbe entering into a voting agreement with ITAC or Arbe in connection with the Business Combination Agreement and has acted independently regarding its decision to enter into this Agreement. Nothing contained in this Agreement shall be deemed to vest in ITAC or Arbe any direct or indirect ownership or incidence of ownership of or with respect to any Shares. All rights, ownership and economic benefits of Holder in and relating to the Shares of the Holder shall remain vested in and belong to the Holder, and ITAC shall have no authority to manage, direct, restrict, regulate, govern or administer any of the policies or operations of Arbe or exercise any power or authority to direct the Holder in the voting or disposition of any of the Shares, except as otherwise provided herein.
(m) Further Assurances. From time to time, at another party’s request and without further consideration, each party shall execute and deliver such additional documents and take all such further action as may be reasonably necessary or desirable to consummate the transactions contemplated by this Agreement.
(n) Entire Agreement. This Agreement (together with the Business Combination Agreement to the extent referred to herein) constitutes the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between the parties is expressly canceled; provided, that, for the avoidance of doubt, the foregoing shall not affect the rights and obligations of the parties under the Business Combination Agreement or any Ancillary Document.
(o) Capacity as an Arbe Shareholder. Holder signs this Agreement solely in Holder’s capacity as a shareholder of Arbe, and not in Holder’s capacity as a director, officer or employee of Arbe. Notwithstanding anything herein to the contrary, nothing herein shall in any way restrict a director or officer of Arbe in the exercise of his or her fiduciary duties as a director or officer of Arbe or prevent or be construed to create any obligation on the part of any director or officer of Arbe from taking any action in his or her capacity as such director. No such action shall affect Holder’s obligations under this Agreement as a shareholder of Arbe.
(p) Counterparts; Facsimile. This Agreement may also be executed and delivered by facsimile or electronic signature or by email in portable document format 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.
(q) Non-Recourse. This Agreement may only be enforced against, and any claim or cause of action based upon, arising out of, or related to this Agreement or the transactions contemplated hereby may only be brought against, the entities that are expressly named as parties hereto, and then only with respect to the specific obligations set forth herein with respect to such party. Except to the extent a named party to this Agreement (and then only to the extent of the specific obligations undertaken by such named party in this Agreement), (a) no past, present or future director, officer, employee, incorporator, member, partner, shareholder, affiliate, agent, attorney, advisor or representative or affiliate of any named party to this Agreement and (b) no past, present or future director, officer, employee, incorporator, member, partner, shareholder, affiliate, agent, attorney, advisor or representative or affiliate of any of the foregoing shall have any liability (whether in contract, tort, equity or otherwise) for any one or more of the representations, warranties, covenants, agreements or other obligations or liabilities of any one or more of ITAC, Arbe or the Holder under this Agreement of or for any claim based on, arising out of, or related to this Agreement or the transactions contemplated hereby provided that such other person does not take or direct or cause Holder to take any action in contravention of the Holder’s obligations under this Agreement.
[Remainder of Page Intentionally Left Blank; Signature Page Follows]
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IN WITNESS WHEREOF, the parties have executed this Voting and Support Agreement as of the date first written above.
| Arbe: | ||
| ARBE ROBOTICS LTD | ||
| By: | ||
| Name: | ||
| Title: | ||
| ITAC: | ||
| INDUSTRIAL TECH ACQUISITIONS, INC. | ||
| By: | ||
| Name: | ||
| Title: | ||
{Arbe and ITAC Signature Page to Voting and Support Agreement}
| Holder: | ||
|
[_______________________________________]
|
||
| By: | ||
| Name: | ||
| Title: | ||
|
|
|
Number and Type of Shares:
Company Ordinary Shares: __________________________________________________
Company Preferred Shares (indicate each series of Company Preferred Shares): _________________________________________________________________________
_________________________________________________________________________
Arbe warrants or other convertible Arbe securities: __________________________________
Address for Notice:
Address: _______________________________
_______________________________________
_______________________________________
Facsimile No.: ____________________________
Telephone No.: ___________________________
Email: :__________________________________ |
{Holder Signature Page to Voting and Support Agreement}
Exhibit 10.2
FORM OF LOCK-UP AGREEMENT
THIS LOCK-UP AGREEMENT (this “Agreement”) is made and entered into as of March 18, 2021 by and between Arbe Robotics Ltd., an Israeli company (the “Company”), and the undersigned (“Holder”). Any capitalized term used but not defined in this Agreement will have the meaning ascribed to such term in the Business Combination Agreement, as hereinafter defined.
WHEREAS, on or about the date hereof, the Company, Autobot MergerSub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), entered into that certain Business Combination Agreement (as amended from time to time in accordance with the terms thereof, the “Business Combination Agreement”), pursuant to which, among other things, following the consummation of the Recapitalization, Merger Sub shall, at the Effective Time, be merged with and into ITAC, which shall continue as a wholly owned subsidiary of the Company, and, in connection therewith, each share of ITAC Common Stock (including shares of ITAC Class B Stock held by Sponsor) issued and outstanding immediately prior to the Effective Time shall no longer be outstanding and shall automatically be cancelled in exchange for the right of the holder thereof to receive an equal number of Company Ordinary Shares, all upon the terms and subject to the conditions set forth in the Business Combination Agreement and in accordance with the provisions of applicable law. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Business Combination Agreement;
WHEREAS, as of the date hereof, Holder is a holder of the Company Ordinary Shares in such amounts and classes or series as set forth underneath Holder’s name on the signature page hereto; and
WHEREAS, pursuant to the Business Combination Agreement, and in view of the valuable consideration or benefits to be received by Holder by virtue thereof or thereunder, the parties desire to enter into this Agreement, pursuant to which the Company Ordinary Shares received by Holder in the Merger (or converted into as a result of the Merger), including its right to any Company Ordinary Shares underlying the Company Warrants (all such securities, together with any securities paid as dividends or distributions with respect to such securities or into which such securities are exchanged or converted, the “Restricted Securities”), shall become subject to limitations on disposition as set forth herein (which shall not include, for the sake of clarification, the Company Ordinary Shares to be issued under the PIPE Investment).
NOW, THEREFORE, in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and intending to be legally bound hereby, the parties hereby agree as follows:
1. Lock-Up Provisions.
(a) Holder hereby agrees not to, during the period (the “Lock-Up Period”) commencing from the Closing and ending on the earlier of (x) the one (1) year anniversary of the date of the Closing, (y) the date on which the closing price of the Company Ordinary Shares equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any twenty (20) trading days within any thirty (30) trading day period commencing at least one-hundred fifty (150) days after the Closing, and (z) the date after the Closing on which the Company consummates a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of the Company’s stockholders having the right to exchange their Company Ordinary Shares for cash, securities or other property: (i) lend, offer, pledge, hypothecate, encumber, donate, assign, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any Restricted Securities, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the Restricted Securities, or (iii) publicly disclose the intention to do any of the foregoing, whether any such transaction described in clauses (i), (ii) or (iii) above is to be settled by delivery of Restricted Securities or other securities, in cash or otherwise (any of the foregoing described in clauses (i), (ii) or (iii), a “Prohibited Transfer”). The foregoing sentence shall not apply to the transfer of any or all of the Restricted Securities owned by Holder (I) by gift, will or intestate succession upon the death of Holder, (II) to any Permitted Transferee (as defined below) or (III) pursuant to a court order or settlement agreement related to the distribution of assets in connection with the dissolution of marriage or civil union; provided, however, that in any of cases (I), (II) or (III) it shall be a condition to such transfer that the transferee executes and delivers to the Company an agreement stating that the transferee is receiving and holding the Restricted Securities subject to the provisions of this Agreement applicable to Holder, and there shall be no further transfer of such Restricted Securities except in accordance with this Agreement. As used in this Agreement, the term “Permitted Transferee” shall mean: (A) the members of Holder’s immediate family (for purposes of this Agreement, “immediate family” shall mean with respect to any natural person, any of the following: such person’s spouse, the siblings of such person and his or her spouse, and the direct descendants and ascendants (including adopted and step children and parents) of such person and his or her spouses and siblings), (B) any trust for the direct or indirect benefit of Holder or the immediate family of Holder, (C) if Holder is a trust, the trustor or beneficiary of such trust or to the estate of a beneficiary of such trust, (D) if Holder is an entity, as a distribution to limited partners, shareholders, members of, or owners of similar equity interests in Holder upon the liquidation and dissolution of Holder, (E) any affiliate of Holder, (F) pursuant to an order or decree of a governmental entity, (G) from an executive officer to the Company or its subsidiary or parent entities upon death, disability or termination of employment, in each case, of such executive officer, and (H) to the Company (1) pursuant to the exercise, in each case on a “cashless” or “net exercise” basis, of any option to purchase shares granted by the Company pursuant to any employee benefit plans or arrangements which are set to expire during the Lock-Up Period, where any shares received by the undersigned upon any such exercise will be subject to the terms of this Agreement, or (2) for the purpose of satisfying any withholding taxes (including estimated taxes) due as a result of the exercise of any option to purchase shares or the vesting of any award granted by the Company pursuant to employee benefit plans or arrangements which are set to expire or automatically vest during the Lock-Up Period, in each case on a “cashless” or “net exercise” basis. Holder further agrees to execute such agreements as may be reasonably requested by the Company that are consistent with the foregoing or that are necessary to give further effect thereto.
(b) If any Prohibited Transfer is made or attempted contrary to the provisions of this Agreement, such purported Prohibited Transfer shall be null and void ab initio, and the Company shall refuse to recognize any such purported transferee of the Restricted Securities as one of its equity holders for any purpose. In order to enforce this Section 1, the Company may impose stop-transfer instructions with respect to the Restricted Securities of Holder (and Permitted Transferees and assigns thereof) until the end of the Lock-Up Period.
(c) During the Lock-Up Period each certificate evidencing any Restricted Securities shall be stamped or otherwise imprinted with a legend in substantially the following form, in addition to any other applicable legends:
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER SET FORTH IN A LOCK-UP AGREEMENT, DATED AS OF MARCH 18, 2021, BY AND AMONG ARBE ROBOTICS LTD. (THE “ISSUER”) AND THE ISSUER’S SECURITY HOLDER NAMED THEREIN INCLUDING THE REGISTERED OWNER OF THE SHARES REPRESENTED BY THE CERTIFICATE,, AS AMENDED. A COPY OF SUCH LOCK-UP AGREEMENT WILL BE FURNISHED WITHOUT CHARGE BY THE ISSUER TO THE HOLDER HEREOF UPON WRITTEN REQUEST.”
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(d) For the avoidance of any doubt, Holder shall retain all of its rights as a stockholder of the Company during the Lock-Up Period, including the right to vote any Restricted Securities.
2. Miscellaneous.
(a) Termination of Business Combination Agreement. This Agreement shall be binding upon Holder upon Holder’s execution and delivery of this Agreement, but this Agreement shall only become effective upon the Closing. Notwithstanding anything to the contrary contained herein, in the event that the Business Combination Agreement is terminated in accordance with its terms prior to the Closing, this Agreement and all rights and obligations of the parties hereunder shall automatically terminate and be of no further force or effect.
(b) Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective permitted successors and assigns. This Agreement and all obligations of Holder are personal to Holder and may not be transferred or delegated by Holder at any time, except as expressly permitted under Section 1 above. The Company may freely assign any or all of its rights under this Agreement, in whole or in part, to any successor entity (whether by merger, consolidation, equity sale, asset sale or otherwise) without obtaining the consent or approval of Holder.
(c) Third Parties. Nothing contained in this Agreement or in any instrument or document executed by any party in connection with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any person or entity that is not a party hereto or thereto or a successor or permitted assign of such a party.
(d) Governing Law; Jurisdiction. This Agreement and any dispute or controversy arising out of or relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to the conflict of law principles thereof. All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in any state or federal court located in New York, New York (or in any appellate courts thereof) (the “Specified Courts”). Each party hereto hereby (i) submits to the exclusive jurisdiction of any Specified Court for the purpose of any Action arising out of or relating to this Agreement brought by any party hereto and (ii) irrevocably waives, and agrees not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated hereby may not be enforced in or by any Specified Court. Each party agrees that a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party irrevocably consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party at the applicable address set forth in Section 2(g). Nothing in this Section 2(d) shall affect the right of any party to serve legal process in any other manner permitted by applicable law.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 2(e).
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(f) Interpretation. The titles and subtitles used in this Agreement are for convenience only and are not to be considered in construing or interpreting this Agreement. In this Agreement, unless the context otherwise requires: (i) any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa; (ii) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding or succeeding such term and shall be deemed in each case to be followed by the words “without limitation”; (iii) the words “herein,” “hereto,” and “hereby” and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and not to any particular section or other subdivision of this Agreement; and (iv) the term “or” means “and/or”. The parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.
(g) Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered (i) in person, (ii) by facsimile (if a facsimile number is given) email or other electronic means, with affirmative confirmation of receipt, (iii) two (2) Business Days after being sent, if sent by reputable, internationally recognized overnight courier service that provides evidence of delivery or attempted delivery or (iv) four (4) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in each case to the applicable party at the following addresses (or at such other address for a party as shall be specified by like notice):
|
If to the Company: Arbe Robotics Ltd. HaHashmonaim Street 107 Tel Aviv-Yafo, Israel Attn: Kobi Marenko, CEO |
with a copy (which will not constitute notice) to: DLA Piper LLP (US) |
| If to Holder, to: the address set forth below Holder’s name on the signature page to this Agreement. |
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(h) 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 instance, and either retroactively or prospectively) only with the written consent of (i) the Company’s board of directors, (ii) a majority of the Disinterested Independent Directors (as defined below) and (iii) Holder. For purposes of this Agreement, a “Disinterested Independent Director” means an independent director serving on the Company’s board of directors at the applicable time of determination that is disinterested in this Agreement (i.e., such independent director is not a Company shareholder, an Affiliate of a Company shareholder, or an officer, director, manager, employee, trustee or beneficiary of a Company shareholder or its Affiliate, nor an immediate family member of any of the foregoing). Without limiting the foregoing, in the event that a Company shareholder or its Affiliate serves as a director, officer, employee or other authorized agent of the Company, the Company shareholder or its Affiliate shall have no authority, express or implied, to act or make any determination on behalf of the Company in connection with this Agreement or any dispute, action or legal proceeding respect hereto. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof. No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such term, condition, or provision.
(i) Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction, such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid, legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out, so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(j) Specific Performance. Holder acknowledges that its obligations under this Agreement are unique, recognizes and affirms that in the event of a breach of this Agreement by Holder, money damages will be inadequate and the Company will have no adequate remedy at law, and agrees that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed by Holder in accordance with their specific terms or were otherwise breached. Accordingly, the Company shall be entitled to an injunction or restraining order to prevent breaches of this Agreement by Holder and to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such party may be entitled under this Agreement, at law or in equity.
(k) Entire Agreement. This Agreement constitutes the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between the parties is expressly canceled; provided, that, for the avoidance of doubt, the foregoing shall not affect the rights and obligations of the parties under the Business Combination Agreement or any Ancillary Document. Notwithstanding the foregoing, nothing in this Agreement shall limit any of the rights or remedies of the Company or any of the obligations of Holder under any other agreement between Holder and the Company or any certificate or instrument executed by Holder in favor of the Company, and nothing in any other agreement, certificate or instrument shall limit any of the rights or remedies of the Company or any of the obligations of Holder under this Agreement.
(l) Further Assurances. From time to time, at another party’s request and without further consideration (but at the requesting party’s reasonable cost and expense), each party shall execute and deliver such additional documents and take all such further action as may be reasonably necessary to consummate the transactions contemplated by this Agreement.
(m) Counterparts; Facsimile. This Agreement may also be executed and delivered by electronic means, including docusign, email or scanned pages or in portable document format, in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
{Remainder of Page Intentionally Left Blank; Signature Pages Follow}
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IN WITNESS WHEREOF, the parties have executed this Lock-Up Agreement as of the date first written above.
| Company: | ||
| ARBE ROBOTICS LTD. | ||
| By: | ||
| Name: | ||
| Title: | ||
{Additional Signature on the Following Page}
{Signature Page to Lock-Up Agreement}
IN WITNESS WHEREOF, the parties have executed this Lock-Up Agreement as of the date first written above.
Holder:
Name of Holder: [__________________________]
| By: | ||
| Name: | ||
| Title: |
| Number and Type of Shares of Company Ordinary Shares: |
| Company Ordinary Shares: ____________________________________ |
| Company Ordinary Shares (as a result of conversion of Preferred Shares at Closing): ______ |
| Address for Notice: |
| Address: _________________________________________ |
| _______________________________________________ |
| _______________________________________________ |
| Facsimile No.: ___________________________________ |
| Telephone No.: ___________________________________ |
| Email: __________________________________________ : |
{Signature Page to Lock-Up Agreement}
Exhibit 10.3
Industrial
Tech Partners, LLC
5090 Richmond Avenue, Suite 319
Houston, TX 77056, U.S.A.
March 18, 2021
Arbe Robotics Ltd.
HaHashmonaim 107
Tel Aviv, Israel
Attn: Kobi Marenko, Co-Founder & Chief Executive Officer
| Re: | Sponsor Share Letter |
Ladies and Gentlemen:
Reference is hereby made to that certain Business Combination Agreement, dated as of March 18, 2021 (as it may be amended from time to time, the “Business Combination Agreement), by and among Arbe Robotics Ltd., an Israeli company (the “Company”), Autobot MergerSub, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), and Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), pursuant to which, among other things, following the consummation of the Recapitalization, Merger Sub shall, at the Effective Time, be merged with and into ITAC, which shall continue as a wholly owned subsidiary of the Company, and, in connection therewith, among other things, each share of ITAC Common Stock (including shares of ITAC Class B Stock held by Sponsor (as defined below)) issued and outstanding immediately prior to the Effective Time shall no longer be outstanding and shall automatically be cancelled in exchange for the right of the holder thereof to receive an equal number of Company Ordinary Shares, all upon the terms and subject to the conditions set forth in the Business Combination Agreement and in accordance with the provisions of applicable law. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Business Combination Agreement.
In order to induce the Company to enter into the Business Combination Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Industrial Tech Partners, LLC, a Delaware limited liability company (“Sponsor”), has entered into this letter agreement (this “Agreement”), to become effective at the Effective Time, relating to the 1,905,900 shares of ITAC Class B Stock held by the Sponsor (collectively, the “Founder Shares”).
For good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Sponsor and the Company hereby agree as follows:
| 1. | 952,950 of the Founder Shares shall be deemed fully vested upon completion of the Closing and shall not be subject to the Enhanced Lock-Up Restrictions (as defined below) hereunder, but shall continue to be subject to the restrictions set forth in that certain letter agreement dated as of September 8, 2020, by and between the Sponsor and ITAC (the “Insider Letter”). |
| 2. | The remaining Founder Shares owned by the Sponsor as of the Closing (such shares, the “Price Based Lockup Shares”) shall be subject to the following post-Closing lock-up restrictions (the “Enhanced Lock-Up Restrictions”) for a period of up to three (3) years following the Closing Date (such three (3)-year period, the “Enhanced Lock-Up Period”), provided, that any Founder Shares which vest pursuant to this Section 2 shall nonetheless continue to be subject to the restrictions set forth in the Insider Letter to the extent that they still apply): |
| (a) | Fifty percent (50%) of the Price Based Lockup Shares shall vest and no longer be subject to the Enhanced Lock-Up Restrictions hereunder if, at any time during the Enhanced Lock-Up Period, the VWAP (as defined below) of the Company Ordinary Shares (or any equity security that is the successor to the Company Ordinary Shares (“Successor Shares”)) for twenty (20) consecutive trading days on the primary exchange on which such securities are then listed or quoted (the “20-Day VWAP”) shall equal or exceed $12.50 per share (subject to equitable adjustment for any stock splits, stock dividends, reorganizations, combinations, recapitalizations and similar transactions affecting the Company Ordinary Shares or any Successor Shares after the Effective Time). |
| (b) | The remaining Price Based Lockup Shares shall vest and no longer be subject to the Enhanced Lock-Up Restrictions hereunder if, at any time during the Enhanced Lock-Up Period, the 20-Day VWAP of the Company Ordinary Shares (or any Successor Shares) shall equal or exceed $15.00 per share (subject to equitable adjustment for any stock splits, stock dividends, reorganizations, combinations, recapitalizations and similar transactions affecting the Company Ordinary Shares or any Successor Shares after the Effective Time). |
| (c) | In the event that all Price Based Lockup Shares have not become vested during the Enhanced Lock-Up Period in accordance with Sections 2(a) and 2(b), all such remaining Price Based Lockup Shares shall be deemed fully vested and released from the Enhanced Lock-Up Restrictions hereunder on the first day following the end of the Enhanced Lock-Up Period. |
| (d) | For purposes hereof, “VWAP” means, for any security as of any date(s), the dollar volume-weighted average price for such security on the principal securities exchange or securities market on which such security is then traded during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg through its “HP” function (set to weighted average) or, if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic bulletin board for such security during the period beginning at 9:30:01 a.m., New York time, and ending at 4:00:00 p.m., New York time, as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security by Bloomberg for such hours, the average of the highest closing bid price and the lowest closing ask price of any of the market makers for such security as reported by OTC Markets Group Inc. If the VWAP cannot be calculated for such security on such date(s) on any of the foregoing bases, the VWAP of such security on such date(s) shall be the fair market value as determined reasonably and in good faith by a majority of the disinterested independent directors of the board of directors (or equivalent governing body) of the applicable issuer. All such determinations shall be appropriately adjusted for any stock dividend, stock split, stock combination, recapitalization or other similar transaction during such period. |
| 3. | Sponsor hereby agrees that during the Enhanced Lock-Up Period, it will not Transfer (as such term is defined in the Insider Letter) any of the Price Based Lockup Shares until such Price Based Lockup Shares have vested pursuant to this Agreement, except pursuant to Transfers that are permitted with respect to the Founder Shares under Section 7(c) of the Insider Letter, provided that any Transfer under the exceptions in clauses (a) through (e) or (g) of Section 7(c) of the Insider Letter, the permitted transferees must enter into a written agreement agreeing to be bound by the Transfer restrictions in this Agreement. Any share certificates representing the Price Based Lockup Shares shall contain a legend relating to transfer restrictions imposed by this Agreement until such time as such shares have become vested. Such legend shall be promptly removed by the Company at such time as such Price Based Lockup Shares have become vested in accordance with this Agreement (but in any event within three (3) Business Days after such Price Based Lockup Shares have vested or, if later, the first Business Day following the end of the Enhanced Lock-Up Period). |
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| 4. | Notwithstanding the Enhanced Lock-Up Restrictions, Sponsor shall at all times have full ownership rights to its Founder Shares, including the right to vote such shares and to receive dividends and distributions thereon. |
| 5. | Notwithstanding the foregoing or anything in this Agreement to the contrary, all of the Price Based Lockup Shares shall vest and no longer be subject to the transfer restrictions in this Agreement upon the first of any of the following to occur: |
| (a) | if the Company shall engage in a “going private” transaction pursuant to Rule 13e-3 under the Exchange Act or otherwise cease to be subject to reporting obligations under Sections 13 or 15(d) of the Exchange Act; |
| (b) | if the Company Ordinary Shares shall cease to be listed on a national securities exchange; |
| (c) | if the Company is merged, consolidated or reorganized with or into another Person (an “Acquiror”) and, as a result of such merger, consolidation or reorganization, less than 50.1% (whether by voting or economic rights) of the outstanding equity securities or other capital interests of the Acquiror or surviving or resulting entity is owned in the aggregate by the shareholders of the Company, directly or indirectly, immediately prior to such merger, consolidation or reorganization, excluding from such computation the interests of the Acquiror or any Affiliate of the Acquiror (the “Pre-Transaction Company Equityholders”); |
| (d) | the Company and/or its subsidiaries sell, assign, transfer or otherwise dispose of, in one or a series of related transactions, all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, to an Acquiror, less than 50.1% (whether by voting or economic rights) of the outstanding equity securities or other capital interests of which, immediately following such sale, assignment or transfer, is owned in the aggregate by the Pre-Transaction Company Equityholders; or |
| (e) | a Schedule 13D or Schedule 14D report (or any successor schedule form or report), each as promulgated pursuant to the Exchange Act, is filed with the SEC disclosing that any person or group (as the terms “person” and “group” are used in Section 13(d) or Section 14(d) of the Exchange Act and the rules and regulations promulgated thereunder) has become the beneficial owner (as the term “beneficial owner” is defined in Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of a percentage of shares of the outstanding Company Ordinary Shares as shall be greater than the percentage of such shares that, at the date of such filing, is held by any other person or group that held more than one-half of the voting or economic power of the Company immediately following the Closing. |
| 6. | Subject to Section 3, no party hereto may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written consent of the other parties; provided, that in the event that Sponsor liquidates and distributes to its members all securities of the Company that it owns in accordance with its organizational documents, Sponsor may, without obtaining the consent of any other party hereto, transfer the Price Based Lockup Shares and its rights and obligations under this Agreement to its members so long as such members agree in writing to be bound by the terms of this Agreement that apply to Sponsor hereunder. Any purported assignment in violation of this Section 6 shall be void and ineffectual and shall not operate to transfer or assign any interest or title to the purported assignee. This Agreement shall be binding on the undersigned and their respective successors and permitted assigns. |
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| 7. | For the avoidance of doubt, nothing contained herein shall amend or otherwise replace the provisions of the Insider Letter. The Sponsor hereby agrees to comply with its obligations under the Insider Letter, including its obligations under Section 1 thereto to vote any shares of ITAC Common Stock owned by it in favor of the transactions contemplated by the Business Combination Agreement (the “Transactions”), and not redeem any shares of ITAC Common Stock owned by it in connection with the ITAC shareholder approval for the Business Combination Agreement or otherwise prior to or in connection with the Closing. Prior to the earlier of the Closing and any valid termination of the Business Combination Agreement in accordance with its terms, the Sponsor shall use its reasonable efforts to take, or cause to be taken, all actions reasonably necessary and appropriate under applicable Laws to consummate the Business Combination and the other transactions contemplated by the Business Combination or any other Ancillary Agreement, in each case on the terms and subject to the conditions set forth therein (provided, that for the avoidance of doubt, the foregoing will not require the Sponsor to transfer or forfeit any of its ITAC securities or other economics in ITAC (other than its exchange of its ITAC securities for equivalent Company securities in the Merger in accordance with the terms of the Business Combination Agreement)). The Sponsor acknowledges that it will comply with the terms of the Insider Letter with respect to the transactions contemplated by the Business Combination Agreement whether or not the Transactions are recommended by the ITAC board of directors, including if the ITAC board of directors has changed, withdrawn, withheld, amended, qualified or modified, or (privately or publicly) proposed to change, withdraw, withhold, amend, qualify or modify its recommendation with respect to the Transactions. |
| 8. | This Agreement (including the Business Combination Agreement to the extent incorporated herein) constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and supersedes all prior understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof. |
| 9. | This Agreement may not be changed, amended or modified as to any particular provision, except by a written instrument executed by all parties hereto. No provision of this Agreement may be waived except in a writing signed by the party against whom enforcement of such waiver is sought. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder. |
| 10. | Any notice, consent or request to be given in connection with any of the terms or provisions of this Agreement shall be in writing and shall be sent in the same manner as provided in Section 9.1 of the Business Combination Agreement. Unless otherwise specified in writing by such party, notices to the Sponsor shall be sent to the address set forth on the first page of this Agreement (or such other address as shall be specified in a notice given in accordance with this Section 9 and Section 9.1 of the Business Combination Agreement). |
| 11. | This Agreement shall be construed, interpreted and enforced in a manner consistent with the provisions of the Business Combination Agreement. Without limiting the foregoing, the parties agree that the provisions of Section 9.8 of the Business Combination Agreement will apply to the enforcement of this Agreement (with any references therein to (x) a “Party” referring to a party to this Agreement, and (y) this “Agreement” referring to this Agreement). |
| 12. | This Agreement shall terminate at such time, if any, as the Business Combination Agreement is terminated in accordance with its terms prior to the Closing, and upon such termination this Agreement shall be null and void and of no effect whatsoever, and the parties hereto shall have no obligations under this Agreement. |
{Remainder of Page Left Blank; Signature Page Follows}
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Please indicate your agreement to the foregoing by signing in the space provided below.
| INDUSTRIAL TECH PARTNERS, LLC | ||
| By: | /s/ E. Scott Crist | |
| Name: | E. Scott Crist | |
| Title: | CEO | |
Accepted and agreed, effective as of the date first set forth above:
| ARBE ROBOTICS LTD. | ||
| By: | /s/ Kobi Marenko | |
| Name: | Kobi Marenko | |
| Title: | CEO | |
{Signature Page to Sponsor Share Letter}
Exhibit 10.4
FIRST AMENDMENT TO REGISTRATION RIGHTS AGREEMENT
THIS FIRST AMENDMENT TO REGISTRATION RIGHTS AGREEMENT (this “Amendment”) is made and entered into as of March 18, 2021, and shall be effective as of the Closing (defined below), by and among (i) Arbe Robotics Ltd., an Israeli company (the “Company”), (ii) Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), and (iii) Industrial Tech Partners, LLC, a Delaware limited liability company (the “Sponsor”). Capitalized terms used but not otherwise defined herein shall have the respective meanings assigned to such terms in the Registration Rights Agreement (as defined below) (and if such term is not defined in the Registration Rights Agreement, then in the Business Combination Agreement (as defined below)).
RECITALS
WHEREAS, ITAC and the Sponsor are parties to that certain Registration Rights Agreement, dated as of September 8, 2020 (the “Original Agreement” and, as amended by this Amendment, the “Registration Rights Agreement”), pursuant to which ITAC granted certain registration rights to the Sponsor with respect to ITAC’s securities;
WHEREAS, on March 18, 2021, (i) the Company, (ii) Autobot MergerSub, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), and (iii) ITAC, entered into that certain Business Combination Agreement (as amended from time to time in accordance with the terms thereof, the “Business Combination Agreement”);
WHEREAS, pursuant to the Business Combination Agreement, subject to the terms and conditions thereof, (i) prior to, but contingent upon, the Closing of the Merger, pursuant to a recapitalization (the “Recapitalization”) approved by the Company’s shareholders, (a) each outstanding warrant (collectively, the “Outstanding Company Warrants”) to purchase Company Ordinary Shares or Company Preferred Shares (other than any Outstanding Company Warrants which (1) are not required by their terms to be exercised in connection with the Transactions, and (2) are not exercised at the election of the holder thereof prior to the consummation of the Recapitalization, which unexercised warrants are referred to as the “Continuing Warrants”) shall be exercised in accordance with its terms; (b) immediately following such exercise, each outstanding preferred share, (“Company Preferred Shares”) shall become and be converted into ordinary shares, of the Company (“Company Ordinary Shares”); and (c) immediately following such conversion, each then outstanding Company Ordinary Share shall become and be converted into such number of Company Ordinary Shares as is determined pursuant to the terms of the Business Combination Agreement, and (d) as a result of the Recapitalization, each Continuing Warrant and each option to purchase Company Ordinary Shares shall be adjusted to reflect the Recapitalization as set forth in Section 1.8 of the Business Combination Agreement; (ii) as described in Article I of the Business Combination Agreement, immediately following the consummation of the Recapitalization, Merger Sub shall, at the Effective Time, be merged with and into ITAC, and ITAC shall continue as a wholly owned subsidiary of the Company, and, in connection therewith, (A) each share of the ITAC Common Stock issued and outstanding immediately prior to the Effective Time, including shares of ITAC Class A Stock issued in a PIPE Investment to be consummated immediately prior to the Effective Time, shall no longer be outstanding and shall automatically be cancelled, in exchange for the right of the holder thereof to receive an equal number of Company Ordinary Shares, and (B) each ITAC Warrant shall be exchanged for the right to receive a warrant to purchase the same number of Company Ordinary Shares (each, a “Company Warrant”) at the same exercise price during the same exercise period as the ITAC Warrant being exchanged all upon the terms and subject to the conditions set forth in the Business Combination Agreement and in accordance with the provisions of applicable law; and (iii) the certificate of incorporation of ITAC shall be amended and restated in the form attached as Exhibit B to the Business Combination Agreement and each issued and outstanding share of common stock of Merger Sub shall become and be converted into one share of common stock of ITAC, and the corporate name of ITAC shall be changed to Autobot HoldCo, Inc.;
WHEREAS, the parties hereto desire to amend the Original Agreement to add the Company as a party to the Registration Rights Agreement and to revise the terms hereof in order to reflect the transactions contemplated by the Business Combination Agreement, including the issuance of the Company Ordinary Shares and Company Warrants thereunder; and
WHEREAS, pursuant to Section 5.5 of the Original Agreement, the Original Agreement can be amended with the written consent of ITAC and the holders of at least a majority in interest of the Registrable Securities at the time in question.
NOW, THEREFORE, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:
1. Addition of the Company as a Party to the Registration Rights Agreement. The parties hereby agree to add the Company as a party to the Registration Rights Agreement. The parties further agree that, from and after the Closing, all of the rights and obligations of ITAC under the Registration Rights Agreement shall be, and hereby are, assigned and delegated to and assumed by the Company as if it were the original “Company” party thereto. By executing this Amendment, the Company hereby agrees to be bound by and subject to all of the terms and conditions of the Registration Rights Agreement, including from and after the Closing as if it were the original “Company” party thereto.
2. Amendments to Registration Rights Agreement. The Parties hereby agree to the following amendments to the Registration Rights Agreement:
(a) The defined terms in this Amendment, including in the preamble and recitals hereto, and the definitions incorporated by reference from the Business Combination Agreement, are hereby added to the Registration Rights Agreement as if they were set forth therein.
(b) The parties hereby agree that the term “Registrable Security” shall include any Company Ordinary Shares and Company Warrants issued by the Company under the Business Combination Agreement to the Sponsor in the Merger for its Registrable Securities of ITAC, and any Company Ordinary Shares issuable upon exercise or conversion of such Company Warrants and any other securities of the Company or any successor entity issued to the Sponsor in consideration of (including as a stock split, dividend or distribution) or in exchange for any of such securities. The parties also agree that any reference in the Registration Rights Agreement to “Common Stock” will instead refer to Company Ordinary Shares, and any other securities of the Company or any successor entity issued in consideration of (including as a stock split, dividend or distribution) or in exchange for any of such securities.
(c) Section 5.1 of the Registration Rights Agreement is hereby amended to add the following address for notices to the Company under the Registration Rights Agreement: “Arbe Robotics Ltd., HaHashmonaim Street, 107 Tel Aviv-Yafo, Israel, Attn: Kobi Marenko, CEO.”
3. Effectiveness. This Amendment shall become effective upon the Closing. In the event that the Business Combination Agreement is terminated in accordance with its terms prior to the Closing, this Amendment and all rights and obligations of the parties hereunder shall automatically terminate and be of no further force or effect.
4. Miscellaneous. Except as expressly provided in this Amendment, all of the terms and provisions in the Original Agreement are and shall remain in full force and effect, on the terms and subject to the conditions set forth therein. This Amendment does not constitute, directly or by implication, an amendment or waiver of any provision of the Original Agreement, or any other right, remedy, power or privilege of any party thereto, except as expressly set forth herein. Any reference to the Registration Rights Agreement in the Original Agreement or any other agreement, document, instrument or certificate entered into or issued in connection therewith shall hereinafter mean the Registration Rights Agreement, as amended by this Amendment (or as the Registration Rights Agreement may be further amended or modified in accordance with the terms thereof and hereof). The terms of this Amendment shall be governed by, enforced and construed and interpreted in a manner consistent with the provisions of the Original Agreement, including Sections 5.4 thereof.
{REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGES FOLLOW}
IN WITNESS WHEREOF, each party hereto has signed or has caused to be signed by its officer thereunto duly authorized this First Amendment to Registration Rights Agreement as of the date first above written.
| The Company: | ||
| ARBE ROBOTICS LTD. | ||
| By: | /s/ Kobi Marenko | |
| Name: Kobi Marenko | ||
| Title: CEO | ||
| Sponsor: | ||
| INDUSTRIAL TECH PARTNERS, LLC | ||
| By: | /s/ E. Scott Crist | |
| Name: E. Scott Crist | ||
| Title: CEO | ||
| ITAC: | ||
| INDUSTRIAL TECH ACQUISITIONS, INC. | ||
| By: | /s/ E. Scott Crist | |
| Name: E. Scott Crist | ||
| Title: CEO | ||
{Signature Page to First Amendment to Registration Rights Agreement}
Exhibit 10.5
CONFIDENTIAL
SUBSCRIPTION AGREEMENT
March 18, 2021
Industrial Tech Acquisitions, Inc.
5090 Richmond Avenue, Suite 319
Houston, Texas 77056
Attn: Scott Crist, Chief Executive Officer and Chairman
ARBE Robotics Ltd.
HaHashmonaim 107
Tel Aviv, Israel
Attn: Kobi Marenko, Co-Founder & Chief Executive Officer
Ladies and Gentlemen:
In connection with the proposed business combination transaction (the “Transaction”) between Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC” or the “Company”), and ARBE Robotics Ltd., an Israeli corporation (“ARBE”), pursuant to that certain Business Combination Agreement, dated as of March 18, 2021 (as it may be amended, the “Transaction Agreement”), by and among, ITAC, ARBE and certain other parties named therein, ITAC is seeking commitments to purchase shares of ITAC’s Class A common stock, par value $0.0001 per share (the “Common Shares”) (or at ARBE’s sole election, ARBE Shares, as hereinafter described), for a purchase price of $10.00 per share (the “Purchase Price”), in a private placement to be conducted by ITAC (the “Offering”). Substantially concurrently with the execution of this subscription agreement (this “Subscription Agreement”), ITAC is entering into separate subscription agreements on substantially the same terms (the “Other Subscription Agreements”) with certain investors (collectively, “Other Subscribers”) with an aggregate Purchase Price for all Common Shares and/or ARBE Shares issued pursuant to this Subscription Agreement and the Other Subscription Agreements of $100,000,000. In connection therewith, the undersigned subscriber (“Subscriber”), ITAC and ARBE agree as follows:
1. Subscription. As of the date written above (the “Subscription Date”), the Subscriber hereby irrevocably subscribes for and agrees to purchase from ITAC, and ITAC agrees to issue and sell to the Subscriber, such number of Common Shares as is set forth on the signature page of this Subscription Agreement (together with any equity securities of ARBE that may be issued in exchange therefor pursuant to this Subscription Agreement or the Transaction Agreement in connection with the Transaction, the “Shares”) at the Purchase Price per Share and on the terms provided for herein. Notwithstanding anything contained herein to the contrary, the parties hereto hereby acknowledge and agree that ARBE shall have the right, at its sole discretion, to instead (and without duplication) issue and sell to the Subscriber, and cause the Subscriber to instead directly purchase from ARBE such number of ARBE’s ordinary shares with a nominal value of NIS 0.01 per share (“ARBE Shares”) as is set forth on the signature page of this Subscription Agreement at the Closing (which, for the avoidance of doubt, shall occur after giving effect to the Recapitalization (as defined in the Transaction Agreement) (the “Recapitalization”)) at the Purchase Price in lieu of the Common Shares from ITAC in accordance with this Subscription Agreement, and in such event ARBE will deliver the ARBE Shares directly to the Subscriber (the “Direct Purchase Election”). In the event of a Direct Purchase Election, any reference in this Subscription Agreement to the Shares or Common Shares will mean, to the extent reasonably applicable, the ARBE Shares that are directly being issued by ARBE in lieu of the Common Shares that were to have been issued by ITAC pursuant to this Subscription Agreement and then exchanged for ARBE Shares pursuant to the Transaction Agreement, and any and all undertakings, representations, warranties or covenants with respect to the Offering, as set forth hereunder by the Subscriber towards ITAC, shall be also be for the benefit of ARBE, and ARBE shall also have all of the rights, privileges and authorities of ITAC with respect thereto.
2. Closing; Issuance of Shares.
(a) The closing of the sale of Shares contemplated hereby (the “Closing”, and the date that the Closing actually occurs, the “Closing Date”) is contingent upon the conditions set forth herein. The Closing shall occur on the date of, and immediately prior to, the closing of the Transaction (the “Transaction Closing”), or if the Direct Purchase Election is exercised, simultaneously with the Transaction Closing (but for the avoidance of doubt, shall occur after giving effect to the Recapitalization).
(b) ITAC and ARBE shall provide written notice (which may be via email) to the Subscriber (the “Closing Notice”) that ITAC and ARBE reasonably expect the Transaction Closing to occur on a date specified in the notice (the “Scheduled Closing Date”) that is not less than five (5) business days from the date of the Closing Notice, which Closing Notice shall contain wire instructions for an escrow account (the “Escrow Account”) established by ITAC and ARBE with a third party escrow agent, and in the event of a Direct Purchase Election, which will define ARBE as its beneficiary (the “Escrow Agent”) to be identified in the Closing Notice. At least two (2) business days prior to the Scheduled Closing Date (unless otherwise agreed to by ITAC), the Subscriber shall deliver to the Escrow Account the aggregate Purchase Price for the Shares subscribed (the “Aggregate Purchase Price”) by wire transfer of United States dollars in immediately available funds. The wire transfer shall identify the Subscriber, and unless otherwise agreed by ITAC the funds shall be wired from an account in the Subscriber’s name. Upon the Closing, ITAC shall provide instructions to the Escrow Agent to release the funds in the Escrow Account to ITAC (or in the event of a Direct Purchase Election, ARBE) against the issuance to the Subscriber of the Shares, free and clear of any liens or other restrictions whatsoever (other than those arising under state or federal securities laws), in book-entry form as set forth in Section 2(c) below. If this Subscription Agreement is terminated prior to the Closing and any funds have already been sent by the Subscriber to the Escrow Account, then promptly after such termination, ITAC will instruct the Escrow Agent to promptly return such funds to the Subscriber. In the event that the consummation of the Transaction does not occur on the Scheduled Closing Date specified in the Closing Notice or within three (3) business days thereafter, unless otherwise agreed to in writing by the Company and the Subscriber, the Company shall promptly cause the Escrow Agent (but in no event later than four (4) business days after the Scheduled Closing Date specified in the Closing Notice) return the Purchase Price so delivered by Subscriber to the Escrow Agent by wire transfer in immediately available funds to the account specified by Subscriber, and any book entries shall be deemed cancelled.
(c) On the Closing Date, or promptly after the Closing, ITAC or ARBE, as applicable, shall deliver (or cause the delivery of) the Shares (which, in the event of a Direct Purchase Election, shall for the avoidance of doubt, be the ARBE Shares) to Subscriber in book-entry form with restrictive legends for the number of Shares as set forth on the signature page to the Subscriber as indicated on the signature page or to a custodian designated by the Subscriber, as applicable, as indicated below; provided, that, if the Direct Purchase Election is not made, at the Transaction Closing, as contemplated by and in accordance with the terms set forth in the Transaction Agreement, each Share shall automatically be cancelled and convert into the right to receive one (1) ARBE Share for each Share owned by Subscriber immediately prior to the Transaction Closing. From and after the Transaction Closing, any ARBE Shares issued in accordance with the preceding sentence shall be held in book-entry form with restrictive legends.
(d) Simultaneously with the execution and delivery of this Subscription Agreement, Subscriber is delivering to ITAC and ARBE a duly completed and executed U.S. Internal Revenue Service Form W-9 or appropriate Form W-8.
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3. Closing Conditions.
(a) The obligations of each of ITAC, ARBE and Subscriber to consummate the Closing are subject to the satisfaction or valid waiver by each of ITAC, ARBE and Subscriber of the following conditions that, on the Closing Date:
(i) the Transaction Closing shall occur on the Closing Date immediately after the Closing (or, if the Direct Purchase Election is made, substantially simultaneously with the Closing but following the Recapitalization);
(ii) no suspension of the qualification of the Shares for offering or sale or trading in any jurisdiction, or initiation or threatening of any proceedings for any of such purposes, shall have occurred (other than any such suspension with respect to the Common Shares in connection with the Transaction Closing if, as part of the Transaction, ARBE Shares are expected to be admitted to trading);
(iii) no applicable governmental authority shall have enacted, rendered, issued, promulgated, enforced or entered any judgment, order, law, rule or regulation (whether temporary, preliminary or permanent) which is then in effect and has the effect of making consummation of the transactions contemplated hereby illegal or otherwise restraining or prohibiting consummation of the transactions contemplated hereby; and
(iv) all material conditions precedent to the Transaction Closing set forth in the Transaction Agreement, including all necessary approvals of the Company’s stockholders and regulatory approvals, if any, shall have been satisfied or waived (other than those conditions which, by their nature, are to be satisfied at the Transaction Closing).
(b) The obligations of ITAC and ARBE to consummate the Closing are also subject to the satisfaction or valid waiver by ITAC and ARBE of the additional conditions that, on the Closing Date:
(i) all representations and warranties of the Subscriber contained in this Subscription Agreement shall be true and correct in all material respects at and as of the Closing Date (except for representations and warranties made as of a specific date, which shall be true and correct in all material respects as of such date), and consummation of the Closing, shall constitute a reaffirmation by the Subscriber of each of the representations, warranties and agreements of the Subscriber contained in this Subscription Agreement as of the Closing Date (provided that any representations and warranties made as of a specific date shall be reaffirmed to be true and correct in all material respects as of such specific date);
(ii) the Subscriber shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Subscription Agreement to be performed, satisfied or complied with by it at or prior to Closing; and
(iii) the Subscriber shall have delivered an executed copy of the investor representation letter to Wells Fargo Securities, LLC (“Wells Fargo”) in the form set forth in Exhibit B attached hereto (the “Investor Representation Letter”) (or, where Epsilon or Poalim (each as defined below) is acting as placement agent with respect to such Offer, in the form set forth in Exhibit C).
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(c) The obligations of the Subscriber to consummate the Closing are also subject to the satisfaction or valid waiver by the Subscriber of the additional conditions that, on the Closing Date:
(i) all representations and warranties of ITAC and ARBE contained in this Subscription Agreement shall be true and correct in all material respects at and as of the Closing Date (except for representations and warranties made as of a specific date, which shall be true and correct in all material respects as of such date), and consummation of the Closing, shall constitute a reaffirmation by ITAC and ARBE of each of the representations, warranties and agreements of ITAC and ARBE contained in this Subscription Agreement as of the Closing Date;
(ii) ITAC and ARBE each shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Subscription Agreement to be performed, satisfied or complied with by it at or prior to Closing;
(iii) the ARBE Shares shall have been approved for listing on Nasdaq Capital Market (“Nasdaq”), in accordance with the terms set forth in the Transaction Agreement and subject to notice of issuance thereof;
(iv) no amendment or modification of the Transaction Agreement (as the same exists on the date hereof as provided to the Subscriber) shall have occurred that would reasonably be expected to materially and adversely affect the economic benefits that the Subscriber would reasonably expect to receive under this Subscription Agreement, including, without limitation, any material amendment or waiver of any representation or covenant of ITAC or ARBE relating to the financial position or outstanding indebtedness of ITAC or ARBE, any amendment in any respect of the exchange ratio of Common Shares for ARBE Shares; and
(v) there shall have been no amendment, waiver or modification to any of the Other Subscription Agreements entered into in connection with the Offering that materially benefits the Other Subscribers thereunder unless the Subscriber has been offered substantially the same benefits.
4. ITAC Representations and Warranties. ITAC represents and warrants to the Subscriber that:
(a) As of the date hereof, ITAC is, and as of the Closing, ITAC will be, a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. ITAC has the corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under this Subscription Agreement. This Subscription Agreement has been duly authorized, validly executed and delivered by ITAC, constitutes the valid and binding agreement of ITAC and is enforceable against ITAC in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.
(b) The Shares have been duly authorized and, assuming that the Direct Purchase Election is not made, when issued and delivered to the Subscriber against full payment therefor in accordance with the terms of this Subscription Agreement, the Shares will be validly issued, fully paid and non-assessable, free and clear of all liens or other restrictions (other than those arising under this Subscription Agreement or applicable securities laws or that incurred by the Subscriber) and will not have been issued in violation of or subject to any preemptive or similar rights created under ITAC’s Second Amended and Restated Certificate of Incorporation (and any amendment thereof) or under the Delaware General Corporation Law, as amended, or any similar rights pursuant to any agreement or other instrument to which ITAC is a party or by which it is otherwise bound.
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(c) Subject in all instances to receipt of the Required Purchaser Shareholder Approval (as defined in the Transaction Agreement), the execution, delivery and performance of this Subscription Agreement including, if the Direct Purchase Election is not made, the issuance and sale of the Shares and the compliance by ITAC with all of the provisions of this Subscription Agreement and the consummation of the transactions herein will be done in accordance with the Nasdaq marketplace rules and will not conflict with or result in a material breach or material violation of any of the terms or provisions of, or constitute a material default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of ITAC or any of its subsidiaries pursuant to the terms of (i) any indenture, mortgage, deed of trust, loan agreement, license, lease or any other agreement or instrument to which ITAC or any of its subsidiaries is a party or by which ITAC or any of its subsidiaries is bound or to which any of the property or assets of ITAC is subject, which would have a Material Adverse Effect on ITAC or materially affect the validity of the Shares or the legal authority of ITAC to comply in all material respects with the terms of this Subscription Agreement; (ii) result in any material violation of the provisions of the organizational documents of ITAC; or (iii) result in any violation of any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction over ITAC or any of its properties that would have a Material Adverse Effect on ITAC or materially affect the validity of the Shares or the legal authority of ITAC to comply with this Subscription Agreement; subject, in the case of the foregoing clauses (i) and (iii) with respect to the consummation of the transactions therein contemplated. For purposes of this Subscription Agreement, “Material Adverse Effect” with respect to (i) ITAC or ARBE, as defined in the Transaction Agreement, and (ii) with respect to any other party hereto, shall mean any events, circumstances, facts or events which, individually or in the aggregate have a material adverse effect on the business, properties, financial condition, stockholders’ equity or results of operations of such party and its subsidiaries taken as a whole
(d) Assuming the accuracy of the representations and warranties of the Subscriber, ITAC is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization or other person on the part of ITAC in connection with the execution, delivery and performance by ITAC of this Subscription Agreement (including, without limitation, the issuance of the Shares) which has not heretofore been obtained or will be obtained prior to the Closing, other than (i) any required filing of a Notice of Exempt Offering of Securities on Form D with U.S. Securities and Exchange Commission (the “SEC”) under Regulation D of the Securities Act of 1933, as amended (the “Securities Act”), if applicable, (ii) if applicable, the filing with the SEC of a registration statement pursuant to Section 7, (iii) any other filings with the SEC or other filings required by applicable state or federal securities laws, (iv) any filings or notices required by Nasdaq, (v) those required to consummate the Transaction as provided under the Transaction Agreement, (vi) the filing of notification under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, if applicable, and (vii) any consent, waiver, authorization or order of, notice to, or filing or registration, the failure of which to obtain would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect on ITAC.
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(e) As of the date of this Subscription Agreement and as of immediately prior to Closing, the authorized capital stock of ITAC consists of (i) 100,000,000 Common Shares, (ii) 20,000,000 shares of Class B common stock, par value of $0.0001 per share (the “Class B Common Stock”) and (iii) 1,000,000 shares of preferred stock, par value of $0.0001 per share (the “Preferred Stock”). As of the date of this Subscription Agreement, (A) 7,774,836 Common Shares are issued and outstanding, (B) 1,905,900 shares of Class B Common Stock are issued and outstanding, (C) 7,774,836 redeemable public warrants to purchase Common Shares are issued and outstanding, (D) 3,112,080 private placement warrants to purchase Common Shares are issued and outstanding, and (E) no Preferred Stock is issued and outstanding. All (1) issued and outstanding Common Shares and Class B Common Stock have been duly authorized and validly issued, are fully paid and are non-assessable and are not subject to preemptive rights and (2) outstanding warrants have been duly authorized and validly issued and are not subject to preemptive rights. Except as set forth above and pursuant to the Other Subscription Agreements, the Transaction Agreement and the other agreements and arrangements referred to therein or in the SEC Reports (as defined below) (including, without limitation, (x) the right of the Sponsor (as defined below) to convert up to $1.5 million in working capital loans into private placement warrants, as described in the Prospectus, and (y) ITAC’s sale to Maxim Group LLC, the representative of the underwriters in the IPO, of an option to purchase up to a total of 230,000 units (consisting of one Common Share and one redeemable public warrant to purchase a Common Share) exercisable, in whole or in part, at $11.50 per unit, commencing on the later of (A) the consummation of a business combination by ITAC and (B) six months from September 11, 2020, as described in the Prospectus), as of the date hereof, there are no outstanding options, warrants or other rights to subscribe for, purchase or acquire from ITAC Common Shares or other equity interests in ITAC, or securities convertible into or exchangeable or exercisable for such equity interests. As of the date hereof, ITAC has no subsidiaries, and does not own, directly or indirectly, interests or investments (whether equity or debt) in any person, whether incorporated or unincorporated. There are no shareholder agreements, voting trusts or other agreements or understandings to which ITAC is a party or by which it is bound relating to the voting of any securities of ITAC, other than (1) as set forth in the SEC Reports and (2) as contemplated by the Transaction Agreement. There are no securities or instruments issued by or to which ITAC is a party containing anti-dilution or similar provisions that will be triggered by the issuance of (i) the Shares or (ii) the shares to be issued pursuant to any Other Subscription Agreement, that have not been or will not be validly waived on or prior to the Closing Date. Except as disclosed in the SEC Reports (as defined below), as of the date of this Subscription Agreement, ITAC has no outstanding indebtedness for borrowed money.
(f) As of the date of this Agreement, the issued and outstanding Common Shares are registered pursuant to Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are listed for trading on Nasdaq under the symbol “ITAC”. As of the date of this Subscription Agreement, there is no suit, action, proceeding or investigation pending or, to the knowledge of ITAC, threatened against ITAC by Nasdaq or the SEC with respect to any intention by such entity to deregister the Common Shares or prohibit or terminate the listing of the Common Shares on the Nasdaq, excluding, for the purposes of clarity, the customary ongoing review by Nasdaq of ITAC’s listing application with respect to the Transaction.
(g) ITAC is in compliance with all applicable laws, except where such non-compliance would not reasonably be expected to have a Material Adverse Effect on ITAC. As of the date of this Subscription Agreement, ITAC has not received any written communication from a governmental authority that alleges that ITAC is not in compliance with or is in default or violation of any applicable law, except where such non-compliance, default or violation would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect on ITAC.
(h) ITAC has not entered into any agreement or arrangement entitling any agent, broker, investment banker, financial advisor or other person to any broker’s or finder’s fee or any other commission or similar fee in connection with the transactions contemplated by this Subscription Agreement for which the Subscriber could become liable. Other than (i) Wells Fargo, who is acting as placement agent to ITAC solely with respect to the offering of Common Shares in the United States and jurisdictions other than Israel, and (ii) Epsilon Underwriting & Issuing Ltd. (“Epsilon”) and Poalim I.B.I. Underwriting & Issuing Ltd. (“Poalim” and, together with Wells Fargo, the “Placement Agents” and each, a “Placement Agent”), who are acting as placement agents to ITAC solely with respect to the offering of Common Shares in Israel, ITAC is not aware of any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Common Shares in the Offering.
(i) ITAC is not, and immediately after receipt of payment for the Shares, will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
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(j) Assuming the accuracy of the Subscriber’s representations and warranties set forth in Section 6, in connection with the offer, sale and issuance of the Shares in the manner contemplated by this Subscription Agreement, it is not necessary to register the Shares under the Securities Act. The Shares (i) were not offered by any form of general solicitation or general advertising and (ii) are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act or any applicable state securities laws.
(k) ITAC has filed all reports required to be filed by it under the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, since its initial public offering (the “IPO”) (such reports, together with any materials filed or furnished thereafter by ITAC under the Exchange Act, whether or not any such reports were required, the “SEC Reports”). As of their respective dates (or, if amended or superseded by a filing prior to the Closing Date, then on the date of such filing), the SEC Reports filed by ITAC complied in all material respects with the requirements of the Securities Act and the Exchange Act and the rules and regulations of the SEC promulgated thereunder, and none of the SEC Reports, when filed (or, if amended or superseded by a filing prior to the Closing Date, then on the date of such filing) by ITAC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements of ITAC included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto as in effect at the time of filing (or, if amended or superseded by a filing prior to the Closing Date, then on the date of such filing). Such financial statements (excluding for the avoidance of doubt, any pro forma financial statements which include the financial information of ARBE) have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements, the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP or may be condensed or summary statements, and fairly present in all material respects the consolidated financial position of ITAC and its consolidated subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, year-end audit adjustments. All material agreements to which ITAC is a party or to which the property or assets of ITAC are subject are included as part of or identified in the SEC Reports, to the extent such agreements are required to be included or identified pursuant to the rules and regulations of the SEC
(l) Other than the Other Subscription Agreements and the Transaction Agreement, ITAC has not entered into any side letter or similar agreement with any Other Subscriber in connection with such Other Subscriber’s investment in ITAC through the Offering. No Other Subscription Agreement includes terms and conditions that are materially more advantageous to any such Other Subscriber than the Subscriber hereunder. Such Other Subscription Agreements have not been amended in any material respect following the date of this Subscription Agreement.
(m) Neither ITAC nor any of its subsidiaries has taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership, liquidation, administration or winding up or failed to pay its debts when due, nor does ITAC or any subsidiary thereof have any knowledge or reason to believe that any of their respective creditors intend to initiate involuntary bankruptcy proceedings or seek to commence an administration (unless ITAC does not consummate its Business Combination and is required to liquidate in accordance with its organizational documents and the Prospectus).
(n) As of the date hereof and as of the Closing Date, neither ITAC, nor, to ITAC’s knowledge, any Covered Person of ITAC, are subject to any of the “Bad Actor” disqualifications described in Rule 506(d) under the Securities Act (a “Disqualification Event”), except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). “Covered Person” means, for the purposes of this Subscription Agreement, in respect of any person as an “issuer” for purposes of Rule 506 under the Securities Act, any person listed in the first paragraph of Rule 506(d)(1) under the Securities Act.
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(o) Except for such matters as have not had and would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect on ITAC, as of the date of this Subscription Agreement, there is no (A) suit, action, proceeding or arbitration before a governmental authority or arbitrator pending against ITAC or (B) judgment, decree, injunction, ruling or order of any governmental entity or arbitrator outstanding against ITAC. ITAC and its directors and officers are not (i) a person named on the List of Specially Designated Nationals and Blocked Persons administered by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”) or in any Executive Order issued by the President of the United States and administered by OFAC (“OFAC List”), or a person prohibited by any OFAC sanctions program, (ii) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (iii) a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank (collectively, a “Prohibited Person”). Each of ITAC and, to ITAC’s knowledge, its directors, officers employees, representatives, agents and any person acting on its or their behalf has not engaged in any activity or conduct which would violate any applicable anti-bribery, anticorruption or anti-money laundering laws, regulations or rules in any applicable jurisdiction.
(p) ITAC understands that the foregoing representations and warranties shall be deemed material to and have been relied upon by the Subscriber.
5. ARBE Representations and Warranties. ARBE represents and warrants to the Subscriber that:
(a) As of the date hereof, ARBE is, and as of the ARBE Closing, ARBE will be, a corporation duly organized and validly existing under the laws of Israel. ARBE has the corporate power and authority to own, lease and operate its properties and conduct its business as presently conducted and to enter into, deliver and perform its obligations under this Subscription Agreement. This Subscription Agreement has been duly authorized, validly executed and delivered by ARBE, constitutes the valid and binding agreement of ARBE and is enforceable against ARBE in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.
(b) Other than the applicable Placement Agents, ARBE has not entered into any agreement or arrangement entitling any agent, broker, investment banker, financial advisor or other person to any broker’s or finder’s fee or any other commission or similar fee in connection with the transactions contemplated by this Subscription Agreement. Other than the Placement Agents, ARBE is not aware of any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with the sale of any Common Shares in the Offering (including, if the Direct Purchase Election is made, the issuance of the ARBE Shares hereunder).
(c) Subject in all instances to receipt of the Required Company Shareholder Approval (as defined in the Transaction Agreement), the execution, delivery and performance of this Subscription Agreement by ARBE, and the compliance by ARBE with all of the provisions of this Subscription Agreement and the consummation of the transactions herein (including if the Direct Purchase Election is made, the issuance of the ARBE Shares hereunder), will, if the Direct Purchase Election is made, be done in accordance with the Nasdaq marketplace rules and, in any event, will not conflict with or result in a material breach or material violation of any of the terms or provisions of, or constitute a material default under, or result in the creation or imposition of any lien, charge or encumbrance upon any of the property or assets of ARBE or any of its subsidiaries pursuant to the terms of (i) any indenture, mortgage, deed of trust, loan agreement, license, lease or any other agreement or instrument to which ARBE or any of its subsidiaries is a party or by which ARBE or any of its subsidiaries is bound or to which any of the property or assets of ARBE or any of its subsidiaries is subject, which would have a Material Adverse Effect on ARBE or materially affect the validity of the ARBE Shares or legal authority of ARBE to comply in all material respects with the terms of this Subscription Agreement; (ii) result in any material violation of the provisions of the organizational documents of ARBE; or (iii) result in any violation of any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction over ARBE or any of its properties that would have a Material Adverse Effect on ARBE or materially affect the validity of the ARBE Shares or the legal authority of ARBE to comply with this Subscription Agreement; subject, in the case of the foregoing clauses (i) and (iii) with respect to the consummation of the transactions therein contemplated.
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(d) Assuming the accuracy of the representations and warranties of the Subscriber, ARBE is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority, self-regulatory organization or other person on the part of ARBE in connection with the execution, delivery and performance by ARBE of this Subscription Agreement which has not heretofore been obtained or will be obtained prior to the Closing, other than (i) filings with the SEC, (ii) filings required by applicable state or local securities laws, (iii) the filing with the SEC of a registration statement pursuant to Section 7, (iv) those required by the Nasdaq, and (v) any consent, waiver, authorization or order of, notice to, or filing or registration, the failure of which to obtain would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect on ARBE.
(e) If the Direct Purchase Election is made, the ARBE Shares issuable to the Subscriber hereunder will, when so issued, have been duly authorized, validly issued, fully paid and non-assessable, free and clear of all liens or other restrictions (other than those arising under this Subscription Agreement or applicable securities laws or that incurred by the Subscriber) and will not have been issued in violation of or subject to any preemptive or similar rights created under ARBE’s Amended and Restated Company Articles of Association as then in effect or under the Israeli Companies Law, 5759-1999, as amended, or any similar rights pursuant to any agreement or other instrument to which ARBE is a party or by which it is otherwise bound.
(f) ARBE is not, and, if the Direct Purchase Election is exercised, immediately after receipt of payment for the ARBE Shares, will not be, an “investment company” within the meaning of the Investment Company Act of 1940, as amended.
(g) Assuming the accuracy of the Subscriber’s representations and warranties set forth in Section 6, and compliance by the Placement Agents with applicable securities laws, in connection with the offer, sale and issuance of the Shares in the manner contemplated by this Subscription Agreement, it is not necessary to register the Shares under the Securities Act and the Shares (i) were not offered by any form of general solicitation or general advertising and (ii) and are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act or any applicable state securities laws.
(h) As of the date hereof and as of the Closing Date, neither ARBE, nor, to the ARBE’s knowledge, any Covered Person of ARBE are subject to any Disqualification Event, except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3) under the Securities Act.
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(i) Neither ARBE nor any of its subsidiaries has taken any steps to seek protection pursuant to any law or statute relating to bankruptcy, insolvency, reorganization, receivership, liquidation, administration or winding up or failed to pay its debts when due, nor does ARBE have any knowledge or reason to believe that any of their respective creditors intend to initiate involuntary bankruptcy proceedings or seek to commence an administration.
(j) Except for such matters as have not had and would not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect on ARBE, there is no (i) suit, action, proceeding or arbitration before a governmental authority or arbitrator pending against ARBE or (ii) judgment, decree, injunction, ruling or order of any governmental entity or arbitrator outstanding against ARBE. ARBE is not and none of its directors and officers are a Prohibited Person. Each of ARBE and, to ARBE’s knowledge, its directors, officers employees, representatives, agents and any person acting on its or their behalf has not engaged in any activity or conduct which would materially violate any applicable anti-bribery, anticorruption or anti-money laundering laws, regulations or rules in any applicable jurisdiction
(k) Other than the Other Subscription Agreements and the Transaction Agreement, ITAC has not entered into any side letter or similar agreement with any Other Subscriber in connection with such Other Subscriber’s investment in ITAC through the Offering. No Other Subscription Agreement includes terms and conditions that are materially more advantageous to any such Other Subscriber than the Subscriber hereunder. Such Other Subscription Agreements have not been amended in any material respect following the date of this Subscription Agreement.
(l) ARBE understands that the foregoing representations and warranties shall be deemed material to and have been relied upon by the Subscriber.
6. Subscriber Representations and Warranties. The Subscriber represents and warrants to ITAC and ARBE that:
(a) The Subscriber is either a U.S. investor, an Israeli investor or other non-U.S. investor as set forth under its name on the signature page hereto, and accordingly represents the applicable additional matters under clause (i), (ii) or (iii) below:
(i) Applicable to U.S. investors: At the time the Subscriber was offered the Shares, it was, and as of the date hereof, the Subscriber is (A) a “qualified institutional buyer” (within the meaning of Rule 144A under the Securities Act) or an “accredited investor” (within the meaning of Rule 501(a) of Regulation D under the Securities Act) as indicated in the questionnaire attached as Exhibit A hereto, and (B) is acquiring the Shares only for its own account and (C) not for the account of others, and not on behalf of any other account or person or with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act. The Subscriber is not an entity formed for the specific purpose of acquiring the Shares.
(ii) Applicable to Israeli investors: At the time the Subscriber was offered the Shares, it was, and as of the date hereof, the Subscriber is (A) a “qualified investor” (within the meaning of the First Addendum of the Israeli Securities Law, 1968 (“ISL”) as indicated in the questionnaire attached as Exhibit C hereto, and (B) is acquiring the Shares only for its own account and (C) not for the account of others, and not on behalf of any other account or person or with a view to, or for offer or sale in connection with, any distribution thereof in violation of the ISL. The Subscriber is not an entity formed for the specific purpose of acquiring the Shares.
(iii) Applicable to non-U.S. investors: The Subscriber understands that the sale of the Shares is made pursuant to and in reliance upon Regulation S promulgated under the Securities Act (“Regulation S”). The Subscriber is not a U.S. Person (as defined in Regulation S), it is acquiring the Shares in an offshore transaction in reliance on Regulation S, and it has received all the information that it considers necessary and appropriate to decide whether to acquire the Shares hereunder outside of the United States. The Subscriber is not relying on any statements or representations made in connection with the transactions contemplated hereby other than representations contained in this Subscription Agreement. The Subscriber understands and agrees that Securities sold pursuant to Regulation S may be subject to restrictions thereunder, including compliance with the distribution compliance period provisions therein.
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(b) The Subscriber understands that the Shares are being offered in a transaction not involving any public offering within the meaning of the Securities Act and that the Shares issued at the Closing have not been registered under the Securities Act. The Subscriber understands that the Shares may not be resold, transferred, pledged or otherwise disposed of by the Subscriber absent an effective registration statement under the Securities Act except (i) to ITAC (or, after the Transaction Closing, ARBE) or a subsidiary thereof, (ii) to non-U.S. persons pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act or (iii) pursuant to another applicable exemption from the registration requirements of the Securities Act, and in each of cases (i) and (iii) in accordance with any applicable securities laws of the states and other jurisdictions of the United States, and that any certificates (if any) or any book-entry shares representing the Shares issued at the Closing shall contain a legend or restrictive notation to such effect. The Subscriber acknowledges that the Shares will not immediately be eligible for resale pursuant to Rule 144A promulgated under the Securities Act. The Subscriber understands and agrees that the Shares, until registered under an effective registration statement, will be subject to transfer restrictions and, as a result of these transfer restrictions, the Subscriber may not be able to readily resell the Shares and may be required to bear the financial risk of an investment in the Shares for an indefinite period of time. The Subscriber understands that it has been advised to consult legal counsel prior to making any offer, resale, pledge or transfer of any of the Shares.
(c) The Subscriber understands and agrees that the Subscriber is purchasing Shares directly from ITAC or, if the Direct Purchase Election is made, ARBE. The Subscriber further acknowledges that there have been no representations, warranties, covenants and agreements made to the Subscriber by ITAC, ARBE, or any of their respective officers or directors, or any other person, expressly (other than those representations, warranties, covenants and agreements included in this Subscription Agreement by ITAC and ARBE) or by implication.
(d) The Subscriber acknowledges and agrees that the Subscriber has received such information as the Subscriber deems necessary in order to make an investment decision with respect to the Shares. Without limiting the generality of the foregoing, the Subscriber acknowledges that it has received and carefully reviewed the following items (collectively, the “Disclosure Documents”): (i) the final prospectus of ITAC, dated as of September 8, 2020 and filed with the SEC (File No. 333-242339) on September 10, 2020 (the “Prospectus”), (ii) each filing made by ITAC with the SEC following the filing of the Prospectus through the date of this Subscription Agreement, (iii) the Transaction Agreement, a copy of which will be filed by ITAC with the SEC, and (iv) the investor presentation by ITAC and ARBE dated March 2021 (the “Investor Presentation”), a copy of which will be furnished by ITAC to the SEC. The Subscriber represents and agrees that the Subscriber and the Subscriber’s professional advisor(s), if any, have had the full opportunity to ask ITAC’s and ARBE’s management questions, receive such answers and obtain such information as the Subscriber and the Subscriber’s professional advisor(s), if any, have deemed necessary to make an investment decision with respect to the Shares. The Subscriber has conducted its own investigation of ITAC, ARBE and the Shares and the Subscriber has made its own assessment and have satisfied itself concerning the relevant tax and other economic considerations relevant to its investment in the Shares. The Subscriber further acknowledges that the information contained in the Disclosure Documents is subject to change, and that any changes to the information contained in the Disclosure Documents, including any changes based on updated information or changes in terms of the Transaction, shall in no way affect the Subscriber’s obligation to purchase the Shares hereunder, except as otherwise provided herein, and that, in purchasing the Shares, the Subscriber is not relying upon any projections contained in the investor presentation.
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(e) The Subscriber became aware of this Offering of the Shares solely by means of direct contact between the Subscriber and ITAC, ARBE, the applicable Placement Agent or a representative of ITAC, ARBE or the applicable Placement Agent, and the Shares were offered to the Subscriber solely by direct contact between the Subscriber and ITAC, ARBE, the applicable Placement Agent or a representative of ITAC, ARBE or the applicable Placement Agent. The Subscriber acknowledges that ITAC represents and warrants that the Shares (i) were not offered by any form of general solicitation or general advertising and (ii) are not being offered in a manner involving a public offering under, or in a distribution in violation of, the Securities Act, or any state securities laws. The Subscriber has a substantive pre-existing relationship with ITAC, ARBE or their respective affiliates or the applicable Placement Agent for this Offering of the Shares. If the Subscriber is located in the United States or a jurisdiction other than Israel, then the only Placement Agent it has had contact with in connection with the offer and sale of the Shares is Wells Fargo. If the Subscriber is located in Israel, then the only Placement Agents it has had contact with, in connection with the offer and sale of the Shares, are Epsilon and/or Poalim.
(f) The Subscriber acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Shares, including those set forth in the Disclosure Documents and in ITAC’s filings with the SEC. The Subscriber is able to fend for itself in the transactions contemplated herein and has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Shares, and the Subscriber has sought such accounting, legal and tax advice as the Subscriber has considered necessary to make an informed investment decision.
(g) Alone, or together with any professional advisor(s), the Subscriber has considered the risks of an investment in the Shares and determined that the Shares are a suitable investment for the Subscriber and that the Subscriber is able at this time and in the foreseeable future to bear the economic risk of a total loss of the Subscriber’s investment in ITAC (and after the Transaction Closing, ARBE). The Subscriber acknowledges specifically that a possibility of total loss exists.
(h) In making its decision to purchase the Shares, the Subscriber has relied solely upon independent investigation made by the Subscriber, the Investor Presentation and the representations and warranties of ITAC and ARBE set forth herein. Without limiting the generality of the foregoing, the Subscriber has not relied on any statements or other information provided by any of the Placement Agents concerning ITAC, ARBE or the Shares or the offer and sale of the Shares. Subscriber acknowledges and agrees that Subscriber had access to, and an adequate opportunity to review, financial and other information as Subscriber deems necessary in order to make an investment decision with respect to the Shares.
(i) The Subscriber understands and agrees that no federal or state agency has passed upon or endorsed the merits of this Offering of the Shares or made any findings or determination as to the fairness of this investment or the accuracy or adequacy of the Disclosure Documents.
(j) If an entity, the Subscriber has been duly formed or incorporated and is validly existing in good standing under the laws of its jurisdiction of incorporation or formation. The execution, delivery and performance by the Subscriber of this Subscription Agreement are within the powers of the Subscriber, have been duly authorized and will not constitute or result in a material breach or default under or conflict with any law, statute, rule or regulation applicable to the Subscriber, any order, ruling or regulation of any court or other tribunal or of any governmental commission or agency, or any agreement or other undertaking, to which the Subscriber is a party or by which the Subscriber is bound, and, if the Subscriber is not an individual, will not violate any provisions of the Subscriber’s organizational documents. The signature on this Subscription Agreement is genuine, and the signatory, if the Subscriber is an individual, has legal competence and capacity to execute the same or, if the Subscriber is not an individual the signatory has been duly authorized to execute the same, and this Subscription Agreement constitutes a legal, valid and binding obligation of the Subscriber, enforceable against the Subscriber in accordance with its terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally, and (ii) principles of equity, whether considered at law or equity.
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(k) Neither the due diligence investigation conducted by the Subscriber in connection with making its decision to acquire the Shares nor any representations and warranties made by the Subscriber herein shall modify, amend or affect the Subscriber’s right to rely on the truth, accuracy and completeness of ITAC’s or ARBE’s representations and warranties contained herein.
(l) The Subscriber is not a Prohibited Person. The Subscriber agrees to provide law enforcement agencies, if requested thereby, such records as required by applicable law, provided that the Subscriber is permitted to do so under applicable law. If the Subscriber is a financial institution subject to the Bank Secrecy Act (31 U.S.C. Section 5311 et seq.), as amended by the USA PATRIOT Act of 2001, and its implementing regulations (collectively, the “BSA/PATRIOT Act”), the Subscriber maintains policies and procedures reasonably designed to comply with applicable obligations under the BSA/PATRIOT Act. To the extent required, it maintains policies and procedures reasonably designed for the screening of its investors against the OFAC sanctions programs, including the OFAC List. To the extent required, it maintains policies and procedures reasonably designed to ensure that the funds held by the Subscriber and used to purchase the Shares were legally derived.
(m) As of the date hereof and as of the Closing Date, neither the Subscriber, nor, to the extent it has them, any of its equity holders, managers, general or limited partners, directors, affiliates or executive officers (collectively with the Subscriber, the “Covered Persons”), are subject to any Disqualification Event, except for a Disqualification Event covered by Rule 506(d)(2) or (d)(3). The Subscriber has exercised reasonable care to determine whether any Covered Person is subject to a Disqualification Event. The acquisition of Shares by the Subscriber will not subject ITAC or ARBE to any Disqualification Event.
(n) No disclosure or offering document has been prepared by any of the Placement Agent in connection with the offer and sale of the Shares. The Subscriber acknowledges that each Placement Agent and each of its members, directors, officers, employees, representatives and controlling persons have made no independent investigation with respect to ITAC, ARBE or the Shares or the accuracy, completeness or adequacy of any information supplied to the Subscriber by ITAC or ARBE. In connection with the issue and purchase of the Shares, no Placement Agent has acted as the Subscriber’s financial advisor or fiduciary. The Subscriber acknowledges that such information and projections were prepared without the participation of any of the Placement Agents and no Placement Agent assumes any responsibility for independent verification of, or the accuracy or completeness of, such information or projections.
(o) The Subscriber acknowledges its obligations under applicable securities laws with respect to the treatment of non-public information relating to ITAC.
(p) The Subscriber acknowledges that, in the Transaction, the Common Shares, including any Shares acquired by the Subscriber if the Direct Purchase Election is not made, will be exchanged for ARBE Shares.
(q) Subscriber has, and on each date any portion of the Aggregate Purchase Price would be required to be funded to ITAC (or if the Direct Purchase Election is made, to ARBE) pursuant to this Subscription Agreement will have, sufficient immediately available funds to pay the Aggregate Purchase Price.
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7. Registration Rights.
(a) From and after the Transaction Closing, ARBE agrees that, within thirty (30) calendar days after the Transaction Closing, ARBE will file with the SEC (at ARBE’s sole cost and expense) a registration statement registering the resale of the ARBE Shares either, if the Direct Purchase Election is made, issued at Closing or, if the Direct Purchase Election is not made, exchanged at the Transaction Closing for the Common Shares purchased by the Subscriber hereunder (the “Registration Statement”), and ARBE shall use its commercially reasonable efforts to have the Registration Statement declared effective as soon as practicable after the filing thereof (for the avoidance of doubt, not as a condition to Closing), but no later than the earlier of (i) the sixtieth (60th) calendar day (or ninetieth (90th) calendar day if the SEC notifies ABRE that it will “review” the Registration Statement) following the filing of the Registration Statement with the SEC and (ii) the tenth (10th) business day after the date ABRE is notified in writing by the SEC that the Registration Statement will not be “reviewed” or will not be subject to further review. ABRE will use its commercially reasonable efforts to provide a draft of the Registration Statement to the undersigned for review (but not comment) at least two (2) business days in advance of filing the Registration Statement; provided that, for the avoidance of doubt, in no event shall ABRE be required to delay or postpone the filing of such Registration Statement as a result of or in connection with the undersigned’s review. In no event shall the Subscriber be identified as a statutory underwriter in the Registration Statement unless required by the SEC or otherwise agreed to by the Subscriber in writing; provided, that if the SEC requests that the Subscriber be identified as a statutory underwriter in the Registration Statement, the Subscriber will have an opportunity to withdraw from the Registration Statement. Any failure by ARBE to file or to effect the Registration Statement by the deadlines set out herein shall not otherwise relieve ARBE of its obligations to file or effect the Registration Statement as set forth above in this Section 7. ARBE shall, upon reasonable request, inform the Subscriber as to the status of the registration effected by ARBE pursuant to this Subscription Agreement.
(b) ARBE agrees that ARBE will cause such Registration Statement or another registration statement (which may be a “shelf” registration statement, if applicable) which includes the Shares to remain effective until the earlier of (i) three years from the issuance of the Shares, (ii) the date on which the Subscriber ceases to hold the Shares covered by such Registration Statement, or (iii) on the first date on which the Subscriber can sell all of its Shares (or shares received in exchange therefor) under Rule 144 of the Securities Act without limitation, including as to the manner of sale or the amount of such securities that may be sold and without the requirement for the ARBE to be in compliance with the current public information required under Rule 144(c)(1) (or Rule 144(i)(2), if applicable). The Subscriber agrees to disclose its beneficial ownership, as determined in accordance with Rule 13d-3 of the Exchange Act, of the Shares to ARBE (or its successor) upon request to assist ARBE in making the determination described above. For as long as the Subscriber holds Shares, ARBE will use commercially reasonable efforts to file all reports for so long as the condition in Rule 144(c)(1) (or Rule 144(i)(2), if applicable) is required to be satisfied, and provide all customary and reasonable cooperation, necessary to enable the undersigned to resell the Shares pursuant to Rule 144 of the Securities Act including furnishing to Subscriber so long as it owns Shares, promptly upon request, (x) a written statement by ARBE, if true, that it has complied in all material respects with the reporting requirements of Rule 144, the Securities Act and the Exchange Act, (y) a copy of the most recent annual or quarterly report of ARBE and such other reports and documents so filed by ARBE (public availability on the SEC’s EDGAR system (or successor system) being sufficient) and (z) such other information as may be reasonably requested to permit Subscriber to sell such securities pursuant to Rule 144 without registration (in each case, when Rule 144 of the Securities Act becomes available to the Subscriber).
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(c) ARBE’s obligations to include the Shares in the Registration Statement are contingent upon the Subscriber furnishing in writing to ARBE such information regarding the Subscriber, the securities of ARBE held by the Subscriber and the intended method of disposition of the Shares as shall be reasonably requested by ARBE to effect the registration of the Shares, and shall execute such documents in connection with such registration as ARBE may reasonably request that are customary of a selling stockholder in similar situations; provided that the Subscriber shall not in connection with the foregoing be required to execute any lock-up or similar agreement or otherwise be subject to any contractual restriction on the ability to transfer the Shares. With respect to any information to be provided by the Subscriber pursuant to this Section 7, ARBE shall request such information from the Subscriber at least five (5) business days prior to the anticipated filing date of the Registration Statement. Notwithstanding the foregoing, if the SEC prevents ARBE from including any or all of the shares proposed to be registered for resale under the Registration Statement due to limitations on the use of Rule 415 of the Securities Act for the resale of ARBE’s securities by the applicable shareholders or otherwise, (i) such Registration Statement shall register for resale such number of ARBE securities which is equal to the maximum number of ARBE securities as is permitted by the SEC and (ii) the number of ARBE securities to be registered for each selling shareholder named in the Registration Statement shall be reduced pro rata among all such selling shareholders, and as promptly as practicable after being permitted to register additional shares under Rule 415 under the Securities Act, ARBE shall amend the Registration Statement or file a new Registration Statement to register such Shares not included in the initial Registration Statement and cause such amendment or Registration Statement to become effective as promptly as practicable.
(d) ARBE may delay filing or suspend the use of any such registration statement if it determines, upon advice of external legal counsel, that (x) in order for the registration statement to not contain a material misstatement or omission, an amendment thereto would be needed, or (y) such filing or use would materially affect a bona fide business or financing transaction of ARBE or would require premature disclosure of information that would materially adversely affect ARBE (each such circumstance, a “Suspension Event”); provided, that ARBE shall use commercially reasonable efforts to make such registration statement available for the sale by the Subscriber of such securities as soon as practicable thereafter and ARBE may not delay or suspend any such registration statement on more than two occasions or for more than 60 consecutive calendar days, or more than 100 total calendar days in any twelve-month period. Upon receipt of any written notice from ARBE of the happening of any Suspension Event during the period that the Registration Statement is effective or if as a result of a Suspension Event the Registration Statement or related prospectus contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made (in the case of the prospectus) not misleading, the Subscriber agrees that it will (i) immediately discontinue offers and sales of the Shares under the Registration Statement (excluding, for the avoidance of doubt, sales conducted pursuant to Rule 144) until the Subscriber receives (A) (x) copies of a supplemental or amended prospectus that corrects the misstatement(s) or omission(s) referred to above, which ARBE agrees to promptly prepare and file and (y) notice that any post-effective amendment has become effective or (B) notice from ARBE that it may resume such offers and sales, and (ii) maintain the confidentiality of any information included in such written notice delivered by ARBE unless otherwise required by applicable law. If so directed by ARBE, the Subscriber will deliver to ARBE or destroy all copies of the prospectus covering the Shares in the Subscriber’s possession; provided, however, that this obligation to deliver or destroy all copies of the prospectus covering the Shares shall not apply to (i) the extent the Subscriber is required to retain a copy of such prospectus (A) in order to comply with applicable legal, regulatory, self-regulatory or professional requirements or (B) in accordance with a bona fide pre-existing document retention policy or (ii) copies stored electronically on archival servers as a result of automatic data back-up. The Subscriber may deliver written notice (an “Opt-Out Notice”) to ARBE requesting that Subscriber not receive notices from ARBE otherwise required by this Section 7; provided, however, that Subscriber may later revoke any such Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from Subscriber (unless subsequently revoked), (i) ARBE shall not deliver any such notices to Subscriber and Subscriber shall no longer be entitled to the rights associated with any such notice and (ii) each time prior to Subscriber’s intended use of an effective Registration Statement, Subscriber will notify ARBE in writing at least three (3) business days in advance of such intended use, and if a notice of a Suspension Event was previously delivered (or would have been delivered but for the provisions of this Section 7(d)) and the related suspension period remains in effect, ARBE will so notify Subscriber, within two (2) business days of Subscriber’s notification to ARBE, by delivering to Subscriber a copy of such previous notice of Suspension Event, and thereafter will provide Subscriber with the related notice of the conclusion of such Suspension Event promptly following its availability.
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(e) In the case of the registration, qualification, exemption or compliance effected by ABRE pursuant to this Subscription Agreement, ABRE shall, upon reasonable request, inform the Subscriber as to the status of such registration, qualification, exemption and compliance. At its expense, ABRE shall: (i) except for such times as ABRE is permitted hereunder to suspend the use of the prospectus forming part of a Registration Statement, use its commercially reasonable efforts to keep such registration, and any qualification, exemption or compliance under state securities laws which ABRE determines to obtain, continuously effective with respect to the Subscriber, and to keep the applicable Registration Statement or any subsequent shelf registration statement free of any material misstatements or omissions; (ii) advise Subscriber within five (5) business days (A) of the issuance by the SEC of any stop order suspending the effectiveness of any Registration Statement or the initiation of any proceedings for such purpose, (B) of the receipt by ABRE of any notification with respect to the suspension of the qualification of the Shares included therein for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and (C) subject to the provisions in this Subscription Agreement, of the occurrence of any event that requires the making of any changes in any Registration Statement or prospectus included therein so that, as of such date, the statements therein are not misleading and do not omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in light of the circumstances under which they were made) not misleading (notwithstanding anything to the contrary set forth herein, ABRE shall not, when so advising the Subscriber of such events listed above, provide the Subscriber with any material, nonpublic information regarding ABRE other than to the extent that providing notice to Subscriber of the occurrence of the events listed in (A) through (C) above constitutes material, nonpublic information regarding ABRE); (iii) use its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement as soon as reasonably practicable; and (iv) upon the occurrence of any event contemplated above, except for such times as ABRE is permitted hereunder to suspend, and has suspended, the use of a prospectus forming part of a Registration Statement, ABRE shall use its commercially reasonable efforts to as soon as reasonably practicable prepare a post-effective amendment to such Registration Statement or a supplement to the related prospectus, or file any other required document so that, as thereafter delivered to purchasers of the Shares included therein, such prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(f) During any periods that a Registration Statement registering the resale of the Shares is effective or when the Shares may be sold pursuant to Rule 144 under the Securities Act or may be sold without restriction under Rule 144, ABRE shall, at its expense, cause ABRE’s transfer agent to remove any restrictive legends on any Shares sold by the Subscriber within three (3) business days following the date that such Shares are sold and the Subscriber notifies ABRE of such sale (and prior to removal the Subscriber provides ABRE with any customary representations in connection therewith).
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(g) ARBE shall indemnify, defend and hold harmless the Subscriber (to the extent a seller under such registration statement), the officers, directors and agents of the Subscriber, and each person who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) the Subscriber to the fullest extent permitted by applicable law, from and against any and all losses, claims, damages, liabilities, costs (including, without limitation, reasonable attorneys’ fees) and expenses (collectively, “Losses”), as incurred, that arise out of or are based upon (i) any untrue or alleged untrue statement of a material fact contained in the Registration Statement or any registration statement including any of the Shares, any prospectus included in such registration statement or any form of prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus or form of prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading, or (ii) any violation or alleged violation by ARBE of the Securities Act, Exchange Act or any state securities law or any rule or regulation thereunder, in connection with the performance of its obligations under this Section 7, except to the extent, but only to the extent, that such untrue statements, alleged untrue statements, omissions or alleged omissions are based upon information regarding the Subscriber furnished in writing to ARBE by the Subscriber expressly for use therein or the Subscriber has omitted a material fact from such information or otherwise violated the Securities Act, Exchange Act or any state securities law or any rule or regulation thereunder; provided, however, that the indemnification contained in this Section 7 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the consent of ARBE (which consent shall not be unreasonably withheld, conditioned or delayed), nor shall ARBE be liable for any Losses to the extent they arise out of or are based upon a violation which occurs (A) in reliance upon and in conformity with written information furnished by Subscriber, (B) in connection with any failure of such person to deliver or cause to be delivered a prospectus made available by ARBE in a timely manner, (C) as a result of offers or sales effected by or on behalf of any person by means of a freewriting prospectus (as defined in Rule 405) that was not authorized in writing by ARBE, or (D) in connection with any offers or sales effected by or on behalf of Subscriber in violation of Section 7(d) hereof. The Company shall notify the Subscriber promptly of the institution, threat or assertion of any proceeding arising from or in connection with the transactions contemplated by this Section 7 of which ARBE is aware. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of an indemnified party and shall survive the transfer of the Shares by the Subscriber.
(h) The Subscriber shall, severally and not jointly with any other selling shareholder named in the Registration Statement, indemnify and hold harmless ARBE, its directors, officers, agents and employees, and each person who controls ARBE (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), to the fullest extent permitted by applicable law, from and against all Losses, as incurred, arising out of or are based upon any untrue or alleged untrue statement of a material fact contained in any Registration Statement, any prospectus included in the Registration Statement, or any form of prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein (in the case of any prospectus, or any form of prospectus or supplement thereto, in light of the circumstances under which they were made) not misleading to the extent, but only to the extent, that such untrue statements or omissions are based upon information regarding the Subscriber furnished in writing to ARBE by the Subscriber expressly for use therein; provided, however, that the indemnification contained in this Section 7 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the consent of the Subscriber (which consent shall not be unreasonably withheld, conditioned or delayed). In no event shall the liability of any Subscriber be greater in amount than the dollar amount of the net proceeds received by the Subscriber upon the sale of the Shares giving rise to such indemnification obligation. The Subscriber shall notify ARBE promptly of the institution, threat or assertion of any proceeding arising from or in connection with the transactions contemplated by this Section 7 of which the Subscriber is aware. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of an indemnified party and shall survive the transfer of the Shares by the Subscriber.
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(i) If the indemnification provided under this Section 7 from the indemnifying party is unavailable or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities and expenses referred to herein, then the indemnifying party, in lieu of indemnifying the indemnified party, shall contribute to the amount paid or payable by the indemnified party as a result of such losses, claims, damages, liabilities and expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party, as well as any other relevant equitable considerations. The relative fault of the indemnifying party and indemnified party shall be determined by reference to, among other things, whether any action in question, including any untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact, was made by, or relates to information supplied by, such indemnifying party or indemnified party, and the indemnifying party’s and indemnified party’s relative intent, knowledge, access to information and opportunity to correct or prevent such action. The amount paid or payable by a party as a result of the losses or other liabilities referred to above shall be subject to the limitations set forth in this Section 7 and deemed to include any legal or other fees, charges or expenses reasonably incurred by such party in connection with any investigation or proceeding. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution pursuant to this Section 7(i) from any person who was not guilty of such fraudulent misrepresentation. Each indemnifying party’s obligation to make a contribution pursuant to this Section 7(i) shall be individual, not joint, and in no event shall the liability of the Subscriber under this Section 7(i) be greater in amount than the dollar amount of the net proceeds received by the Subscriber upon the sale of the Shares giving rise to such indemnification obligation.
8. Termination. This Subscription Agreement shall terminate and be void and of no further force and effect, and all rights and obligations of the parties hereunder shall terminate without any further liability on the part of any party in respect thereof, upon the earlier to occur of: (a) the mutual written agreement of ITAC, the Subscriber and ARBE to terminate this Subscription Agreement; (b) such date and time as the Transaction Agreement is terminated in accordance with its terms; or (c) written notice by either (x) ITAC and ARBE to the Subscriber or (y) the Subscriber to ITAC and ARBE to terminate this Subscription Agreement if the transactions contemplated by this Subscription Agreement are not consummated on or prior to the Outside Date (as defined in the Transaction Agreement); provided that (i) nothing herein will relieve any party from liability for any willful breach hereof prior to the time of termination, and each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising from such breach, and (ii) the provisions of Sections 8 through 12 of this Subscription Agreement will survive any termination of this Subscription Agreement and continue indefinitely. ITAC shall notify the Subscriber of the termination of the Transaction Agreement promptly after the termination thereof. Upon occurrence of any termination prior to the Closing in accordance with this Section 8, any monies paid by the Subscriber to ITAC or ARBE in connection herewith shall promptly be returned to the Subscriber.
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9. Trust Account Waiver. The Subscriber hereby represents and warrants that it has read the Prospectus and understands that ITAC has established a trust account (the “Trust Account”) containing the proceeds of the IPO and the overallotment securities acquired by its underwriters and from certain private placements occurring simultaneously with the IPO (including interest accrued from time to time thereon) for the benefit of ITAC’s public stockholders (including overallotment shares acquired by ITAC’s underwriters, the “Public Stockholders”), and that, except as otherwise described in the Prospectus, ITAC may disburse monies from the Trust Account only: (a) to the Public Stockholders in the event they elect to redeem their ITAC shares in connection with the consummation of ITAC’s initial business combination (as such term is used in the Prospectus) (the “Business Combination”) or in connection with an extension of its deadline to consummate a Business Combination, (b) to the Public Stockholders if ITAC fails to consummate a Business Combination within fifteen (15) months after the closing of the IPO (or up to twenty-one (21) months from the closing of the IPO if ITAC in accordance with the requirements of the Prospectus extends its deadline to consummate a Business Combination), subject to extension by amendment to ITAC’s organizational documents, (c) with respect to any interest earned on the amounts held in the Trust Account, as necessary to pay for any franchise or income taxes (and up to $50,000 in dissolution expenses), or (d) to ITAC after or concurrently with the consummation of a Business Combination. For and in consideration of ITAC entering into this Subscription Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Subscriber hereby agrees on behalf of itself and its affiliates that, notwithstanding anything to the contrary in this Subscription Agreement, neither the Subscriber nor any of its affiliates do now or shall at any time hereafter have any right, title, interest or claim of any kind in or to any monies in the Trust Account or distributions therefrom directly or indirectly to Public Stockholders (“Public Distributions”), or make any claim against the Trust Account or Public Distributions, regardless of whether such claim arises as a result of, in connection with or relating in any way to, this Subscription Agreement or any other matter, and regardless of whether such claim arises based on contract, tort, equity or any other theory of legal liability (collectively, the “Released Claims”). The Subscriber on behalf of itself and its affiliates hereby irrevocably waives any Released Claims that the Subscriber or any of its affiliates may have against the Trust Account or Public Distributions now or in the future and will not seek recourse against the Trust Account or Public Distributions for any reason whatsoever (including for an alleged breach of this Subscription Agreement). The Subscriber agrees and acknowledges that such irrevocable waiver is material to this Subscription Agreement and specifically relied upon by ITAC and its affiliates to induce ITAC to enter in this Subscription Agreement, and the Subscriber further intends and understands such waiver to be valid, binding and enforceable against the Subscriber and each of its affiliates under applicable law. To the extent the Subscriber or any of its affiliates commences any action or proceeding based upon, in connection with, relating to or arising out of any Released Claims, which proceeding seeks, in whole or in part, monetary relief against ITAC or its Representatives, the Subscriber hereby acknowledges and agrees that the Subscriber’s and its affiliates’ sole remedy shall be against funds held outside of the Trust Account and that such claim shall not permit the Subscriber or its affiliates (or any person claiming on any of their behalf or in lieu of them) to have any claim against the Trust Account or Public Distributions or any amounts contained therein. Notwithstanding the foregoing, this Section 9, shall not (x) serve to limit or prohibit the Subscriber’s right to pursue a claim against ITAC or ARBE for legal relief against assets held outside the Trust Account (other than Public Distributions), for specific performance or other equitable relief, (y) serve to limit or prohibit any claims that the Subscriber may have in the future against ITAC’s or ARBE’s assets or funds that are not held in the Trust Account (including any funds that have been released from the Trust Account and any assets that have been purchased or acquired with any such funds), excluding Public Distributions, or (z) affect any rights of Subscriber or its affiliates as a Public Stockholder to receive distributions from the Trust Account in its capacity as a Public Stockholder. For purposes of this Subscription Agreement, “Representatives” with respect to any person shall mean such person’s affiliates and its and its affiliate’s respective directors, officers, employees, consultants, advisors, agents and other representatives.
10. Miscellaneous.
(a) Neither this Subscription Agreement nor any rights that may accrue to the Subscriber hereunder (other than the Shares acquired hereunder, if any, and the Subscriber’s rights under Section 7) may without the prior written consent of ITAC and ARBE be transferred or assigned by the Subscriber other than an assignment to any fund or account managed by the same investment manager as the Subscriber or an affiliate thereof, subject to, if such transfer or assignment is prior to the Closing, such transferee or assignee, as applicable, executing a joinder to this Subscription Agreement, and any purported transfer or assignment without such consent shall be null and void ab initio. Neither this Subscription Agreement nor any rights or obligations of ITAC or ARBE hereunder may be transferred or assigned by such party without the prior written consent of the Subscriber and any purported transfer or assignment without such consent shall be null and void ab initio.
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(b) Each of ITAC and ARBE may request from the Subscriber such additional information as ITAC or ARBE may reasonably deem necessary to evaluate the eligibility of the Subscriber to acquire the Shares, and the Subscriber shall provide such information to ITAC or ARBE as may be reasonably requested to the extent readily available and to the extent consistent with its internal policies and procedures. Each of ITAC and ARBE agrees to keep any such information provided by Subscriber confidential, except as may be required by applicable law, rule, regulation or in connection with any legal proceeding or regulatory request.
(c) The Subscriber acknowledges that ITAC, ARBE and each of the Placement Agents will rely on the acknowledgments, understandings, agreements, representations and warranties of the Subscriber contained in this Subscription Agreement as if they were made directly to them. Prior to the Closing, the Subscriber agrees to promptly notify ITAC and ARBE if any of the representations and warranties set forth herein are no longer accurate in any material respect. The Subscriber agrees that the purchase by the Subscriber of Shares from ITAC or from ARBE, as may be applicable, will constitute a reaffirmation of the acknowledgments, understandings, agreements, representations and warranties herein (as modified by any such notice) by the Subscriber as of the time of such purchase. ITAC acknowledges that Subscriber and each of the Placement Agents will rely on the acknowledgments, understandings, agreements, representations and warranties of ITAC contained in this Subscription Agreement. Prior to the Closing, ITAC agrees to promptly notify Subscriber if any of the acknowledgments, understandings, agreements, representations and warranties set forth herein are no longer accurate in any material respect. ARBE acknowledges that Subscriber and each of the Placement Agents will rely on the acknowledgments, understandings, agreements, representations and warranties of ARBE contained in this Subscription Agreement. Prior to the Closing, ARBE agrees to promptly notify Subscriber if any of the acknowledgments, understandings, agreements, representations and warranties set forth herein are no longer accurate in any material respect. The Subscriber acknowledges and agrees that each of the Placement Agents is a third-party beneficiary of the representations, warranties and covenants of the Subscriber contained in Section 6 of this Subscription Agreement. Each of ITAC and ARBE acknowledges and agrees that each of the Placement Agents is a third-party beneficiary of the representations, warranties and covenants of ITAC and ARBE contained in Sections 4 and 5, respectively, of this Subscription Agreement in performing their respective services to ITAC in connection with the sale of the Shares. Except as expressly set forth herein, this Subscription Agreement shall not confer any rights or remedies upon any person other than the parties hereto, and their respective successor and permitted assigns.
(d) Each of ITAC, ARBE and the Placement Agents is entitled to rely upon this Subscription Agreement and is irrevocably authorized to produce this Subscription Agreement or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby to the extent required by applicable law, regulatory body or stock exchange requirement. The Subscriber shall not issue any press release or make any other similar public statement with respect to the transactions contemplated hereby without the prior written consent of ITAC and ARBE (such consent not to be unreasonably withheld or delayed).
(e) All the agreements, representations and warranties made by each party hereto in this Subscription Agreement shall survive the Closing.
(f) This Subscription Agreement may not be amended, modified or terminated (other than pursuant to the terms of Section 8) except by an instrument in writing, signed by ITAC, ARBE and the Subscriber. This Subscription Agreement may not be waived except by an instrument in writing signed by the party against whom enforcement of such waiver is sought. No failure or delay in exercising any right, power or privilege hereunder will operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power or privilege hereunder.
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(g) This Subscription Agreement, together with the Transaction Agreement and the documents referred to therein (in each case, solely to the extent expressly referred to or incorporated herein) constitutes the entire agreement, and supersedes all other prior agreements, understandings, representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof (other than any confidentiality agreement entered into by ITAC or ARBE and the Subscriber in connection with the Offering).
(h) This Subscription Agreement shall be binding upon, and inure to the benefit of the parties hereto and their heirs, executors, administrators, successors, legal representatives, and permitted assigns, and the agreements, representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be binding upon, such heirs, executors, administrators, successors, legal representatives and permitted assigns.
(i) If any provision of this Subscription Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability of the remaining provisions of this Subscription Agreement shall not in any way be affected or impaired thereby and shall continue in full force and effect. Upon such determination that any provision is invalid, illegal or unenforceable, the parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out, so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(j) This Subscription Agreement may be executed in one or more counterparts (including by facsimile or electronic mail or in .pdf) and by different parties in separate counterparts, with the same effect as if all parties hereto had signed the same document. All counterparts so executed and delivered shall be construed together and shall constitute one and the same agreement.
(k) The parties hereto agree that irreparable damage may occur in the event that any of the provisions of this Subscription Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to seek an injunction or injunctions to prevent breaches of this Subscription Agreement and seek to enforce specifically the terms and provisions of this Subscription Agreement, without the necessity of proving actual damages or that money damages would be insufficient and without the necessity of posting bond or other security, this being in addition to any other remedy to which such party is entitled at law, in equity, in contract, in tort or otherwise.
(l) Subscriber shall pay all of its own expenses in connection with this Subscription Agreement and the transactions contemplated herein. The Subscriber shall not be responsible for any expenses of ITAC or ARBE in connection with this Subscription Agreement and the transactions contemplated herein.
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(m) ITAC shall, by 9:00 a.m., New York City time, on the first (1st) business day immediately following the date of this Subscription Agreement, issue one (1) or more press releases, and within four (4) business days following the date of this Subscription Agreement file with the SEC a Current Report on Form 8-K disclosing all material terms of the transactions contemplated hereby and by the Other Subscription Agreements, and the Transaction, and if not disclosed prior to then, a copy of the Investor Presentation. From and after the publication of the 8-K, the Subscriber shall not be in possession of any material, non-public information received from ITAC, ARBE or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by this Subscription Agreement and the Transactions, and Subscriber shall no longer be subject to any confidentiality or similar obligations under any current agreement, whether written or oral with ITAC, ARBE, the Placement Agents, or any of their affiliates in connection with the Transactions. Subscriber hereby consents to the publication and disclosure in any press release issued by ARBE or ITAC or Form 8-K filed by ARBE or ITAC with the SEC in connection with the execution and delivery of the Transaction Agreement or this Subscription Agreement and the filing of any related documentation with the SEC (and, as and to the extent otherwise required by the federal securities laws or the SEC or any other securities authorities, any other documents or communications provided by ARBE or ITAC to any governmental authority or to securityholders of ARBE or ITAC) of Subscriber’s identity and beneficial ownership of Shares and the nature of Subscriber’s commitments, arrangements and understandings under and relating to this Subscription Agreement and, if deemed appropriate by ARBE or ITAC, a copy of this Subscription Agreement or the form hereof. Subscriber will promptly provide any information reasonably requested by ARBE or ITAC for any regulatory application or filing made or approval sought in connection with the Transaction (including filings with the SEC). Notwithstanding anything in this Subscription Agreement to the contrary, ARBE and ITAC shall not, without the prior written consent of the Subscriber, publicly disclose the name of Subscriber or any of its affiliates, or include the name of the Subscriber or any of its affiliates (i) in any other press release or marketing materials or (ii) in any filings with the SEC or any regulatory agency or trading market except (A) required by the federal securities law in connection with the Registration Statement, and (B), to the extent such disclosure is required by law, at the request of the staff of the SEC or regulatory agency or under the regulations of Nasdaq or by any other governmental authority (the foregoing, “Legal Requirement”), in which case ARBE or ITAC, as applicable, shall, to the extent permitted by Legal Requirement provide Subscriber with prior written notice of such disclosure permitted under this subclause (B).
(n) This Subscription Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to principles relating to conflict of laws. Each party hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the state and federal courts seated in New York County, New York (and any appellate courts thereof) in any action or proceeding arising out of or relating to this Subscription Agreement, and each of the parties hereby irrevocably and unconditionally (a) agrees not to commence any such action or proceeding except in such courts, (b) agrees that any claim in respect of any such action or proceeding may be heard and determined in such court, (c) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such action or proceeding in any such court, and (d) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Each party agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each party irrevocably consents to the service of the summons and complaint and any other process in any other Proceeding relating to the transactions contemplated by this Subscription Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party at the applicable address set forth in Section 10(o). Nothing in this Section 10(n) shall affect the right of any party to serve legal process in any other manner permitted by law. Each party hereby knowingly, voluntarily and intentionally irrevocably waives the right to a trial by jury in respect to any litigation, dispute, claim, legal action or other legal proceeding based hereon, or arising out of, under, or in connection with, this Subscription Agreement.
22
(o) All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given (i) when delivered in person, (ii) when delivered by facsimile or email, with affirmative confirmation of receipt, (iii) one business day after being sent, if sent by reputable, internationally recognized overnight courier service or (iv) three (3) business days after being mailed, if sent by registered or certified mail, prepaid and return receipt requested, in each case to the applicable party at the following addresses (or at such other address for a party as shall be specified by like notice):
|
If to ITAC at or prior to the Transaction Closing, to:
Industrial Tech Acquisitions, Inc.
|
with a copy (which shall not constitute notice) to:
Ellenoff Grossman & Schole LLP
|
|
If to ITAC after to the Transaction Closing or to ARBE, to:
ARBE Robotics Ltd.
|
with copies (which shall not constitute notice) to:
DLA Piper LLP (US)
and
Erdinast, Ben Nathan, Toledano & Co.
|
| Notice to the Subscriber shall be given to the address underneath the Subscriber’s name on the signature page hereto. | |
(p) The headings set forth in this Subscription Agreement are for convenience of reference only and shall not be used in interpreting this Subscription Agreement. In this Subscription Agreement, unless the context otherwise requires: (i) whenever required by the context, any pronoun used in this Subscription Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa; (ii) “including” (and with correlative meaning “include”) means including without limiting the generality of any description preceding or succeeding such term and shall be deemed in each case to be followed by the words “without limitation”; and (iii) the words “herein”, “hereto” and “hereby” and other words of similar import in this Subscription Agreement shall be deemed in each case to refer to this Subscription Agreement as a whole and not to any particular portion of this Subscription Agreement. As used in this Subscription Agreement, the term: (x) “business day” shall mean any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in New York, New York are authorized to close for business (excluding as a result of “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems, including for wire transfers, of commercially banking institutions in New York, New York are generally open for use by customers on such day); (y) “person” shall refer to any individual, corporation, partnership, trust, limited liability company or other entity or association, including any governmental or regulatory body, whether acting in an individual, fiduciary or any other capacity; and (z) “affiliate” shall mean, with respect to any specified person, any other person or group of persons acting together that, directly or indirectly, through one or more intermediaries controls, is controlled by or is under common control with such specified person (where the term “control” (and any correlative terms) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such person, whether through the ownership of voting securities, by contract or otherwise). For the avoidance of doubt, any reference in this Subscription Agreement to an affiliate of ITAC will include ITAC’s sponsor, Industrial Tech Partners, LLC (the “Sponsor”).
23
(q) At Closing, the parties hereto shall execute and deliver such additional documents and take such additional actions as the parties may reasonably deem practical and necessary in order to consummate the Offering as contemplated by this Subscription Agreement, including an executed copy of the Investor Representation Letter to Wells Fargo in the form set forth in Exhibit B attached hereto (or, where Epsilon or Poalim are acting as placement agent with respect to such Offer, in the form set forth in Exhibit C).
11. Non-Reliance and Exculpation. The Subscriber acknowledges that it is not relying upon, and has not relied upon, any statement, representation or warranty made by any person other than the statements, representations and warranties contained in this Subscription Agreement in making its investment or decision to invest in ITAC. The Subscriber agrees that neither (i) any Other Subscriber pursuant to other Subscription Agreements (including the controlling persons, members, officers, directors, partners, agents, or employees of any such Other Subscriber) nor (ii) any of the Placement Agents, their respective affiliates or any of their or their affiliates’ respective control persons, officers, directors or employees, shall be liable to the Subscriber (including in contract, tort, under federal or state securities laws or otherwise) for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with this Subscription Agreement or the Offering. The Subscriber acknowledges that none of the Placement Agents, nor any of their respective Representatives (a) shall be liable to the Subscriber for any improper payment made in accordance with the information provided by ITAC; (b) make any representation or warranty, or has any responsibilities as to the validity, accuracy, value or genuineness of any information, certificates or documentation delivered by or on behalf of ITAC or ARBE pursuant to this Subscription Agreement or the Transaction Agreement (the “Transaction Documents”); or (c) shall be liable to the Subscriber (x) for any action taken, suffered or omitted by any of them in good faith and reasonably believed to be authorized or within the discretion or rights or powers conferred upon it by this Subscription Agreement or any Transaction Document or (y) for anything which any of them may do or refrain from doing in connection with this Subscription Agreement or any Transaction Document, except in each case for their gross negligence, willful misconduct or bad faith.
12. Independent Obligations. The obligations of the Subscriber under this Subscription Agreement are several and not joint with the obligations of any Other Subscriber under the Other Subscription Agreements, and Subscriber shall not be responsible in any way for the performance of the obligations of any Other Subscriber under the Other Subscription Agreements. The decision of Subscriber to purchase Shares pursuant to this Subscription Agreement has been made by the Subscriber independently of any Other Subscriber and independently of any information, materials, statements or opinions as to the business, affairs, operations, assets, properties, liabilities, results of operations, condition (financial or otherwise) or prospects of ITAC or any of its subsidiaries which may have been made or given by any Other Subscriber or by any agent or employee of any Other Subscriber, and neither the Subscriber nor any of its agents or employees shall have any liability to any Other Subscriber (or any other person) relating to or arising from any such information, materials, statements or opinions. Nothing contained herein or in any Other Subscription Agreement, and no action taken by the Subscriber or any Other Subscribers pursuant hereto or thereto, shall be deemed to constitute the Subscriber and Other Subscribers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Subscriber and Other Subscribers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Subscription Agreement and the Other Subscription Agreements. The Subscriber acknowledges that no Other Subscriber has acted as agent for the Subscriber in connection with making its investment hereunder and no Other Subscriber will be acting as agent of the Subscriber. The obligations of ARBE and ITAC under this Subscription Agreement are several and not joint with the obligations of any other party, and neither party shall be responsible in any way for the performance of the obligations of any other party under this Subscription Agreement.
{SIGNATURE PAGES FOLLOW}
24
IN WITNESS WHEREOF, the parties hereto have caused this Subscription Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
| Industrial Tech Acquisitions, Inc. | ||
| By: | ||
| Name: | ||
| Title: | ||
| ARBE Robotics Ltd. | ||
| By: | ||
| Name: | ||
| Title: | ||
{Signature Page to Subscription Agreement}
{SUBSCRIBER SIGNATURE PAGE TO THE SUBSCRIPTION AGREEMENT}
IN WITNESS WHEREOF, the undersigned has caused this Subscription Agreement to be duly executed by its authorized signatory as of the date first indicated above.
| Name(s) of Subscriber: |
| Signature of Authorized Signatory of Subscriber: |
| Name of Authorized Signatory: |
| Title of Authorized Signatory: |
Address for Notice to Subscriber:
| Attention: | |
| Email: | |
| Facsimile No.: | |
| Telephone No.: |
Address for Delivery of Shares to Subscriber (if not same as address for notice):
| Subscription Amount: | $ | |
| Number of Shares: |
Subscriber status (mark one): ☐ U.S. investor ☐ Israeli investor ☐ Other non-U.S. investor
| EIN Number: |
Exhibit A
Accredited Investor Questionnaire
Capitalized terms used and not defined in this Exhibit A shall have the meanings given in the Subscription Agreement to which this Exhibit A is attached. The undersigned represents and warrants that the undersigned is an “accredited investor” (an “Accredited Investor”) as such term is defined in Rule 501(a) of Regulation D under the U.S. Securities Act of 1933, as amended (the “Securities Act”), for one or more of the reasons specified below (please check all boxes that apply):
| _______ | (i) | A natural person whose net worth, either individually or jointly with such person’s spouse or spousal equivalent, at the time of the Subscriber’s purchase, exceeds $1,000,000; |
The term “net worth” means the excess of total assets over total liabilities (including personal and real property, but excluding the estimated fair market value of the Subscriber’s primary home). For the purposes of calculating joint net worth with the person’s spouse or spousal equivalent, joint net worth can be the aggregate net worth of the Subscriber and spouse or spousal equivalent; assets need not be held jointly to be included in the calculation. There is no requirement that securities be purchased jointly. A spousal equivalent means a cohabitant occupying a relationship generally equivalent to a spouse.
| _______ | (ii) | A natural person who had an individual income in excess of $200,000, or joint income with the Subscriber’s spouse or spousal equivalent in excess of $300,000, in each of the two most recent years and reasonably expects to reach the same income level in the current year; |
In determining individual “income,” the Subscriber should add to the Subscriber’s individual taxable adjusted gross income (exclusive of any spousal or spousal equivalent income) any amounts attributable to tax exempt income received, losses claimed as a limited partner in any limited partnership, deductions claimed for depletion, contributions to an IRA or Keogh retirement plan, alimony payments, and any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income.
| _______ | (iii) | A director or executive officer of ITAC; |
| _______ | (iv) | A natural person holding in good standing with one or more professional certifications or designations or other credentials from an accredited educational institution that the U.S. Securities Exchange Commission (“SEC”) has designated as qualifying an individual for accredited investor status; |
| The SEC has designated the General Securities Representative license (Series 7), the Private Securities Offering Representative license (Series 82) and the Licensed Investment Adviser Representative (Series 65) as the initial certifications that qualify for accredited investor status. | ||
| _______ | (v) | A natural person who is a “knowledgeable employee” as defined in Rule 3c-5(a)(4) under the Investment Company Act of 1940 (the “Investment Company Act”), of the issuer of the securities being offered or sold where the issuer would be an investment company, as defined in section 3 of the Investment Company Act, but for the exclusion provided by either section 3(c)(1) or section 3(c)(7) of the Investment Company Act; |
| _______ | (vi) | A bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity; |
A-1
| _______ | (vii) | A broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); |
| _______ | (viii) | An investment adviser registered pursuant to section 203 of the Investment Advisers Act of 1940 (the “Investment Advisers Act”) or registered pursuant to the laws of a state, or an investment adviser relying on the exemption from registering with the SEC under the section 203(l) or (m) of the Investment Advisers Act; |
| _______ | (ix) | An insurance company as defined in section 2(13) of the Exchange Act; |
| _______ | (x) | An investment company registered under the Investment Company Act or a business development company as defined in Section 2(a)(48) of that Act; |
| _______ | (xi) | A Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; |
| _______ | (xii) | A Rural Business Investment Company as defined in section 384A of the Consolidated Farm and Rural Development Act; |
| _______ | (xiii) | A plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state, or its political subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000; |
| _______ | (xiv) | An employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such act, which is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors; |
| _______ | (xv) | A private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940; |
| _______ | (xvi) | An organization described in Section 501(c)(3) of the Internal Revenue Code, or a corporation, business trust, partnership, or limited liability company, or any other entity not formed for the specific purpose of acquiring the Shares, with total assets in excess of $5,000,000; |
| _______ | (xvii) | A trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Shares, whose purchase is directed by a sophisticated person who has such knowledge and experience in financial and business matters that such person is capable of evaluating the merits and risks of investing in ITAC; |
| _______ | (xviii) | A “family office” as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers Act with assets under management in excess of $5,000,000 that is not formed for the specific purpose of acquiring the securities offered and whose prospective investment is directed by a person who has such knowledge and experience in financial and business matters that such family office is capable of evaluating the merits and risks of the prospective investment; |
| _______ | (xix) | A “family client” as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers Act, of a family office meeting the requirements set forth in (xviii) and whose prospective investment in the issuer is directed by a person from a family office that is capable of evaluating the merits and risks of the prospective investment; |
A-2
| _______ | (xx) | A “qualified institutional buyer” as defined in Rule 144A under the Securities Act; |
| _______ | (xxi) | An entity, of a type not listed above, not formed for the specific purpose of acquiring the securities offered, owning investments in excess of $5,000,000; and/or |
| _______ | (xxii) | An entity in which all of the equity owners qualify as an accredited investor under any of the above subparagraphs. |
| _______ | (xxiii) | The Subscriber does not qualify under any of the investor categories set forth in (i) through (xxii) above. |
| 2.1 | Type of the Subscriber. Indicate the form of entity of the Subscriber: |
| ☐ | Individual | ☐ | Limited Partnership |
| ☐ | Corporation | ☐ | General Partnership |
| ☐ | Revocable Trust | ☐ | Limited Liability Company |
| ☐ | Other Type of Trust (indicate type): | ________________________________ | |
| ☐ | Other (indicate form of organization): | ________________________________ | |
| 2.2.1 | If the Subscriber is not an individual, indicate the approximate date the Subscriber entity was formed: _____________________. |
| 2.2.2 | If the Subscriber is not an individual, initial the line below which correctly describes the application of the following statement to the Subscriber’s situation: the Subscriber (x) was not organized or reorganized for the specific purpose of acquiring the Shares and (y) has made investments prior to the date hereof, and each beneficial owner thereof has and will share in the investment in proportion to his or her ownership interest in the Subscriber. |
__________ True __________ False
If the “False” line is initialed, each person participating in the entity will be required to fill out a Subscription Agreement.
| Subscriber: | |
| Subscriber Name: | |
| By: | |
| Signatory Name: | |
| Signatory Title: | |
| Date: |
A-3
Exhibit B
Investor Representation Letter
Wells Fargo Securities, LLC
500 West 33rd Street
New York, New York 10001
| Re: | Purchase of common stock, warrants or other equity or equity-linked interests of Industrial Tech Acquisitions, Inc. or any subsidiary thereof or of ARBE Robotics Ltd. (the “Securities”) |
Ladies and Gentlemen:
In connection with the offer and sale of the Securities to be issued by Industrial Tech Acquisitions, Inc. or any subsidiary thereof or of ARBE Robotics Ltd (as applicable, the “Company”), we represent, warrant, agree and acknowledge as follows:
| 1. | No disclosure or offering document has been prepared in connection with the offer and sale of the Securities by Wells Fargo Securities, LLC or any of its affiliates (“Wells Fargo Securities”). |
| 2. | (a) We have conducted our own investigation of the Company and the Securities and we have not relied on any statements or other information provided by Wells Fargo Securities concerning the Company or the Securities or the offer and sale of the Securities, (b) we have had access to, and an adequate opportunity to review, financial and other information as we deem necessary to make our decision to purchase the Securities, (c) we have been offered the opportunity to ask questions of the Company and received answers thereto, as we deemed necessary in connection with our decision to purchase the Securities; and (d) we have made our own assessment and have satisfied ourselves concerning the relevant tax and other economic considerations relevant to our investment in the Securities. |
| 3. | Wells Fargo Securities and its directors, officers, employees, representatives and controlling persons have made no independent investigation with respect to the Company or the Securities or the accuracy, completeness or adequacy of any information supplied to us by the Company. |
| 4. | In connection with the issue and purchase of the Securities, Wells Fargo Securities has not acted as our financial advisor or fiduciary. |
| 5. | We are an accredited investor (as defined in Rule 501 of the Securities Act of 1933, as amended (the “Securities Act”). Accordingly, we understand that the offering meets the exemptions from filing under Financial Industry Regulatory Authority (“FINRA”) Rule 5123(b)(1)(J). |
| 6. | We (i) are an institutional account as defined in FINRA Rule 4512(c), (ii) are a sophisticated investor, experienced in investing in equity transactions that are not registered under the Securities Act, and capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities and (iii) have exercised independent judgment in evaluating our participation in the purchase of the Securities. Accordingly, we understand that the offering meets (i) the exemptions from filing under FINRA Rule 5123(b)(1)(A) and (ii) the institutional customer exemption under FINRA Rule 2111(b). |
| 7. | We are aware that the sale to us is being made in reliance on a private placement exemption from registration under the Securities Act and are acquiring the Securities for our own account or for an account over which we exercise sole discretion for another qualified institutional buyer or accredited investor. |
| 8. | We are able to fend for ourselves in the transactions contemplated herein; have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our prospective investment in the Securities; and have the ability to bear the economic risks of our prospective investment and can afford the complete loss of such investment. |
| 9. | The Securities have not been registered under the Securities Act or any other applicable securities laws, are being offered for resale in transactions not requiring registration under the Securities Act, and unless so registered, may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act or any other applicable securities laws, pursuant to any exemption therefrom or in a transaction not subject thereto. |
Very truly yours,
| Name of Investor: |
| By: | ||
| Name: | ||
| Title: | ||
| Date: |
B-1
Exhibit C
Investor Representation Letter
Epsilon Underwriting & Issuing Ltd.
40 Einstein
Ramat Aviv, Tel Aviv - Jaffa, 6910203, Israel
Poalim I.B.I. Underwriting & Issuing Ltd.
28 HaArba’a St., North Tower 20th floor
Tel Aviv 6473925, Israel
| Re: | Purchase of common stock, warrants or other equity or equity-linked interests of Industrial Tech Acquisitions, Inc. or any subsidiary thereof or of ARBE Robotics Ltd. (the “Securities”) |
Ladies and Gentlemen:
In connection with the offer and sale of the Securities to be issued by Industrial Tech Acquisitions, Inc. or any subsidiary thereof or of ARBE Robotics Ltd (as applicable, the “Company”), we represent, warrant, agree and acknowledge as follows:
| 1. | No disclosure or offering document has been prepared in connection with the offer and sale of the Securities by Epsilon Underwriting & Issuing Ltd. or any of its affiliates (“Epsilon”) or Poalim I.B.I. Underwriting & Issuing Ltd. or any of its affiliates (“Poalim”). |
| 2. | (a) We have conducted our own investigation of the Company and the Securities and we have not relied on any statements or other information provided by Epsilon or Poalim concerning the Company or the Securities or the offer and sale of the Securities, (b) we have had access to, and an adequate opportunity to review, financial and other information as we deem necessary to make our decision to purchase the Securities, (c) we have been offered the opportunity to ask questions of the Company and received answers thereto, as we deemed necessary in connection with our decision to purchase the Securities; and (d) we have made our own assessment and have satisfied ourselves concerning the relevant tax and other economic considerations relevant to our investment in the Securities. |
| 3. | Epsilon and Paolim and their respective directors, officers, employees, representatives and controlling persons have made no independent investigation with respect to the Company or the Securities or the accuracy, completeness or adequacy of any information supplied to us by the Company. |
| 4. | In connection with the issue and purchase of the Securities, neither Epsilon nor Poalim have acted as our financial advisor or fiduciary. |
| 5. | We are a sophisticated investor, experienced in investing in equity transactions that are not registered under the Securities Act of 1933, as amended (the “Securities Act”) and capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities and have exercised independent judgment in evaluating our participation in the purchase of the Securities. |
| 6. | We are aware that the sale to us is being made in a transaction not subject to the registration requirements under the Securities Act and are acquiring the Securities for our own account or for an account over which we exercise sole discretion for another qualified institutional buyer or accredited investor. |
| 7. | We are able to fend for ourselves in the transactions contemplated herein; have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our prospective investment in the Securities; and have the ability to bear the economic risks of our prospective investment and can afford the complete loss of such investment. |
| 8. | The Securities have not been registered under the Securities Act or any other applicable securities laws, are being offered for resale in transactions not requiring registration under the Securities Act, and unless so registered, may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act or any other applicable securities laws, pursuant to any exemption therefrom or in a transaction not subject thereto. |
Very truly yours,
| Name of Investor: |
| By: | ||
| Name: | ||
| Title: | ||
| Date: |
C-1
Attachment to Exhibit C:
Israeli Addendum/Israeli Qualified Investor Questionnaire
Questionnaire
(Qualified Israeli Investors)
Please respond to every item, even if your response is “none.” If you need more space for any response, please attach additional sheets of paper. Please be sure to indicate your name and the number of the item being responded to on each such additional sheet of paper, and to sign each such additional sheet of paper before attaching it to this Questionnaire. Please note that you may be asked to answer additional questions depending on your responses to the following questions.
IF YOU HAVE ANY QUESTIONS ABOUT THE CONTENTS OF THIS QUESTIONNAIRE OR AS TO WHO SHOULD COMPLETE THIS QUESTIONNAIRE, PLEASE CONTACT EPSILON UNDERWRITING - Yoav Fogel - 03-7450515
COMPLETED QUESTIONNAIRES SHOULD BE RETURNED
TO EPSILON UNDERWRITING BY EMAIL TO: yoavf@epsilon.co.il
In connection with and as part of the consideration for our purchase of shares (“Securities”), of Industrial Tech Acquisitions, Inc., a Delaware corporation (“ITAC”), and/or ARBE Robotics Ltd., an Israeli corporation (“ARBE”), as applicable, the undersigned hereby represents, warrants and acknowledges to Epsilon Underwriting & Issuing Ltd. (“Epsilon”), Poalim I.B.I Underwriting & Issuing Ltd. (“Poalim”), ITAC and ARBE, in accordance with the Israeli Securities Law of 1968, as amended, that that the following is accurate and complete:
| 1. | Your Identity. |
| (a) | Your full legal name: | |
| (b) | Your business address (including street address) (or residence if no business address), telephone number, facsimile number and email address: |
| Address: | |
| Telephone No.: | |
| Fax No.: | |
| Email: |
| (c) | Are you an investor in one of the categories listed in the First Addendum to the Israeli Securities Law, 5728-1968, such an investor being referred to in this Questionnaire as a “Qualified Israeli Investor”? |
| ☐ | Yes |
| ☐ | No |
C-2
| (d) | If your response to Item 1(c) above is yes, please check the applicable box(es) below to confirm and identify the category/ies within which you are a Qualified Israeli Investor. |
| ☐ | A joint investment fund or the manager of such a fund within the meaning of the Joint Investments in Trust Law, 5754-1994; |
| ☐ | A provident fund or the manager of such a fund within the meaning of the Control of Financial Services Law (Provident Funds), 5765-2005; |
| ☐ | An insurance company as defined in the Supervision of Insurance Business Law, 5741-1981; |
| ☐ | A banking corporation or a supporting corporation within the meaning of the Banking (Licensing) Law, 5741-1981, with the exception of a joint services company, purchasing for its own account or for the accounts of clients who are Qualified Israeli Investors; |
| ☐ | A licensed portfolio manager within the meaning of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, 5755-1995, purchasing for its own account or for the accounts of clients who are Qualified Israeli Investors; |
| ☐ | A licensed investment advisor or a licensed investment marketer within the meaning of the Regulation of Investment Advice, Investment Marketing and Investment Portfolio Management Law, 5755-1995, purchasing for its own account; |
| ☐ | A member of the Tel Aviv Stock Exchange, purchasing for its own account or for the accounts of clients who are Qualified Israeli Investors; |
| ☐ | An underwriter that satisfies the criteria prescribed in Section 56(c) of the Israeli Securities Law, 5728-1968, purchasing for its own account; |
| ☐ | A venture capital fund (defined for this purpose as an entity whose principal activity is investing in entities that are engaged primarily in research and development, or in the manufacture of innovative products and processes, with an unusually high investment risk); |
| ☐ | An entity that is wholly owned by Qualified Israeli Investors; or |
| ☐ | An entity, except for an entity that was incorporated for the purpose of investing in securities in a specific offering, whose shareholders equity exceeds NIS 50 million1. |
| 2. | We irrevocably authorize any of ITAC, ARBE, Epsilon and Poalim to produce this letter, pursuant to, in connection with, or as may be required by any applicable law or regulation, administrative or legal proceeding, dispute or official inquiry with respect to the matters set forth herein. |
| 3. | We undertake to provide you with the necessary documentation evidencing our status as a Qualified Investor (including without limitations such documents as are detailed in the Israel Securities Authority’s position 103-30 dated September 21, 2014), as shall be required by you, and represent that such documentation is accurate, true, complete, in force and up to date. |
| 4. | We have been informed by you and we acknowledge that the Securities are not being offered pursuant to a prospectus filed in Israel. In particular, we understand that any such materials have not been reviewed or approved by the Israel Securities Authority. |
| 5. | Your Status as a Qualified Israeli Investor – Updating Information. |
By signing below, the undersigned confirms that it is fully familiar, following advice of its own legal counsel, with the meaning and implications of being a Qualified Israeli Investor investing in the common shares of ITAC or ARBE, as applicable, and agrees thereto.
| 1 | If you marked this item, please provide a written confirmation of your compliance with the above from your accountant. |
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By signing below, the undersigned agrees to promptly notify you of any inaccuracies or changes in the information provided herein that may occur subsequent to the date hereof at any time while the offer to purchase securities remains valid and, in any event, before making any purchase of the securities offered thereby. Once this Questionnaire is executed by the undersigned and received by you, the terms of this Questionnaire and the representations and warranties contained herein shall inure to the benefit of and be binding on and shall be enforceable by you.
| 6. | Investment Representation. |
By signing below, the undersigned confirms that it is acquiring the common shares of ITAC or ARBE, as applicable, offered to it for investment for its own account or, if applicable, for investment by clients who are institutional investors that are themselves Qualified Israeli Investors, and in any event not as a nominee, market maker or agent and not with a view to, or for the resale in connection with, any distribution thereof.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this Questionnaire to be executed and delivered either in person or by its duly authorized agent.
| Name of Investor: | ||
| (Please Print) | ||
| Signature: | ||
| Date: | ||
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