Exhibit 10.4

 

CANCELLATION AND EXCHANGE AGREEMENT

 

THIS CANCELLATION AND EXCHANGE AGREEMENT (this “Agreement”), is entered into
effective as of April 20, 2018, among FC Global Realty Incorporated, a Nevada
corporation (the “Company”), and Opportunity Fund I-SS, LLC, a Delaware limited
liability company (the “Investor”). The Company and the Investor are
collectively referred to in this Agreement as the “Parties,” and each a “Party.”

 

RECITALS

 

A.          On December 22, 2017, the Investor and the Company entered into a
Securities Purchase Agreement (the “Purchase Agreement”) pursuant to which the
Investor may invest up to $15,000,000 in the Company in a series of closings, in
exchange for which the Investor will receive shares of the Company’s newly
designated Series B Preferred Stock at a purchase price of $1.00 per share.

 

B.          The Company and the Investor completed the first closing under the
Purchase Agreement on December 22, 2017, pursuant to which the Investor provided
$1,500,000 to the Company in exchange for 1,500,000 shares of the Company’s
Series B Preferred Stock.

 

C.          On January 24, 2018, the Company and the Investor completed a second
closing under the Purchase Agreement, pursuant to which the Investor provided
$2,225,000 to the Company in exchange for 2,225,000 shares of the Company’s
Series B Preferred Stock.

 

D.          Subject to the Company obtaining the Stockholder Consent (as defined
below) and filing with the SEC and mailing the definitive Information Statement
(as defined below) to the Company’s Stockholders and each such being in full
force and effect, subject to the terms of the Purchase Agreement the Investor
will invest (the “Additional Investment”) an additional $2,000,000 and will
receive an additional 2,000,000 shares of Series B Preferred Stock pursuant to
the Purchase Agreement.

 

E.          It is a condition to the Additional Investment that the parties
enter into this Agreement pursuant to which (1) the Investor will cancel 95,770
shares of the Company’s Series A Preferred Stock held by the Investor (the
“Series A Shares”) concurrently with and subject to (2) the Company issuing to
the Investor 5,382,274 shares of common stock (the “Common Shares”) subject to
the Company obtaining Shareholder Approval (as defined below).

 

F.          The Company has delivered to the Investor a copy of the consent of
the board of directors of the Company with respect to the authorization and
approval of this Agreement and the performance by the Company of its obligations
under this Agreement and such consent is in full force and effect.

 

 

 

AGREEMENT

 

NOW THEREFORE, in consideration of the mutual covenants and agreements contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the undersigned do hereby agree as follows:

 

1.          Cancellation of Series A Shares.

 

(a)          Investor hereby agrees to surrender the Series A Shares to the
Company free and clear of all claims, charges, liens, contracts, rights,
options, security interests, mortgages, encumbrances and restrictions of every
kind and nature, in each case, to the extent incurred by the Investor or any of
its assignees (collectively, “Claims”) for cancellation concurrently with, and
against delivery of, the issuance of the Common Shares pursuant to Section 2
hereof (it being acknowledged that any rights of the Company to or with respect
to any of the Series A Shares other than under this Agreement, shall not be a
“Claim”). After such cancellation and receipt of the Common shares by Investor
or its assignees, Investor acknowledges and agrees that all such Series A Shares
shall no longer be outstanding, and Investor shall have no further rights with
respect to the Series A Shares or the equity ownership in the Company
represented thereby.

 

(b)          Investor hereby represents and warrants that Investor owns the
Series A Shares beneficially and of record, free and clear of all Claims other
than Claims in favor of the Company or any assignee of the Company under this
Agreement or otherwise. Investor has never transferred or agreed to transfer the
Series A Shares, other than pursuant to this Agreement. There is no restriction
affecting the ability of Investor to transfer the legal and beneficial title and
ownership of the Series A Shares to the Company for cancellation other than
restrictions, if any, in favor of the Company or any assignee of the Company.
Neither the execution and delivery of this Agreement, the consummation of the
transactions contemplated hereby, nor the performance of this Agreement in
compliance with its terms and conditions by Investor will conflict with or
result in any violation of any agreement, judgment, decree, order, statute or
regulation applicable to Investor, or any breach of any agreement to which
Investor is a party, or constitute a default thereunder, or result in the
creation of any Claim of any kind or nature on, or with respect to Investor or
Investor’s assets.

 

(c)          At the request of the Company and without further consideration,
Investor will execute and deliver such other instruments of sale, transfer,
conveyance, assignment and confirmation as may be reasonably requested in order
to effectively transfer, convey and assign to the Company for cancellation the
Series A Shares.

 

2.          Issuance of Common Shares.

 

(a)          As soon as practicable after obtaining Stockholder Approval (as
defined below) and in any event within three (3) business days of obtaining
Stockholder Approval, the Company shall irrevocably instruct its transfer agent
to issue to the Investor the Common Shares. The Investor acknowledges that the
Common Shares constitute restricted shares and will contain a customary legend
referring to transfer restrictions under the Securities Act of 1933, as amended.
The Company represents and warrants to the Investor that, upon issuance of the
Common Shares in accordance with this Agreement, the Common Shares will be duly
issued, fully paid and nonassessable.

 

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(b)          The Company agrees that the Common Shares shall constitute
“Registrable Securities” under the Registration Rights Agreement between the
Company and the Investor, dated December 22, 2017 and the Company shall use
commercially reasonable efforts to promptly amend the Registration Statement
filed by the Company on January 23, 2018 (the “Investor Registration Statement”)
to include in the Investor Registration Statement the Common Shares and any
other shares of Common Stock of the Company that are issuable to the Investor
upon conversion of Series B Preferred Stock of the Investor that are not already
included in the Investor Registration Statement.

 

3.          Stockholder Approval.

 

(a)          The rules and regulations of The Nasdaq Stock Market require
approval from the Company’s stockholders prior to the issuance of the Common
Shares because the Common Shares when taken together with the shares of common
stock of the Company underlying Series B Preferred Stock held by the Investor
and other shares of Common Stock held by the Investor are in excess of 19.99% of
the Company’s issued and outstanding Common Stock on the date hereof.

 

(b)          The Company has obtained the irrevocable written consent of at
least a majority of the stockholders of the Company (excluding the Investor)
that is final and binding (the “Stockholder Consent”) approving the issuance of
the Common Shares (including any other Common Shares that the Investor has
acquired or has a right to under any other stock of the Company) and the
issuance of the Company’s Common Stock upon conversion of all of the Series B
Preferred Stock held by the Investor or issuable under the Purchase Agreement.
The Company has delivered to the Investor a copy of the Stockholder Consent. The
Stockholder Consent shall become effective on the 20th day following the filing
and mailing of the definitive Information Statement at which time stockholder
approval of such issuances shall become effective (“Stockholder Approval”). The
Company represents and warrants that the Stockholder Approval is final,
irrevocable and binding subject only the passage of time and no other
conditions.

 

(c)          On the date hereof, and as a condition to the effectiveness of this
Agreement, the Company shall file with the Securities and Exchange Commission
(the “SEC”) an Information Statement on Schedule 14C (the “Information
Statement”), a copy of which has been delivered to the Investor. The Company
shall use commercially reasonable efforts to promptly respond to any comments of
the SEC and to file with the SEC a definitive Information Statement as soon as
possible under SEC rules and regulations. The Company will promptly provide to
Investor a copy of all correspondence with the SEC regarding such comments and
responses.

 

4.          Additional Investment. Promptly following the filing of the
definitive Information Statement with the SEC and mailing of the definitive
Information Statement to the stockholders of the Company, and in any event
within three (3) days thereafter, if the Stockholder Approval is final,
irrevocable and binding subject only the passage of time and no other
conditions, the Investor shall purchase 2,000,000 shares of Series B Preferred
Stock for $2,000,000 using the monies currently held in escrow, which purchase
shall be subject to the conditions of the Purchase Agreement. For the avoidance
of doubt, the Additional Investment is mandatory and not at the discretion of
the Investor so long as the other conditions precedent under the Purchase
Agreement are satisfied and subject to the Investor Directors being appointed to
the board of directors of the Company. Notwithstanding anything to the contrary
contained in the Purchase Agreement, the Investor agrees that the Company may
use the Additional Investment in accordance with the terms of a written budget
that will be mutually agreed upon by the Company and the Investor.

 

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5.          Amendment to Voting Agreements.

 

(a)          On December 22, 2017, First Capital Real Estate Operating
Partnership, LP, Dolev Rafaeli, Dennis M. McGrath and Yoav Ben-Dror entered into
a shareholder voting support and confidentiality agreement (the “Voting
Agreement”) pursuant to which, among other things, such persons agreed to vote
in favor of (or execute written consents in favor of) the transactions
contemplated by the Purchase Agreement and the issuance of all securities
thereunder, including the issuance of the Company’s Common Stock upon conversion
of the Series B Preferred Stock held by the Investor. On the date hereof, and as
a condition to the effectiveness of this Agreement, the parties to the Voting
Agreement are entering into Amendment No. 1 to the Voting Agreement in the form
of Exhibit A to this Agreement pursuant to which, among other things, the
parties thereto agree to (i) vote in favor of (or execute written consents in
favor of) the transactions contemplated by this Agreement, including, without
limitation, the issuance of the Common Shares to the Investor, and (b) amend the
termination provisions of the Voting Agreement as set forth in Exhibit A.

 

6.          Solicitation of Additional Capital. Immediately following the
execution of this Agreement, the Investor will request that its placement agent
continue soliciting investors for capital to be invested in the Investor. The
use of any such proceeds raised will be to make additional investments in the
Company subject to the terms and conditions of the Purchase Agreement and all
related agreements including the solicitation materials that were used by the
Investor and including that any such investment is within the Investor’s sole
discretion. The Investor hereby confirms to the Company that fund-raising
efforts are ongoing subject to termination by the Investor or its placement
agent. The Company acknowledges that there is no assurance that any additional
funds will be raised by the Investor or that the Investor will make any
additional Investments in the Company, except for the Additional Investment as
described in Section 4 above which will be made subject to the conditions in the
Purchase Agreement being satisfied.

 

7.          Appointment of Investor Designees. As soon as the Investor
identifies two director nominees (“Investor Directors”) to the Company, the
Company’s nominating committee will commence its customary vetting process. On
or prior to the time that the Additional Investment is made, and to comply with
the obligations of the Company to the Investor, the Company shall appoint to its
board of directors the Investor Directors.

 

8.          Amendment to Section 4.6 of the Purchase Agreement. The Parties
hereby amend Section 4.6 of the Purchase Agreement, which is captioned
“Amendment to Series A Certificate of Designation” to remove such Section and
insert in its place “[intentionally omitted].” For the avoidance of doubt, from
and after the date hereof the Company shall have no obligation to amend the
Certificate of Designation of the Series A Preferred Stock to reduce the
conversion price thereof as specified in Section 4.6 of the Purchase Agreement.

 

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9.          Representations and Warranties of the Parties.

 

(a)          The Investor represents and warrants to the Company as follows:

 

(i)          The Investor is a limited liability company that is validly
existing and in good standing under the laws of its state of organization. The
Investor has the requisite power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated by this Agreement. The execution, delivery and
performance by the Investor of this Agreement and the consummation by the
Investor of the transactions contemplated hereby have been duly authorized by
all necessary action on the part of the Investor and no other action is
necessary on the part of the Investor to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
executed and delivered by the Investor and, assuming the due authorization,
execution and delivery by the Company, constitutes a legal, valid and binding
obligation of the Investor, enforceable against the Investor in accordance with
its terms, except as limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws relating to creditors’
rights generally and (b) general principles of equity, whether such
enforceability is considered in a proceeding in equity or at law.

 

(ii)          Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will conflict with, result
in a breach of, constitute a default under, result in the acceleration of,
create in any Party the right to accelerate, terminate, modify or cancel, or
require any notice under any agreement, contract, lease, license, instrument or
other arrangement to which the Investor is a party or by which it is bound or to
which any of its assets is subject.

 

(iii)          The execution and delivery of this Agreement by the Investor does
not, and the performance of this Agreement by the Investor will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any governmental entity.

 

(b)          The Company represents and warrants to the Investor as follows:

 

(i)           The Company is a corporation that is validly existing and in good
standing under the laws of its state of Nevada. The Company has the requisite
power and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated by this
Agreement. The execution, delivery and performance by the Company of this
Agreement and the consummation by the Company of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of the
Company and no other action is necessary on the part of the Company to authorize
this Agreement or to consummate the transactions contemplated hereby. This
Agreement has been duly executed and delivered by the Company and, assuming the
due authorization, execution and delivery by the Investor, constitutes a legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as limited by (a) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws relating
to creditors’ rights generally and (b) general principles of equity, whether
such enforceability is considered in a proceeding in equity or at law.

 

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(ii)           Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will conflict with, result
in a breach of, constitute a default under, result in the acceleration of,
create in any Party the right to accelerate, terminate, modify or cancel, or
require any notice under any agreement, contract, lease, license, instrument or
other arrangement to which the Company is a party or by which it is bound or to
which any of its assets is subject.

 

(iii)          The execution and delivery of this Agreement by the Company does
not, and the performance of this Agreement by the Company will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any governmental entity.

 

10.          Miscellaneous.

 

(a)          Fees and Expenses. Each Party shall pay the fees and expenses of
its advisers, counsel, accountants and other experts, if any, and all other
expenses incurred by such Party incident to the negotiation, preparation,
execution, delivery and performance of this Agreement.

 

(b)          Entire Agreement. This Agreement, together with the exhibits
hereto, contain the entire understanding of the Parties with respect to the
subject matter hereof and supersede all prior agreements, understandings,
discussions and representations, oral or written, with respect to such matters,
which the Parties acknowledge have been merged into such documents, exhibits and
schedules.

 

(c)          Notices. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective if given in accordance with the Purchase Agreement.

 

(d)          Amendments; Waivers. No provision of this Agreement may be waived
or amended except in a written instrument signed, in the case of an amendment,
by the Company and the Investor, in the case of a waiver, by the Party against
whom enforcement of any such waiver is sought. No waiver of any default with
respect to any provision, condition or requirement of this Agreement shall be
deemed to be a continuing waiver in the future or a waiver of any subsequent
default or a waiver of any other provision, condition or requirement hereof, nor
shall any delay or omission of either Party to exercise any right hereunder in
any manner impair the exercise of any such right.

 

(e)          Construction. The headings herein are for convenience only, do not
constitute a part of this Agreement and shall not be deemed to limit or affect
any of the provisions hereof. The language used in this Agreement will be deemed
to be the language chosen by the Parties to express their mutual intent, and no
rules of strict construction will be applied against any Party. This Agreement
shall be construed as if drafted jointly by the Parties, and no presumption or
burden of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any provisions of this Agreement.

 

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(f)          No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the Parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.

 

(g)          Mediation; Arbitration and Governing Law. In the event of a dispute
between any of the Parties arising under or relating in any way whatsoever to
this Agreement, the disputing Parties shall attempt to resolve it through good
faith negotiation. If the dispute is not resolved through such negotiation, then
the disputing Parties shall attempt to resolve it through mediation in the State
of New York, USA, with a neutral, third-party mediator mutually agreed upon by
the disputing Parties. Unless otherwise agreed by the disputing Parties, the
costs of mediation shall be shared equally. If the dispute is not resolved
through mediation, then upon written demand by one of the disputing Parties it
shall be referred to a mutually agreeable arbitrator. The arbitration process
shall be conducted in accordance with the laws of the United States of America
and the State of New York, except as modified herein. Venue for the arbitration
hearing shall be the State of New York, USA. All remedies, legal and equitable,
available in court shall also be available in arbitration. The arbitrator’s
decision shall be final and binding, and judgment may be entered thereon in a
court of competent jurisdiction. This Agreement shall be interpreted and
enforced in accordance with the laws of the United States of America and the
State of New York, without regard to conflict of law principles thereof.

 

(h)          Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and the
same agreement and shall become effective when counterparts have been signed by
each Party and delivered to the other Party, it being understood that both
Parties need not sign the same counterpart. In the event that any signature is
delivered by facsimile or e-mail transmission, such signature shall create a
valid and binding obligation of the Party executing (or on whose behalf such
signature is executed) with the same force and effect as if such facsimile or
e-mail signature page were an original thereof.

 

(i)          Severability. If any provision of this Agreement is held to be
invalid or unenforceable in any respect, the validity and enforceability of the
remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the Parties will attempt to agree upon a valid
and enforceable provision that is a reasonable substitute therefor, and upon so
agreeing, shall incorporate such substitute provision in this Agreement.

 

(j)          Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, each of the
Investor and the Company will be entitled to specific performance under this
Agreement. The Parties agree that monetary damages may not be adequate
compensation for any loss incurred by reason of any breach of obligations
described in the foregoing sentence and hereby agrees to waive in any action for
specific performance of any such obligation the defense that a remedy at law
would be adequate.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Cancellation and
Exchange Agreement to be executed as of the date first above written.

 

  COMPANY:         FC GLOBAL REALTY INCORPORATED         By: /s/ Vineet Bedi    
Name: Vineet Bedi     Title: Chief Executive Officer and President        
INVESTOR:         OPPORTUNITY FUND I-SS, LLC         BY: OP FUND I MANAGER, LLC
        By: /s/ Kristen Pigman     Name: Kristen Pigman     Title: Director

 

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EXHIBIT A

 

Amendment No. 1 to Voting Agreement

 

(See Attached)

 

 

 

AMENDMENT NO. 1 TO SHAREHOLDER VOTING SUPPORT AND CONFIDENTIALITY AGREEMENT

 

AMENDMENT NO. 1 TO SHAREHOLDER VOTING SUPPORT AND CONFIDENTIALITY AGREEMENT,
dated April 20, 2018 (the “Amendment”), by and among Opportunity Fund I-SS LLC
(“OFI”) and those holders of securities of FC Global Realty Incorporated, a
Nevada corporation (the “Company”), listed on the signature page hereto (each a
“Securityholder” and collectively, the “Securityholders”).

 

RECITALS

 

A.          The Company and OFI have entered into a Securities Purchase
Agreement, dated December 22, 2017 (the “Purchase Agreement”), pursuant to which
OFI will invest certain funds in the Company in exchange for shares of the
Series B Preferred Stock, par value $.01 per share, of the Company (the “Series
B Stock”), which will be convertible into shares of the Common Stock, par value
$.01 per share, of the Company (the “Common Stock”).

 

B.          In connection with and as a condition to the consummation of the
transactions contemplated by the Purchase Agreement, on December 22, 2017, OFI
and the Securitiyholders entered into a Shareholder Voting Support and
Confidentiality Agreement (the “Voting Agreement”).

 

C.         On the date hereof, OFI and the Company are entering into a
Cancellation and Exchange Agreement (the “Cancellation Agreement”) and, it is a
condition to the effectiveness of the Cancellation Agreement that OFI, the
Company and the Securityholders enter into this Amendment pursuant to which,
among other things, the Securityholders agree to vote in favor of (or take
action by written consent in favor of) the issuance of the Common Shares to OFI
and the consummation of the other transactions contemplated by the Cancellation
Agreement.

 

D.         Pursuant to Section 10(l) of the Voting Agreement, the Voting
Agreement may be amended by the parties thereto by an instrument in writing
signed OFI and the Securityholders.

 

AGREEMENT

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto, intending to be legally
bound, hereby agree as follows:

 

1.          Definitions. Capitalized terms used, but not otherwise defined, in
this Amendment, have the meanings ascribed to them in the Cancellation Agreement
or in the Voting Agreement as applicable.

 

2.          Amendment to Section 1. Section 1 of the Voting Agreement is hereby
amended and restated in their entirety as follows:

 

“SECTION 1.      Securityholder Meetings; Voting. Each Securityholder hereby
agrees that from and after the date hereof and until this Agreement is
terminated in accordance with Section 8, such Securityholder shall appear in
person or by proxy at any meeting of the Securityholders of the Company called
for purposes, and any adjournment or postponement thereof, or in any other
circumstances upon which a vote, consent or other approval with respect to the
Securities Purchase Agreement or the transactions contemplated by the Securities
Purchase Agreement is sought by the Company and approved by the board of
directors of the Company and recommended to the Securityholders of the Company
by the board of directors that include any of the following: (i) the adoption of
the Securities Purchase Agreement or the Cancellation Agreement and the
transactions contemplated by the Securities Purchase Agreement and the
Cancellation Agreement, (ii) the approval of issuance of shares of Series B
Stock as contemplated by the Securities Purchase Agreement, (iii) the approval
of the Common Shares as contemplated by the Cancellation Agreement, and (iv) the
approval of issuance of shares of Common Stock upon conversion of shares of
Series B Stock issued pursuant to the Securities Purchase Agreement.

 

 

 

Each Securityholder hereby agrees that from and after the date hereof and until
this Agreement is terminated in accordance with Section 8, such Securityholder
shall exercise all of his, her or its rights as a holder of securities of the
Company to vote as follows to the extent that the following are approved by the
board of directors of the Company and recommended to the Securityholders of the
Company: (i) in favor of the adoption of the Securities Purchase Agreement and
the Cancellation Agreement and the approval of the transactions contemplated by
the Securities Purchase Agreement and the Cancellation Agreement; (ii) in favor
of any proposal seeking approval for the issuance to OFI or its designees of the
Common Shares pursuant to the Cancellation Agreement and Common Stock (or
securities convertible into or exercisable for Common Stock) equal to 20% or
more of the Common Stock or 20% or more of the voting power outstanding before
the issuance, in order that any shares of Series B Stock issued by the Company
to OFI or its designees under the Securities Purchase Agreement can be
immediately converted into Common Stock (the “20% Proposal”); (iii) against any
proposal made in opposition to, or in competition with, the matters set forth in
(i) or (ii) above; and (v) against any other action that is intended, or would
reasonably be expected to, impede, interfere with, delay, postpone, discourage
or adversely affect the adoption of the Securities Purchase Agreement and the
Cancellation Agreement and approval of the transactions contemplated by the
Securities Purchase Agreement and the Cancellation Agreement at any meeting of
the Securityholders of the Company. In addition, from and after a Date of
Default (as defined below) each Security holder will vote the Required
Percentage of voting power under securities held by such Securityholder in favor
of every proposal that is proposed by a majority of the holders of the Series B
Stock (a “Stock B Proposal”) as conclusively evidenced on a nonexclusive basis
by a statement to such effect in a proxy or other instrument soliciting the
consent of any of the Securityholders and shall vote the Required Percentage of
voting power under securities held by such Securityholder against any proposal
that is adverse to any such Stock B Proposal. It is the intention of this
paragraph that each Securityholder shall be obligated to vote in accordance with
the above regardless of the particular wording of any proposal put forth to the
Securityholders of the Company, in a manner consistent with the purpose of
authorizing the Securities Purchase Agreement, the Cancellation Agreement and
the issuance to OFI or its designees of shares of Common Stock of the Company
having the maximum voting power as is contemplated by the Securities Purchase
Agreement and the Cancellation Agreement.

 

For the purposes of this Agreement, the term (1) “Date of Default” shall mean
the date that either (A) there is any material default by the Company under the
terms of the Securities Purchase Agreement or the Cancellation Agreement that is
not cured within thirty (30) days after receipt by the Company of written notice
from OFI that provides in reasonable detail a description of the breach, or (B)
any failure of the 20% Proposal to be approved by the stockholders of the
Company on or prior to March 31, 2018; and (2) “Requisite Percentage” means the
percentage of voting power of a Securityholder that is equal to the quotient of
(A) the number of shares into which the Series B Stock is convertible without
giving effect to any restrictions on conversion thereof, divided by (B) the sum
of (i) the number of shares of the Common Stock of the Company outstanding plus
(ii) the number of shares of Common Stock underlying the outstanding Series B
Stock.”

 

 

 

3.          Amendment to Section 8. Section 8 of the Voting Agreement is hereby
amended and restated in its entirety as follows:

 

“SECTION 8.     Termination.

 

(a) This Agreement, and all rights and obligations of the parties hereunder,
shall terminate immediately upon the earliest to occur of the following:

 

(i) the first Business Day following the date of the approval of the 20%
Proposal by the Company’s stockholders;

 

(ii) the mutual written consent of the Note Holders and the Securityholders; or

 

(iii) December 31, 2018.

 

(b) Except as set forth in Section 8(c), upon termination of this Agreement,
except in the case of liability for any willful breach by any party to this
Agreement prior to termination from which liability termination shall not
relieve any such party, all obligations of the parties under this Agreement will
terminate, without any liability or other obligation on the part of any party
hereto to any person or entity in respect hereof or the transactions
contemplated hereby, and no party shall have any claim against another (and no
person shall have any rights against such party), whether under contract, tort
or otherwise.

 

(c) Section 4 of this Agreement shall survive the termination of this Agreement
until the first anniversary of the date of this Agreement. Section 8 of this
Agreement shall survive the termination of this Agreement indefinitely.”

 

4.          Effect of Amendment. Except as amended as set forth above, the
Voting Agreement shall continue in full force and effect.

 

5.          Counterparts. This Amendment may be executed in two (2) or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. Counterparts may be
delivered via facsimile, electronic mail (including pdf or any electronic
signature complying with the U.S. federal ESIGN Act of 2000, e.g.,
www.docusign.com) or other transmission method and any counterpart so delivered
shall be deemed to have been duly and validly delivered and be valid and
effective for all purposes.

 

 

 

6.          Governing Law. This Agreement will be governed by, and construed in
accordance with, the Laws of the State of New York, without giving effect to any
choice of law or conflict of law provision or rule that would cause the
application of the laws of any jurisdiction other than the State of New York.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed as of the date first set forth above.

 

  OPPORTUNITY FUND I-SS LLC       BY: OP FUND I MANAGER, LLC         By:    
Name: Kristen Pigman   Title: Director         SECURITYHOLDERS:       FIRST
CAPITAL REAL ESTATE OPERATING PARTNERSHIP, LP       By: First Capital Real
Estate Trust Incorporated, its general partner       By:     Name: Suneet Singal
  Title: Chief Executive Officer         Yoav Ben-Dror       Dolev Rafaeli      
Dennis M. McGrath