1

 

Debenture – Floating Charge

DEBENTURE

 

Made and executed this 23 day of October 2013

 

WHEREAS,the undersigned, Inspire M.D Ltd, a limited liability company organised
and existing under the laws of the State of Israel with its registered office at
4 Menorat Hamaor St., Tel Aviv, 6744831, Israel (hereinafter: the “Pledgor”),
intends to receive, jointly and severally with its parent company InspireMD,
Inc. (hereinafter: the “Parent”) from Hercules Technology Growth Capital, Inc.,
a Maryland corporation with its registered office at 400 Hamilton Avenue, Suite
310, Palo Alto, California 94301 (hereinafter: the “Lender”), a loan or loans,
for such purpose and on such conditions as specified in the provisions of that
certain Loan and Security Agreement entered into between and among the Lender,
the Pledgor and the Parent on October 23rd, 2013 (hereinafter, as may be
amended, restated, replaced or supplemented from time to time in accordance with
its terms, and together with the Loan Documents (as defined thereunder),
collectively, the “Loan Agreement”); and

 

THEREFORE,it has been agreed that the Pledgor shall secure the repayment of the
various amounts of money which the Pledgor may owe and/or may be liable to the
Lender in connection with the Loan Agreement and/or otherwise, all in accordance
with the terms hereinafter contained.

 

NATURE OF THE DEBENTURE

 

1.This Debenture has been made to secure the full and punctual payment of all
the sums due and to become due to the Lender from the Pledgor in connection with
the Loan Agreement, including without limitations in connection with the Secured
Obligations (as defined in the Loan Agreement), whether due from the Pledgor
alone or jointly with others, whether the Pledgor may have incurred or will
incur liability with respect thereto in the future, as obligor and/or as
guarantor and/or as endorser or otherwise, now due or becoming due in the
future, which are payable prior to the realisation of the collateral security to
which this Debenture is applicable or subsequent thereto, whether due absolutely
or contingently, directly or indirectly, unlimited in amount together with
interest, commissions, charges, fees and direct expenses including costs
required for realising the collateral security, reasonable lawyers fees,
insurance, stamp duty and any other payments arising from this Debenture and
together with any nature of linkage differences due and becoming due from the
Pledgor to the Lender in any manner whatsoever in respect of linked principal
and interest and any other linked sum all in accordance with the terms of the
Loan Agreement (all the foregoing sums being jointly and severally hereinafter
referred to as the “Secured Sums”).

 

THE CHARGE

 

2.As collateral security for the full and punctual payment of all of the Secured
Sums (whether at stated maturity, acceleration or otherwise), and without
derogating from any other security, the Pledgor hereby absolutely and
unconditionally charges in favour of the Lender and its successors by way of a
first ranking floating charge all of the Pledgor's property, assets and rights,
now or at any time belonging to or acquired by the Pledgor and the profits and
benefits derived therefrom, including without derogating from the generality of
the aforementioned, the property, assets and rights set forth below, but
excluding in all cases the Intellectual Property and Permitted Liens as long as
they exist (as such terms are defined in the Loan Agreement) (hereinafter
together, the “Assets Subject to a Floating Charge”):

 

 

2

 

Debenture – Floating Charge

 

(a)All the assets, monies, property and rights of any kind whatsoever without
exception, whether now or hereafter at any time in the future owned by the
Pledgor in any manner or way whatsoever (including, for the avoidance of any
doubt, and without limitation, all accounts, general intangibles, licenses
(except for Restricted Licences, as defined below) , royalty fees and other
property that consist of rights to payment and proceeds from the sale, licensing
or disposition of all or any part, or rights in, the Intellectual Property (as
such term is defined under the Loan Agreement));

for purposes of this Section, "Restricted Licenses" shall mean any material
license or other agreement with respect to which Pledgor is the licensee
(a) that prohibits or otherwise restricts Pledgor from granting a security
interest in and a fixed or floating charge over Pledgor’s interest in such
license or agreement or any other property, or (b) for which a default under or
termination of could interfere with Lender’s right to sell any Assets Subject to
a Floating Charge;

 

(b)All the current assets, without exception, now or hereafter at any time in
the future owned by the Pledgor in any manner or way whatsoever, the expression
'current assets' meaning all the assets, monies, property and rights of any kind
with the exception of land, buildings and fixtures;

 

(c)All the fixed assets now or hereafter at any time in the future owned,
belonging to, acquired by the Pledgor in any manner or way whatsoever, the
expression 'fixed assets' to include, inter alia, land, buildings, fixtures and
fittings and fixed plant and machinery thereon;

 

(d)All the stocks, shares, debentures, bonds, notes, instruments, Bills drawn or
made by others, securities and other documents or instruments of any kinds owned
by the Pledgor and/or which the Pledgor has any right in connection thereto now
and at any time in the future, held by the Lender and/or by others and/or any
rights in respect thereof;

 

(e)All rights in land and/or all contractual rights under agreements between the
Pledgor and the Israel Lands Administration and/or the Israel Development
Authority and/or the Jewish National Fund ('Keren Kayemeth Le-Israel') and/or
any other parties, now and hereafter existing at any time whatsoever.

 

3.As further collateral security for the full and punctual payment of all of the
Secured Sums, the Pledgor hereby absolutely and unconditionally pledges and
charges to the Lender and its successors by way of a first ranking fixed pledge
and charge the uncalled and/or called but unpaid share capital of the Pledgor
and its reputation and goodwill, as presently and in the future at any time
existing (hereinafter, jointly and severally - the “Charged Assets”).

 

4.As further collateral security for the full and punctual payment of all of the
Secured Sums, the Pledgor hereby absolutely and unconditionally assigns to the
Lender by way of first ranking fixed charge and pledge all rights, claims and
remedies of the Pledgor, including without limitation, any right to exemptions,
relief, or reduction under and deriving from the Income Tax Ordinance [New
Version], 5721-1961 and/or the Land Appreciation Tax Law, 5723-1963 and/or the
Property Tax and Compensation Fund Law, 5721-1961 and/or any other applicable
law.

 

 

3

 

Debenture – Floating Charge

 

5.As further collateral security for the full and punctual payment of all the
Secured Sums, the Pledgor hereby pledges and charges to the Lender all such
securities, documents and instruments, Bills drawn or made by others which the
Pledgor has delivered or may deliver to the Lender from time to time whether for
collection, safekeeping or otherwise (hereinafter: the “Charged Documents”), and
upon the delivery thereof shall be and be deemed pledged and charged to the
Lender by way of a first ranking fixed pledge and charge according to the terms
of this Debenture the provisions of which, mutatis mutandis, shall apply to the
charge and pledge thereof. The Lender shall be exempt from taking any action
whatsoever in connection with the Charged Documents and shall not be liable for
any loss or damage which may be caused in connection therewith and the Pledgor
undertakes to indemnify the Lender in any event that the Lender is sued for any
such loss of damage by others, except for any damages resulting of wilful
misconduct by Lender.

 

The Pledgor hereby waives in advance any defence based on prescription in
relation to the Charged Documents.

 

6.The Assets Subject to a Floating Charge, the Charged Assets and the Charged
Documents shall be hereinafter called the “Charged Property”.

 

The pledge and charge created by operation of this Debenture shall apply to all
and any rights to compensation or indemnity which may accrue to the Pledgor by
reason of the loss of, damage to or appropriation of the Charged Property.

 

DECLARATIONS OF THE PLEDGOR

 

7.The Pledgor hereby declares as follows:

 

(a)That the Charged Property is not charged, pledged or attached in favour of
any other persons or parties other than any charge, pledge or attachment created
by any Permitted Lien, as defined under the Loan Agreementprovided however, that
to the extent that such Permitted Liens are specific first ranking
limited-in-amount liens created by Pledgor in favour of another bank or
financial institution, then, with respect to each such Permitted Liens, for as
long as it is in effect, the terms of this Debenture, including without
limitation, the definition of “Charged Property” hereunder shall be construed in
a manner to give full force and effect to such Permitted Lien and enable this
Debenture to be enforced to the maximum extent possible under applicable law.

 

(b)That the Charged Property is, in its entirety, in the exclusive possession
and ownership of the Pledgor, or in the possession or under the control of the
Lender.

 

 

4

 

Debenture – Floating Charge

 

(c)That no restriction or condition of law or any agreement exists or applies to
the ability of the Pledgor to transfer or charge the Charged Property.

 

(d)That the Pledgor is capable of and entitled to charge the Charged Property.

 

(e)That no assignment of rights or other disposition has occurred derogating
from the value of the Charged Property.

 

(f)The Pledgor has received all permits, consents and authorizations that shall
be necessary or required to consummate this Debenture.

 

all except as permitted under the documents signed between the Pledgor and the
Lender.

 

COVENANTS OF THE PLEDGOR

 

8.The Pledgor hereby covenants as follows, as long as the floating charge
created by this Debenture is in force and until the Lender has certified in
writing that this Debenture is terminated:

 

(a)To hold the Charged Property in accordance with the provisions of the Loan
Agreement;

 

(b)To use and deal with the Charged Property with the utmost care and to notify
the Lender of any case of material disrepair, damage, loss, fault or defect
affecting same and to remedy any disrepair, damage, fault or defect affecting
the Charged Property due to use or for any other reason, and to be liable
towards the Lender for any disrepair, damage, fault or defect as aforesaid;

 

(c)To allow any representative of the Lender, during Pledgor’s regular business
hours, to inspect and examine the condition of the Charged Property wherever the
Charged Property may be situated, in accordance with the provisions of the Loan
Agreement;

 

(d)Following the occurrence of any of the events enumerated in Section 15 hereof
and subject to applicable law, upon the Lender's first demand, to deliver to the
Lender or to any bailee on its behalf, the Charged Property. In the event of the
refusal of the Pledgor to comply with the provisions of this sub-clause, the
Lender may, without the consent of the Pledgor, remove the Charged Property from
the Pledgor's possession and hold the same or deliver the same to a bailee on
behalf of the Lender at the expense of the Pledgor. Where the Charged Property
have been so delivered to a bailee, the Lender shall be exempt from any loss or
damage which for any reason may be caused to the Charged Property;

 

(e)Not to sell, assign, dispose of, hire out, let, lease or transfer any of the
Charged Property and not to allow any person to do any of the foregoing acts,
without the prior written consent of the Lender, except as specifically
permitted under the Loan Agreement;

 

(f)Not to sell, assign, transfer, let, lease, surrender, dispose of, relinquish
or waive, in whole or in part, any present or future asset, claim or right of
the Pledgor, except as specifically permitted under the Loan Agreement and this
Debenture;

  

 

5

 

Debenture – Floating Charge

 

(g)To notify, upon the Pledgor’s knowledge, the Lender forthwith of the levying
of any attachment on the Charged Property, to forthwith notify the attachor of
the charge in favour of the Lender and to take at the Pledgor's own expense
immediately and without delay all such measures as are required for discharging
such attachment;

 

(h)Not to charge or pledge in any manner or way the Charged Property by
conferring any rights ranking pari-passu prior to or deferred to the rights of
the Lender and not to make any assignment of any right which the Pledgor may
have in the Charged Property without receiving the prior written consent of the
Lender, except as specifically permitted under the Loan Agreement;

 

(i)To be liable towards the Lender for any defect in the Pledgor's title to the
Charged Property and/or any default thereunder and to bear the responsibility
for the authenticity, regularity and correctness of all the signatures,
endorsements and particulars of any Bills, documents, instruments and securities
which have been or may be delivered to the Lender by way of collateral security;

 

(j)To pay when due all taxes and compulsory payments levied against the Charged
Property and/or the income accruing thereon under any law and to furnish the
Lender, at its request, with all the receipts for such payments. If the Pledgor
fails to make such payments when due, the Lender may pay the same for the
account of the Pledgor and debit the Pledgor with the payment thereof coupled
with expenses, and Interest at the Default Rate. Such payments shall be secured
by this Debenture;

 

(k)Not to voluntarily wind up, liquidate or dissolve, sell, exchange, lease,
transfer or otherwise dispose of all or substantially all its properties and
assets;

 

(l)That no structural change is or will be effected in the Pledgor and/or that
no change of control in the Pledgor will occur, except as specifically permitted
under the Loan Agreement;

  

(m)Not to create, incur, assume, allow, or suffer to be created or exist any
Lien (as defined under the Loan Agreement) on any of its property, or assign or
convey any right to receive income, including the sale of any accounts, or
permit any of its subsidiaries to do so, or permit any collateral not to be
subject to the first priority security interest granted in the Loan Agreement,
or the charges granted hereunder or under any other Loan Documents (as defined
under the Loan Agreement) except for Permitted Liens (as defined under the Loan
Agreement) , or enter into any agreement, document, instrument or other
arrangement (except with or in favour of Lender) with any Person (as defined in
the Loan Agreement) which directly or indirectly prohibits or has the effect of
prohibiting Pledgor, Parent or any subsidiary from assigning, mortgaging,
pledging, granting a security interest or charge in, over or upon, or
encumbering any of Pledgor’s, Parent's or any subsidiary's Intellectual Property
(as defined under the Loan Agreement) as specifically permitted under the Loan
Agreement.

 

 

 

6

 

Debenture – Floating Charge

 

9.The Pledgor undertakes to notify the Lender forthwith upon its becoming aware
of any of the following:

 

(a)of any claim of right to any collateral security given to the Lender to which
this Debenture is applicable and/or of any execution or injunction proceedings
or other steps taken to attach, preserve or realise any such collateral
security;

 

(b)of any of the events enumerated in Clause 15 hereof;

 

(c)of any material reduction in value of any collateral security granted or
which may be granted by the Pledgor;

 

(d)of any application filed for the winding-up of the Pledgor's affairs or for
the appointment of a receiver over the Pledgor's assets as well as any
resolution regarding any structural change in the Pledgor or any intention to do
so;

 

(e)of any change of address.

 

INSURANCE

 

10.The Pledgor hereby undertakes to keep the Charged Property insured at all
times as provided in the Loan Agreement.

 

11.All the rights of the Pledgor deriving from the insurance of the Charged
Property, including rights under the Property Tax and Compensation Fund Law,
5721-1961, as in force at any relevant time and under any other law, whether or
not assigned to the Lender as aforesaid, are hereby charged to the Lender by way
of a first ranking fixed charge and pledge.

 

INTEREST

 

12.The Lender shall be entitled to calculate interest on the Secured Sums at
such rate as has been or may be agreed upon from time to time between the Lender
and the Pledgor according to the terms of the Loan Agreement.

 

REPAYMENT DATES

 

13.The Pledgor hereby undertakes to pay the Lender, including through the
Parent, all and any of the Secured Sums promptly on the maturity dates
prescribed or which may be prescribed therefor from time to time.

 

14.Except as specifically permitted under the Loan Agreement, the Lender may
decline to accept any prepayment of the Secured Sums or pay part thereof prior
to the date of maturity thereof and the Pledgor shall not be entitled to redeem
all or any of the Charged Property by discharging the Secured Sums and/or any
part thereof prior to their prescribed maturity dates.

 

Except as specifically permitted under the Loan Agreement, neither the Pledgor
nor any person having a right liable to be affected by the pledges and charges
hereby created or the realisation thereof shall have any right under Section
13(b) of the Pledge law, 5727-1967, or any other statutory provisions in
substitution therefor.

 

 

7

 

Debenture – Floating Charge

 

15.Without derogating from the generality of the provisions of this Debenture,
the Lender shall be entitled to demand the immediate payment of the Secured Sums
and to debit any account of the Pledgor with the amount thereof in any one of
the events enumerated below, in which case the Pledgor undertakes to pay the
Lender all of the Secured Sums, and the Lender shall be entitled to take
whatever steps it sees fit for the collection of the Secured Sums and in
particular to crystallise the floating charge on the Assets Subject to a
Floating Charge as provided in Clause 19(a) hereof and to realise, at the
Pledgor's expense, the collateral securities by any means allowed by law;

 

(a)The Pledgor is in breach of any of its obligations, undertakings,
representations or warranties under this Debenture (the foregoing shall not
derogate from any right, under any law, granted to the Lender in respect of any
other breach), and such breach was not cured within Ten (10) days following the
occurrence of such breach; and/or;

 

(b)There occurs and continues to subsist an event which gives the Lender right
to demand payment, under any of the Loan Documents signed between the Pledgor
and the Lender, including, inter alia, under the Loan Agreement, provided that
any period (if any) given to the Pledgor to effect payment or cure any other
failure thereof, respectively, under such document shall have elapsed and as
long as such payment or cure is not actually effected.

 

RIGHTS OF THE LENDER

 

16.The Lender shall have the right of possession, lien, set-off and charge over
any amounts, assets and/or rights including securities, coins, gold, banknotes,
documents in respect of goods, insurance policies, Bills, assignments of rights,
deposits, collaterals and their countervalue, in the possession of or under the
control of the Lender at any time for or on behalf of the Pledgor, including
such as have been delivered for collection, as security, for safe-keeping or
otherwise. The Lender shall be entitled to retain the said assets until payment
in full of the Secured Sums or to realise them by selling them and applying the
countervalue thereof in whole or in part in payment of the Secured Sums.

 

17.The Pledgor confirms that the Lender's books, accounts and entries shall be
binding upon the Pledgor, shall be deemed to be correct and shall serve as prima
facie evidence against the Pledgor in all their particulars, including all
reference to the computation of the Secured Sums, the particulars of the Bills,
guarantees and other collateral securities and any other matter related hereto.
Notwithstanding the aforementioned, this Section shall in no way derogate from
the rights or arguments of the Pledgor and the validity or effectiveness thereof
regarding any claims in respect of inaccuracies, mistakes or other errors in the
Lender’s books, accounts and entries.

 

18.Without derogating from the other provisions contained in this Debenture, any
waiver, extension, concession, acquiescence or forbearance (hereinafter:
“waiver”) on the Lender's part as to the non-performance, partial performance or
incorrect performance of any of the Pledgor's obligations pursuant to this
Debenture, such waiver shall not be treated as a waiver on the part of the
Lender of any rights but as a limited consent given in respect of the specific
instance.

 

 

8

 

Debenture – Floating Charge

 

19.In any of the events enumerated in Clause 15 hereof;

 

(a)the Lender shall be entitled to notify the Pledgor of the crystallisation
immediately or on a date specified by the Lender of the floating charge over the
Charged Property or any part thereof and to adopt all the measures it deems fit
and allowed by applicable law in order to recover the Secured Sums and realise
all of its rights hereunder, including the realisation of the Charged Property,
in whole or in part, and to apply the proceeds thereof to the Secured Sums
without the Lender first being required to realise any other guarantees or
collateral securities, if such be held by the Lender.

 

(b)Should the Lender decide to realise securities, Bills and other negotiable
instruments, in accordance with Section 4(2) of the Pledge Law 5727-1967, then
ten (10) days' advance notice regarding the steps that the Lender intends to
take shall be deemed to be reasonable advance notice for the purpose of Section
19(b) of the Pledge Law, 5727-1967, or any other statutory provisions in
substitution therefor.

 

(c)As long as the Secured Sums are not paid in full, the Lender may realize the
Charged Property in any lawful manner, inter alia, by applying to the qualified
court or execution office (Hotzaa Lapoal) for the appointment of a receiver or
receiver and manager on behalf of the Lender. Such receiver or receiver and
manager, who shall be empowered, inter alia:

 

1.to call in all or any part of the Charged Property.

 

2.to carry on or to participate in the management of the business of the
Pledgor, as they see fit.

 

3.to sell or agree to the sale of the Charged Property, in whole or in part, to
dispose of same or agree to dispose of same in such other manner on such terms
as they deem fit.

 

4.to make such other arrangement regarding the Charged Property or any part
thereof as they deem fit.

 

(d)All income to be received by the receiver or the receiver and manager from
the Charged Property as well as any proceeds to be received by the Lender and/or
by the receiver or receiver and manager from the sale of the Charged Property or
any part thereof shall be applied to pay the Secured Sums in such order as
Lender shall determine in its sole discretion and subject to any law.

 

20.Should the payment date of the Secured Sums or any part thereof not yet have
fallen due at the time of the sale of the Charged Property, or the Secured Sums
be due to the Lender contingently only, then the Lender shall be entitled to
recover out of the proceeds of the sale an amount sufficient to cover the
Secured Sums and the amount so recovered shall be charged to the Lender as
security for, and be held by the Lender until the discharge in full of, the
Secured Sums.

 

 

 

9

 

Debenture – Floating Charge

 

NATURE OF THE COLLATERAL SECURITY

 

21.The collateral securities which have been or may be given to the Lender under
this Debenture shall be continuing and revolving securities and shall remain in
force until all Secured Sums have been fully discharged. Promptly after the full
discharge of the Secured Sums the Lender shall certify in writing at the request
of Pledgor, that this Debenture and any Lien hereunder are terminated and in
addition, at the request of Borrower, execute and provide the Pledgor with any
documents reasonably necessary in order to remove the charge created by this
Debenture.

 

22.All collateral securities and guarantees which have been or may be given to
the Lender for payment of the Secured Sums shall be independent of one another.

 

23.The nature and effect of the collateral securities to which this Debenture is
applicable shall not be affected nor shall the validity of any of the securities
and obligations of the Pledgor hereunder be impaired or affected by any
compromise, concession, granting of time or other like release consented to by
the Lender with respect to the Pledgor and/or the Parent or any subsidiary or by
any variation in the Pledgor's and/or the Parent's obligations towards the
Lender in connection with the Secured Sums or by any release or waiver by the
Lender of any other collateral security or guarantees.

  

24.The Lender may deposit all or any of the collaterals given or which may be
given pursuant to this Debenture with a bailee of its own choosing, at its
discretion and at the Pledgor's expense, and may substitute such bailee with
another from time to time. The Lender may register all or any of such
collaterals with any competent authority in accordance with any law and/or in
any public register.

 

RIGHT OF ASSIGNMENT

 

25.The Lender may at any time, at its own discretion and without the Pledgor's
consent being required, assign this Debenture and its rights arising thereunder
together, and not separately, with the assignment of all of its rights and
obligations under the Loan Agreement. including the collaterals in whole or in
part and any assignee may also reassign the said rights without any further
consent being required from the Pledgor. Such assignment may be effected by
endorsement on this Debenture or in any other way the Lender or any subsequent
assignor deems fit.

 

NOTICE OF OBJECTION

 

26.The Pledgor undertakes to notify the Lender in writing of any objection or
contention it may have regarding any statement of account, extract thereof,
certificate or notice received by it from the Lender including information
received through any automatic terminal facility.

 

EXPENSES

 

27.All the expenses in connection with this Debenture as detailed in the Loan
Agreement and in any other Loan Documents signed between the Lender and the
Pledgor, including the fee for preparing credit and security documents, the
stamping and registration of documents, and all and any expenses involved in the
realisation of the collateral security and institution of proceedings for
collection (including the reasonable fees of the Lender's lawyers), insurance,
safe-keeping, maintenance and repair of the Charged property shall be paid by
the Pledgor to the Lender on its first demand, together with Interest at the
Default Rate from the date demand was made until payment in full, and until
payment in full, all the above expenses together with interest thereon shall be
secured by this Debenture. The Lender may debit the Pledgor with the aforesaid
expenses, together with interest thereon.

 

 

10

 

Debenture – Floating Charge

 

LIABILITY OF THE PLEDGOR

 

28.Should the Pledgor consist of two or more persons or entities, the Pledgor's
liability shall be joint and several and all the parties comprising the Pledgor
shall be jointly and severally liable for the performance of all the Pledgor's
obligations hereunder and/or in connection with the Secured Sums, or any other
liability incurred by, any party comprising the Pledgor shall be deemed to have
been received or incurred by all the parties comprising the Pledgor. However, if
any of the parties comprising the Pledgor is or becomes legally incompetent or
is or becomes in any way discharged of his liability for the performance of any
of the Pledgor's obligations as aforesaid, the liability of all of the other
parties comprising the Pledgor shall not be affected thereby.

  

INTERPRETATION; AMENDMENT

 

29.Any of the representations, warranties and covenants made by Pledgor
hereunder shall be in addition to, and shall not derogate in any manner from,
any representations, warranties and covenants made by Pledgor under the Loan
Agreement and any other related document.

 

30.In this Debenture - (a) the singular includes the plural and vice versa; (b)
the masculine gender includes the feminine gender and vice versa; (c) “Lender”
means Hercules Technology Growth Capital, Inc., its assigns, successors, or
attorneys-in-fact; (d) “Bills” means: promissory notes, bills of exchange,
cheques, undertakings, guarantees, sureties, assignments, bills of lading,
deposit notes and any other negotiable instruments; (e) “Interest at the Default
Rate” means interest at such default rate as is defined in the Loan Agreement;
(f) the headings are only indicative and are not to be used in construing this
Debenture; (g) the recitals hereto form an integral part hereof.

 

31.Any term of this Debenture may be amended and the observance of any term
hereof may be waived (either prospectively or retroactively and either generally
or in a particular instance) with the written consent of both parties only.

 

32.To the extent required, this Debenture may be translated into Hebrew for the
sole purposes of the registration and filing of this Debenture with the Israeli
Registrar of Companies and/or any other relevant Israeli official registrations.
Notwithstanding the aforesaid, the executed English version of this Debenture
shall prevail and supersede for all purposes and for all respects, in the event
of any discrepancy or inconsistency between the English version and the
translation.

 

NOTICES AND WARNINGS

 

33.                   

 

 

11

 

Debenture – Floating Charge

 

(a)Each communication to be made under this Debenture shall be made in writing
and, unless otherwise stated, may be made also by telex or facsimile
transmission or by electronic mail.

 

(b)Each communication or document to be made or delivered by each party to
another pursuant to this Debenture shall (unless that other party has by written
notice, specified another address) be made or delivered to that party, addressed
as follows:

 

(i)if to the Pledgor:

 

    Inspire M.D Ltd     4 Menorat Hamaor St.,     Tel Aviv, 6744831, Israel    
Attn.:  Craig Shore     Fax: +972 (3) 691 7692     Email: craigs@inspiremd.com

 

with a copy (which will not constitute notice) to:

 

    Haynes and Boone, LLP     Attn.: Todd Ransom, Esquire     30 Rockefeller
Plaza 26th Floor New York, NY 10112

 

and with a copy (which will not constitute notice) to:

 

     Kafri Leibovich, Law Offices     Attn.: Amit Leibovich, Adv     5
Jabotinsky St., Ramat Gan 52520

(ii)if to the Lender:

 

    Hercules Technology Growth Capital, Inc.     400 Hamilton Avenue, Suite 310
    Palo Alto, California 94301     Attn.:  Chief Legal Officer and Mr. Bryan
Jadot     Fax: 650-473-9194     Telephone:  650-289-3060     Email:
bjadot@herculestech.com

 

with a copy to:

  

  Riemer & Braunstein, LLP   Three Center Plaza   Boston, Massachusetts  02108  
Attn: David A. Ephraim, Esquire   Fax: (617) 880-3455   Email:  
dephraim@riemerlaw.com

 

and with a copy to:

 

  Raved, Magriso, Benkel & Co.   37 Shaul Hamelech Boulevard,   Tel Aviv,
Israel, 6492806   Attn: Einat Weidberg, Adv.   Fax: +972-3-606-0266   Email:  
einat_w@rmblaw.co.il

 

 

12

 

Debenture – Floating Charge

 

and shall be deemed to have been made or delivered (a) upon the earlier of
actual receipt and five (5) business days after deposit in regular mail, first
class, registered or certified mail return receipt requested, with proper
postage prepaid; (b) upon transmission, when sent by electronic mail or
facsimile transmission with receipt confirmation; (c) one (1) Business Day after
deposit with a reputable overnight courier with all charges prepaid; or (d) when
delivered, if hand-delivered by messenger.

 

GOVERNING LAW AND PLACE OF JURISDICTION

 

  34.  

 

(a)This Debenture shall be construed in accordance with the laws of the State of
Israel.

 

(b)The exclusive place of jurisdiction for the purpose of this Debenture is
hereby established as the competent court of law in Israel situated in Tel-Aviv,
Jaffa.

*****

 

 

13

 

Debenture – Floating Charge

 

IN WITNESS WHEREOF THE PLEDGOR HAS SIGNED THIS DEBENTURE OF FLOATING CHARGE

 

 

INSPIRE M.D LTD

 

 

/s/ Craig Shore   By:  Craig Shore   Title:  Chief Financial Officer