Exhibit 10.8

 

EXECUTION VERSION

 

ASSET PLEDGE AGREEMENT

 

This Asset Pledge Agreement is entered into as of December 31, 2019 by and
among: on one side (i) CIMA Telecom, Inc., a corporation organized under the
laws of the State of Florida (hereinafter referred to as “Pledgee”), and on the
other side (ii) Cuentas Inc., a corporation organized under the laws of the
State of Florida (hereinafter referred to as “Pledgor”)

 

PREAMBLE

 

WHEREAS, the Pledgor is the Licensee under that certain Platform License
Agreement, by and among Auris, LLC and Knetik, Inc., each wholly-owned
subsidiaries of Pledgee, Pledgee and Pledgor entered into as of the date hereof
(the “License”);

 

WHEREAS, the Pledgee and the Pledgor have entered into a series of other
transaction documents, including the License, that certain Voting Agreement and
Proxy between Pledgor, the Pledgee and the other parties thereto (the “Voting
Agreement”), that certain Note and Warrant Purchase Agreement by and between
Pledgor and the Pledgee (the “Purchase Agreement”) and Promissory Note and
Warrant issued by the Pledgor in favor of the Pledgee, and any other transaction
documents related thereto (the “Transaction Documents”);

 

WHEREAS, Pledgor has agreed to take certain actions in connection with and as
set forth more specifically in the Transaction Documents;

 

WHEREAS it is a condition of the License and the Note Purchase Agreement that
the Pledgor unconditionally and irrevocably pledges all of its rights, title and
interest in and to the License and any rights and assets granted pursuant to the
License (the “Assets”) to the Pledgee as a guarantee for the full and punctual
fulfillment of its obligations under Sections 2, 3, and 4 of the Voting
Agreement, the issuance of the securities under the Debenture and Warrant (the
“Obligations”).

 

NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
Pledgor and the Pledgee hereby agree as follows.

 

 

 

 

1. Pledge. The Pledgor hereby pledges to the Pledgee all of its rights and
interests in the Assets (the “Pledged Assets”), and hereby grants to the Pledgee
a first priority security interest in the Pledged Assets, as collateral security
for the prompt and complete payment and performance when due (whether at the
stated maturity, by acceleration or otherwise) of its Obligations.

 

2. Representations and Warranties. The Pledgor represents and warrants to the
Pledgee as follows:

 

2.1. The Pledgor has lawfully entered into this Agreement and this Agreement
constitutes a legal, valid and binding obligation of the Pledgor enforceable
against the relevant Pledgor in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, moratorium
or similar laws affecting the rights of creditors generally;

 

2.2. No governmental approvals or other consents or approvals or notices of or
to any person are required in connection with (i) the pledge by the Pledgor of
the Pledged Assets pursuant to this Agreement, or the execution, delivery,
performance by the Pledgor of this Agreement, (ii) the validity or
enforceability of this Agreement, (iii) the perfection or the maintenance of the
security interests created hereby (including the first priority nature of such
security interests), or (iv) the exercise by the Pledgee of the rights provided
for in this Agreement or the remedies in respect of the Pledged Assets pursuant
to this Agreement, except to the extent the same have been obtained and are in
full force and effect .

 

2.3. No litigation, investigation or proceeding of or before any arbitrator,
court or governmental authority with respect to this Agreement, the Pledged
Assets or any of the transactions contemplated hereby is pending or, to the best
of its knowledge, threatened against or affecting the Pledgor or against or
affecting any of its properties, rights, revenues or assets, in each case that
could reasonably be expected to have a material adverse effect on the rights and
remedies of the Pledgee hereunder;

 

2.4. The Assets are not subject to any transfer or sale restrictions, except as
provided herein or in the License;

 

2.5. The Pledgor is the legal owner of the Pledged Assets (as set forth in the
recitals hereof), free of any and all liens or encumbrances in favor of, or
claims of, any other person, except as provided for by this Agreement or the
License; and

 

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2.6. The lien granted pursuant to this Agreement will constitute in favor of the
Pledgee a legal, valid and enforceable perfected, first priority lien on the
Pledged Assets under Florida law; and, upon compliance by the Pledgor with its
obligations under Section 3 hereof, the lien granted pursuant to this Agreement
will constitute in favor of Pledgee a legal, valid and enforceable perfected,
first priority lien on any Assets acquired by the Pledgor after the date hereof
under Florida law;

 

2.7. Neither the Pledgor nor the Pledged Assets have any immunity from
jurisdiction of any court or from off-set or any legal process (whether through
service of notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise).

 

3. Covenants. The Pledgor covenants and agrees with the Pledgee that from and
after the date of this Agreement until its Obligations are satisfied in full:

 

3.1. Without the prior written consent of the Pledgee, the Pledgor will not (i)
create, incur or permit to exist any lien or option in favor of, or any claim of
any person with respect to, any of the Pledged Assets or any interest therein or
(ii) sell, assign, transfer, exchange, or otherwise dispose of the Pledged
Assets. The Pledgor will defend the right, title and interest of the Pledgee in
and to the Pledged Assets against the claims and demands of all persons
whomsoever.

 

3.2. At any time and from time to time, upon the written request of the Pledgee
and at the sole expense of the Pledgor, the Pledgor will promptly and duly
execute and deliver such further instruments and documents and take such further
actions as the Pledgee may reasonably request for the purposes of obtaining or
preserving the full benefits of this Agreement and of the rights and powers
herein granted.

 

3.3. The Pledgor will pay, and save the Pledgee and its successors, assigns,
employees and agents harmless from, any and all liabilities, costs and expenses
(including, without limitation, legal fees and expenses) (i) with respect to, or
resulting from, any delay in paying any and all excise, sales or other taxes
which may be payable or determined to be payable with respect to any of the
Pledged Assets, (ii) with respect to or resulting from any breach by the Pledgor
of its representations contained in Section 2 hereof or its covenants contained
in this Section 3 and the other provisions hereof, or (iii) in connection with
the grant and perfection of the lien contemplated by this Agreement (including,
without limitation, those actions described in Section 1 hereof).

 

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4. Termination and Release. This Agreement shall be terminated and the Pledgor
shall consequently be released and discharged from the obligations established
herein upon full and punctual satisfaction of all of its Obligations. The
Pledgee shall confirm to the Pledgor in writing within 30 (thirty) days as of
the settlement of the Obligations secured by the pledge hereunder that such
Obligations have been fully and punctually satisfied, after which the parties
shall perform all further acts and execute all documents necessary to cancel the
pledge granted by virtue of this Agreement, including, but not limited to,
entering into a Termination Asset Pledge Agreement to evidence the termination
of the pledge and release of obligations. It is hereby expressly agreed that
each party shall bear its respective expenses in connection with such
termination and registration.

 

5. Events of Default. If any of the following events (“Events of Default”) shall
occur and be continuing, the Pledgee may, at its option, by notice in writing to
the Pledgor, declare all of the obligations to be immediately due together with
interest accrued thereon:

 

(a) if the Pledgor defaults in its fulfillment of any of its Obligations;

 

(b) if any representation or warranty made by the Pledgor herein shall be false
or misleading in any material respect;

 

(c) if the Pledgor makes an assignment of the Pledged Assets for the benefit of
creditors;

 

(d) if the Pledgor files a petition or application, or commences any
proceedings, under any insolvency or readjustment of debt laws of any
jurisdiction, whether now or hereafter in effect;

 

(e) if any such petition or application is filed, or any such proceedings are
commenced, against the Pledgor, and the Pledgor by any act indicates its
approval thereof, consent there to, or acquiescence therein, or any order is
entered adjudicating the Pledgor bankrupt or insolvent, or approving the
petition in any proceedings; or

 

(f) if the Pledgor defaults on its obligations in the Voting Agreement, in the
Warrant or under Article II of the Purchase Agreement.

 

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In the event that the terms of the Pledge Agreement are enforced by the Pledgee
upon an event of default pursuant to this Section 6 and the License Agreement is
terminated, Pledgee shall transfer and return to the Pledgor all shares of the
Pledgor it has been issued through the conversion of the Debenture or exercise
of the Warrant. For the avoidance of doubt, in the event that the terms of this
Agreement are enforced and the License Agreement is terminated, then the Five
Million Dollars ($5,000,000) of liquidated damages called for under this Section
4.6 of the Purchase Agreement shall no longer be payable and due by the Pledgor.

 

6. Severability. Any provision of this Agreement which is prohibited or
unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability shall not invalidate or render
unenforceable such provision in any other jurisdiction. Where provisions of any
law or regulation resulting in such prohibition or unenforceability may be
waived they are hereby waived by the Pledgor and the Pledgee to the full extent
permitted by law so that this Agreement shall be deemed a valid, binding
agreement, and the security interest created hereby shall constitute a
continuing first lien on and first perfected security interest in the Pledged
Assets, in each case enforceable in accordance with its terms.

 

7. Headings. The paragraph, section and caption headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.

 

8. Waivers and Amendments; Successors and Assigns. None of the terms or
provisions of this Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the parties hereto;
provided, however, that any provision of this Agreement may be waived by the
Pledgee in a written letter or agreement executed by the Pledgee or by facsimile
transmission from the Pledgee. This Agreement shall be binding upon the
successors and permitted assigns of the Pledgor and shall inure to the benefit
of the Pledgee and its respective successors and assigns.

 

9. Notices. All notices, requests and demands to or upon the respective parties
hereto to be effective shall be in writing (including by facsimile
transmission), and, unless otherwise expressly provided herein, shall be deemed
to have been duly given or made when delivered by hand, or five (5) Business
Days after being deposited in the Brazilian mail, first class air mail postage
prepaid, or, in the case of telecopy notice, when confirmation of receipt is
obtained. Each notice, demand or request shall be made to the intended recipient
at the addresses indicated in the Preamble hereto or at such other address or
facsimile number from time to time designated by such party to the other hereto
for such purposes.

 

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10. Governing Law. This Agreement shall be governed by, and shall be construed
and enforced in accordance with the laws of Florida, without regard to its
principles of conflicts of law.

 

IN WITNESS WHEREOF, the undersigned have caused this Asset Pledge Agreement to
be duly executed and delivered as of the date first above written, in the
presence of the two undersigned witnesses.

 

CIMA TELECOM, INC.

as Pledgee

 

CUENTAS, INC.

as Pledgor

      By: /s/ Juan M. Gomez   By: /s/ Arik Maimon Name:   Juan M. Gomez   Name: 
 Arik Maimon Title: Chief Executive Officer   Title: Chief Executive Officer

 

 

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