Document:

exhibit_4-8.htm

 

Exhibit 4.8

 

ENGLISH SUMMARY OF THE FRAMEWORK LETTER

(ORIGINAL LANGUAGE – HEBREW)

 

BY AND BETWEEN

 

ELBIT VISION SYSTEMS LTD. ("EVS")

SCANMASTER SYSTEMS (IRT) LTD. ("SCANMANSTER")

(TOGETHER, THE "DEBTORS")

 

AND

 

BANK HAPOALIM LTD. (THE "BANK")

 

Dated May 27, 2010

(the “Letter”)

 

	
Description:

	 	
Letter pursuant to which Bank Hapoalim Ltd. (the "Bank"), within the framework of the sale of ScanMaster Ltd., consents to the sale of ScanMaster and EVS shares, sets the terms for the outstanding obligations of the Debtor's to the Bank and agrees to waive certain outstanding debts.

 

	
Guarantees

	 	
To guarantee the Debtors' debts to the Bank, both EVS and ScanMaster have created unlimited first ranking floating charges in favor of the Bank, on all of their assets and rights.

 

The Bank's prior written consent is required for any change in control or in structure in EVS and/or ScanMaster.

 

	
Bank Consent to Sale

	 	
The Bank consents to:

 

	 	 	
(i)

	

the sale of ScanMaster's shares (free of floating charge) held by EVS to David Gal ("Gal") and Ofer Sela ("Sela"), and;

 

	 	 	(ii)	

the purchase of Panoptes' shares held by ScanMaster by EVS, and;

 

	 	 	(iii)	

the transfer of EVS' shares held by M.S.N.D Real Estate Holdings Ltd. to Mr. Sam Cohen ("Cohen") and Mr. Yaron Menashe ("Menashe") for no compensation, and;

 

	 	 	

(iv)

	

to cancel the abovementioned charges;

 

	 	 	

subject to the fulfillment of the following conditions, in the aggregate, no later than June 30, 2010:

 

	 	 	
1.

 

	

Gal and Sela shall transfer USD $1,000,000 to ScanMaster at the date of the sale of the ScanMaster shares.

 

	 	 	

2.

 

	

Gal and Sela and/or ScanMaster shall pay EVS USD $250,000

 

	 	 	

3.

 

	

EVS shall transfer Gal and Sela the ScanMaster shares.

 

	 	 	

4.

 

	

Cohen and Menashe shall transfer USD $100,000 to EVS as a loan, as specified in the Owner's Loans section below.

 

	 	 	

5.

 

	

Cohen and Menashe shall consent to postponing the payment of their salaries up to an aggregate amount of USD $100,000, and this amount will be considered a loan as specified in the Owner's Loans section below.

 

	 	 	

6.

	

$112,000 held in EVS's account in the Bank and of $28,000 in ScanMaster's account, shall be applied to the repayment of your debts to the Bank, at the Bank's discretion.

 

	 	 	

7.

 

	

The Debtors shall undertake to sign agreements with the Bank which shall replace any previous agreement by no later than June 30, 2006

 

	 	 	

8.

	

The Debtors shall undertake to sign an agreement with Bank Leumi LeIsrael Ltd. settling their debts in that Bank no later than June 30, 2010.

 

  

  

  

 

	
Owner's Loans

	 	
As of the signing of the Agreement and until all of the Debtor's obligations to the Bank are repaid, the owner's loans will not be repaid without the Bank's prior written consent.

 

Notwithstanding the above, Cohen and Menashe shall be entitled to the repayment of their loan, subject to EVS fulfilling all of its obligations to the Bank, according to the following terms:

 

	 	 	1.	

In connection with the postponing of the payment of their salaries up to an aggregate amount of USD $100,000, this shall be repaid commencing July 2011 in 3 equal monthly payments.

 

	 	 	2.	

In connection with the USD $100,000 loan, this shall be repaid in one of the 2 following options:

 

	 	 	 	a.	

Commencing July 1, 2012 subject to the 5 Year Loan being repaid and USD $196,000 of principal out of the 10 Year Loan being repaid.

 

	 	 	 	b.	

Commencing 2013 subject to the fulfillment of the following conditions in the aggregate:

 

	 	 	 	 	i.	

60 days before the date of repayment, EVS shall request the Bank's consent for the repayment, along with a certified external auditor's confirmation

 

	 	 	 	 	ii.	

The Bank shall consent to the repayment subject to the auditor's confirmation confirming the fulfillment of the following conditions in the aggregate:

 

	 	 	 	 	 	1.	

Existence of net profit for distribution

 

	 	 	 	 	 	2.	

Existence of positive cash flow from ongoing operations

 

	 	 	 	 	 	3.	

The Repayment amount shall not exceed 50% of the net profit for distribution and/or the positive cash flow from ongoing operations, the lower of the two, and in any case shall not exceed the outstanding loan amount.

 

	 	 	 	 	 	4.	

The auditor's confirmation provides that EVS' tangible share capital is greater than zero.

 

	
Validity

	 	
This letter will be valid until no later than June 30, 2010, and if until this date, the conditions mentioned in the Bank Consent to the Sale section above are not fulfilled, the Bank's consent in connection with this letter is cancelled.exhibit_4-9.htm

 

Exhibit 4.9

 

ENGLISH SUMMARY OF THE DEBT RESTRUCTURE AGREEMENT

(ORIGINAL LANGUAGE – HEBREW)

 

BY AND BETWEEN

 

ELBIT VISION SYSTEMS LTD. ("EVS")

 

AND

 

BANK HAPOALIM LTD.

 

Dated June 30, 2010

(the “Agreement”)

 

	
Description:

	 	
Letter Agreement pursuant to which Bank Hapoalim Ltd. (the "Bank"), within the framework of the sale of ScanMaster Ltd., agrees to waive up part of EVS' existing debt to the Bank and restructure the repayment of the remaining debt, pursuant to EVS fulfilling certain conditions.

 

	
Debt Balance

	 	
EVS confirms its Debt Balance to the Bank is NIS 44,673, $231,411 and €12,000.

 

EVS will pay the Bank $112,000 towards the Debt Balance. Additionally, all funds in EVS' account with the Bank will be applied towards the Debt Balance.

 

	
Loan A - Terms and Interest

	 	
The Bank will loan $448,000 to EVS, the loan will be for 5 years, with principal repayable in equal consecutive monthly payments commencing January 31, 2011, and interest of LIBOR+4.47% repayable in consecutive monthly payments commencing July 31, 2010, for the outstanding principal, as it may be at every payment date.

 

	
Loan B - Terms and Interest

	 	
Additionally, the Bank will loan $105,000 to EVS, to be applied to any part of the Debt Balance, the loan will be for 10 years, with principal repayable in consecutive monthly payments commencing July 31, 2015, and interest of LIBOR+4.95% repayable in consecutive monthly payments commencing July 31, 2010, for the outstanding principal, as it may be at every payment date.

 

	
Loan C - Terms and Interest

	 	
The loan of $231,000 that was given to EVS by the Bank on November 24, 2009 ("Loan C") will continue to be repaid as originally set until December 31, 2011.

 

On December 31, 2011, the Bank shall loan to EVS the outstanding principal of Loan C for the repayment of Loan C, and this loan (the "January 31, 2012 Loan") will be for 102 months, with principal repayable in consecutive monthly payments commencing July 31, 2015, and interest (as it will be defined at the date of the loan) repayable in consecutive monthly payments commencing January 31, 2012, for the outstanding principal, as it may be at every payment date.

 

	
Transfer to ScanMaster Account

	 	
The Bank shall transfer amounts from Loan A, Loan B and from EVS' deposits in the Bank, a sum of $681,000 to repay part of ScanMaster's debts towards the Bank. The remainder from Loan A, Loan B and from EVS' deposits in the Bank, after the transfer to the ScanMaster account, shall be applied to any part of the Debt Balance

	  	 	  
	
Waivers

	 	
Subject to EVS completing all of its obligations, as detailed in this agreement, and providing true representations, the Bank will waive the repayment of the rest of the Company's debts.

 

	
Security

	 	
All the securities existing by EVS in favor of the Bank shall continue to survive in any event, unless cancelled by the Bank.

 

  

  

  

 

	
EVS' Obligations

	 	
EVS confirms that as long as it owes the Bank any amount, it will:

 

	 	 	

a.

	

provide the Bank with audited annual financial statements and any additional information regarding EVS' operations upon the Bank's request;

 

	 	 	

b.

	

not sell and/or transfer and/or lease any kind of assets to any third party (this does not apply to the ScanMaster transaction);

 

	 	 	

c.

	

not distribute dividends and/or distribute any amounts to any shareholder or third party on behalf of the shareholder (other than salaries), without the Bank's prior written consent;

 

	 	 	

d.

	

not loan or repay any amounts to any shareholder (other than Sam Cohen's and Yaron Menashe's loan attached to this agreement) without the Bank's prior written consent;

 

	 	 	

e.

	

not issue and/or transfer shares or securities (other than options to employees at a rate of 0.25% of the outstanding share capital of EVS per employee and at an aggregate amount that will not exceed 5% of the outstanding share capital) without the Bank's prior written consent.

 

	
Bank Fee

	 	
All of the expenses and fees including for this agreement, will be paid by EVS.exhibit_4-10.htm

Exhibit 4.10

 

LOAN UNDERTAKING

The undersigned hereby agrees to lend Elbit Visions Systems Ltd. (the "Company") an aggregate amount of One Hundred Thousand United States Dollars (US$ 100,000) (the "Loan Amount"), as follows, and all in accordance with the terms of agreements between the Company and Bank Hapoalim BM and Bank Leumi Le'Israel BM (the "Banks") attached hereto as Exhibits 1 and 2 respectively (the "Bank Agreements"):

	
1.

	
Shareholder Loan.  As of June 3, 2010,  the undersigned will remit to the Company an amount of Fifty Thousand US Dollars ($50,000) (the "Shareholder Loan Amount").

	
2.

	
Deferred Compensation Loan. For a period of time up to 13 months from the effective date of this undertaking, the undersigned agrees to defer receipt of compensation owed to it by the Company pursuant to the Consulting Agreement between the undersigned and the Company, attached hereto as Exhibit 3, up to an amount of Fifty Thousand US Dollars ($50,000) (the "Deferred Compensation Loan Amount").

	
3.

	
Interest. Subject to the terms and conditions of this undertaking, the Loan Amount shall bear interest from the date that such portion of the Loan Amount was actually transferred to the Company, or any accrued compensation was deferred, until its actual repayment, at the same rate of interest as the lowest rate of interest to be paid by the Company to the Banks in connection with the Company's existing repayment obligations to the Banks under the Bank Agreements (the "Interest").

	
4.

	
Repayment of Loan. The undersigned acknowledges that in accordance with the provisions contained therein the Bank Agreements: (i) the Deferred Compensation Loan Amount plus all accrued Interest, shall only become be due and payable to the Company at the date of July 1, 2011, and shall be repaid by the Company therefrom in three (3) equal monthly installments; and (ii) the repayment of the Shareholder Loan Amount plus all accrued Interest, shall only become be due and payable at the date of Januay 1, 2013 and shall be subject to the fulfillment of the conditions specified in the Bank Agreements.

	
5.

	
Subordination.  The undersigned acknowledges that in accordance with the provisions contained therein the Bank Agreements, the Loan Amount and Interest shall be subordinated to any debts owed by the Company to the banks in accordance with the Bank Agreements.

Voluntarily Agreed to and Accepted this ___ day of _______, 2010, by

	
_______________

Cyloes Ltd.

	  

Undertaking

I hereby acknowledge the terms of this Loan Undertaking and agree to the provisions set forth therein as if such provisions applied to me personally.

Shmuel Cohen

______________________________

Company Ackowledgement

The Company hereby acknowledges the terms of this Loan Undertaking and agree to the provisions set forth.

Elbit Vision Systems Ltd.

______________________________

By: _________________

Title: ________________

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