Document:

EX-10.3

 

Exhibit 10.3

SHARE PURCHASE AGREEMENT

between

Voltaire Ltd.

and

BCF II Belgium Holding SPRL

and Other Investors

Dated: February 1, 2007

	 	 	 
	ORI ROSEN & CO.
	 	HERZOG, FOX & NEEMAN
	Azrieli Centre
	 	Asia House
	Round Building
	 	4 Weizmann St.
	Tel Aviv 67021
	 	Tel Aviv 64239
	Israel
	 	Israel
	Tel: 972-3 607 4700
	 	Tel: 972-3 6922020
	Fax: 972-3 607 4701
	 	Fax: 972-3 6966464

 

 

SHARE PURCHASE AGREEMENT

This Share Purchase Agreement is entered into as of the 1st day of February 2007, by and between:

	1.	 	Voltaire Ltd., a company organised under the laws of the State of Israel (Company No.
51-247196-2) (the “Company”);
	 
	2.	 	BCF II Belgium Holding SPRL, a company organised under the laws of Belgium (“Belco”); and
	 
	3.	 	Those persons and entities listed in Schedule 1 hereto (the “Other Investors”);

(Each of Belco and the Other Investors being referred to hereafter as an “Investor” and
collectively as the “Investors”)

WHEREAS

The Investors wish to acquire shares in the Company, and the Company wishes to issue and sell to
the Investors shares in the Company on the terms as set forth herein.

NOW THEREFORE, the parties agree as follows:

	1.	 	DEFINITIONS

	 	1.1	 	The following terms shall have the following meanings:

	 	 	 
	“Additional Investors”
	 	Mr. Eric Benhamou or a corporation under his
Control and others as approved by the
Company and the Principal Investors.

	 
	“Affiliate”
	 	with respect to any Person:

	 	 	 

	 	 	(i)   any other Person of which securities or
other ownership interests representing more
than fifty percent (50%) of the voting
interests are, at the time such
determination is being made, owned,
Controlled or held, directly or indirectly,
by such Person; or

	 	 	 

	 	 	(ii)   any other Person which, at the time
such determination is being made, is
Controlling, Controlled by or under common
Control with, such Person.

	 	 	 

	 	 	As used herein, “Control”, whether used as a
noun or verb, refers to the possession,
directly or indirectly, of the power to
direct, or cause the direction of, the
management or policies of a Person, whether
through the ownership of voting

 

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	 	 	securities
or otherwise.

	 	 	 

	“Amended and Restated
Articles of Association”
	 	As defined in Section 2.2.1(b)(iii).

	 	 	 

	“Belco”
	 	Shall mean BCF II Belgium Holding SPRL or
any Permitted Transferee (as such term is
defined in the Articles) of Belco following
the transfer of Belco’s holdings in the
Company to such Permitted Transferee.

	 	 	 

	“Board of Directors”
	 	The board of directors of the Company.

	 	 	 

	“Closing”
	 	As defined in Section 2.2.1.

	 	 	 

	“Closing Date”
	 	As defined in Section 2.2.1.

	 	 	 

	“Code”
	 	The United States Internal Revenue Code of
1986, as amended.

	 	 	 

	“Disclosure Material”
	 	As defined in Section 3.5.

	 	 	 

	“Fully Diluted Basis”
	 	As defined in Section 2.1.

	 	 	 

	“Initial Series E SPA”
	 	Collectively, the share purchase agreement
between the Company, Belco and other
investors, dated 7 March 2004 and the share
purchase agreement between the Company,
Belco, and other investors dated 28 April
2005.

	 	 	 

	“Intellectual Property”
	 	All forms of intellectual property rights
recognised under any applicable laws,
including without limitation, the following:

	 	 	 

	 	 	(i)   Patents, whether in the form of utility
patents or design patents and all
continuations, continuations in part,
renewals and pending applications for the
foregoing (“Patents”);

	 	 	 

	 	 	(ii) Trademarks, trade names, service marks,
designs, logos, trade dress, and trade
styles, whether or not registered, and all
pending applications for registration of the
same (“Trademarks”);

	 	 	 

	 	 	(iii) Copyrights, whether or not registered,
and all pending applications for
registration of the same;

	 	 	 

	 	 	(iv) Inventions, research records, trade
secrets, 

 

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	 	 	     confidential information, product
designs, know-how, engineering
specifications and drawings, technical
information, formulae, customer lists,
supplier lists and market analyses;

	 	 	 

	 	 	(v) Computer programs, including, without
limitation, computer programs embodied in
semiconductor chips or otherwise embodied,
and related flow-charts, programmer notes,
updates and data, whether in object or
source code form; and

	 	 	 

	 	 	(vi) Semiconductor chip designs, whether or
not registered mask works or topographies.

	 	 	 

	“Investment”
	 	An investment of up to $12 million in the
Company, based on a pre-money Company
valuation of $100 million.

	 	 	 

	“Key Employees”
	 	The employees of the Company included in
Schedule 3.15(a), attached hereto and marked
as “Key Employees”.

	 	 	 

	“Ordinary Shares”
	 	Ordinary Shares of the Company of nominal
value of NIS 4.00 each.

	 	 	 

	“Organisational Documents”
	 	In respect of any entity, the memorandum of
association, articles of association,
certificate of incorporation, by-laws,
certificate(s) of designation or other
constitutional documents of any type.

	 	 	 

	“Person”
	 	An individual, corporation, trust,
partnership, limited liability company,
joint venture, unincorporated organization,
government body or any agency or political
subdivision thereof, or any other entity.

	 	 	 

	“Pitango”
	 	Shall mean Pitango Venture Capital Fund III
(Israeli Sub) LP., Pitango Fund II
Opportunity Annex Fund L.P., Pitango Fund II
Opportunity Annex Fund (ICA), L.P., Pitango
Principals Fund III (Israel) LP, Pitango II
Holdings LLC and Pitango Fund II (Tax Exempt
Investors) LLC (each, a “Pitango Fund”) and
any Permitted Transferee of any Pitango Fund
following the transfer of such Pitango
Fund’s holdings in the Company to such
Permitted Transferee.

	 	 	 

	“Principal Investor”
	 	Each of Belco, Pitango and Vertex who holds
shares in the Company.

 

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	“Purchase Price”
	 	As defined in Section 2.1.

	 	 	 

	“Series E2 Preferred Shares”
	 	Preferred E2 Shares of the Company, of
nominal value NIS 4.00 each.

	 	 	 

	“Securities Act”
	 	The United States Securities Act of 1933, as
amended.

	 	 	 

	“Security Interest”
	 	Any interest or equity of any person
(including any right to acquire, option, or
right of pre-emption) or any mortgage,
charge, pledge, lien, or assignment, or any
other encumbrance or security interest or
arrangement of whatsoever nature over or in
the relevant property.

	 	 	 

	“Senior Executives”
	 	The employees of the Company listed in
Schedule 3, attached hereto.

	 	 	 

	“Subsidiary”
	 	Each of Voltaire Inc. and Voltaire Japan K.K.

	 	 	 

	“Transaction Documents”
	 	This Agreement and the documents listed in
Schedule 1.1.

	 	 	 

	“Vertex”
	 	Vertex Israel II (C.I.) Fund L.P. or any
Permitted Transferee thereof following the
transfer of its holdings in the Company to
such Permitted Transferee.

	 	1.2	 	Words and defined terms denoting the singular number include the plural and vice
versa and the use of any gender shall be applicable to all genders.
	 
	 	1.3	 	The paragraph headings are for the sake of convenience only and shall not affect
the interpretation of this Agreement.
	 
	 	1.4	 	The recitals, schedules, appendices, annexes and exhibits hereto form an integral
part of this Agreement.

	2.	 	PURCHASE AND SALE OF THE SHARES

	 	2.1	 	Agreement to Purchase and Sell
	 
	 	 	 	Subject to and in accordance with the terms and conditions of this Agreement, the
Company shall issue to the Investors, and the Investors shall purchase from the Company
a total of up to 6,360,002 Series E2 Preferred Shares, constituting up to 9.1% of the
issued and outstanding shares of the Company on a fully diluted basis (including but not
limited to all warrants, options, convertible securities and convertible debt) as of the
date of Closing, as represented in the Capitalisation Table set out in Schedule 3.4(a)
(“Fully Diluted Basis”) at a price per share of $1.58 and for an aggregate purchase
price of $up to $10,048,803 (the “Purchase Price”).
	 
	 	 	 	At the Closing, each Investor shall pay that part of the Purchase Price set out next to
such Investor’s name in Schedule 2.1 attached hereto and shall be entitled to receive

 

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	 	 	 	such number of Series E2 Preferred Shares as are set out next to such Investor’s
name in Schedule 2.1.
	 
	 	2.2	 	Closing

	 	2.2.1	 	The closing of the purchase and sale of the Series E2 Preferred Shares
as detailed in Section 2.1 above (the “Closing”) shall take place at the offices of
Ori Rosen & Co., Azrieli Centre, Round Building, Tel Aviv, Israel on the date
hereof (the time and date of the Closing being herein referred to as the “Closing
Date”).
	 
	 	 	 	At the Closing, the following actions and occurrences will take place, all of
which shall be deemed to have occurred simultaneously and no action shall be
deemed to have been completed and no document or certificate shall be deemed to
have been delivered, until all actions are completed and all documents and
certificates delivered:

	 	(a)	 	The Company will allot and deliver to each Investor a
certificate representing that number of Series E2 Preferred Shares appearing
next to its name in Schedule 2.1, against payment in U.S. dollars by each
Investor by wire transfer of the portion of the Purchase Price appearing next
to that Investor’s name in Schedule 2.1 in immediately available funds to the
account of the Company in accordance with the following details:
	 
	 	 	 	Bank Name: CitiBank N.A.

Bank Address: Lincoln Square Financial Center 162 Amsterdam Ave

New York, NY 10023

Account Name Voltaire Ltd

Account Number: 02706293

SWIFT Code: CITIUS33

ABA Number: 021000089
	 
	 	(b)	 	The Company shall deliver to the Investors:

	 	(i)	 	the opinion, addressed to the Investors, of Ori
Rosen & Co., counsel to the Company, dated as of the Closing Date,
substantially in the form attached hereto as Schedule 2.2.1(b)(i);
	 
	 	(ii)	 	a copy of the resolution of the Board of
Directors and a resolution from the Company’s shareholders meeting, if
necessary, in the forms attached hereto as Schedule 2.2.1(b)(ii)
approving and authorising the issuance of the Series E2 Preferred
Shares, and approving this Agreement (and all documents relating
hereto) and approving the reservation of sufficient number of Ordinary
Shares for conversion of the Series E2 Preferred Shares; and
	 
	 	(iii)	 	copies of the amended and restated Articles of
Association of the Company (the “Amended and Restated Articles of
Association”), as duly adopted and in effect as of the Closing, in the
form attached hereto as Schedule 2.2.1(b)(iii) and accompanied by
certified resolutions (to the extent required by law) of shareholders
of the

 

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	 	 	 	Company adopting the Amended and Restated Articles of Association.

	 	(c)	 	The Company, the Investors and shareholders of the Company
in sufficient majorities as required to amend the Company’s Amended and
Restated Shareholders Rights Agreement, dated 28 April, 2005, shall sign the
Amended and Restated Shareholders’ Rights Agreement in the form attached
hereto as Schedule 2.2.1(c) (the “Shareholders’ Rights Agreement”).
	 
	 	(d)	 	The Company shall record the issuance of the Series E2
Preferred Shares to the Investors in the name of the Investors, as set out in
Schedule 2.1 on the shareholders’ register of the Company and other records
and, promptly after the Closing, the Company shall make all filings and
registrations as may be necessary to perfect such issuance and sale and shall
deliver copies thereof to the Investors.
	 
	 	(e)	 	The parties hereto shall execute and deliver this
Agreement.

	 	2.3	 	Additional Investors

	 	(a)	 	The Additional Investor(s) may invest up to $1,951,197 (one
million nine hundred fifty one thousand one hundred and ninety seven United
States Dollars) as part of the Investment at the Closing Date or within 60
days after the Closing Date (or such a longer period as may be agreed to by
the Company and the Principal Investors) that will complete the total
Purchase Price to $12,000,000 in accordance with the terms and conditions of
this Agreement The Additional Investor(s) shall each execute a joinder
agreement in the form of Schedule 2.3 hereto, pursuant to which such
Additional Investor(s) shall become a party to this Agreement and shall, from
such time, be considered an Investor for all intents and purposes under this
Agreement.

	3.	 	REPRESENTATIONS AND WARRANTIES
	 
	 	 	It is hereby clarified that for the purposes of this Section 3, any reference to “knowledge”
includes such information as is actually known by the Company, the Subsidiary or any Senior
Executive or any information which a Senior Executive would be expected to be aware of if the
Company, the Subsidiary or Senior Executive had made prudent enquiries into the relevant
actions and circumstances of the Company and the Subsidiary.
	 
	 	 	The Company represents and warrants to the Investors as follows:

	 	3.1	 	Constitution and Compliance 

	 	(a)	 	The Company is duly incorporated and validly existing under the laws of
the State of Israel, with power and authority to carry on its business as now being
conducted and as proposed to be conducted. The Company has at all times carried on
its business and affairs in all respects in accordance with its Organisational
Documents and all applicable laws and regulations, and there is no violation or
default with respect to any statute, regulation, order, decree, or judgement of any
court or any governmental entity which could have a material

 

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	 	 	 	adverse effect upon the assets or business of the Company. The Company is duly
qualified to do business and in good standing in each jurisdiction in which the
Company currently conducts business.
	 
	 	(b)	 	The Company has delivered to the Investors true and accurate copies of
the Organisational Documents of the Company and the Subsidiary as of the date of
this Agreement.
	 
	 	(c)	 	The Company and the Subsidiary maintain all corporate, shareholder or
other records and registries required by law. True and complete copies of all such
documents have been delivered to the Investors.
	 
	 	(d)	 	The Company does not presently own or control, directly or indirectly,
any interest in any corporation, association or other business entity other than
the Subsidiary which is a wholly-owned subsidiary of the Company. The Company is
not, directly or indirectly a participant in any joint venture, partnership or
similar arrangement. Voltaire Inc. and Voltaire Japan K.K. are duly incorporated,
validly existing and in good standing under the State of Maryland and Japan,
respectively, and have all requisite corporate power and authority and it has
obtained all necessary licences, authorisations and approvals to carry on their
business as now conducted in each jurisdiction in which failure so to qualify would
have a material adverse effect on their business or properties. There are no other
share capital, pre-emptive rights, convertible securities, outstanding warrants,
options or other rights to subscribe for, purchase and or acquire from the
Subsidiary. The Subsidiary is not in default under any material licence,
authorisation or approval mentioned in this Section 3, where applicable. The
Subsidiary is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure so to qualify would have a material adverse on
its business or properties.

	 	3.2	 	Authority to Transact

	 	(a)	 	The Company has all requisite corporate power and authority to execute
and deliver this Agreement and the Transaction Documents and to sell and issue the
Series E2 Preferred Shares hereunder and to carry out and perform its obligations
under this Agreement and the Transaction Documents and to consummate the
transactions contemplated hereby and thereby.
	 
	 	(b)	 	All corporate action on the part of the Company, its directors, and its
shareholders necessary for the authorisation and execution of this Agreement and
the Transaction Documents by the Company, the authorisation, sale, issuance, and
delivery of the Series E2 Preferred Shares and the performance of all of the
Company’s obligations under the Agreement and the Transaction Documents has been
taken. This Agreement constitutes and, when signed and where applicable, filed by
its duly authorised representatives, the Transaction Documents will constitute,
valid and legally binding obligations of the Company, enforceable in accordance
with their terms.

	 	3.3	 	Execution of Agreement

	 	(a)	 	The execution and delivery of this Agreement by the Company does not,
and the execution and delivery of the Transaction Documents and the consummation of
the transactions contemplated hereby and thereby will not, violate any provisions

 

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	 		 	of the Company’s Organisational Documents or any contract, agreement, indenture,
mortgage, instrument, lease, license, arrangement, or undertaking of any nature,
written or oral, of the Company or any Subsidiary.
	 
	 	(b)	 	Other than as set forth in Schedule 3.14, the execution and delivery of
this Agreement by the Company does not, and the execution and delivery of the
Transaction Documents and the consummation of the transactions contemplated hereby
and thereby will not, require the consent or agreement of any governmental body,
entity or any other third party.
	 
	 	(c)	 	The execution, delivery and performance of and compliance with this
Agreement and the Transaction Documents by the Company and the issuance of the
Series E2 Preferred Shares to the Investors will not result in any violation of, or
conflict with or constitute a default under any term of, or result in the creation
or enforcement of any Security Interest upon any of the properties or assets of the
Company.
	 
	 	(d)	 	The execution, delivery and performance of and compliance with this
Agreement and the Transaction Documents by the Company will not cause the Company
to lose any interest in or the benefit of any asset, right, license or privilege it
presently owns or enjoys or result in the termination of any relationship with
anyone who normally does business with the Company on the same basis as previously
conducted, and will not result in any present or future indebtedness of the Company
becoming due prior to its stated maturity. Compliance with the terms of this
Agreement or the Transaction Documents will not give rise to or cause any option or
right of pre-emption to become exercisable, except as set forth in the
Organisational Documents.

	 	3.4	 	Capitalisation

	 	(a)	 	The authorised and issued share capital of the Company as of
immediately prior to and after the Closing is as stated in Schedule 3.4(a).
	 
	 	(b)	 	Other than as listed in Schedule 3.4(a), there are no outstanding or
authorised subscriptions, options, warrants, rights, commitments, or any other
agreements of any character directly or indirectly obligating the Company or the
Subsidiary to issue (i) any additional shares or other securities or (ii) any
securities or debt convertible into, or exchangeable for, or evidencing the right
to subscribe for, any shares or other securities.
	 
	 	(c)	 	Neither the Company nor the Subsidiary has adopted or authorised any
plan for the benefit of its officers, employees, consultants or directors which
requires or permits the issuance, sale, purchase, or grant of any shares of the
Company’s or the Subsidiary’s share capital or other securities or any securities
convertible into, or exercisable or exchangeable for, or evidencing the right to
subscribe for any such shares or securities, other than as set forth in Schedule
3.4(a).
	 
	 	(d)	 	The Series E2 Preferred Shares to be issued to the Investors in
accordance herewith, will, when issued and paid for, be duly authorised, validly
issued, fully paid and non-assessable, and will have the rights, preferences,
privileges, and restrictions as set forth in the Amended and Restated Articles of
Association, Shareholders’ Rights Agreement and this Agreement and will be free and
clear of

 

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	 	 	 	all Security Interests, proxies, voting trusts and other voting agreements, calls
or commitments of any kind, other than as explicitly contemplated by the Amended
and Restated Articles of Association and this Agreement, and will be duly
registered in the name of the Investors in the Company’s shareholders’ register.
The Series E2 Preferred Shares, when issued, will have been issued in compliance
with all laws, rules and regulations, including applicable securities laws.
	 
	 	(e)	 	All other securities of the Company and the Subsidiary have been issued
in compliance with all laws, rules and regulations, including applicable securities
laws. Other than as contemplated by this Agreement and the Transaction Documents,
the Company is not subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any of its shares or any warrants,
options or other rights to acquire its shares.

	 	3.5	 	Disclosure Material and Information

	 	(a)	 	The opinions and assumptions contained in the disclosure material
attached hereto as Schedule 3.5 (the “Disclosure Material”) are reasonable and have
been prepared in good faith, and the financial projections set out in the
Disclosure Material have been prepared with due diligence, care and consideration,
and there are no facts or matters of which the Company is aware which would render
any such opinions, assumptions or projections misleading provided, however, that no
assurance can be or is given that the assumptions are correct or any of the
forecast projections, expectations or transactions contemplated therein will be
attained.
	 
	 	(b)	 	All facts and information with regard to the Company and the Subsidiary
since their incorporation which would reasonably have been considered as material
for disclosure to an intending investor in the shares of the Company have been
disclosed to the Investors.

	 	3.6	 	Financial Statements

	 	(a)	 	The Company has delivered to the Investors the financial statements of
the Company for the year ended 31st December, 2005, in the form as has
been audited by the Company’s independent auditors and reviewed financial
statements for the nine months ended 30 September 2006 (the “Financial
Statements”), all prepared in accordance with generally accepted accounting
principles accepted in the United States (“GAAP”), consistently applied, and in
English and stated in US dollars.
	 
	 	(b)	 	The Financial Statements are in accordance with the books and records
of Company; are accurate in all respects; present in a true, complete and fair
view, the financial position, assets and liabilities of the Company as of the dates
indicated and the results of its operations for such periods; and have been
prepared in accordance with generally accepted accounting principles in the United
States consistently applied.
	 
	 	(c)	 	Except as set forth in Schedule 3.6(c), there are no off-balance sheet
liabilities, claims, or obligations of any nature, whether accrued, absolute,
contingent, anticipated, or otherwise, whether due or to become due, that are not
shown or provided for in the Financial Statements. The liabilities of the Company
were included in the ordinary course of the Company’s business.

 

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	 	(d)	 	Except as set forth in Schedule 3.6(d), all of the accounts receivable
shown on the balance sheets included in the Financial Statements have been
collected or are good and collectible in the aggregate recorded amounts thereof
(less the allowance for doubtful accounts also appearing in the Financial
Statements and net of returns and payment discounts allowable by the Company’s
policies) and can reasonably be anticipated to be paid in full without outside
collection efforts within ninety (90) days of the due date, and are not subject to
counterclaims or setoffs in excess of recorded reserves.
	 
	 	(e)	 	The Company knows of no basis for the assertion against the Company of
any liabilities not adequately reflected or reserved against in the Financial
Statements.

	 	3.7	 	Business to Date

	 	(a)	 	Since September 30, 2006, except as provided in Schedule 3.7(a)
attached hereto and except if presented in any of the provisions of Section 3 of
this Agreement:

	 	(i)	 	neither the Company nor the Subsidiary has amended any of
its Organisational Documents;
	 
	 	(ii)	 	neither the Company nor the Subsidiary has entered into any
transaction in excess of $25,000 per transaction or greater than $100,000 in
the aggregate for a series of related transactions, as to both;
	 
	 	(iii)	 	there has been no material adverse change in the business,
prospects (in so far as they may reasonably be foreseen), operations, assets,
liabilities, or condition (financial or otherwise) of the Company or the
Subsidiary;
	 
	 	(iv)	 	neither the Company nor the Subsidiary has made any payment
of, or declaration, setting a record date, setting aside or authorizing the
payment of, any dividend or other distribution in respect of any shares of
capital stock of the Company or the Subsidiary or made any purchase,
repurchase, redemption, retirement or other acquisition by the Company or the
Subsidiary, of any of the outstanding shares of capital stock or other
securities of, or other ownership interest in, the Company or the Subsidiary;
	 
	 	(v)	 	there has not been any transfer, issue, sale or other
disposition by the Company or the Subsidiary of any shares of capital stock
or other securities of the Company or the Subsidiary or any grant of options,
warrants, calls or other rights to purchase or otherwise acquire shares of
such capital stock or such other securities;
	 
	 	(vi)	 	neither the Company nor the Subsidiary has increased or
entered into an agreement to increase the compensation payable or to become
payable, or awarded or paid any bonuses to employees, consultants,
independent contractors, officers, directors, shareholders or representatives
of the Company or the Subsidiary or agreed to increase the coverage or
benefits available under any severance pay, deferred compensation, bonus or
other incentive compensation, pension or other employee benefit plan, payment
or arrangement made to, for or with such employees, consultants,

 

11

	 	 	 	independent contractors, officers, directors, shareholders or
representatives, other than in the ordinary course of business consistent
with past practice and with the Company’s or the Subsidiary’s operating
expense budget;
	 
	 	(vii)	 	there has not been satisfaction or discharge of any lien,
claim or encumbrance or payment of any obligation by the Company or the
Subsidiary, except in the ordinary course of business and that is not
material to the business, operations, properties, assets, liabilities,
financial condition or results of operations of the Company or the Subsidiary
(as such business is presently conducted and as it is presently proposed to
be conducted);
	 
	 	(viii)	 	there has not been any termination or change to a material contract or
arrangement by which the Company or the Subsidiary or any of its assets is
bound or subject;
	 
	 	(ix)	 	there has not been any resignation or termination of
employment of any Senior Employee, consultant or independent contractor of
the Company or the Subsidiary;
	 
	 	(x)	 	there has not been any damage, destruction or loss, whether
or not covered by insurance, with respect to the property or assets of the
Company or the Subsidiary having a replacement cost of more than $10,000 for
any single loss or $50,000 for all such losses in the aggregate;
	 
	 	(xi)	 	neither the Company nor the Subsidiary have mortgaged,
pledged or subjected to any lien any of its assets, or acquired any assets or
sold, assigned, transferred, conveyed, leased or otherwise disposed of any
assets of the Company or the Subsidiary, except for assets acquired or sold,
assigned, transferred, conveyed, leased or otherwise disposed of in the
ordinary course of business consistent with past practice;
	 
	 	(xii)	 	neither the Company nor the Subsidiary have cancelled or
compromised any debt or claim or amended, cancelled, terminated,
relinquished, waived or released any contract or right except in the ordinary
course of business consistent with past practice and which, individually or
in the aggregate, would not be material to the Company or the Subsidiary;
	 
	 	(xiii)	 	neither the Company nor the Subsidiary has entered into any material
transaction except for this Agreement and the Transaction Documents;
	 
	 	(xiv)	 	neither the Company nor the Subsidiary have encountered
any labour disputes, strikes, slowdowns, work stoppages or labour union
organizing activities;
	 
	 	(xv)	 	neither the Company nor the Subsidiary have made any change
in the accounting principles, methods or practices followed by it or
depreciation or amortization policies or rates theretofore adopted;

 

12

	 	(xvi)	 	neither the Company nor the Subsidiary have disclosed to
any person any material trade secrets except for disclosures made to persons
subject to valid and enforceable confidentiality agreements;
	 
	 	(xvii)	 	neither the Company nor the Subsidiary have suffered or experienced any
change in the relationship or course of dealings between the Company or the
Subsidiary and any of their suppliers or customers which supply goods or
services to the Company or the Subsidiary or purchase goods or services from
the Company or the Subsidiary, which has resulted in, or could reasonably be
expected to result in, a material adverse change;
	 
	 	(xviii)	 	neither the Company nor the Subsidiary have made any loans, advances or
capital contributions or payment to, or received any payment from, or made or
received any investment in, or entered into any transaction or series of
related transactions (including without limitation, the purchase, sale,
exchange or lease of assets, property or services, or the making of a loan or
guarantee) with any Affiliate or paid any fees or expenses to any Affiliate
of the Company;
	 
	 	(xix)	 	neither the Company nor the Subsidiary have entered into
any agreement or commitment (contingent or otherwise) to do any of the
foregoing;
	 
	 	(xx)	 	there has been no sale, assignment, or transfer of any
tangible asset of the Company or the Subsidiary except in the ordinary course
of business and no sale, assignment, or transfer of any patent, trademark,
trade secret, or other intangible asset of the Company or the Subsidiary; and
	 
	 	(xxi)	 	neither the Company nor the Subsidiary have taken any
actions to reduce the scale of operations, work-force or scope of business as
a result of shortages of funds.

	 	(b)	 	Neither the Company nor the Subsidiary have any debts or liabilities of
any nature whatsoever, fixed or variable or contingent, except as shown on Schedule
3.7(b) (except for up to $50,000 in the aggregate as to both the Company and any
Subsidiary).
	 
	 	(c)	 	Except as set forth in Schedule 3.7(c), there are no outstanding debts
owed to the Company or the Subsidiary.
	 
	 	(d)	 	Except as set forth in Schedule 3.7(d), there are no bad or doubtful
debts on the Company’s or the Subsidiary’s books at the date hereof.
	 
	 	(e)	 	Full and accurate details of all bank accounts, overdrafts, loans,
guarantees or other financial facilities outstanding or available to the Company or
the Subsidiary are contained in Schedule 3.7(e).

	 	3.8	 	Properties

	 	(a)	 	Full and accurate details of the Company’s and the Subsidiary’s
tangible properties and assets are contained in Schedule 3.8(a) to this Agreement.
The Company and the Subsidiary each has good title to, or valid leasehold interest
in,

 

13

	 	 	 	all properties and assets used in its business or owned by it, free and clear of
all Security Interests, other than as contained in Schedule 3.8(a).
	 
	 	(b)	 	Other than the shares of the Subsidiary being owned by the Company,
neither the Company nor the Subsidiary is the holder or the beneficial owner of any
share, debenture, mortgage, or security (or interest therein) in any other company
or corporation, or a member of any partnership or unincorporated association or
limited liability company.
	 
	 	(c)	 	No condemnation, environmental, zoning or other land use regulation
proceedings have been instituted or, to the best of the Company’s knowledge, are
planned to be instituted, which would materially adversely affect the use or
operation of the Company’s or the Subsidiary’s properties and assets for their
respective intended uses and purposes, or the value of such properties and assets,
and the Company has not received notice of any special assessment proceedings which
would affect such properties and assets.
	 
	 	(d)	 	All items of personal property and assets owned or leased by the
Company and the Subsidiary are in good operating condition, normal wear and tear
excepted, are reasonably fit and useable for the purposes for which they are being
used, are adequate and sufficient for the Company’s business, and conform in all
material respects with all applicable laws. The carrying value of the Company’s
assets on the Financial Statements is not overstated in accordance with generally
accepted accounting principles and practices in the U.S.A, in any material respect.

	 	3.9	 	Assumptions, Guaranties
	 
	 	 	 	The Company and the Subsidiary have not assumed, guaranteed, endorsed or otherwise
become directly or contingently liable on any indebtedness of any other person
(including, without limitation, liability by way of agreement, contingent or otherwise,
to purchase, to provide funds for payment, to supply funds to or otherwise invest in the
debtor, or otherwise to assure the creditor against loss), except for guaranties by
endorsement of negotiable instruments for deposit or collection in the ordinary course
of business.

	 	3.10	 	Taxation 

	 	(a)	 	All reports, returns or other information required to be filed by or on
behalf of the Company or the Subsidiary regarding taxes of any sort (including,
without limitation, taxes concerning income, capital gains, sales, value added,
franchise, withholding, payroll, employment, social security, severance, stamp,
property) (“Taxes”), have been filed on a timely basis with the appropriate
governmental authorities in all requisite jurisdictions and all such returns,
reports or other information were true, correct and complete in all respects;
	 
	 	(b)	 	All Taxes due and payable have been fully and timely paid;
	 
	 	(c)	 	There are no circumstances which will, whether by lapse of time or the
issue of any notice of assessment or otherwise, give rise to any dispute with any
relevant taxation authority in relation to the Company’s or the Subsidiary’s
liability or accountability for taxation under currently enacted statutes and
regulations;

 

14

	 	(d)	 	The provision for taxes of the Company as shown in the Financial
Statements is adequate for taxes due or accrued as of the respective dates thereof.
	 
	 	(e)	 	The Company and the Subsidiary have not had any tax deficiency proposed
or assessed against them and have not executed any waiver of any statute of
limitations on the assessment or collection of any tax or governmental charge.
Other than as set forth on Schedule 3.10(e), the Company and the Subsidiary have
never been audited by governmental authorities. Since the date of the Financial
Statements, the Company and the Subsidiary have not incurred any taxes, assessments
or governmental charges, other than in the ordinary course of business and the
Company and the Subsidiary have made adequate provisions for all taxes, assessments
and governmental charges with respect to their business, properties and operations
for such period.

	 	3.11	 	Capital Expenditure and Contracts

	 	(a)	 	Schedule 3.11(a) contains a true and complete list of all contracts,
agreements, instruments, leases, licenses, arrangements, or undertakings of any
nature, written or oral, of the Company and the Subsidiary which are material to
Company or the Subsidiary, including (if so deemed material) but not limited to the
following:

	 	(i)	 	any hire, hire purchase, credit sale or conditional sale
agreement or any contract providing for payment on deferred terms in respect
of assets purchased by the Company or the Subsidiary;
	 
	 	(ii)	 	any Security Interest on or over any asset of the Company
or the Subsidiary (including the issued or unissued share capital of the
Company or the Subsidiary), and any agreement or commitment to give or create
any such Security Interest;
	 
	 	(iii)	 	any guarantee, indemnity, security or other agreement
pursuant to which the Company or the Subsidiary agrees to become directly or
contingently liable for any obligation of any other person;
	 
	 	(iv)	 	any guarantee, indemnity, security or other agreement
pursuant to which any third party agrees to become directly or contingently
liable for any obligation of the Company or the Subsidiary;
	 
	 	(v)	 	any agreement, instrument or other arrangement creating any
indebtedness of the Company or the Subsidiary or Security Interest regarding
the assets of the Company or Subsidiary;
	 
	 	(vi)	 	any power of attorney given by the Company or the
Subsidiary with respect to any material asset or business of the Company or
the Subsidiary;
	 
	 	(vii)	 	any agreement, instrument or deed pursuant to which a
third party is entitled or authorised to bind or commit the Company or the
Subsidiary to any obligation;

 

15

	 	(viii)	 	any application or award of any grant or allowance which is now liable or
may in the future become liable to be repaid or which imposes any other
financial obligations on the Company or the Subsidiary;
	 
	 	(ix)	 	any contract with any director, officer, employee (other
than contracts relating to the employment of such employee, disclosed in
Schedule 3.15(a)), shareholder of the Company or any subsidiary or any
Affiliate of any of the foregoing;
	 
	 	(x)	 	any agreement restricting the competitive freedom of the
Company or the Subsidiary to provide and take goods and services by such
means and from and to such persons as it may from time to time think fit
(including any exclusive licenses made by such entities or contracts with
other entities limiting rights);
	 
	 	(xi)	 	any distributor, dealer, manufacturer’s representative or
sales agency agreement which is not terminable on less than ninety (90) days’
notice without cost or other liability to the Company or the Subsidiary;
	 
	 	(xii)	 	any agreement with any supplier containing any provision
permitting any party other than the Company or the Subsidiary to renegotiate
the price or other terms, or containing any pay-back or other similar
provision, upon the occurrence of a failure by the Company or the Subsidiary
to meet its obligations under the agreement when due or the occurrence of any
other event;
	 
	 	(xiii)	 	any agreement for the future purchase of fixed assets or for the future
purchase of materials, supplies, services or equipment in excess of its
normal operating requirements or at an excessive price;
	 
	 	(xiv)	 	any agreement for the employment of any officer, employee
or other person (whether of a legally binding nature or in the nature of
informal understandings) on a full-time, part-time or consulting basis which
is not terminable on notice without cost or other liability to the Company or
the Subsidiary;
	 
	 	(xv)	 	any bonus, pension, profit-sharing, retirement,
hospitalisation, insurance, stock purchase, stock option or other plan,
agreement or understanding pursuant to which benefits are provided to any
employee of the Company or the Subsidiary;
	 
	 	(xvi)	 	any voting trust or agreement, shareholders’ agreement,
pledge agreement, buy-sell agreement, first refusal or pre-emptive rights
agreement relating to any of the securities of the Company or the Subsidiary;
	 
	 	(xvii)	 	any acquisition, sale or lease agreement outside of the Company’s or the
Subsidiary’s ordinary course of business;
	 
	 	(xviii)	 	any partnership or joint venture agreement;

 

16

	 	(xix)	 	any agreement (A) which prohibits or requires consent for
(1) a change in control or merger of the Company or the Subsidiary, (2) the
sale of all or substantially all of the Company’s or the Subsidiary’s assets,
(3) the transfer or issuance of any securities of the Company or the
Subsidiary, or (4) the assignment, subletting or other transfer of the rights
under such agreement, or (B) which terminates, is subject to termination, is
materially and adversely affected or is subject to being materially and
adversely affected as a result of the occurrence of any event described in
subsection (A) hereof;
	 
	 	(xx)	 	any agreement, or group of related agreements with the same
party or any group of affiliated parties, under which the Company or
Subsidiary has advanced or agreed to advance money or has agreed to lease any
property as lessee or lessor;
	 
	 	(xxi)	 	any agreement or obligation (contingent or otherwise) to
issue, sell, transfer, assign or otherwise distribute or dispose of,
repurchase, redeem or otherwise acquire, or retire any shares of the
securities of the Company or the Subsidiary ;
	 
	 	(xxii)	 	any assignment, license or other agreement with respect to any form of
intangible property;
	 
	 	(xxiii)	 	any agreement under which it has granted any person any registration
rights;
	 
	 	(xxiv)	 	any agreement, or group of related agreements with the same party,
involving more than $100,000 or continuing over a period of more than six (6)
months from the date or dates thereof (including renewals or extensions
optional with another party), which agreement or group of agreements is not
terminable by the Company or the Subsidiary without penalty upon notice of
thirty (30) days or less, or any agreement not made in the ordinary course of
business;
	 
	 	(xxv)	 	any agreement with any municipal or governmental body,
department, commission, board, bureau, agency or instrumentality, domestic or
foreign; or
	 
	 	(xxvi)	 	any binding commitment or agreement to enter into any of the foregoing.

	 	 	 	(hereinafter referred to collectively as “Material Contracts”).
	 
	 	(b)	 	The Company has made available to the Investors true, correct, and
complete copies (or where oral, written descriptions) of all Material Contracts.
	 
	 	(c)	 	Except as set forth in Schedule 3.11(c), all Material Contracts are in
full force and effect. The Company and each Subsidiary (as appropriate) has
performed in all material respects all of its obligations under each Material
Contract, and, to the best of the Company’s knowledge, information and belief, all
third parties with whom the Company or the Subsidiary has transacted business have
performed in all material respects all of their obligations thereunder which were
due to have been performed. No party to a Material Contract has made a claim to
the effect

 

17

	 	 	 	that the Company or Subsidiary has failed to perform an obligation thereunder and
nor has any such party notified the Company or the Subsidiary of an intention to
terminate or not renew any such contracts.

	 	3.12	 	Material Customers and Suppliers
	 
	 	 	 	Except as set forth in Schedule 3.12, since 28 April 2005, no customer or supplier which
is material to the Company or the Subsidiary has terminated, materially reduced or
threatened to terminate or materially reduce its purchases from or provision of products
or services to the Company or the Subsidiary, as the case may be.
	 
	 	3.13	 	Litigation; Compliance

	 	(a)	 	There are no civil, criminal, arbitration or administrative proceedings
involving the Company or the Subsidiary, including claims on which, to the best
knowledge of the Company, the Company or the Subsidiary may be vicariously liable.
No such proceedings and no claims of any nature are pending or threatened by, or,
to the best knowledge of the Company, against the Company, the Subsidiary, or the
directors of the Company or the Subsidiary (in their capacity as such) or any such
person or in respect whereof the Company or the Subsidiary is liable to indemnify
any party concerned and, to the best knowledge of the Company, there are no facts
likely to give rise to any such proceedings.
	 
	 	(b)	 	Neither the Company nor the Subsidiary is in default with respect to
any order, writ, judgment, injunction or decree known to or served upon the Company
or the Subsidiary of any court or governmental body, department, commission, board,
bureau, agency or instrumentality, domestic or foreign. Except as set forth in
Schedule 3.13(b), there is no action or suit by the Company or the Subsidiary
pending, threatened or contemplated against others.
	 
	 	(c)	 	The Company and the Subsidiary have complied, in all material respects,
with all laws, rules, regulations and orders applicable to the Company or the
Subsidiary and its business, operations, properties, assets, products and services.
The Company and the Subsidiary each has all necessary permits, licenses,
registrations, franchises, approvals, exemptions and other authorisations required
to conduct its business as conducted and as proposed to be conducted and, each of
the Company and the Subsidiary has been operating its business pursuant to and in
compliance with the terms of all such permits, licenses, registrations, franchises,
approvals, exemptions and other authorisations. Such permits, licenses,
registrations, franchises, approvals, exemptions and other authorisations have been
validly issued, and the Company and the Subsidiary have complied in all material
respects with all conditions of permits, licenses, registrations, franchises,
approvals, exemptions and other authorisations applicable to them. No default or
violation, or event that with the lapse of time or giving of notice or both would
become a default or violation, has occurred in the due observance of any such
permits, licenses, registrations, franchises, approvals, exemptions and other
authorisations. All such permits, licenses, registrations, franchises, approvals,
exemptions and other authorisations are in full force and effect without further
consent or approval of any person. The Company and Subsidiary have not received
any notice from any source (i) to the effect that the Company or the Subsidiary
lack any such permits, licenses, registrations, franchises, approvals, exemptions
or other authorisations required in connection with the Company’s

 

18

	 	 	 	and the Subsidiary’s current or proposed operations or otherwise asserting a
violation of law applicable to the conduct of its business, (ii) threatening to
revoke any permit, license, registration, franchise, approval, exemption, or other
authorisation or (iii) restricting or in any way limiting its operations as
currently conducted or proposed to be conducted, in each case which has not been
previously remedied or resolved.
	 
	 	(d)	 	There is no law, regulation or order, and the Company and Subsidiary
are not aware of any proposed law, rule, regulation or order, which would prohibit
or restrict the Company or the Subsidiary from, or otherwise materially adversly
affect the Company or Subsidiary in, conducting business in any jurisdiction in
which it is now conducting business or in which it proposes to conduct business.
Neither the Company nor Subsidiary have received any notices of violation or
alleged violation of any law, rule, regulation or order by any governmental body,
department, commission, board, bureau, agency or instrumentality, domestic or
foreign.
	 
	 	(e)	 	As set forth in Schedule 3.13(e), the Company has applied for and/or
received financings or grants through the Office of the Chief Scientist, Ministry
of Industry and Trade of the State of Israel and from the Fund for the
Encouragement of Overseas Marketing Activities. The Company is in compliance, in
all material respects, with the terms and conditions of such financings and grants
and has fully fulfilled in all in all material respects all of the undertakings
relating thereto.

	 	3.14	 	Approvals 
	 
	 	 	 	Subject to the accuracy of the representations and warranties of the Investors set forth
in this Agreement, and other than as set forth in Schedule 3.14, no registration or
filing with, or consent or approval of or other action by, any federal, state or other
governmental agency or instrumentality or any third party is or will be necessary for
the Company’s valid execution, delivery and performance of this Agreement and the
Transaction Documents, the issuance, sale and delivery of the Series E2 Preferred Shares
or, upon conversion thereof, the Company’s issuance and delivery of Ordinary Shares.
Such approvals (i) have previously been obtained or made, or (ii) are required to be
made under law, and will be obtained or made, and will be effective within the time
periods required by law. The Company and the Subsidiary have complied with all
applicable securities laws in connection with the offer, issuance and sale of the Series
E2 Preferred Shares and, upon conversion thereof, the issuance and delivery of Ordinary
Shares.

	 	3.15	 	Employees

	 	(a)	 	A list of all the directors, officers, employees and consultants
(excluding consultants receiving less than $10,000 per year, lawyers and
accountants) of the Company and the Subsidiary (the “Employees”) is attached hereto
as Schedule 3.15(a)-1.
	 
	 	(b)	 	Except as set forth in Schedule 3.15 (b), no Key Employee of the
Company or Subsidiary has been dismissed in the last six months or has given notice
of termination of his employment. To the Company’s knowledge, no Key Employee and
no group of the Company’s or the Subsidiary’s employees, consultants or

 

19

	 	 	 	independent contractors has any plans to terminate their employment or
relationship as an employee, consultant or independent contractor with the
Company, nor does the Company have any present intention to terminate the
employment of any Key Employee, group of employees, consultant or independent
contractor.
	 
	 	(c)	 	The Company has made available to the Investors true and complete
copies of all employment agreements with the Key Employees, and a standard form of
an employment agreement for its other employees. No employee has signed an
employment agreement with terms materially different to the standard agreement.
	 
	 	 	 	Except for extension orders of common application to all employees in Israel, the
Company is not a party or subject to any collective bargaining agreement with any
labour union or any local or subdivision thereof. There is no current union
organising activity among any of the employees of the Company or Subsidiary or any
union representative petition pending or threatened.
	 
	 	(d)	 	Except as set forth in the Material Contracts, there are no agreements
or arrangements for the payment of any pensions, allowances, lump sums or other
like benefits on retirement or on death or termination or during periods of
sickness or disablement for the benefit of any Employee or consultant of the
Company or the Subsidiary or for the benefit of the dependants of any such person
in operation at the date hereof except for the plans detailed in Schedule
3.15(e).The Company, and the Subsidiary have fulfilled all their obligations under
the law to the Employees.
	 
	 	(e)	 	Attached as Schedule 3.15(e) is a true and complete copy of all share
or stock option plans approved by the Company and the Subsidiary, together with a
list of all options granted pursuant thereto.
	 
	 	(f)	 	The Company and the Subsidiary have withheld or collected from each
payment made to each of their employees, the amount of all taxes (including but not
limited to, Israeli income taxes) required to be withheld or collected therefrom
and has paid the same to the proper tax receiving officers or authorised
depositories.
	 
	 	(g)	 	The severance pay and accrued vacation days due to the employees is
recorded in the Company’s records, but no actual funds have been put aside for the
purpose thereof, other than with respect to the transfer of funds to manager’s
insurance policies relating to 80% of the salaries of the Company’s Israeli
employees. The Company is not aware of any circumstance whereby any employee might
demand any claim for compensation on termination of employment beyond the statutory
severance pay to which such employee is entitled or as they are entitled to under
their employment agreements with the Company, nor is the Company aware of any claim
to be made by any employee for payment of compensation arising from the purchase of
Series E2 Preferred Shares by the Investors as contemplated hereby.
	 
	 	(h)	 	Except as provided in Schedule 3.15(h), each employee has undertaken to
provide their services on a full time basis to the Company and all such employment
agreements, may be terminated upon prior notice of not more than 90 days. The
employments of each officer and employee of the Company and the

 

20

	 	 	 	Subsidiary is terminable at the will of the Company or the Subsidiary, as
applicable, subject to the payment of severance and other payments, pursuant to
law or an employment agreement.
	 	(i)	 	No Senior Executive is and the Company is not aware of any other
employee of the Company or the Subsidiary who is a party to or is otherwise bound
by any agreement or arrangement (including, without limitation, confidentiality
agreements, non-competition agreements, proprietary information and inventions
agreements, licenses, covenants or commitments of any nature), or subject to any
judgment, decree, or order of any court or governmental body, that would conflict
with the employment of such employee with the Company or the Subsidiary (as the
case may be).
	 
	 	(j)	 	Neither the Company nor the Subsidiary is delinquent in payments to any
of its employees, consultants or independent contractors for any wages, salaries,
commissions, bonuses or other direct compensation for any services performed
through the date hereof or amounts required to be reimbursed to them through the
date hereof. The Company and the Subsidiary are in material compliance with all
laws, rules and regulations respecting employment, employment practices, labour,
terms and conditions of employment and wages and hours. There is no labour strike,
dispute, slowdown or stoppage pending or, to the best knowledge of the Company,
threatened against or involving the Company or the Subsidiary.

	 	3.16	 	Insurance

	 	(a)	 	There is in full force and effect one or more policies of insurance,
insuring the Company and the Subsidiary, as specified in Schedule 3.16(a). Full and
accurate copies of the insurance policies of the Company and the Subsidiary have
been delivered to the Investors.
	 
	 	(b)	 	Neither the Company nor the Subsidiary have done or suffered anything
to be done which has rendered or might render any polices of insurance taken out by
them void or voidable or which might result in an increase in premiums and the
Company and the Subsidiary have complied with all conditions attached to such
policies.
	 
	 	(c)	 	There is no claim outstanding under any of such policies nor are there,
to the Company’s knowledge, any circumstances likely to give rise to a claim.
	 
	 	(d)	 	The Company has procured and maintains in effect a “key man” life
insurance policy for the benefit of the Company, in the amount of $2,000,000,
regarding Ronnie Kenneth.

	 	3.17	 	Intellectual Property 

	 	(a)	 	The Intellectual Property owned by the Company and the Subsidiary is
described in Schedule 3.17(a), including a full list of all Patents and Trademarks
and where appropriate indicating for each item, the applicable jurisdiction,
registration number (or application number) and date issued (or date filed).
Except as set forth in Schedule 3.17(a), all such Intellectual Property is owned
outright by the Company, free and clear of any rights of any third party, including
any Security Interests.

 

21

	 	(b)	 	Except as disclosed in Schedule 3.17(b), neither the Company nor the
Subsidiary has licensed any Intellectual Property from third parties (not including
off the shelf products acquired or licensed from third parties and not to be
incorporated in intellectual property distributed by the Company or such
Subsidiary).
	 
	 	(c)	 	Except as disclosed in Schedule 3.17(c), neither the Company nor the
Subsidiary has granted any licence of any Intellectual Property to third parties.
	 
	 	(d)	 	The Company owns or has the right to use all of the Intellectual
Property required for its business as currently conducted or as proposed to be
conducted in the Disclosure Material.
	 
	 	(e)	 	Except as disclosed in Schedule 3.17(e), neither the Company nor the
Subsidiary are obligated or under any liability whatsoever to make any payments by
way of royalties, fees or otherwise to any owner or licensee of, or other claimant
to any Intellectual Property used by the Company or the Subsidiary (other than
off-the shelf software), with respect to the use thereof or in connection with the
business of the Company and the Subsidiary or otherwise.
	 
	 	 	 	To the best knowledge and belief of the Company, the Company will be able to
obtain or acquire rights to use all of the Intellectual Property required for the
future conduct of the business as contemplated to be conducted in the Disclosure
Material.
	 
	 	 	 	There is no Intellectual Property required for the Company’s business as currently
conducted or as proposed to be conducted in the Disclosure Material, the use of
which by the Company or the Subsidiary requires or would require the payment of a
royalty to a third party.
	 
	 	(f)	 	To the Company’s best knowledge, information and belief, (i) no
Intellectual Property, used or proposed to be used in the business of the Company
or the Subsidiary as currently conducted or as proposed to be conducted in the
Disclosure Material, has infringed or infringes upon any Intellectual Property
rights of others, (ii) the use of such Intellectual Property in the business of the
Company or the Subsidiary as currently conducted or as proposed to be conducted in
the Disclosure Material, will not constitute an infringement, misappropriation or
misuse of any Intellectual Property rights of any third party, and (iii) no third
party has the right to assert any claim regarding the use of, or challenging or
questioning the Company’s or the Subsidiary’s right or title in, any of such
Intellectual Property.
	 
	 	 	 	The Company does not use, nor will be necessary to use any inventions of any of
the employees (or persons that the Company or any Subsidiary currently intends to
engage) made prior to their employment or engagement by the Company or the
Subsidiary.
	 
	 	(g)	 	The Company and Subsidiary have taken all necessary measures, including
measures against unauthorised disclosure, to protect the secrecy, confidentiality
and value of their Intellectual Property.

 

22

	 	(h)	 	All Intellectual Property that has been developed or is currently being
developed on behalf of the Company or Subsidiary by any employee or other third
party shall be the sole property of the Company or the Subsidiary.
	 
	 	 	 	Each employee, independent contractor and consultant is bound by a Non Disclosure
and Proprietary Information and Inventions Agreement, in the form made available
to the Investors, regarding, among other things, confidentiality, transfer of
rights to the Company and, with respect to employees, non-competition, all as set
forth in the documents made available to the Investors.

	 	3.18	 	Environmental and Safety Laws
	 
	 	 	 	The Company and the Subsidiary are not in violation of any applicable laws relating to
the environment or occupational health and safety which is likely to result in a
material adverse change and no material expenditures are or will be required in order to
comply with any such existing laws.
	 
	 	3.19	 	Transactions With Interested Parties
	 
	 	 	 	Except as set forth in Schedule 3.19 no director, officer, employee or shareholder of
the Company, the Subsidiary, or Affiliate thereof, is a party to any transaction with
the Company or the Subsidiary, including any contract, agreement or other arrangement
providing for the employment of, furnishing of services by, rental of real or personal
property from or otherwise requiring payments to any such person, other than
employment-at-will or consulting-at-will arrangements in the ordinary course of
business. To the Company’s knowledge, none of such persons has any direct or indirect
ownership interest in any person with which the Company or the Subsidiary is affiliated
or with which the Company or the Subsidiary has a business relationship, or any person
that competes with the Company or the Subsidiary.
	 
	 	 	 	Notwithstanding the foregoing, the Company has signed an indemnity agreement with each
of the directors of the Company, and obtained customary directors’ and officers’
insurance policy in an amount not less than $10.0 million for all the directors
including any director nominated by the Investors, in forms acceptable to the Investors.
	 
	 	3.20	 	Offering of the Series E2 Preferred Shares 
	 
	 	 	 	Neither the Company, the Subsidiary nor any person authorised or employed by the Company
or the Subsidiary as agent, broker, dealer or otherwise in connection with the offering
or sale of the Series E2 Preferred Shares has offered the Series E2 Preferred Shares for
sale to, or solicited any offer to buy the Series E2 Preferred Shares, or otherwise
approached or negotiated with respect thereto with, any person or persons other than the
Investors. Neither the Company, the Subsidiary nor any person acting on its behalf has
taken or will take any other action (including, without limitation, any offer, issuance
or sale of any security of the Company under circumstances which might require the
integration of such security with the Series E2 Preferred Shares under the Securities
Act or the rules and regulations of the Commission promulgated thereunder), in either
case so as to subject the offering, issuance or sale of the Series E2 Preferred Shares
to the registration provisions of the Securities Act. Neither the Company, the
Subsidiary nor any person acting on its behalf has offered the Series E2 Preferred
Shares to any person by means of general or public solicitation or general or public

 

23

	 	 	 	advertising, such as by newspaper or magazine advertisements, by broadcast media, or at
any seminar or meeting whose attendees were solicited by such means.
	 
	 	3.21	 	Brokers and Finders
	 
	 	 	 	Neither the Company, nor any of its Employees, shareholders or the Subsidiary, has
employed or made any agreement with any broker, finder or similar agent or any person or
firm, which will result in the obligation of the Company or any of the Investors to pay
any finder’s fee, brokerage fees or commission or similar payment in connection with the
transactions contemplated hereby.
	 
	 	3.22	 	Full Disclosure
	 
	 	 	 	Neither this Agreement nor any certificates made or delivered by the Company in
connection herewith contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements herein or therein not misleading, in view
of the circumstances in which they were made.

	4.	 	REPRESENTATIONS AND WARRANTIES OF THE INVESTORS
	 
	 	 	Each Investor, severally and not jointly, represents and warrants:

	 	4.1	 	Authorisation
	 
	 	 	 	All actions on the part of the Investor necessary for the authorisation, execution,
delivery, and performance by it of this Agreement have been duly taken and this
Agreement constitutes the legal, valid, and binding obligation of the Investor,
enforceable as to the Investor in accordance with its terms. The execution, delivery
and performance of this Agreement do not violate the Investor’s Organisational Documents
or any previous agreement of the Investor.
	 
	 	4.2	 	Brokers
	 
	 	 	 	The Investor has not made any agreement with any broker, finder or similar agent or any
person or firm, which will result in the obligation of the Company to pay any finder’s
fee, brokerage fees or commission or similar payment in connection with the transactions
contemplated hereby.
	 
	 	4.3	 	Investment
	 
	 	 	 	The Investor is acquiring the Series E2 Preferred Shares for investment for its own
account, not as a nominee or agent, and not with the view to, or for resale in
connection with, any distribution thereof. The Investor understands that the Series E2
Preferred Shares to be purchased hereby have not been, and will not be, registered under
the Securities Act by reason of a specific exemption from the registration provisions of
the Securities Act, the availability of which depends upon, among other things, the bona
fide nature of the investment intent and the accuracy of the Investors’ representations
as expressed herein.
	 
	 	4.4	 	Restricted Securities

 

24

	 	 	 	The Investor understands that the Series E2 Preferred Shares (and any Ordinary Shares
issued on conversion thereof) may not be sold, transferred, or otherwise disposed of
without registration under the Securities Act or an exemption therefrom, and that in the
absence of an effective registration statement covering the Series E2 Preferred Shares
(or the Ordinary Shares issued on conversion thereof) or an available exemption from
registration under the Securities Act, the Series E2 Preferred Shares (and any Ordinary
Shares issued on conversion thereof) may have to be held indefinitely. In particular,
the Investor is aware that the Series E2 Preferred Shares (and any Ordinary Shares
issued on conversion thereof) may not be sold pursuant to Rule 144 promulgated under the
Securities Act unless the conditions of that Rule are met.
	 
	 	4.5	 	Accredited Investor 
	 
	 	 	 	Such Investor is an Accredited Investor as defined in Rule 501 of Regulation D under the
Securities Act.

	5.	 	INDEMNIFICATION AND REMEDIES

	 	5.1	 	The Company agrees, to protect, defend, indemnify, and hold the Investors harmless
against and in respect of any and all loss, liability, deficiency, damage, cost, or
expense or actions in respect thereof (including reasonable legal fees and expenses)
(“Damages”) as and when incurred, occasioned by (i) any breach of this Agreement, or (ii)
any falsity of any of the representations and warranties of the Company contained in this
Agreement. Each such representation and warranty is deemed to be made on the date of this
Agreement and shall survive the Closing for a period up to the date one month after the
publication of the Company’s audited financial statements for the year ending
31st December 2008. It is hereby clarified that notwithstanding the forgoing,
the representations made in Sections 3.1, 3.2, 3.3, 3.4, 3.10 and 3.17 above, shall
survive for a period of seven (7) years from the Closing.
	 
	 	5.2	 	Indemnity Procedure
	 
	 	 	 	Promptly after (i) receipt by any Investor of notice of the commencement of any action,
proceeding, or investigation; or (ii) becoming aware of any breach of this Agreement or
falsity of representation, in each case, in respect of which indemnity may be sought as
provided above, such Investor shall notify the party from whom indemnification is
claimed (the “Indemnitor”). The Indemnitor shall promptly assume the defence of the
Investor with counsel reasonably satisfactory to the Investor, and the fees and expenses
of such counsel shall be at the sole cost and expense of the Indemnitor. The Investor
will cooperate with the Indemnitor in the defence of any action, proceeding, or
investigation for which the Indemnitor assumes the defence. The Indemnitor shall not be
liable for the settlement by the Investor of any action, proceeding, or investigation
effected without its consent, which consent shall not be unreasonably withheld. The
Indemnitor shall not enter into any settlement in any action, suit, or proceeding to
which any Investor is a party, unless such settlement includes a general release of the
Investor with no payment by the Investor of consideration and without an admission of
liability.
	 
	 	5.3	 	Subject to the other provisions of this Section 5, the Investors shall be entitled,
in addition, to any other non-pecuniary remedy provided by law or equity, and injunctive
relief may be obtained to enjoin the breach, or threatened breach, of any provision of
this Agreement, and each party shall be entitled to the specific performance by the other
of its obligations hereunder and thereunder.

 

25

	 	5.4	 	The Investors’ rights of indemnification under this Section 6 shall not be affected
by any examination made for or on behalf of the Investors or the knowledge of any of the
Investors’ officers, directors, employees or agents.
	 
	 	5.5	 	No claims shall be asserted by any Investor, unless the amount claimed is in excess
of $25,000 (twenty five thousand U.S. Dollars), and under no circumstances shall any
Investor be entitled to compensation or damages in an amount greater than the aggregate
amount paid by such Investor for the shares issued to it as set forth in Schedule 2.1,
plus an amount of 8% (eight percent) per year from the date of payment by such Investor
until the date of actual reimbursement by the Company.

	6.	 	MISCELLANEOUS

	 	6.1	 	Communications
	 
	 	 	 	All notices or other communications hereunder shall be in writing and shall be given in
person, by registered mail (registered international air mail if mailed
internationally), by an overnight courier service which obtains a receipt to evidence
delivery, or by facsimile transmission (provided that written confirmation of receipt is
provided) with a copy by mail, addressed as set forth below:

	 	 	 
	If to the Company:

	 	Voltaire Ltd.

9 Hamenofim Street, Building A 

Herzelia 

ISRAEL 

Fax: 972-9-971-7660
	 
	 	 
	 

	 	Attn: CEO
	 
	 	 
	with a copy to:

	 	Ori Rosen & Co. 

Azrieli Centre 

Round Building 

Tel Aviv 67021

Israel 4701
	 
	 	 
	 

	 	Attn: Ori Rosen, Adv.
	 
	 	 
	If to Investors

	 	BCF II Belgium Holding SPRL 

Avenue Louise 331-333

1050 Brussels 

BELGIUM 

Fax: 32-2-642-86-50

Attn: Robert Kimmels and Caroline 
Hoogsteyns 

with copies to:
	 

	 	Baker Capital Corp. 

540 Madison Avenue 

New York,

 

26

	 	 	 
	 

	 	New York 10022

USA

Fax: 1-212-486-6686
	 
	 	 
	 

	 	Attn: Ashley Leeds and Joseph Saviano
	 
	 	 
	 

	 	and:
	 

	 	Herzog, Fox & Neeman

4 Weizmann Street,

Asia House

Tel-Aviv 64239

ISRAEL

Fax: 972-3-696-6464
	 
	 	 
	 

	 	Attn: Gil White
	 
	 	 
	 

	 	and:
	 

	 	Akin, Gump, Strauss Hauer & Feld, L.L.P. 

590 Madison Avenue 

New York, New York 10022

Fax: 212 872 1002
	 
	 	 
	 

	 	Attn: Stephen E. Older
	 
	 	 
	And:

	 	Pitango 

11 HaMenofim St., Eastern Tower 

Herzliya 46725, Israel
	 
	 	 
	 

	 	Fax: +972-9-971-8102

Attn: General Counsel
	 
	 	 
	And:

	 	To the other addresses set forth in Schedule 6.1.

	 	 	 	or such other address as any party may designate to the other in accordance with the
aforesaid procedure. All communications delivered in person or by courier service shall
be deemed to have been given upon delivery, those given by facsimile transmission shall
be deemed given on the business day following transmission with confirmed answer back,
and all notices and other communications sent by registered mail (or air mail if the
posting is international) shall be deemed given ten (10) days after posting.
	 
	 	6.2	 	Successors and Assigns
	 
	 	 	 	The Company shall not sell, assign, transfer, or otherwise convey any of its rights or
delegate any of its duties under this Agreement. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the parties and their respective
successors and assigns.
	 
	 	6.3	 	Expenses 
	 
	 	 	 	At the Closing, the Company will reimburse the Investors for all out-of-pocket
expenses, including all attorneys’ fees and disbursements, incurred in connection with

 

27

	 	 	 	the purchase of the Series E2 Preferred Shares hereunder, including legal fees, up to a
total of $25,000, plus VAT, if applicable, and disbursements against receipt of tax
invoices. The Investors shall be entitled, at their choice, to withhold all or part of
the amount of such out-of-pocket expenses from the Purchase Price, provided that they
shall thereafter supply invoices to the Company evidencing such expenses.
	 
	 	 	 	The Company shall be responsible for costs in connection with (a) all Transaction
Documents signed by it or actions taken by it relating to the transactions contemplated
by this Agreement (or any other documents and actions if approved in advance by the
Company for purpose of this Section 6.3), and (b) all stamp duty payable in respect of
this Agreement or the issuance of shares as contemplated hereby.
	 
	 	6.4	 	Delays or Omissions; Waiver
	 
	 	 	 	No delay or omission to exercise any right, power, or remedy accruing to any party
hereto upon any breach or default by the other under this Agreement shall impair any
such right or remedy nor shall it be construed to be a waiver of any such breach or
default, or any acquiescence therein or in any similar breach or default thereafter
occurring.
	 
	 	6.5	 	Entire Agreement; Amendment
	 
	 	 	 	This Agreement (together with the recitals, schedules, appendices, annexes and exhibits
hereto attached hereto) contains the entire understanding of the parties with respect to
its subject matter and all prior negotiations, discussions, commitments, and
understandings heretofore had between them with respect thereto are merged herein. This
Agreement may be amended or modified only by a written document signed by the Company
and Investors holding at least a majority of the Series E2 Preferred Shares issued
pursuant to this Agreement, including each of Belco, Vertex and Pitango.
	 
	 	6.6	 	Preemptive Rights.
	 
	 	 	 	Each of the Investors, by executing and delivering this Agreement, hereby waives any and
all rights pursuant to any agreement, arrangement or other instrument to subscribe for
any securities of the Company issued pursuant to the Board of Directors resolutions set
forth on Schedule 2.2.1(b)(ii), other than the number of Series E2 Preferred Shares set
forth opposite such Investor’s name on Schedule 2.1 hereof.
	 
	 	6.7	 	Counterparts, Facsimile Signatures
	 
	 	 	 	This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same
instrument. A signed Agreement received by a party hereto via facsimile will be deemed
an original, and binding upon the party who signed it.
	 
	 	6.8	 	Several Obligations
	 
	 	 	 	The obligations of the Investors under this Agreement and the Transaction Documents are
several and not joint. The failure of any Principal Investor to carry out its
obligations under this Agreement or the Transaction Documents or of this Agreement and
the Transaction Documents to be duly authorised, executed and delivered by any Principal
Investor shall relieve any of the other Principal Investors of their obligations

 

28

	 	 	 	under this Agreement or the Transaction Documents (or affect the rights under this
Agreement or the Transaction Documents of such other Principal Investor). No Investor
shall be responsible for the obligations of, or any action taken or omitted by, any
other Investor under this Agreement or under the Transaction Documents.
	 
	 	6.9	 	Governing Law 
	 
	 	 	 	The Agreement shall be governed by and construed in accordance with the laws of the
State of Israel, without giving effect to the rules respecting conflict of law. The
competent courts of Tel Aviv-Jaffa shall have exclusive jurisdiction to hear all
disputes arising in connection with this Agreement.
	 
	 	6.10	 	Further Actions
	 
	 	 	 	At any time and from time to time, each party agrees, without further consideration, to
take such actions and to execute and deliver such documents as may be reasonably
necessary to effectuate the purposes of this Agreement.
	 
	 	6.11	 	Force Majeure
	 
	 	 	 	No party shall be liable to any other party for non-performance or delay in performance
of any of its obligations under this Agreement due to causes beyond its reasonable
control, including, but not limited to, fire, strike, hostilities (whether or not
declared war), riot, insurrection, civil commotion or unavoidable accident.

[rest of this page intentionally left blank]

 

29

[First Signature Page of Voltaire Round E2 Share Purchase Agreement]

	 	 	 
	Voltaire Ltd.
	 	BCF II Belgium Holding SPRL
	 
	 	 
	By: /s/ Ronnie Kenneth

	 	By: /s/ Ashley Leeds
	 

	 	 

	Name: RONNIE KENNETH

	 	Name: ASHLEY LEEDS
	Title: CEO

	 	Title: Manager
	 
	 	 
	 	 	 
	 	 	 
	 	 	By: /s/ Joseph Saviano
	 	 	 

	 	 	Name: Joseph Saviano
	 	 	Title: Manager
	 
	 	 
	Tamir Fishman Ventures II (Israeli) LP

	 	Tamir Fishman Ventures II CEO Fund LP
	 
	 	 
	By: /s/ Michael Elias

	 	By: /s/ Michael Elias
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Tamir Fishman Ventures II LP

	 	Tamir Fishman Ventures II CEO Fund (US) LP
	 
	By: /s/ Michael Elias

	 	By: /s/ Michael Elias
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Tamir Fishman Ventures II (Cayman Islands) LP

	 	Tamir Fishman Venture Capital II Ltd.
	 
	By: /s/ Michael Elias

	 	By: /s/ Michael Elias
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Pitango Venture Capital Fund III
(Israeli Sub) L.P.

	 	Pitango Principals Fund III (Israel) LP
	 
	By: /s/ Chemi Peres

	 	By: /s/ Chemi Peres
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Pitango Fund II Opportunity Annex Fund LP

	 	Pitango Fund II Opportunity Annex Fund
(ICA) LP
	 
	By: /s/ Chemi Peres

	 	By: /s/ Chemi Peres
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Pitango II Holdings LLC

	 	Pitango Fund II (Tax Exempt Investors) LLC
	 
	By: /s/ Chemi Peres

	 	By: /s/ Chemi Peres
	 

	 	 

	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	D Partners (Israel) Limited Partners

	 	D Partners (BVI) LP
	 
	By: /s/ Aharon Dovrat /s/ Eylon Penchas

	 	By: /s/ Aharon Dovrat /s/ Eylon Penchas
	 

	 	 

	Name: Aharon Dovrat Eylon Penchas

	 	Name: Aharon Dovrat Eylon Penchas
	Title: Directors

	 	Title: Directors

 

30

[Second Signature Page of Voltaire Round E2 Share Purchase Agreement]

	 	 	 
	 
	 	 
	Vertex Israel II (C.I.) Fund L.P.

	 	Platinum Venture Capital Ltd.
	 
	 	 
	By: /s/ Illegible

	 	By: /s/ Illegible on behalf of Dr. Shuki Gleitman
	 

	 	 
	Name:

	 	Name: Dr. Shuki Gleitman
	Title:

	 	Title: Managing Partner
	 
	 	 
	Danbar Tech 2001 LP

	 	Shrem Fudim Kelner Technologies Ltd.
	 
	 	 
	By: /s/ Illegible

	 	By: /s/ Illegible
	 

	 	 
	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	Shrem, Fudim, Kelner & Co. Ltd.

	 	SFK wing 1, LP
	 
	 	 
	By: /s/ Illegible

	 	By: /s/ Illegible
	 

	 	 
	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	SFK Wing 2, LP

	 	Shrem Fudim Kelner — Trust Co. Ltd
	 
	 	 
	By: /s/ Illegible

	 	By: /s/ Illegible
	 

	 	 
	Name:

	 	Name:
	Title:

	 	Title:
	 
	 	 
	The Challenge Fund-Etgar II LP

	 	Argos Capital Appreciation Master Fund, LP
	 
	 	 
	By: /s/ J. Ciechanover

	 	By: /s/ Ephraim Gildor
	 

	 	 
	Name:

	 	Name: Ephraim Gildor
	Title:

	 	Title:
	 
	 	 
	Neurone Ventures II Investment
(Israel) Ltd. & Neurone II
Investment GP. Ltd., as joint
trustees on behalf of certain
Neurone Ventures II capital funds

	 	NV II (Side Fund), L.P.
	 
	 	 
	By: /s/ Ami Dotan

	 	By: /s/ Ami Dotan
	 

	 	 
	Name: AMI DOTAN

	 	Name: AMI DOTAN
	Title: G.P.

	 	Title: G.P.
	 
	 	 
	PRB Family Partners, LLP

	 	Giora Bitan
	 
	By: /s/ Paul R. Bonderson, Jr.

	 	/s/ Giora Bitan
	 

	 	 
	Name: Paul R. Bonderson, Jr.

	 	Name: GIORA BITAN
	Title: Manager

	 	Title:

 

31

Schedule 6.1

	 	 	 
	Name of Other Investor	 	Address
	Platinum Venture Capital Ltd.
	 	21 Haarba’a Street
	Danbar Tech 2001 LP
	 	Tel Aviv
	Shrem Fudim Kelner — Trust Co. Ltd.
	 	Israel
	Shrem Fudim Kelner Technologies Ltd.

	 	Fax: 972-3-6869535
	SFK Wing 1, L.P.

	 	 
	SFK Wing 2, L.P.

	 	 
	Shrem, Fudim, Kelner & Co. Ltd.

	 	 
	 
	 	 
	Tamir Fishman Ventures II (Israeli) LP
	 	46 Rothschild Avenue
	Tamir Fishman Ventures II CEO Fund LP
	 	Tel Aviv 66883
	Tamir Fishman Ventures II LP

	 	Israel
	Tamir Fishman Ventures II CEO Fund (US) LP

	 	Fax: 972-3-5663389
	Tamir Fishman Ventures II (Cayman Islands) LP

	 	 
	Tamir Fishman Venture Capital II Ltd.

	 	 
	 
	 	 
	The Challenge Fund-Etgar II LP

	 	20 Lincoln Street
	 

	 	Robinshtein House, 20th floor
	 

	 	Tel Aviv
	 	 	Fax: 972-3-5621999
	 
	 	 
	Pitango Venture Capital Fund III (Israeli Sub) L.P.
	 	11 HaMenofim Street
	Pitango Principals Fund III (Israel) LP

	 	Eastern Tower
	Pitango Fund II Opportunity Annex Fund, L.P

	 	Herzliya 46725
	Pitango Fund II Opportunity Annex Fund (ICA), L.P.

	 	Israel
	Pitango II Holdings LLC

	 	Fax: 972-9-9718102
	Pitango Fund II (Tax Exempt Investors) LLC

	 	 
	 
	 	 
	Vertex Israel II (C.I.) Fund L.P.

	 	1 Ha’Shikma Street,
	 

	 	POB 89, Savyon, Israel 56530
	 

	 	Israel
	 	 	Fax: 972-3-7378889
	 
	 	 
	Argos Capital Appreciation Master
Fund, LP	 	1290 Avenue of the Americas
	 

	 	34th floor
	 

	 	New-York, NY, 10104
	 	 	USA
	 
	 	 
	Neurone Ventures II Investment (Israel) Ltd. &

	 	Neurone Ventures II L.P
	Neurone II Investment GP. Ltd., as joint trustees

	 	3 Gav Yam Blgd. 3rd Fl.
	on behalf of certain Neurone Ventures II capital

	 	7 Shenkar St.
	funds

	 	Herzelia Pituach 46766
	NV II (Side Fund), L.P.

	 	+972 9-972-8636
	 
	 	 
	PRB Family Partners, LP

	 	8121 Alpha Lane, Sunol, California 94586
	 
	 	 
	Giora Bitan

	 	32 Yonatan St.,
	 	 	Tel Aviv, Israel
	 
	 	 
	D Partners (BVI) L.P.

	 	16 HaGalim Boulevard
	D Partners (Israel) Limited Partners

	 	Beit Delta
	 	 	P.O. Box 2037
	 	 	Herzelia Pituach 46120EX-10.4

 

Exhibit 10.4

AMENDED AND RESTATED SHAREHOLDERS’ RIGHTS AGREEMENT

THIS AMENDED AND RESTATED SHAREHOLDERS’ RIGHTS AGREEMENT (this “Agreement”) made as of July 1,
2007, by and among

	 	1.	 	Voltaire Ltd., a company organized under the laws of the State of Israel (the
“Company”); and
	 
	 	2.	 	Those shareholders and the warrant holder of the Company listed in Exhibit A hereto.

WHEREAS, the shareholders of the Company are parties to an amended and restated Shareholders’
Rights Agreement, dated February 1, 2007(the “Prior Agreement”); and

WHEREAS, the Company is contemplating a public offering of its shares in the United States pursuant
to a registration statement to be filed with the SEC (as defined below) (the “Offering”) and in
connection with the Offering, subject to the closing of the Offering, the parties desire to amend
and restate the Prior Agreement and to set forth herein provisions governing the registration of
the securities of the Company and certain other matters involving the rights of the shareholders.

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties
hereby agree that the Prior Agreement shall be amended and restated in its entirety, effective
immediately as of and contingent upon and conditioned on the closing of the Offering (the
“Effective Date”), provided that such closing occurs no later than August 15, 2007 (the
“Termination Date”), as follows:

	1.	 	DEFINITIONS

	 	1.1	 	As used herein, the following terms have the following meanings:

	 	 	 
	“Affiliate”

	 	with respect to any Person:
	 
	 	 
	 

	 	(i) any other Person of which securities or
other ownership interests representing more
than fifty percent (50%) of the voting interest
are, at the time such determination is being
made, owned, Controlled or held, directly or
indirectly, by such Person; or

	 
	 	 
	 

	 	(ii) any other Person which, at the time such
determination is being made, is Controlling,
Controlled by or under common Control with,
such Person.

	 
	 	 
	 

	 	As used herein, “Control,” whether used as a
noun or verb, refers to the possession,
directly or indirectly, of the power to direct,
or cause the direction of, the management or
policies of a Person, whether through the
ownership of voting securities or otherwise.

 

-2-

	 	 	 
	“Articles”

	 	the Company’s Articles of Association, as may
be amended from time to time in accordance with
their terms.
	 
	 	 
	“Belco”

	 	shall mean BCF II Belgium Holding SPRL or any
Permitted Transferee of Belco following the
transfer of Belco’s holdings in the Company to
such Permitted Transferee.
	 
	 	 
	“Exchange Act”

	 	the United States Securities Exchange Act of
1934, as amended.
	 
	 	 
	“Form F-3”

	 	Form F-3 under the Securities Act, as in effect
on the date hereof or any registration form
under the Securities Act subsequently adopted
by SEC which permits inclusion or incorporation
of substantial information by reference to
other documents filed by the Company with the
SEC.
	 
	 	 
	“Holder”

	 	any holder of outstanding Registrable Shares.
	 
	 	 
	“Initiating Holders”

	 	the Principal Investors.
	 
	 	 
	“IPO”

	 	the closing of a bona fide initial public
offering of the Company’s Ordinary Shares on a
recognised securities exchange, under the
Securities Act, as amended, the Israeli
Securities Law, 1968, or similar securities
laws of another jurisdiction.
	 
	 	 
	“Ordinary Shares”

	 	ordinary shares of the Company, par value NIS
0.01 each, as such par value may be adjusted
from time to time for any stock split, stock
combination or the like.
	 
	 	 
	“Permitted Transferee”

	 	(A) with respect to an individual, any parent,
spouse or lineal descendant of such individual
or a company or other entity fully owned or
controlled by him;
	 
	 	 
	 

	 	(B) with respect to an entity shareholder:
	 
	 	 
	 

	 	(i) if such Shareholder is a corporation or
company, any entity which controls, is
controlled by or is under common control with,
such entity Shareholder; and

	 
	 	 
	 

	 	(ii) if such shareholder is a general or
limited partnership, or if it is an entity
which, directly or indirectly has holdings in a
general partnership,

 

-3-

	 	 	 
	 

	 	(a) any of its limited partners or general
partners;

	 
	 	 
	 

	 	(b) any affiliated partnership managed by the
same management company or managing or general
partner of such Shareholder;

	 
	 	 
	 

	 	(c) any corporation or company, the members of
such corporation or company and affiliated
corporations or companies managed by the same
management company or managing general partner
of such shareholder or by any entity which
controls, is controlled by, or is under common
control with, such management company or
managing or general partner;

	 
	 	 
	 

	 	(d) any entity which controls, is controlled
by, or is under common control with any
management company or managing or general
partner of a shareholder (“Current Managing
Entities”) and/or any other management company
or managing or general partner which may be
established by substantially the same persons
or entities who established any of the Current
Managing Entities;

	 
	 	 
	 

	 	(e) with respect to any of the Persons included
in the definition of “Pitango” or any Person
who is a Permitted Transferee from Pitango —
in addition to the Permitted Transferees listed
in (A) and (B)(i) and B(ii)(a) through (d)
above, also any of the following: (i) any other
Person included in the definition of “Pitango”,
any funds and accounts controlled or managed by
any of the Persons includied in the definition
of “Pitango”, and Virgotech Ltd.; and (ii) any
Affiliate of such transferor, (iii) any direct
or indirect general or limited partner, member,
officer, stockholder, beneficiary, heir or

 

-4-

	 	 	 
	 

	 	legatee of such transferor and (iv) any trust
the beneficiaries of which, any corporation the
stockholders of which, any partnership the
partners of which, or any limited liability
company, the members of which, include Persons
described in (i), (ii) or (iii) above;

	 
	 	 
	 

	 	(f) with respect to Belco or any Person who is
a Permitted Transferee from Belco: (i) any
Affiliate of Belco or such Person, (ii) any
direct or indirect general or limited partner,
member, officer, stockholder, beneficiary, heir
or legatee of Belco or such Person and (iii)
any trust the beneficiaries of which, any
corporation the stockholders of which, any
partnership the partners of which, or any
limited liability company, the members of
which, include Persons described in (i) or (ii)
above;

	 
	 	 
	 

	 	(g) with respect to Vertex or any Person who is
a Permitted Transferee from Vertex: (i) any
Affiliate of Vertex or such Person, (ii) any
direct or indirect general or limited partner,
member, officer, stockholder, beneficiary, heir
or legatee of Vertex or such Person and (iii)
any trust the beneficiaries of which, any
corporation the stockholders of which, any
partnership the partners of which, or any
limited liability company, the members of
which, include Persons described in (i) or (ii)
above; and

	 
	 	 
	 

	 	(h) with respect to Lighthouse Capital Partners
V (Israel) L.L.C, (“Lighthouse”)— in addition
to the Permitted Transferees listed in (A) and
(B)(i) and B(ii)(a) through (d) above, also
Magnolia Capital Partners, Inc. and any
Permitted Transferee of Magnolia Capital
Partners, Inc.

 

-5-

	 	 	 
	“Person”

	 	shall mean an individual, corporation, trust,
partnership, limited liability company, joint
venture, unincorporated organisation,
government body or any agency or political
subdivision thereof, or any other entity.
	 
	 	 
	Pitango

	 	Shall mean D.S. Pitango Trust Company (Foreign
Residents) (1997) Ltd., Pitango Fund II (Tax
Exempt Investors), LLC, Pitango Fund II LLC,
Pitango Fund II LP, Pitango Venture Capital
Management (Israel) Ltd., Pitango Venture
Capital Management (U.S.A.) LLC, Pitango
Venture Capital Fund III (Israeli Sub) LP,
Pitango Venture Capital Fund III (Israeli Sub)
Non-Q LP, Pitango Venture Capital Fund III
(Israeli Investors) LP, Pitango Venture Capital
Fund III Trusts 2000 Ltd., Pitango Fund II
Opportunity Annex Fund L.P., Pitango Fund II
Opportunity Annex Fund (ICA), L.P., Pitango
Holdings II LLC, Pitango Principals Fund III
(Israel) LP and DS Polaris Ltd. (each, a
“Pitango Fund”) and any Permitted Transferee of
any Pitango entity following the transfer of
such Pitango entity’s holdings in the Company
to such Permitted Transferee.
	 
	 	 
	“Preferred Shares”

	 	all Series C Shares, Series D Shares, Series D2
Shares, Series E Shares and Series E2 Shares.
	 
	 	 
	“Preferred Holder”

	 	any holder of outstanding Preferred Shares.
	 
	 	 
	“Principal Investors”

	 	Belco acting together with one of Vertex or
Pitango.

	 
	 	 
	“Register”, “registered”
and “registration”

	 	 refer to a registration effected by filing a
registration statement in compliance with the
Securities Act and the declaration or ordering
by the SEC of effectiveness of such registration statement, or the equivalent
actions under the laws of another jurisdiction.
	 
	 	 
	“Registrable Shares”

	 	means (i) Ordinary Shares issuable upon
conversion of any Preferred Shares; and (ii)
any Ordinary Shares issued as a dividend, bonus
share or other distribution with respect to, or
in exchange for or in replacement of, such
Ordinary Shares, but excluding any shares (a)
for which registration rights have terminated
pursuant to Section 15.2 of this Agreement, (b)
which have previously been registered or (c)
transferred in a transaction, in which the
rights under this Agreement are not

 

-6-

	 	 	 
	 

	 	assigned in accordance herewith.
	 
	 	 
	“SEC”

	 	the Securities and Exchange Commission of the
United States.
	 
	 	 
	“Securities Act”

	 	the United States Securities Act of 1933, as
amended.
	 
	 	 
	“Series C Shares”

	 	Ordinary Shares of par value NIS 0.01, issued
upon conversion of Series C Preferred Shares of
the Company, and all Ordinary Shares issued by
the Company in respect of such shares,
including without limitation bonus shares.
	 
	 	 
	“Series D Shares”

	 	Ordinary Shares issued upon conversion of
Series D Preferred Shares of the Company, and
all Ordinary Shares issued by the Company in
respect of such shares, including without
limitation bonus shares.
	 
	 	 
	“Series D2 Shares”

	 	Ordinary Shares issued upon conversion of
Series D2 Preferred Shares of the Company, and
all Ordinary Shares issued by the Company in
respect of such shares, including without
limitation bonus shares.
	 
	 	 
	“Series E Shares”

	 	Ordinary Shares issued upon conversion of
Series E Preferred Shares of the Company or
warrants to purchase Series E Preferred Shares
of the Company, and all Ordinary Shares issued
by the Company in respect of such shares,
including without limitation bonus shares.
	 
	 	 
	“Series E2 Shares”

	 	Ordinary Shares issued upon conversion of
Series E2 Preferred Shares of the Company, and
all Ordinary Shares issued by the Company in
respect of such shares, including without
limitation bonus shares.
	 
	 	 
	“Vertex”

	 	Shall mean Vertex Israel II (C.I.) Fund L.P.,
Vertex Israel II (A) Fund L.P., Vertex Israel
II (B) Fund L.P., Vertex Israel II Discount
Fund L.P. and Vertex Israel II (C.I.) Executive
Fund L.P. (each, a “Vertex Fund”) or any
Permitted Transferee of any Vertex Fund
following the transfer of such Vertex Fund’s
holdings in the Company to such Permitted
Transferee.

	 	1.2	 	Words and defined terms denoting the singular number include the plural and vice
versa and the use of any gender shall be applicable to all genders.

 

 

-7-

	 	1.3	 	The paragraph headings are for the sake of convenience only and shall not affect the
interpretation of this Agreement.
	 
	 	1.4	 	The recitals, schedules, appendices, annexes and exhibits hereto form an integral
part of this Agreement.

	2.	 	DEMAND REGISTRATION

	 	2.1	 	At any time following the closing of the Company’s IPO, the Initiating Holders may
request in writing (such request in writing, a “Demand”) that all or part of the Series
E2 Shares or Series E Shares held by the Initiating Holders shall be registered for
trading on the securities exchange on which the securities of the Company were offered in
the IPO, or otherwise under the Securities Act (“Demand Registration”). Within 20 days
after receipt of any Demand, the Company shall give written notice of such Demand to the
other Holders, and shall include in such registration all Registrable Shares held by all
such Holders who wish to participate in such Demand Registration and who provide the
Company with written requests (each a “Demand”) for inclusion therein within 15 days
after the receipt of the Company’s notice. Thereupon, the Company shall use its best
efforts to effect the registration of all Registrable Shares as to which it has received
Demands from the Initiating Holders and the other Holders. The Company shall not be
required to effect more than two Demand Registrations under this Section 2.1 at the
request of the Initiating Holders.

	 	2.2     (a)	 	Subject to and in addition to the above Section 2.1, at any time following a
Demand made by the Initiating Holders pursuant to Section 2.1 hereof the Holders holding
a majority of the Series D Shares may require the Company to make a Demand Registration.
The holders of Series D Shares that are Registrable Shares may make up to two (2)
Demands, provided that the Company shall not be required to effect a Demand Registration
within 180 days, from the effective date of a prior Demand, F-3 Registration or Company
Registration (each as defined below) or the IPO.

	 	(b)	 	Subject to and in addition to the above Section 2.1 and 2.2(a), at any
time following one (1) Demand made by each of the Initiating Holders pursuant to
Section 2.1 hereof and the Holders of Series D Shares pursuant to Section 2.2(a)
hereof, the Holders holding a majority of the Series C Shares may require the
Company to make a Demand Registration. The holders of Series C Shares may make up
to two (2) Demands, provided that the Company shall not be required to effect a
Demand Registration (i) unless the aggregate anticipated offering price of the
Registrable Shares to be sold in such Demand Registration equals at least
US$4,000,000 or (ii) within 180 days, from the effective date of a prior Demand,
F-3 Registration or Company Registration (each as defined below) or the IPO.

Within 10 days after receipt of a Demand pursuant to this Section 2.2, the Company shall
give written notice of such Demand to all Holders, and shall include in such Demand
Registration all Registrable Shares held by all Holders who wish to participate in such
Demand Registration and provide the Company with written requests for inclusion therein
within 15 days after the receipt of the Company’s notice. Thereupon,

 

-8-

the Company shall use its best efforts to effect the registration of all Registrable Shares as to which it
has received Demands pursuant to this Section 2.2.

A Demand which has not culminated in the registration of the requested Registrable
Shares shall not be counted as a Demand for the purposes of this Section 2. It is hereby
clarified that no other Holder may exercise its right to any Demand Registration prior
to completion of the first Demand Registration effected at the request of the Initiating
Holders.

	 	2.3	 	Notwithstanding the provisions of Section 2.1 and 2.2 above, if the Company
advises the Holders in writing that, based on the managing underwriter’s or underwriters’
written opinion, the number of securities requested to be included in such registration
exceeds the number that can be sold in such offering without adversely affecting the
underwriter’s ability to effect an orderly distribution of such securities at the price
per share in such offering (“Cutback”), the Company will include in such registration the
number of Registrable Shares requested to be included that, in the opinion of such
underwriters, can be sold, divided pro rata, among the holders of such
securities on the basis of the number of Registrable Shares held by such Holders
immediately prior to the registration.

Notwithstanding the foregoing, it is hereby clarified that in the event of a Cutback
with respect to a registration pursuant to a Demand made in accordance with Section 2.1
hereof, the Company will include in such registration the number of Registrable Shares
requested to be included that, in the opinion of the underwriters, can be sold, in the
following order: First, all of the Series E2 Shares and Series E Shares requested by the
Holders thereof to be included in such registration; then, all the Series D Shares and
Series D2 Shares requested by the Holders thereof to be included in such registration,
divided pro-rata, among the holders of Series D Shares and Series D2 Shares held by such
Holders immediately prior to the registration; and then, all of the Series C Shares
requested by the Holders thereof to be included in such registration. In the event of
Cutback which precludes the registration of all of the shares requested by the Holders
of a particular series of shares, each Holder in such series will be Cutback pro rata to
their holdings in such series. 

The Company shall be entitled to register securities for sale for its own account in any
registration requested pursuant to this Section 2, provided, however, that in any event
of a Cutback, then such securities shall be excluded from such registration and
underwriting to the extent necessary to satisfy such limitation, prior to any exclusion
of Registrable Shares.

	 	2.4	 	The Company may not cause any other registration of securities for sale for its own
account (other than a registration effected solely with respect to an employee benefit
plan or pursuant to a registration on Form F-4 or S-4) to be initiated after a
registration requested pursuant to this Section 2 and to become effective less than 90
days after the effective date of any registration requested pursuant to this Section 2,
unless permitted to do so by the written consent of Holders who hold at least 50% of the
Registrable Shares as at such time.
	 
	 	2.5	 	If the Company shall furnish to Holders a certificate signed by the Chief Executive
Officer of the Company stating that in the good faith judgment of the Board of Directors

 

-9-

	 	 	 	of the Company it would be seriously detrimental to the Company or its shareholders for a
registration to be effected at such time, the Company shall have the right to defer
the filing for a period of not more than ninety (90) days after a Demand request by the
Holders pursuant to this Section 2; provided, however, that the Company
shall not utilize this right more than once in any twelve (12) month period and the
Company shall not register any other of its securities during such ninety-day period
(other than a registration effected solely with respect to an employee benefit plan).

	3.	 	SHELF REGISTRATIONS

	 	3.1	 	From such time as the Company becomes eligible to register securities on Form
S-3/F-3, the Company shall, at the request of the Initiating Holders, file a shelf
registration statement pursuant to Rule 415 under the Securities Act with the SEC for the
sale of all the Series E2 Shares and Series E Shares that are Registrable Shares and
requested to be included in the registration statement, and the Company will maintain the
effectiveness of each registration statement as set forth in Section 8.1 and will use
best efforts to allow their continued use by the holders of the Registrable Shares,
including the timely filing of all required reports under the Securities Act (“F-3
Registration”). The Initiating Holders may request an unlimited number of F-3
Registrations (but no more than one in any six-month period), provided however that the
aggregate anticipated offering price of the Registrable Shares to be sold in such F-3
Registration equals at least US$500,000.

In addition to the above, at any time and from time to time after the Company becomes
eligible to register securities on Form F-3, Holders of a majority of the Series D
Shares that are Registrable Shares are entitled to make a written request or requests
that the Company effect an F-3 Registration, with respect to the Series D Shares, and
Holders of a majority of the Series C Shares that are Registrable Shares are entitled to
make a written request or requests that the Company effect an F-3 Registration with
respect to the Series C Shares; provided however that the aggregate anticipated offering
price of the Registrable Shares to be sold in the F-3 Registration equals at least
US$500,000. The Holders of the Series D Shares and the Holders of the Series C Shares
shall have the right to request an unlimited number of F-3 Registrations (but no more
than one in any six-month period).

	 	3.2	 	Within twenty (20) days after receipt of a request for an F-3 Registration the
Company shall give written notice of such request, as the case may be, to the other
Holders. Subject to the provisions of Section 3.3 below, the Company shall use its best
efforts to effect the registration of all Registrable Shares included in the requests for
F-3 Registration and all Registrable Shares held by all such Holders who provide the
Company with written requests for inclusion therein within fifteen (15) days after the
receipt of the Company’s notice.

After a registration requested pursuant to Section 3.1, the Company may not cause any
other registration of securities for sale for its own account (other than a registration
effected solely with respect to an employee benefit plan) to be initiated and to become
effective less than 90 days after the effective date of any registration requested
pursuant to Section 3.1, unless permitted to do so by the written consent of Holders who
hold at least 50% of the Registrable Shares as at such time.

 

-10-

	 	3.3	 	Notwithstanding the above, the Company shall not be required to effect a
registration pursuant to this Section 3 if:

	 	(a)	 	the Company shall furnish to the Holders requesting the registration, a
certificate signed by the Chief Executive Officer of the Company stating that in
the good faith judgment of the Board of Directors of the Company it would be
seriously detrimental to the Company or its shareholders for such registration to
be effected at such time, in which case the Company shall have the right to defer
the filing for a period of not more than ninety (90) days after receipt of the
request of the Holders pursuant to Section 3.1; provided, however,
that the Company shall not utilize this right more than once in any twelve (12)
month period and the Company shall not register any other of its shares during such
ninety-day period (other than a registration effected solely with respect to an
employee benefit plan); and
	 
	 	(b)	 	the Company has, within the twelve (12) month period preceding the date
of such request, already effected one (1) registration on Form F-3 for the Holders
pursuant to this Section 3.

	4.	 	PIGGYBACK REQUESTS

	 	4.1	 	At least twenty (20) days prior to the initial filing of a registration statement
or similar document with the relevant securities authority with respect to the
registration of any of the Company’s securities (the “Company Securities”) under the
Securities Act, other than pursuant to a Demand Registration or a registration of
securities issuable on Forms F-4, S-8 or any similar form available for the Company, or
any successor form thereto pursuant to an employee share option, share purchase or
similar benefit plan, or pursuant to a merger, exchange offer or a registration on any
registration form which does not include substantially the same information as would be
required to be included in a registration statement covering the sale of Registrable
Shares (a “Company Registration” ), the Company will give written notice to the Holders
of its intention to effectuate such a Company Registration. Subject to the provisions of
Section 4.2 below, the Company will use its best efforts to include in such Company
Registration all Registrable Shares with respect to which the Company has received
written requests for inclusion therein within twenty (20) days after the Company gives
such notice (“Piggyback Requests”). The Company shall also give the Holders written
notice at least thirty (30) days prior to the initial filing of a registration statement
in connection with the IPO.
	 
	 	4.2	 	If a Company Registration is an underwritten offering and the managing underwriters
advise the Company in writing that, in their opinion, the number of Company Securities
and Registrable Shares included in Piggyback Requests exceeds the number that can be sold
in such offering without adversely affecting such underwriters’ ability to effect an
orderly distribution of the Company Securities, the Company will only include in such
Company Registration (i) first, the Company Securities to be sold by the Company, (ii)
second, the number of the Series E2 Shares and Series E Shares included in Piggyback
Requests which, in the opinion of such underwriters, can be sold if added to the Company
Securities to be sold by the Company, divided pro rata among the holders of such
Series E2 Shares and Series E Shares, on the basis of the number of shares of Series E2
Shares and Series E Shares then held by each of such Holders if not all of 

 

-11-

	 	 	 	such Series E2 Shares and Series E Shares can be sold, (iii) third, the number of the Series D Shares
and Series D2 Shares included in Piggyback Requests which, in the
opinion of such underwriters, can be sold if added to the Company Securities to be sold
by the Company and the Series E2 Shares and Series E Shares to be sold pursuant to
clause (ii), divided pro rata among the holders of Series D Shares and Series D2
Shares, as the case may be, on the basis of the number of shares of Series D Shares and
Series D2 Shares then held by each of such Holders if not all of such Series D Shares
and Series D2 Shares can be sold, and (iv) fourth, the number of the Series C Shares
included in Piggyback Requests which, in the opinion of such underwriters, can be sold
if added to the Company Securities to be sold by the Company and the Series E2 Shares,
Series E Shares, Series D Shares and Series D2 Shares to be sold pursuant to clauses
(ii) and (iii), divided pro rata among the holders of the Series C Shares, on
the basis of the number of Series C Shares then held by each of such Holders if not all
of such Series C Shares can be sold.

	5.	 	DESIGNATION OF UNDERWRITER

In connection with any registration of shares by the Company, the Company shall select the
underwriter, who shall be an internationally recognised underwriter and acceptable to the
holders of the majority of the Registrable Shares participating in the applicable
registration; provided, however, that with respect to a registration initiated by the
Initiating Holders, the Company shall select the underwriter, who shall be a nationally
recognized underwriter and acceptable to the Initiating Holders.

	6.	 	EXPENSES

All costs and expenses (other than underwriting discounts and commissions) incurred in
connection with any registration under Sections 2, 3, or 4 above including the reasonable fees
of one legal counsel and for the selling Holders (which legal counsel shall be in addition to
the counsel instructed by the Company), shall be borne by the Company.

	7.	 	INDEMNITIES

In the event of any registered offering pursuant to this Agreement:

	 	7.1	 	Company Indemnity

To the extent permitted by law, the Company shall indemnify and hold harmless each
Holder selling shares in any registration hereunder (“Selling Shareholder”), and the
officers, directors, employees, legal counsel and accountants of such Selling
Shareholder and each person, if any, who controls such Selling Shareholder within the
meaning of the Securities Act, from and against any and all losses, damages,
liabilities, and charges, joint or several fees and expenses (“Claims”), to which any
of them may be subject under the Securities Act and/or any other applicable securities
law, the Israeli Securities Law, 5728-1968 (the “Securities Law”), the Israeli Companies
Law, 5759 — 1999 (the “Companies Law”), or any other statute (whether U.S., Israeli or
otherwise) or at common law, insofar as such Claims arise out of, or are based upon, (i)
any untrue statement of any material fact included by the Company in any registration
statement or prospectus under which such securities were sold; or (ii) any omission by
the Company to state therein a material fact required to be stated therein or necessary
to make the

 

-12-

statements therein not misleading; or (iii) any other violation by the
Company of the Act, the Securities Law, the Companies Law or any state, Federal or
foreign jurisdiction securities laws in connection with each such registration, and shall reimburse each such
person entitled to indemnification for any legal or other expenses reasonably incurred
by such person and/or entity in connection with investigating or defending any such
Claim, as and when such expenses are incurred; provided, however, that the Company shall
not be liable to any such person and/or entity in any such case to the extent that any
such Claim arises out of or is based upon any untrue statement or omission made in such
registration statement or prospectus in reliance upon and in conformity with a
certificate furnished to the Company by such person and/or entity and/or any person
and/or entity acting on its behalf specifically for use in the preparation thereof.

	 	7.2	 	Selling Shareholder Indemnity

Each Selling Shareholder shall, severally and not jointly, indemnify and hold the
Company and each other Selling Shareholder participating in any registration hereunder
and the officers, directors, employees, legal counsel and accountants of the Company and
any other Selling Shareholder, and each person and/or entity, if any, who controls the
Company or any other Selling Shareholder, within the meaning of the Securities Act,
harmless from and against any Claims which arise out of, or are based upon: (i) any
untrue statement of any material fact contained in any registration statement or
prospectus under which such securities were sold, furnished by such Selling Shareholder
specifically for inclusion in the prospectus; or (ii) any omission to state therein a
material fact required to be stated therein or necessary to make the statements therein
not misleading and relating to any statement furnished in writing by such Selling
Shareholder specifically for inclusion in the prospectus, and shall reimburse each such
person and/or entity entitled to indemnification for any legal or other expenses
reasonably incurred by such person and/or entity in connection with investigating or
defending any such Claim, as and when such expenses are incurred; provided, however,
that the applicable Selling Shareholder shall not be liable to any such person and/or
entity in any such case to the extent that any such Claim arises out of or is based upon
any untrue statement or omission made in such registration statement or prospectus in
reliance upon and in conformity with written information furnished to such Selling
Shareholder by such person and/or entity and/or any person acting on its behalf
specifically for use in the preparation thereof, and provided further that the maximum
liability of any Selling Shareholder under this Section 7.2 shall be limited to the net
proceeds received by each such Selling Shareholder from the sale of shares pursuant to
the offering in respect of which indemnity is required hereunder.

	 	7.3	 	Indemnity Procedure

Promptly after receipt by a Selling Shareholder or the Company of a notice of the
commencement of any action, proceeding, or investigation in respect of which indemnity
may be sought as provided above, such party (the “Indemnified Party”) shall notify the
party from whom indemnification is claimed (the “Indemnifying Party”). The omission to
notify the Indemnifying Party will not relieve it from any liability which it may have
to any Indemnified Party, unless the failure to give such notice is prejudicial to the
Indemnifying Party’s ability to defend such an action. In case such action is brought
against any Indemnified Party and it notifies the Indemnifying Party of the commencement
thereof, the Indemnifying Party shall have

 

-13-

the right to participate in, and, to the extent that it may wish, jointly with any other Indemnifying Parties similarly notified,
to assume the defense thereof with counsel reasonably satisfactory to such Indemnified Party; provided, however, that if the
defendants in any action include both the Indemnified Party and the Indemnifying Party
and there is a conflict of interests which would prevent counsel for the Indemnifying
Party from also representing the Indemnified Party, the Indemnified Party or Parties
shall have the right to select one separate counsel to participate in the defense of
such action on behalf of such Indemnified Party or Parties. After notice from the
Indemnifying Party to such Indemnified Party of its election so to assume the defense
thereof, the Indemnifying Party will not be liable to such Indemnified Party pursuant to
the provisions of said Sections 7.1 or 7.2 for any legal or other expense subsequently
incurred by such Indemnified Party in connection with the defense thereof, unless (i)
the Indemnified Party shall have employed counsel in accordance with the provision of
the preceding sentence, (ii) the Indemnifying Party shall not have employed counsel
reasonably satisfactory to the Indemnified Party to represent the Indemnified Party
within a reasonable time after the notice of the commencement of the action and within
15 days after written notice of the Indemnified Party’s intention to employ separate
counsel pursuant to the previous sentence, or (iii) the Indemnifying Party has
authorised the employment of counsel for the Indemnified Party at the expense of the
Indemnifying Party. No Indemnifying Party will consent to entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect to such claim or litigation. In addition, the Indemnified Party
shall in no event enter into any settlement without obtaining the Indemnifying Party’s
prior written consent, which shall not be unreasonably withheld. Each Indemnified Party
shall provide such information regarding itself or the claim in question as an
Indemnifying Party has reasonably requested in writing and shall otherwise cooperate
with the Indemnifying Party as shall be reasonably required in the defense of such claim
and any litigation resulting therefrom.

	 	7.4	 	Survival

The obligations of the Company and Holders under this Section 7 shall survive the
completion of any offering of Registrable Shares in a registration statement under this
Agreement, and otherwise.

	8.	 	OBLIGATIONS OF THE COMPANY

Whenever required under this Agreement to effect the registration of any Registrable Shares,
the Company shall, subject to the provisions of this Agreement, as expeditiously as possible:

	 	8.1     (a)	 	prepare and file with the SEC a registration statement with respect to such
Registrable Shares and use its best efforts to cause such registration statement to
become effective,

	 	(b)	 	upon the request of the holders of a majority of the Registrable Shares
registered thereunder, keep a registration statement filed pursuant to Section 2
above effective for a period of ninety (90) days or, if sooner, until the
distribution contemplated in the Registration Statement has been completed, and

 

 

-14-

	 	(c)	 	upon the request of the holders of a majority of the Registrable Shares
registered thereunder, keep a registration statement filed pursuant to Section 3
above effective for a period of up to four months or, if sooner, until the
distribution contemplated in the Registration Statement has been completed;
provided, however, that the Company may suspend sales at any time under the
registration statement immediately upon notice to the selling Holders or their
assigns for a period of time not to exceed in the aggregate 90 days during any
twelve (12) month period, if there then exists material, non-public information
relating to the Company which, in the reasonable good faith opinion of the board of
directors of the Company, would be seriously detrimental to the Company to disclose
during that time.

	 	8.2	 	prepare and file with the SEC such amendments and supplements to such registration
statement and the prospectus used in connection with such registration statement as may
be reasonably necessary to comply with the provisions of the Securities Act with respect
to the disposition of all Registrable Shares covered by such registration statement;
	 
	 	8.3	 	furnish to the Preferred Holders such numbers of copies of a prospectus, including
a preliminary prospectus, in conformity with the requirements of the Securities Act, and
such other documents as they may reasonably request in order to facilitate the
disposition of Registrable Shares owned by them;
	 
	 	8.4	 	use every reasonable effort to register or qualify the securities covered by such
registration statement under such securities or blue sky laws of such jurisdictions
within the United States as the Holders shall request, and do any and all other acts and
things which may be necessary under such securities or blue sky laws to enable such
Holders to consummate the public sale or other disposition in such jurisdictions of the
securities to be sold by such Holders, except that the Company shall not for any such
purpose be required to qualify to do business as a foreign corporation in any
jurisdiction wherein it is not qualified or consent to general service of process in any
jurisdiction where it is not otherwise subject to such service, with respect to the
latter, except in such jurisdictions where the Company’s shares are already registered;
	 
	 	8.5	 	in the event of any underwritten public offering, enter into and perform its
obligations under an underwriting agreement, in usual and customary form, with the
managing underwriter of such offering. Each Holder participating in such underwriting
shall also enter into and perform its obligations under such an agreement;
	 
	 	8.6	 	notify each holder of Registrable Shares covered by such registration statement at
any time when a prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which the prospectus included
in such registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of the circumstances
then existing;
	 
	 	8.7	 	use its best efforts to cause all Registrable Shares registered pursuant hereunder
to be listed on each securities exchange on which similar securities issued by the
Company are then listed;

 

-15-

	 	8.8	 	provide a transfer agent and registrar for all Registrable Shares registered
pursuant hereunder and a CUSIP number for all such Registrable Shares, in each case not
later than the effective date of such registration;
	 
	 	8.9	 	use its best efforts to furnish, at the request of any Holder requesting
registration of Registrable Shares pursuant to this Agreement, on the date that such
Registrable Shares are delivered to the underwriters for sale in connection with a
registration pursuant to this Agreement, if such securities are being sold through
underwriters, or, if such securities are not being sold through underwriters, on the date
that the registration statement with respect to such securities becomes effective:

	 	(a)	 	an opinion, dated such date, of the counsel representing the Company
for the purposes of such registration, in form and substance as is customarily
given to underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders requesting registration of Registrable
Shares; and
	 
	 	(b)	 	a letter dated such date, from the independent registered public
accountants of the Company, in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Shares,

	9.	 	CONDITIONS TO REGISTRATION OBLIGATIONS

The Company shall not be obligated to effect the registration of Registrable Shares pursuant
to this Agreement unless the Holder requesting the registration consents to the following
conditions:

	 	9.1	 	conditions requiring the Holder to comply with all applicable provisions of the
Securities Act and the Exchange Act including, but not limited to, the prospectus
delivery requirements of the Securities Act, and to furnish to the Company information
about sales made in such public offering;
	 
	 	9.2	 	conditions prohibiting the Holder upon receipt of telegraphic or written notice
from the Company that it is required by law to correct or update the registration
statement or prospectus from effecting sales of the Registrable Shares until the Company
has completed the necessary correction or updating; and
	 
	 	9.3	 	conditions prohibiting the sale of Registrable Shares by such Holder during the
process of the registration until the Registration Statement is effective, provided that
management and all directors of the Company agree to similar conditions.

	10.	 	LEGENDS
	 
	 	 	Upon the conversion of Preferred Shares into Ordinary Shares following the closing of an IPO,
the Company shall place a legend on each certificate representing Registrable Shares
designating whether the Registrable Shares represented by such certificate are Series C
Shares, Series D Shares, Series D2 Shares, Series E Shares or Series E2 Shares.

	11.	 	DELAY IN REGISTRATION

 

-16-

No Holder shall have any right to obtain or seek an injunction restraining or otherwise
delaying any such registration as the result of any controversy that might arise with respect
to the interpretation or implementation of this Agreement.

	12.	 	ASSIGNMENT OF REGISTRATION RIGHTS
	 
	 	 	Any of the Holders may assign its rights pursuant to Sections 2-8 of this Agreement in respect
of all or any part of its Registrable Shares, only together with the Registrable Shares
themselves. The transferor shall, within twenty (20) days after such transfer, furnish the
Company with written notice of the name and address of such transferee and the securities with
respect to which such registration rights are being assigned, and the transferee’s written
agreement to be bound by this Agreement.

	13.	 	LOCK-UP AND OTHER REQUIREMENTS OF THE HOLDERS
	 
	 	 	In connection with the IPO, all Holders agree that any sales of Registrable Shares may be
subject to a customary “lock-up” period if so required by the underwriter in such a
registration, restricting such sales for up to one hundred and eighty (180) days, and all
Holders will agree to abide by such customary “lock-up” period of up to one hundred and eighty
(180) days if so required by the underwriter in such a registration; provided that management
and all directors of the Company agree to a similar lock-up, unless such condition is waived
by holders of a majority of the Registrable Shares. In addition, no Holder may participate in
any underwritten registration hereunder unless such person: (a) agrees to sell such person’s
securities on the basis provided in any customary underwriting arrangements and (b) provides
any relevant information and completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements, and other documents required under the terms of such
underwriting arrangements.

	14.	 	RULE 144
	 
	 	 	At any time and from time to time after the earlier of the close of business on such date as
(a) a registration statement filed by the Company under the Securities Act becomes effective,
and (b) the Company registers a class of securities under Section 12 of the Exchange Act, the
Company shall:

	 	14.1	 	Make and keep available adequate current public information with respect to the
Company within the meaning of Rule 144(c) under the Securities Act (or similar rule then
in effect);
	 
	 	14.2	 	Furnish to any holder of Registrable Shares forthwith upon request (a) a written
statement by the Company as to its compliance with the informational requirements of Rule
144(c) (or similar rule then in effect) or (b) a copy of the most recent annual or
quarterly report of the Company; and
	 
	 	14.3	 	Use its best efforts to comply with all other necessary filings and other
requirements so as to enable the Registrable Shares and any transferee thereof to sell
Registrable Shares under Rule 144 under the Securities Act (or similar rule then in
effect).

	15.	 	OTHER REGISTRATION RIGHTS; TERM

 

-17-

	 	15.1	 	The Company shall not grant registration rights with respect to any securities of
the Company to any person that are equal to or superior to the registration rights
granted to the Preferred Holders pursuant to this Agreement without the consent of the
Initiating Holders.
	 
	 	15.2	 	No Holder shall be entitled to exercise any right provided for in Sections 2, 3 or
4 following such time after consummation of an IPO as Rule 144 or another similar
exemption under the Securities Act is available for the sale of all of such Holder’s
Registrable Shares during a three (3)-month period without registration. For the
avoidance of doubt, the rights set forth in Section 7 shall not expire due to the
foregoing sentence.

	16.	 	Intentionally Omitted.
	 
	17.	 	Intentionally Omitted.
	 
	18.	 	Intentionally Omitted.
	 
	19.	 	MISCELLANEOUS

	 	19.1	 	Further Assurances
	 
	 	 	 	Each of the parties hereto shall perform such further acts and execute such further
documents as may reasonably be necessary to carry out and give full effect to the
provisions of this Agreement and the intentions of the parties as reflected thereby.

	 	19.2	 	Governing Law; Jurisdiction
	 
	 	 	 	This Agreement shall be governed by and construed in accordance with the laws of the
State of Israel, without giving effect to the rules respecting conflict of law. The
competent courts of Tel Aviv-Jaffa shall have exclusive jurisdiction to hear all
disputes arising in connection with this Agreement.

	 	19.3	 	Successors and Assigns; Assignment; Aggregation
	 
	 	 	 	Except as otherwise expressly limited herein, the provisions hereof shall inure to the
benefit of, and be binding upon, the successors, assigns, heirs, executors, and
administrators of the parties hereto.
	 
	 	 	 	Other than as expressly set out in this Agreement, none of the rights, privileges, or
obligations set forth in, arising under, or created by this Agreement may be assigned or
transferred without the prior consent in writing of each party to this Agreement, with
the exception of assignments by any shareholder to Permitted Transferees of such
shareholder; provided, however, that no such assignment or transfer shall become
effective unless such assignee or transferee has agreed in writing to be bound by all
terms and conditions of this Agreement as if it were an original party hereto.

 

-18-

	 	 	 	Each shareholder of the Company shall be entitled to exercise its rights pursuant hereto
together with those of any other shareholder of the Company who is a Permitted
Transferee of such shareholder provided that, in no event, shall any shareholder’s
rights be exercised more than once.

	 	 	 	All shares of the Company, that are held or acquired by entities and persons that
constitute a group of Permitted Transferees, shall be aggregated together for the
purpose of determining the availability of any rights under this Agreement to any such
entity or person.

	 	19.4	 	Entire Agreement; Amendment and Waiver; 

	 	(a)	 	As of the Effective Date and contingent upon the Effective Date
occurring prior to the Termination Date, this Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the subject
matters hereof and amends and restates in its entirety the Prior Agreement. The
parties understand and agree that if the Effective Date does not occur prior to the
Termination Date, then on the Termination Date this Agreement shall automatically
terminate and be of no force and effect, and the Prior Agreement shall continue to
be binding upon all parties thereto without any modification in accordance with all
of its terms.
	 
	 	(b)	 	Subject to any provision herein to the contrary, any term of this
Agreement 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) only with the written consent of:

(i) the Holders of a majority of the Registrable Shares, which majority must
include the Principal Investors (provided that the consent of Belco, Vertex
or Pitango shall not be required if such entity does not hold any Registrable
Securities); and

(ii) the Company, if the amendment adversely affects the rights or
obligations of the Company.

	 	19.5	 	Notices

All notices or other communications hereunder shall be in writing and shall be given in
person, by registered mail (registered international air mail if mailed
internationally), by an overnight courier service which obtains a receipt to evidence
delivery, or by facsimile transmission (provided that written confirmation of receipt is
provided) with a copy by mail, addressed as set forth below:

	 	 	 
	If to the Company:
	 	Voltaire Ltd.
	 
	 	9 Hamenofim Street, Building A
	 
	 	Herzelia
	 
	 	ISRAEL
	 
	 	Fax: 972-9-971-7660
	 
	 	Attn: CEO

 

-19-

	 	 	 
	With a copy to:
	 	Ori Rosen & Co.
	 
	 	Azrieli Centre
	 
	 	Round Building
	 
	 	Tel Aviv 67021
	 
	 	ISRAEL
	 
	 	Fax: 972-3 607 4701
	 
	 	 
	 
	 	Attn: Ori Rosen, Adv.
	 
	 	 
	If to any other party listed on
	 	The addresses set forth against such
	Exhibit A:
	 	party's name in Exhibit A

or such other address as any party may designate to the other in accordance with the
aforesaid procedure. All communications delivered in person or by courier service shall
be deemed to have been given upon delivery, those given by facsimile transmission shall
be deemed given on the business day following transmission with confirmed answer back,
and all notices and other communications sent by registered mail (or air mail if the
posting is international) shall be deemed given ten (10) days after posting.

	 	19.6	 	Delays or Omissions

No delay or omission to exercise any right, power, or remedy accruing to any party upon
any breach or default under this Agreement, shall be deemed a waiver of any other breach
or default theretofore or thereafter occurring. Any waiver, permit, consent, or approval
of any kind or character on the part of any party of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or conditions of
this Agreement, must be in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this Agreement or by
law or otherwise afforded to any of the parties, shall be cumulative and not
alternative.

	 	19.7	 	Severability

If any provision of this Agreement is held by a court of competent jurisdiction to be
unenforceable under applicable law, then such provision shall be excluded from this
Agreement and the remainder of this Agreement shall be interpreted as if such provision
were so excluded and shall be enforceable in accordance with its terms; provided,
however, that in such event this Agreement shall be interpreted so as to give effect, to
the greatest extent consistent with and permitted by applicable law, to the meaning and
intention of the excluded provision as determined by such court of competent
jurisdiction.

	 	19.8	 	Intentionally Omitted.
	 
	 	19.9	 	Counterparts, Facsimile Signatures

This Agreement may be executed in any number of counterparts, each of which shall be
deemed an original and enforceable against the parties actually executing such

 

-20-

counterpart, and all of which together shall constitute one and the same instrument. A
signed Agreement received by a party to this Agreement via facsimile will be deemed an
original, and binding upon the party who signed it.

	 	29.10	 	Intentionally Omitted.

[Remainder of the page intentionally left blank]

 

-21-

[First Signature Page of Voltaire’s July 2007 Shareholders’ Rights Agreement]

IN WITNESS WHEREOF this Agreement has been duly executed and delivered on the date herein above set
forth.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voltaire Ltd.	 	 	 	BCF II Belgium Holding SPRL	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Ronnie Kenneth	 	 	 	By:	 	/s/ P. Kevin Kilroy	 	/s/ Joseph R. Saviano	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Name: Ronnie Kenneth	 	 	 	 	 	Name: P. Kevin Kilroy	 	Joseph R. Saviano	 	
	 

	 	Title: CEO
	 	 	 	 	 	Title: Director
	 	Director	 	 

	 	 	 	 	 	 	 	 	 	 	 
	Benhamou Global Ventures, LLC	 	 	 	The Challenge Fund-Etgar II LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	/s/ Tamar Ciehanover	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name: Tamar Ciehanover	 	 
	 

	 	Title:
	 	 	 	 	 	Title: General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Tamir Fishman Ventures II (Israel)
LP	 	 	 	Tamir Fishman Ventures II CEO Fund LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Michael Elias	 	 	 	By:	 	/s/ Michael Elias	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Tamir Fishman Ventures II LP	 	 	 	Tamir Fishman Ventures II CEO Fund
(US) LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Michael Elias	 	 	 	By:	 	/s/ Michael Elias	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Tamir Fishman Ventures II (Cayman
Islands) LP	 	 	 	Tamir Fishman Venture Capital II Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Michael Elias	 	 	 	By:	 	/s/ Michael Elias	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Neurone Ventures II Investment
(Israel) Ltd. & Neurone II
Investment GP. Ltd., as joint
trustees on behalf of certain
Neurone Ventures II capital funds	 	 	 	NV II (Side Fund), L.P.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s/ Ami Dotan	 	 	 	By:	 	/s/ Ami Dotan	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Ami Dotan	 	 	 	 	 	Name: Ami Dotan	 	 
	 

	 	Title: General Partner	 	 	 	 	 	Title: General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Yigal Livne	 	 	 	By:	 	/s/ Yigal Livne	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Yigal Livne	 	 	 	 	 	Name: Yigal Livne	 	 
	 

	 	Title: General Partner	 	 	 	 	 	Title: General Partner	 	 

 

-22-

[Second Signature Page of Voltaire’s July 2007 Shareholders’ Rights Agreement]

	 	 	 	 	 	 	 	 	 	 	 
	Pitango Venture Capital
Fund III (Israeli Sub)
Non Q L.P.	 	 	 	Pitango Venture Capital Fund III (Israeli
Investors) L.P.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Pitango Venture Capital
Fund III (Israeli Sub)
L.P.	 	 	 	DS Polaris Trust Company (Foreign Residents)
(1997) Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	DS Polaris Ltd.	 	 	 	Pitango Principals Fund III (Israel) LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Pitango Venture Capital
Fund Trusts 2000 Ltd.	 	 	 	Pitango II Holdings LLC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Pitango Fund II
Opportunity Annex Fund,
L.P	 	 	 	Pitango Fund II Opportunity Annex Fund (ICA),
L.P.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Pitango Fund II LP	 	 	 	Pitango Fund II (Tax Exempt Investors) LLC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s Illegible	 	 	 	By:	 	/s Illegible	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Pitango Fund II LLC	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	/s Illegible	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 	 	 

 

-23-

[Third Signature Page of Voltaire’s July 2007 Shareholders’ Rights Agreement]

	 	 	 	 	 	 	 	 	 	 	 	 	 
	K.T. Concord Venture Fund (Cayman)
LP	 	 	 	 	 	K.T Concord Venture Advisors (Israel) LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	K.T Concord Venture Advisors
(Cayman) LP	 	 	 	 	 	K.T. Concord Venture Fund (Israel) LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Danbar Tech 2001 LP	 	 	 	 	 	Ofra Amir	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Canada Israel Oppurtunity Funs III
LP	 	 	 	 	 	DS Founders Group LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Shrem Fudim Kelner Technologies Ltd.	 	 	 	 	 	Platinum Venture Capital Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Shrem Fudim Kelner & Co. Ltd.	 	 	 	 	 	SFK Wing 1, LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	SFK Wing 2, LP	 	 	 	 	 	Technoplus Ventures Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Technoplus Ventures LP	 	 	 	 	 	Berman & Co. Trading and Investments
Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 

 

-24-

[Fourth Signature Page of Voltaire’s July 2007 Shareholders’ Rights Agreement]

	 	 	 	 	 	 	 	 	 	 	 
	D Partners (Israel) Limited
Partnership	 	 	 	D Partners (BVI) LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Eylon Penchas	 	/s/ Ran Cohen	 	By:	 	/s/ Eylon Penchas	 	/s/ Ran Cohen
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: D. ASSOCAIATES GP (ISRAEL) LTD.
	 	 	 	 	 	Name: D. ASSOCAIATES GP (ISRAEL) LTD.	 	 
	 

	 	Title: The General Partner
	 	 	 	 	 	Title: The General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Golden Wings Investments Ltd.	 	 	 	H.T.C Hi-Tech Consulting Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Ziv Erez	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: (in voluntary liquidation)
	 	 	 	 	 	Name:	 	 
	 

	 	Title: (as liquidator)
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Amir Prescher	 	 	 	QTV Capital Limited	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	/s/ Steve Schlossareck	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name: Steve Schlossareck	 	 
	 

	 	 	 	 	 	 	 	Title: Managing Director	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	HVST Limited Partnerships	 	 	 	Triangle Technologies Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	/s/ Amir Pomerantz	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name: Amir Pomerantz	 	 
	 

	 	Title:
	 	 	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Giora Bitan	 	 	 	Argos Capital Appreciation Master
Fund, LP	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	PRB Family Partners LP	 	 	 	Lighthouse Capital Partners V
(Israel), L.L.C	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Paul R. Bonderson Jr.	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Lone Oak Ventures, LLC
	 	 	 	 	 	Name:	 	 
	 

	 	Title: General Partner of PRB
Family Partners, LP
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Hitachi Ltd.	 	 	 	Far East Finance Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Tadashi Hirose	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: TADASHI HIROSE
	 	 	 	 	 	Name:	 	 
	 

	 	Title: GM. HITACHI LTD. CVC
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Amnon Evron & Co. Trust Company Ltd.	 	 	 	David Gol	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 

 

-25-

[Fifth Signature Page of Voltaire’s July 2007 Shareholders’ Rights Agreement]

	 	 	 	 	 	 	 	 	 	 	 
	Vertex Israel II (C.I.) Fund L.P.	 	 	 	Vertex Israel II (A) Fund L.P.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Yoram Oron /s/ Ran Gartenberg	 	 	 	By:	 	/s/ Yoram Oron /s/ Ran Gartenberg	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Yoram Oron Ran Gartenberg	 	 	 	 	 	Name: Yoram Oron Ran Gartenberg	 	 
	 

	 	Title: Founder &
Managing Partner
Partner, CFO	 	 	 	 	 	Title: Founder &
Managing Partner
Partner, CFO	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Vertex Israel II (B) Fund L.P.	 	 	 	Vertex Israel II Discount Fund L.P.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Yoram Oron /s/ Ran Gartenberg	 	 	 	By:	 	/s/ Yoram Oron /s/ Ran Gartenberg	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Yoram Oron Ran
Gartenberg
	 	 	 	 	 	Name: Yoram Oron Ran
Gartenberg	 	 
	 

	 	Title: Founder & Managing
Partner
Partner, CFO
	 	 	 	 	 	Title: Founder & Managing
Partner
Partner, CFO	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Vertex Israel II (C.I.) Executive
Fund L.P.	 	 	 	Virgotech Ltd.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Yoram Oron /s/ Ran Gartenberg	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name: Yoram Oron Ran
Gartenberg
	 	 	 	 	 	Name:	 	 
	 

	 	Title: Founder & Managing
Partner
Partner, CFO
	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	D.N.S.T. Holdings Ltd.	 	 	 	Cleg Inc.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	Name:	 	 
	 

	 	Title:
	 	 	 	 	 	Title:	 	 

 

-26-

Exhibit A

	 	 	 
	Name of Shareholder	 	Address of Shareholder
	 
	 	 
	BCF II Belgium Holding SPRL

	 	331-333 Avenue Louise

1050 Brussels, Belgium

Fax: 32-2-642-86-50

Attn: Robert Kimmels and Caroline
Hoogsteyns

with copies to: Baker Capital Corp.

540 Madison Avenue

New York, New York 10022, USA

Fax: 1-212-486-0660

Attn: Ashley Leeds and Joseph Saviano
	 
	 	 
	Pitango Venture Capital Fund III (Israeli
Sub) L.P.

	 	11 HaMenofim Street
	Pitango Venture Capital Fund III (Israeli
Sub) Non Q L.P.

	 	Herzliya 46725
	Pitango Venture Capital Fund III (Israeli
Investors) L.P.

	 	Israel
	Pitango Venture Capital Fund Trusts 2000 Ltd.

	 	Fax: 972-9-9718102
	Pitango Principals Fund III (Israel ) L.P.
	 	 
	Pitango Fund II Opportunity Annex Fund L.P.
	 	 
	Pitango Fund II Opportunity Annex Fund (ICA)
L.P.
	 	 
	Pitango Fund II (Tax Exempt Investors) LLC
	 	 
	DS Polaris Trust Company (Foreign Residents)
(1997) Ltd.
	 	 
	Pitango Fund II L.P.
	 	 
	Pitango Fund II LLC.
	 	 
	DS Polaris Ltd.
	 	 
	Pitango II Holdings LLC
	 	 
	 
	 	 
	Vertex Israel II (C.I.) Fund L.P.

	 	1 Ha’Shikma Street,
	Vertex Israel II (A) Fund L.P.

	 	POB 89, Savyon, Israel 56530
	Vertex Israel II (B) Fund L.P.

	 	Israel
	Vertex Israel II Discount Fund L.P.

	 	Fax: 972-3-7378889
	Vertex Israel II (C.I.) Executive Fund L.P.
	 	 
	 
	 	 
	Ofra Amir

	 	21 Haarba’a Street

	Canada Israel Opportunity Fund III L.P.

	 	Tel Aviv

	Platinum Venture Capital Ltd.

	 	Israel

	Danbar Tech 2001 L.P.

	 	Fax: 972-3-6869535
	Shrem Fudim Kelner Technologies Ltd.
	 	 
	Shrem, Fudim, Kelner & Co. Ltd.
	 	 
	SFK wing 1, L.P.
	 	 
	SFK Wing 2, L.P.
	 	 
	DS Founders Group L.P.
	 	 

 

-27-

	 	 	 
	Name of Shareholder	 	Address of Shareholder
	 
	Tamir Fishman Ventures II (Israel) L.P.

	 	46 Rothschild Avenue

	Tamir Fishman Ventures II CEO Fund L.P.

	 	Tel Aviv 66883
	Tamir Fishman Ventures II L.P.

	 	Israel
	Tamir Fishman Ventures II CEO Fund (US) L.P.

	 	Fax: 972-3-5663389
	Tamir Fishman Ventures II (Cayman Islands) L.P.
	 	 
	Tamir Fishman Venture Capital II Ltd.
	 	 
	 
	 	 
	The Challenge Fund-Etgar II L.P.

	 	20 Lincoln Street

Robinshtein House, 20th floor

Tel Aviv

Fax: 972-3-5621999
	 
	 	 
	Neurone Ventures II Investment (Israel) Ltd.
& Neurone II Investment GP. Ltd., as joint
trustees on behalf of certain Neurone
Ventures II capital funds

NV II (Side Fund), L.P.

	 	Neurone Ventures II L.P

21 Ha’arb’ah St.

Tel-Aviv,

Israel 64739
	 
	 	 
	K.T. Concord Venture fund (Israel), L.P.

	 	85 Medinat Hayehudim St.
	K.T. Concord Venture fund (Cayman), L.P.

	 	P.O.Box 4011
	K.T. Concord Venture Advisors (Israel), L.P.

	 	Herzelia, 46140 Israel
	K.T. Concord Venture Advisors (Cayman), L.P.

	 	Tel: 972-9-960-2020
	 

	 	Fax: 972-9-960-2022
	 
	 	 
	PRB Family Partners, L.P.

	 	8121 Alpha Lane, Sunol, California 94586
	 
	 	 
	Hitachi Ltd.

	 	24-14 Nishi Shimbashi, 1chome

Minatu-ku

Tokyo, 1058717

Japan
	 
	 	 
	Benhamou Global Ventures, LLC

	 	540 Cowper St., Suite 200

Palo Alto, CA 94301
	 
	 	 
	Argos Capital Appreciation Master Fund, L.P.

	 	211 W. 61st St.,
6th Floor, New York, NY

10023
	 
	 	 
	QTV Capital Limited

	 	12930 Saratoga Avenue

Suite D8

Saratoga, California 95070, USA

Fax: (408) -944-4477
	 
	 	 
	Far East Finance Ltd.

	 	c/o Adv. Benjamine Waltuch
Gornitzky & Co.

45 Rothchild Avenue, Tel Aviv 65784,

Israel
	 
	 	 
	D Partners (BVI) L.P.

	 	16 HaGalim Boulevard

Beit Delta
	D Partners (Israel) Limited Partnership

	 	P.O. Box 2037

Herzelia Pituach 46120
	 
	 	 
	Virgotech Ltd.

	 	7 Ha’Haruzim St.

Herzeliya, Israel

Tel: 972-9-9574811
	 
	 	 
	TechnoPlus Ventures Ltd.

	 	24 Raul Walenberg St.
	TechnoPlus Ventures L.P.

	 	Tel Aviv 69719, Israel

Tel: 03-7666555
	 
	 	 
	Giora Bitan

	 	32 Yonathan St., Tel Aviv, Israel

 

-28-

	 	 	 
	Name of Shareholder	 	Address of Shareholder
	 
	HVST Limited Partnership

	 	Evergreen Venture Capital

96 Rothschild Blvd., Tel Aviv 65224

Fax: 03-7108205
	 
	 	 
	Golden Wings Investments Ltd.

	 	In Voluntary Liquidation, at:

Ben Naftali, Erez, Zahavi & Co.

Attn: Ziv Erez, Adv.

17 Itzhak Sadeh St.

Tel Aviv 67775, Israel

Tel. +972-3-5652000
	 
	 	 
	David Gol

	 	c/o Adv. Dalia Wexler, Tel: 03-609 6563

12 Heh Be’Iyar Street, Tel-Aviv 62093
	 
	 	 
	Triangle Technologies Ltd.

	 	7 Abba hillel St.

Ramat Gan 52522, Israel

Fax: 972-3-5758660
	 
	 	 
	Berman & CO, Trading and Investments Ltd.

	 	58 Stricker St.

Tel Aviv 62003, Israel

Tel: 972 3 544 0617

Fax: 972 3 544 0619
	 
	 	 
	D.N.S.T Holdings Ltd.

	 	12 Beit HaDfus St.

Jerusalem 95483, Israel

Tel: 02-6537750

Fax: 02-6537751
	 
	 	 
	Cleg, Inc.

	 	1545 Mas. Ave.

Cambridge, MA 02138

bebchuk@law.harvard.edu
	 
	 	 
	Amnon Evron & Co. Trust Company Ltd.

	 	Hamburger, Evron and Co.

4 Berkowitz St., Tel Aviv, Israel
	 
	 	 
	H.T.C Hi-Tech Consulting Ltd.

	 	148 Shalva St.

Herzelia Pituach 46075, Israel

c/o Erez Diamant

Fax: +972-9-9580942

Tel: +972-9-9542358
	 
	 	 
	Amir Prescher

	 	30 Margalit St., Shoham, Israel
	 
	 	 
	Lighthouse Capital Partners V (Israel), LLC

	 	500 Drake’s Landing Road

Greenbrae, CA 94904

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