)b) The finder will be entitle to additional 230K$ (based on an IPO of 8M$) which will be paid for consultancy services during 2018 and the finder will buy shares from the company and invest the money back in the same terms of the IPO when half of the stocks will be free and half will have a vesting time of 1 year. In case the raise will be higher it be reflected in the numbers accordingly."
In the draft of this agreement, the clause remained as it was added by Peleg on April 1, 2018 (as clause 3.1.3), but in light of the addition of clause 3.1.2, the numbering of this clause became 3.1.4.
This agreement was signed by the parties on August 16, 2018 (the signed agreement was attached as Appendix 10 to Don's affidavit, hereinafter: the "First Agreement").
- Signing a loan agreement;
There is no dispute that on the occasion when the first agreement was signed – i.e., on June 18, 2018 – a loan agreement was signed between Peleg and the company (Appendix 9 to Don's affidavit). This is because the company urgently needed cash that would enable its ongoing operations during the interim period until the completion of the pre-IPO process. As such, Peleg agreed to lend the company a sum of US$100,000 as a bridging loan. I will note that there is no dispute about the distress of the company at that time – both Don and Peleg declare this (see paragraph 35 of Peleg's affidavit and paragraph 34 of Don's affidavit). According to Don, Peleg took advantage of the company's distress and agreed to provide the loan only if the first agreement, which was signed at the same time, was also signed. Peleg, on the other hand, argues that at that stage, the company's IPO was still uncertain – despite the interest that Ananda showed in the company, and therefore the provision of funds to the company involved a high economic risk. It was argued that in light of this, the loan was made available for a period of four months at a relatively high interest rate (which was ultimately not paid). In this regard, an examination of the loan agreement shows that the repayment date of the loan is on October 5, 2018 and that the interest on the loan is 10% until the repayment date and 5% per month after the repayment is made. Clause 6.2 of the agreement further stipulates that: "If for one month after the determining repayment date the loan is not repaid in full, including interest, the lender will be entitled to convert the principal, including interest, into the company's shares according to a company value of $5 million."
- Signing a CLA Agreement;
There is no dispute that on July 4, 2018, an additional agreement was signed between the parties (Convertible loan agreement hereinafter: the "CLA Agreement") – as to this, the parties do not dispute that, as detailed in Don's affidavit – in the background of the signing of this agreement – an agreement was signed between the Company and Peleg, according to which, in respect of the offering, Peleg will be entitled to a commission in the sum of USD 230,000, which will be reinvested in the Company through the purchase of the Company's shares at a favorable price even in relation to the price of the shares in the IPO (at a discount of 20%). In addition, according to Don, it was agreed that Peleg would also be able to convert the loan amount of $100,000 into shares on identical terms, under the entitlement to repay the loan plus interest.