Company Capital Structure (a) The registered share capital of the Company is NIS 30,000,000 divided into 30,000,000 Company Shares, of which 20,406,363 Company Shares are issued and outstanding as of August 31, 2009. No Company Shares are dormant shares and no shares are held in treasury by any member of the Company Group. All outstanding Company Shares, when issued, were duly authorized, validly issued, fully paid and non-assessable and are not subject to preemptive rights created by statute, the Charter Documents of the Company, or any agreement to which the Company is or was a party or by which it is or was otherwise bound. All outstanding Company Shares and Company Options have been issued (i) in compliance with all applicable securities laws and other applicable Legal Requirements, and (ii) in compliance with all applicable requirements set forth in Contracts. There are no declared or accrued but unpaid dividends with respect to any Company Shares. Except as contemplated hereby, there are no voting trusts, proxies, or other agreements or understandings with respect to the voting of shares of the Company to which the Company is a party or by which it is bound, or of which the Company has knowledge. To the Company’s knowledge, there are no agreements relating to the registration, sale or transfer (including agreements relating to rights of first refusal, co-sale rights or “drag-along” rights) of any capital stock of the Company, and no Person has any right to cause the Company to effect the registration under the Securities Act of any securities of the Company, other than under the Registration Rights Agreement.
(b) The Purchased Securities have been duly authorized and, when issued, delivered and paid for in the manner set forth in this Agreement or, with respect to the Warrant Shares, in the manner set forth in the Warrants, will be validly issued, fully paid, nonassessable, free and clear of all Liens and duly registered in the name of the Investors in the Company’s share register. On the Pre-Closing Date the Company shall have reserved from its duly authorized share capital the maximum number of Company Shares required for the issuance of the Purchased Securities. The Purchased Shares and the Warrant Shares will have the rights, preferences, privileges and restrictions set forth in the Charter Documents. The execution and delivery by the Company of this Agreement, the Related Agreements and the consummation of the transactions contemplated hereby and thereby will not obligate the Company to issue any Company Shares or other securities to any other person or entity and will not result in the adjustment of, or give rise to a right to adjust, the exercise, conversion, exchange or reset price or any other term of any outstanding security. The Company does not have outstanding stockholder purchase rights or “poison pill” or any similar arrangement in effect giving any person or entity the right to receive or purchase any equity interest in the Company upon the occurrence of certain events.
(c) The SEC Documents detail the number of Company Shares reserved for issuance under the Option Plans upon the exercise of Company Options, the Company Shares subject to outstanding and unexercised Company Options and the Company Shares available for issuance thereunder.
(d) Other than as set forth in Sections 3.2(a) and 3.2(c) and the transactions contemplated by this Agreement and the Related Agreements and in the SEC Documents, there are no (i) securities of any member of the Company Group authorized, convertible into or exchangeable for shares of capital stock or voting securities of such member of the Company Group, (ii) options, warrants, calls, rights, convertible securities or other rights to acquire from the member of the Company Group, and no obligation of the member of the Company Group, to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, now or in the future, any capital stock, voting securities or securities convertible into or exchangeable for capital stock or voting securities of any member of the Company Group, and (iii) equity equivalents, phantom or notional equity interests, interests in the ownership, earnings or price per security of any member of the Company Group or other similar rights in the equity of any member of the Company Group. The execution, delivery and performance by the Company of this Agreement and any Related Agreement to which the Company is a party, and the consummation of the transactions contemplated hereby and thereby, will not result in or give rise to an obligation of the Company to grant, extend, accelerate the vesting of, change the price of, otherwise amend the terms of, any such options, warrants, calls, rights, convertible securities or other rights to acquire from the member of the Company Group.
(e) There are no bonds, debentures, notes or other indebtedness of any member of the Company Group (i) granting the holder thereof the right to vote on any matters on which shareholders may vote (or which is convertible into, or exchangeable for, securities having such right) or (ii) the value of which is in any way based upon or derived from capital or voting share capital of the Company, are issued or outstanding as of the date hereof.
(f) No member of the Company Group has agreed, is obligated to make, or is bound by any Contract under which it may become obligated to make any future investment in, or capital contribution to, any Person.
Capitalization of Merger Sub The authorized capital stock of Merger Sub consists solely of 1,000 shares of common stock, par value $0.01 per share, all of which are validly issued and outstanding. All of the issued and outstanding capital stock of Merger Sub is, and at the Effective Time will be, owned by Parent or a direct or indirect wholly-owned Subsidiary of Parent. Merger Sub has not conducted any business prior to the date hereof and has no, and prior to the Effective Time will have no, assets, liabilities or obligations of any nature other than those incident to its formation and pursuant to this Agreement and the Merger and the other transactions contemplated by this Agreement.
The Merger Closing Effective Time 1.1. The Merger 1 1.2. Closing 2 1.3. Effective Time 2
Organizational Structure The ISO will be governed by a ten (10) person unaffiliated Board of Directors, as per Article 5 herein. The day-to-day operation of the ISO will be managed by a President, who will serve as an ex-officio member of the ISO Board, in accordance with Article 5 herein. There shall be a Management Committee as per Article 7 herein, which shall report to the ISO Board, and shall be comprised of all Parties to the Agreement. There shall be at least two additional standing committees, the Operating Committee, as provided for in Article 8, and the Business Issues Committee, as provided for in Article 9, both of which shall report to the Management Committee. A Dispute Resolution Process will be established and administered by the ISO Board in accordance with Article 10.
Merger, Consolidation, Incorporation (a) Notwithstanding any other provision of this Trust Instrument to the contrary, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, (i) cause the Trust to convert into or merge, reorganize or consolidate with or into one or more trusts, partnerships, limited liability companies, associations, corporations or other business entities (each, a “Successor Entity”), or a series of any Successor Entity to the extent permitted by law, (ii) cause the Shares to be exchanged under or pursuant to any state or federal statute to the extent permitted by law, (iii) cause the Trust to incorporate under the laws of a state, commonwealth, possession or colony of the United States, (iv) sell or convey all or substantially all of the assets of the Trust or any Series or Class to another Series or Class of the Trust or to a Successor Entity, or a series of a Successor Entity to the extent permitted by law, for adequate consideration as determined by the Trustees which may include the assumption of all outstanding obligations, taxes and other liabilities, accrued or contingent of the Trust or any affected Series or Class, and which may include Shares of such other Series or Class of the Trust or shares of beneficial interest, stock or other ownership interest of such Successor Entity (or series thereof) or (v) at any time sell or convert into money all or any part of the assets of the Trust or any Series or Class thereof. Any agreement of merger, reorganization, consolidation, exchange or conversion or certificate of merger, certificate of conversion or other applicable certificate may be signed by a majority of the Trustees or an authorized officer of the Trust and facsimile signatures conveyed by electronic or telecommunication means shall be valid.
(b) Pursuant to and in accordance with the provisions of Section 3815(f) of the Act, and notwithstanding anything to the contrary contained in this Trust Instrument, an agreement of merger or consolidation approved by the Trustees in accordance with this Section 9.3 may effect any amendment to the Trust Instrument or effect the adoption of a new trust instrument of the Trust or change the name of the Trust if the Trust is the surviving or resulting entity in the merger or consolidation.
(c) Notwithstanding anything else herein, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, create one or more statutory or business trusts to which all or any part of the assets, liabilities, profits or losses of the Trust or any Series or Class thereof may be transferred and may provide for the conversion of Shares in the Trust or any Series or Class thereof into beneficial interests in any such newly created trust or trusts or any series or classes thereof.
(d) Notwithstanding any provision of this Trust Instrument to the contrary, the Trustees may, without Shareholder approval, invest all or a portion of the Trust Property of any Series, or dispose of all or a portion of the Trust Property of any Series, and invest the proceeds of such disposition in interests issued by one or more other investment companies registered under the 1940 Act. Any such other investment company may (but need not) be a trust (formed under the laws of the State of Delaware or any other state or jurisdiction) or subtrust thereof which is classified as a partnership for federal income tax purposes. Notwithstanding any provision of this Trust Instrument to the contrary, the Trustees may, without Shareholder approval unless such approval is required by the 1940 Act, cause a Series that is organized in the master/feeder fund structure to withdraw or redeem its Trust Property from the master fund and cause such series to invest its Trust Property directly in securities and other financial instruments or in another master fund.
Reorganization, Consolidation, Merger, etc In case at any time or from time to time, the Company shall (a) effect a reorganization, (b) consolidate with or merge into any other person or (c) transfer all or substantially all of its properties or assets to any other person under any plan or arrangement contemplating the dissolution of the Company, then, in each such case, as a condition to the consummation of such a transaction, proper and adequate provision shall be made by the Company whereby the Holder of this Warrant, on the exercise hereof as provided in Section 1, at any time after the consummation of such reorganization, consolidation or merger or the effective date of such dissolution, as the case may be, shall receive, in lieu of the Common Stock (or Other Securities) issuable on such exercise prior to such consummation or such effective date, the stock and other securities and property (including cash) to which such Holder would have been entitled upon such consummation or in connection with such dissolution, as the case may be, if such Holder had so exercised this Warrant, immediately prior thereto, all subject to further adjustment thereafter as provided in Section 4.
Effect of Merger on Capital Stock (a) The aggregate maximum consideration (the “Merger Consideration”) to be paid in exchange for the acquisition by Parent and Merger Sub of all outstanding Company Stock and all outstanding unexpired and unexercised options that have vested prior to Closing or that will vest in connection with Closing, warrants or other rights to acquire or receive any vested Company Stock, if any, and for the other covenants of the Company provided in this Agreement shall be, subject to adjustment as provided herein, an amount equal to (i) the Closing Amount, plus (ii) the Initial Order Cash Consideration (if any), plus (iii) the Performance Amount (if any), plus (iv) such portion of the Escrow Amount (if any) actually distributed to the Participating Holders pursuant to the terms herein, plus (v) the Post-Closing Adjustment (if any) payable to the Participating Holders pursuant to the terms herein. For the avoidance of doubt and notwithstanding anything herein to the contrary, the Payments Administrator shall not be responsible for processing any payments to be made at Closing, including without limitation the Closing Amount, but shall only be responsible for processing the post-closing payments expressly ascribed to it hereunder (which in no event shall include any amounts subject to wage or payroll tax withholding).
(b) Subject to the terms and conditions of this Agreement, at the Effective Time, by virtue of the Merger and without any action on the part of Parent, Merger Sub, the holder of any shares of Company Stock or Merger Sub Common Stock, each share of Company Stock (excluding any Restricted Shares to be exchanged pursuant to Section 1.9(c)) issued and outstanding immediately prior to the Effective Time shall automatically cease to be outstanding and shall be canceled and retired and shall cease to exist and will be converted automatically following the surrender of the certificate representing such shares of Company Stock in the manner provided in Section 1.14, into the right to receive, that portion, if any, of the Merger Consideration, without interest, as set forth below:
(i) each share of Series A Preferred Stock issued and outstanding immediately prior to the Effective Time (excluding any shares of Series A Preferred Stock to be canceled pursuant to Section 1.6(b)(iii) and any Dissenting Shares as defined in and to the extent provided in Section 1.15) shall be canceled and converted automatically into the right to receive (A) an amount in cash, without interest, equal to the Series A Per Share Closing Amount, plus (B) the contingent right to receive, in accordance with Section 1.7 hereof, an amount equal to the Pro Rata Initial Order Cash Consideration (if any), plus (C) the contingent right to receive, in accordance with Section 1.8 hereof, an amount equal to the Pro Rata Performance Amount (if any), plus (D) an amount in cash, without interest, equal to the product of (x) the Pro Rata Share multiplied by (y) any proceeds or distributions of the Escrow Amount (if, when and to the extent distributed to the Participating Holders pursuant to the terms herein), plus (E) an amount in cash, without interest, equal to the product of (x) the Pro Rata Share multiplied by (y) the Post-Closing Adjustment (if, when and to the extent distributed to the Participating Holders pursuant to the terms herein); provided, however, that, notwithstanding anything in this Agreement to the contrary, upon allocation of Merger Consideration (including, for the avoidance of doubt, the Pro Rata Share of the Escrow Amount and Post-Closing Adjustment, as applicable, initially allocable to each share of Series A Preferred Stock, whether or not actually distributed to the Participating Holders) in the aggregate equal to $21.00 per share of Series A Preferred Stock, no holder of shares of Series A Preferred Stock may receive any further distributions of Merger Consideration in respect of such shares; provided, further, that any funds that remain undistributed following application of the immediately preceding proviso (the “Series A Overflow Funds” and together with the Warrant Overflow Funds, the “Overflow Funds”) shall be distributed in accordance with Section 1.6(b)(ii) below.
(ii) each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (excluding any shares of Company Common Stock to be canceled pursuant to Section 1.6(b)(iii) and any Dissenting Shares as defined in and to the extent provided in Section 1.16) shall be canceled and converted automatically into the right to receive: (A) an amount in cash, without interest, equal to the Common Per Share Closing Amount, plus (B) the contingent right to receive, in accordance with Section 1.7 hereof, an amount equal to the Pro Rata Initial Order Cash Consideration (if any), plus (C) the contingent right to receive, in accordance with Section 1.8 hereof, an amount equal to the Pro Rata Performance Amount (if any), plus (D) an amount in cash, without interest, equal to the product of (x) the Pro Rata Share multiplied by (y) any proceeds or distributions of the Escrow Amount (if, when and to the extent distributed to the Stockholders pursuant to the terms herein), plus (E) an amount in cash, without interest, equal to the product of (x) the Pro Rata Share multiplied by (y) the Post-Closing Adjustment (if, when and to the extent distributed to the Participating Holders pursuant to the terms herein), plus (F) an amount in cash, without interest, equal to the product of (x) the Capped Pro Rata Share multiplied by (y) the amount of the Overflow Funds;
(iii) each share of Company Stock, if any, held by the Company as treasury stock immediately prior to the Effective Time, shall be canceled and extinguished without any conversion thereof, and no payment or distribution shall be made with respect thereto;
(iv) each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall be automatically converted into one (1) validly issued, fully paid and nonassessable share of common stock, $0.01 par value per share, of the Surviving Corporation, and all of such shares, as converted, shall thereafter constitute all of the issued and outstanding capital stock of the Surviving Corporation; and
(v) each share certificate of Merger Sub evidencing ownership of any shares of Merger Sub Common Stock shall continue to evidence ownership of such shares of capital stock of the Surviving Corporation; and
(vi) each share of Company Stock converted pursuant to clauses (i) and (ii) of this Section 1.6(b) shall automatically cease to be outstanding and shall be canceled and retired and shall cease to exist and each holder of a certificate representing any such share of Company Stock shall cease to have any rights with respect thereto, except the right to receive such holder’s respective portion of the Merger Consideration and all payments pursuant to this Section 1.6 shall be made in accordance with the Certificate of Incorporation.
Organizational and Capital Structure The organizational structure and capital structure of Holdings and its Subsidiaries shall be as set forth on Schedule 4.1.
Conversion of Merger Sub Capital Stock Each share of common stock, par value $0.01 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one newly issued, fully paid and non-assessable share of common stock of the Surviving Corporation.
Operations of Merger Sub Merger Sub is a direct, wholly owned subsidiary of Parent, was formed solely for the purpose of engaging in the transactions contemplated by this Agreement, has engaged in no other business activities and has conducted its operations only as contemplated by this Agreement.
