Common use of Restrictions on Transferability of Securities Clause in Contracts

Restrictions on Transferability of Securities. Except as set forth in this Section 9, the Present Shareholders and the Purchaser agree not to sell or transfer any of their shares and rights in the Company to a third party. This Section 9 will terminate upon the initial offering of the Company's shares to the public. 9.1 For the purpose of this Section 9, the shareholders, the Purchaser and the Other Purchasers will be regarded as the following Groups: (a) Zisapel Group - Xxxxxx Xxxxxxx, Xxxxx Xxxxxxx, the Trust and RAD Data Communications Ltd. (b) Clal Group - Clal Venture Capital LP, ECI Telecom Ltd. (c) Finovelec Group - Finovelec, Factory Systemes, Houston Venture Partners Ltd. (d) Capital Group - Xxxxx Xxxxx, Xxxxxxx Xxxxxx, Xxxx Xxxxxx, W.S.P. Capital (e) Maritime Group - Lerosh Investments Ltd., Gevahim Investments House Limited Ltd., Xx. Xxxx Xxxxxxxxx, Permal Emerging Growth V Ltd., Maritime-Julex Investment Ltd., Xx. Xxxxxx Xxxxxx and Xx. Xxx Xxx. 9.2 Group Members are entitled to transfer shares among themselves for consideration or without consideration without any restrictions. 9.3 Except as set forth in sections 9.9, 9.10 and 9.11 hereinbelow, any shareholder who shall elect to transfer (hereinafter "Seller") all or part of his shares, not in accordance with subsection 9.2 (hereinafter "Offered Shares") shall offer them first to the other registered shareholders of the Company at that time (hereinafter "Offerees") on a pro rata basis based on their share in the share capital of the Company. 9.4 In the event any such Offeree fails to exercise his right to purchase his Offered Shares within forty-five (45) days from the date the offer is made, then the Seller shall have the right to offer the Offered Shares to a third party at the same price and upon the same terms of sale as those offered to the other shareholders under section 9.3 and provided that said third party shall undertake all of Seller's obligations under this Agreement. (Such third party to be called hereunder, the "Transferee"). In the event that the shares are not sold to said party within six (6) months as of the offer to such said third party, then Section