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AGREEMENT
AGREEMENT, dated as of September 21, 1999, by and between X-XxxxxxXXX.xxx LLC
("Purchaser"), Xxxx Xxxxx ("Givol"), and those entities and persons listed on
Schedule A hereto (each, a "Seller", and collectively, "Sellers").
WHEREAS the Sellers own in the aggregate 3,226,918 Ordinary Shares of Logal
Educational Software & Systems Ltd. (the "Company") as set forth on Schedule A
hereto (all of said Ordinary Shares owned by the Sellers, as set forth on
Schedule A, are referred to collectively as the "Shares"); and
WHEREAS the Sellers desire to sell all of the Shares to the Purchaser and the
Purchaser desires to purchase all of the Shares from the Sellers, pursuant to,
and subject to, the provisions set forth below;
IT IS HEREBY AGREED AS FOLLOWS:
1. Representations and Warranties.
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1.1 Each Seller hereby represents and warrants to the Purchaser that:
1.1.1 As to any Seller which is an entity, such Seller is duly
organized, validly existing, and in good standing under the laws of the country
or state in which such Seller is incorporated.
1.1.2 Such Seller holds of record and owns beneficially all of the
Shares set forth opposite such Seller's name on Schedule A hereto, and such
Shares will be sold and transferred to the Purchaser free and clear of any
restriction on transfer, tax liens, security interests, options, warrants,
purchase rights, contracts, commitments, equities, claims, and/or demands,
except that such Shares are "restricted shares" for purposes of the United
States Securities Act of 1933, as amended.
1.1.3 Such Seller is not a party to any option, warrant, purchase right,
or other contract or commitment that could require such Seller to sell,
transfer, or otherwise dispose of any of the Shares set forth opposite such
Seller's name on Schedule A hereto.
1.1.4 Such Seller is not a party to any voting, trust, proxy, or other
agreement or understanding with respect to the voting of any shares of the
Company, except an agreement between Discount Investment Corporation Ltd. and
PEC Israel Economic Corporation ("PEC/DIC Agreement") in which they agreed to
cooperate regarding the voting of all of their shares with matters relating to
any companies in which they both hold shares (including the Company).
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1.1.5 This Agreement has been duly executed by such Seller and this
Agreement constitutes a legal, valid and binding obligation of such Seller
enforceable against such Seller in accordance with its applicable terms except
as such enforcement may be limited by applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization or similar laws relating to or limiting
creditor's rights generally or by general equity principles. The execution of
this Agreement by such Seller does not, and the consummation by it of the
transactions contemplated hereby and compliance by such Seller with the
provisions hereof, will not (i) result in any conflict with, breach of, or
default (or give rise to any right of termination, cancellation or acceleration
or the loss of any benefit) under, any of the terms, conditions or provisions of
any material agreement, permit or other instrument or obligation to which such
Seller is a party (including but not limited to the PEC/DIC Agreement), and/or
(ii) violate any law or order applicable to such Seller. No consent or approval
by any governmental authority is required in connection with the execution by
such Seller of this Agreement or the consummation by such Seller of the
transactions contemplated hereby, except that the approval of the Office of the
Chief Scientist of the Ministry of Industry and Trade (the "OCS") may be
required of the Company to consummate the transactions contemplated hereby
between the Purchaser and the Sellers (and if required, such approval will be
sought by Givol as the CEO of the Company).
1.2 Givol hereby represents and warrants to the Sellers that:
1.2.1 He is the President, CEO and a Director of the Company, and has
been a shareholder of the Company since the time of the purchase of the Shares
by the Sellers.
1.2.2 It is his current intention to continue to lead the Company in
the development of its SimPlayer products.
1.2.3 He is not a party to any option, warrant, purchase right, or other
contract or commitment that could require him or the Purchaser to sell,
transfer, or otherwise dispose of any of the Shares purchased according to this
Agreement, except as set forth in this Agreement. He is not aware of any
transaction which is currently being contemplated, which involves the sale or
purchase of shares of the Company by a shareholder who currently holds 5% or
more of the Company's issued and outstanding share capital, other than possible
sales by the Sellers.
1.2.4 Other than the transactions contemplated herein, he is not aware
of (i) any material transactions of the Company which are currently pending, or
which the Company or he himself is currently negotiating, or (ii) any material
fact or information directly related to the business operation of the Company
which would have a material effect on the business, prospects, condition
(financial or otherwise), affairs, operations or assets of the Company, other
than transactions, facts, and information which have been disclosed in the
Company's filings with the Securities and Exchange Commission or reported to the
Company's Board of Directors.
1.3 The Purchaser hereby represents and warrants to the Sellers that:
1.3.1 The Purchaser is duly organized, validly existing, and in good
standing under the laws of the state of Delaware.
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1.3.2 This Agreement has been duly executed by the Purchaser and this
Agreement constitutes a legal, valid and binding obligation of the Purchaser
enforceable against it in accordance with its applicable terms , except as such
enforcement may be limited by applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization or similar laws relating to or limiting creditor's
rights generally or by general equity principles. The execution of this
Agreement by the Purchaser does not, and the consummation by the Purchaser of
the transactions contemplated hereby and compliance by the Purchaser with the
provisions hereof, will not (i) result in any conflict with, breach of, or
default (or give rise to any right of termination, cancellation or acceleration
or the loss of any benefit) under, any of the terms, conditions or provisions of
any material agreement, permit or other instrument or obligation to which the
Purchaser or the Company is a party, and/or (ii) violate any law or order
applicable to the Purchaser and/or the Company. No consent or approval by any
governmental authority is required in connection with the execution of this
Agreement or the consummation by the Purchaser of the transactions contemplated
hereby, except that the approval of the OCS may be required of the Company to
consummate the transactions contemplated hereby between the Purchaser and the
Sellers (and if required, such approval will be sought by Givol as the CEO of
the Company).
1.3.3 Fifty percent of the issued and outstanding shares of the
Purchaser are indirectly beneficially owned by Xxxx Xxxxx. Xxxxx X'Xxxxxxxxx is
the managing director of the Purchaser Xxxx Xxxxx and Xxxxx X'Xxxxxxxxx are the
sole directors of the Purchaser, and they have been duly authorized by the
Purchaser, together, to execute this Agreement on behalf of the Purchaser.
1.3.4 The Purchaser is not a party to any option, warrant, purchase
right, or other contract or commitment that could require it to sell, transfer,
or otherwise dispose of any of the Shares purchased according to this Agreement,
except as set forth in this Agreement.
2. Purchase and Sale Undertakings
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The Purchaser hereby agrees to purchase all of the Shares from the Sellers and
the Sellers hereby agree to sell all of the Shares to the Purchaser, provided
that the condition to closing set forth in Section 6 is satisfied.
3. Purchase Price
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The per-Share consideration to be paid by the Purchaser to the Sellers in
exchange for the Shares is US$0.50 (fifty U.S. cents), representing an aggregate
purchase price equaling US$ 1,613,459 (one million six hundred and thirteen
thousand four hundred and fifty nine US dollars) for all of the 3,226,918 Shares
("Purchase Price"). The bank account details of each Seller for purposes of the
Purchaser effecting such payment are set forth on Schedule A hereto.
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4. The Closing
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On the third business day after the condition set forth in Section 6 hereof will
be satisfied (or any other day agreed upon by the parties, if any) but not
earlier than the tenth business day following the date of this Agreement (as the
case may be, the "Closing Date"), the following acts shall be taken (the
"Closing") simultaneously:
At the Closing, each Seller shall execute two deeds of transfer of shares (i.e.
stock power transfers): one for the transfer of 26% of such Seller's Shares, to
K. H. Trustees Ltd. (the "Trustee"), and the other - for the transfer of 74% of
such Seller's Shares to the Purchaser. Said signed deeds, as well as all share
certificates representing all of the Shares, will be delivered by the Sellers to
the Trustee, to be held by the Trustee in escrow under the terms set forth in
the Escrow Agreement attached hereto as Exhibit F, and under the terms set forth
herein.
At the Closing, Givol shall deliver a written confirmation, signed by him and
addressed to all of the Sellers, confirming that nothing has occurred since the
date hereof which renders his representations & warranties as set forth in
Section 1.2 hereof incorrect and/or incomplete as of the Closing Date, other
than occurrences after the date hereof reported in writing to the Sellers prior
to the Closing Date and accepted by Sellers holding a majority of the Shares
being sold hereunder by the Sellers (the "Majority Group"). In the event that
material occurrences which are reported as aforesaid are not acceptable to the
Majority Group, then the Majority Group will have the right to terminate this
Agreement prior to the Closing date by furnishing written notification of such
termination to all parties hereto prior to the Closing Date. In such event, no
party hereto will have any liability towards any other party hereto with respect
to this Agreement and the termination hereof.
At the Closing, the Purchaser shall deliver a legal opinion, addressed to all of
the Sellers, substantially in the form attached hereto as Exhibit D, regarding
the execution of this Agreement by the Purchaser, and the binding effect
thereof.
At the Closing, each Seller which is an entity shall deliver a legal opinion,
addressed to the Purchaser, substantially in the form attached hereto as Exhibit
E, regarding the execution of this Agreement by such Seller, and the binding
effect thereof.
At the Closing, the Purchaser shall effect payment to the Trustee of the
Purchase Price, as set forth in Section 5 below.
5. Consummation of Purchase
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On the Closing Date, the Purchaser will transfer the Purchase Price to the
following bank account of the Trustee, and such transfer shall consummate the
sale of the Shares from the Sellers to the Purchaser: Account No. 247462 in the
name of K. H. Trustees Ltd. (for LOGAL Shareholders) at Bank Hapoalim, Branch
No. 781 (Montefiore Branch), 00 Xxxxxxxxxx Xx., Xxx-Xxxx, Xxxxxx. As soon as
practicable following the Closing (including receipt by the Trustee of the full
payment of the
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Purchase Price), the Trustee shall (i) transfer to each Seller its portion of
the Purchase Price, and (ii) deliver the deeds of transfer of shares covering
all of each Seller's Shares and the certificates representing said Shares to the
Company for cancellation and replacement, so that 74% of the Shares will be
registered and evidenced by a share certificate in the name of the Purchaser and
delivered to the Purchaser and 26% of the Shares will be registered and
evidenced by a share certificate in the name of the Trustee and delivered to the
Trustee (the "Escrow Shares"). In the event that the Closing does not occur with
respect to any Seller's Shares, all deeds of transfer of shares and certificates
shall be returned by the Trustee to each Seller respectively, and no Seller
shall receive any portion of the Purchase Price for any of the Shares, unless
all Sellers and the Purchaser shall jointly instruct the Trustee otherwise.
6. Conditions to the Closing
--------------------------------
The Closing shall be subject to the following condition. In the event that such
condition is not satisfied within 30 days after the date hereof, or any longer
period agreed upon by Purchaser and the Majority Group, this Agreement may be
terminated by the Sellers (acting through Sellers now holding a majority of the
Shares) or the Purchaser, by written notice to the other party at any time
thereafter.
Receipt of the approval of the OCS to the transaction detailed in this
Agreement, or receipt of a written confirmation of the OCS that no such approval
is required.
Givol, as the President and CEO of the Company, will take all necessary
actions to apply for such approval or confirmation of the OCS, and each party
shall act as necessary on its part in order to obtain such approval, if
required.
7. Exit-Triggered Payment
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7.1 In the event that within six (6) months following the Closing Date,
the Company or any of its shareholders (provided such shareholders include the
Purchaser) (the "Disposing Shareholders") will enter into an agreement for a
merger, sale of all or substantially all of the Company's shares held by the
Disposing Shareholders, or a sale of all or substantially all of the Company's
assets, or any offer made within such six-month period to purchase all or
substantially all of the Company's shares held by the public is accepted (each,
a "Triggering Transaction"), in which cash funds in an amount in excess of
US$0.50 per share but less than $6.00 per share will be paid or distributed to
the Disposing Shareholders, then, as soon as practicable following such payment
or distribution, the Purchaser will pay to each Seller, for each Share sold by
such Seller hereunder, 16% of the difference between (i) the amounts paid or
distributed on account of said Share, minus the projected pro rata tax per Share
payable by the Purchaser (as will be set forth in a letter to be issued by a
certified public accountant associated with one of the "Big Five" international
accounting firms, and presented to the Sellers) and investment banking/brokerage
fees per Share paid by the Purchaser per Share, all in respect of such
Triggering Transaction (and subject to submission to each Seller of the
appropriate proof of the payment of such banking/brokerage fees) and (ii) fifty
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cents ($0.50). Such payment to each Seller shall be effected by the Trustee out
of the monies in respect of the Escrow Shares being paid or distributed to the
Trustee pursuant to the Triggering Transaction, who shall then transfer such
monies to each Seller. In the event of a Triggering Transaction, the Trustee may
release the Escrow Shares to the Purchaser or to its order, but only after, or
against, the transfer of funds to all Sellers, as stated above in this Section
7, has been effected.
7.2 In the event that within six (6) months following the Closing Date,
the Company or any Disposing Shareholders (provided such shareholders include
the Purchaser) will enter into a Triggering Transaction in which the Disposing
Shareholders receive securities of another company ("New Shares") valued (at
their value for purposes of the Triggering Transaction) in excess of $0.50 but
less than $6.00 in exchange for each Company share held by them, then the New
Shares received by the Purchaser on account of each Share purchased by the
Purchaser hereunder shall be distributed among the Purchaser and the Seller of
such Share as follows: (i) for each Share sold by such Seller hereunder, the
Seller shall receive 16% of the number of New Shares receivable in respect of
such Share, provided that the Seller shall repay the Purchaser (or to the
Trustee as recipient for the Purchaser) against delivery of such New Shares to
the Seller, the sum of eight cents ($0.08), plus 16% of the projected pro rata
tax per Share payable by the Purchaser (as will be set forth in a letter to be
issued by a certified public accountant associated with one of the "Big Five"
international accounting firms, and presented to the Sellers) and 16% of the
investment banking/brokerage fees per Share paid by the Purchaser, all in
respect of such Triggering Transaction (and subject to submission to each Seller
of the appropriate proof of the payment of such banking/brokerage fees); (ii)
the balance of the New Shares will be owned by the Purchaser. For the purpose of
this section, fractions of New Shares receivable by any Seller, shall be
aggregated and the total sum of all such fractions due to such Seller shall be
rounded up or down to the nearest one whole New Share. In such event, the Escrow
Shares then being held by the Trustee as set forth above will be released to the
Purchaser or to its order, but only after the Trustee has verified that New
Shares owing to the Sellers have been distributed to the Sellers.
7.3 It is hereby clarified that, in the event that the terms of the
Triggering Transaction under Sections 7.1 or 7.2 provides for the deposit of a
portion of the consideration into escrow, the Trustee may release the Shares to
the Purchaser or to its order at the Closing of the Triggering Transaction
(notwithstanding that the relevant portion payable to the Sellers has been
deposited into such escrow), provided that such relevant portion is to be held
by the escrow for the benefit of the Trustee (on behalf of the Sellers), subject
to the terms and conditions of such escrow.
7.4 In the event of a Triggering Transaction that is consummated partly
for cash and partly for New Shares, Sections 7.1 or 7.2 shall apply on a
combined basis accordingly.
8. Buy-Back Option
----------------------
At any time within 60 months of the Closing Date ("Option Period"), but only in
the event that (i) the Company's shares are then traded on any Stock Exchange or
in any over the counter market transaction and have traded during the last five
trading days in the Company's shares at an average
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closing per-share price equal to $5.00 (five dollars) or more, or (ii) any
Triggering Transaction will be effected in which the per-share proceeds (i.e.
cash, if applicable, and/or securities (valued at their value for purposes of
the Triggering Transaction)) will equal $5.00 (five dollars) or more, each
Seller shall be entitled to cause the Purchaser to sell to such Seller a portion
of the Shares being sold by such Seller hereunder ("Buy-Back Option") at a
per-share price equal to $0.50 (fifty cents). In the event that the Buy-Back
Option is being exercised by any Seller (the "Exercising Seller") in connection
with the event set forth in clause (i) above, then the portion which may be
purchased by each Exercising Seller shall be in accordance with the average
closing share price at which the Company's shares are traded during the last
five trading days in the Company's shares immediately prior to the day that such
Exercising Seller notifies the Purchaser in writing (with a copy to the Trustee)
of Seller's irrevocable election to exercise the Buy-Back Option (the "Five-Day
Period"), all as set forth on Schedule B. Schedule C sets forth the number of
Shares which may be purchased by the Exercising Seller at the various average
prices at which the Company's shares could be traded during the Five-Day Period,
as aforesaid. In the event that the Buy-Back Option is being exercised in
connection with an event set forth in clause (ii) above, then the Buy-Back
Option may be exercised only simultaneously with the Closing of the Triggering
Transaction, and the portion which may be purchased by each Exercising Seller
shall be in accordance with the per-share proceeds of the Triggering
Transaction, all as set forth on Schedule B. Schedule C sets forth the number of
Shares which may be purchased by the Exercising Seller at the various per-share
proceeds amounts, as aforesaid. Each Seller may exercise its Buy-Back Option (A)
once, with respect to all or part of the entire number of shares he is entitled
to purchase or alternatively, (B) twice, provided that each exercise shall
relate to no more than half of the number of Shares which could then be
purchased under the Buy-Back Option on such date. (With respect to alternative
(B) only, for example, if on the notification date of the first exercise, the
maximum percentage of shares which could be purchased is 20% (as per clause (i)
or (ii) above, as the case may be), then the Exercising Seller could elect to
purchase up to 10% (not up to the entire 20%); If the Exercising Seller elects
to purchase not more than 10% , then thereafter, if (for example) on the date of
the second exercise, the maximum percentage of shares which could be purchased
is 26% (as per clause (i) or (ii) above, as the case may be), the Exercising
Seller could then purchase up to 13% (half of 26%).) In the event that such a
notification is furnished as aforesaid during the Option Period, then within
five business days thereafter, a closing shall be held at which the Escrow
Shares subject to such Seller's Buy-Back Option (or up to half of such Shares,
as the case may be) will be transferred from the Trustee to the Seller against
payment to the Purchaser (or to the Trustee for the Purchaser) of $0.50 (fifty
cents) per Share. In the event of such a transfer, the Escrow Shares being
transferred to the Exercising Seller will be transferred to the Seller, free and
clear of any restriction on transfer, tax liens, security, interests, options,
warrants, purchase rights, contracts, commitments, equities, claims, and/or
demands, against receipt of the purchase price therefor.
8A. Cancellation of Exit-Triggered Payment or Buy-Back Option
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8A.1 Notwithstanding the provisions of Section 8, in the event that a
Seller receives (i) a payment in accordance with the provisions of Section 7.1
above, or (ii) shares in accordance with the provisions of Section 7.2, or (iii)
in the event that after 6 months following the Closing Date, the Purchaser sells
all or substantially all of its holdings in the Company's shares (including the
Escrow
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Shares) to a bona fide non affiliated buyer during the Option Period at a
price-per-share less than $5.00 (five dollars), then in each such case, to the
extent not yet exercised at such time, the Buy-Back Option with respect to all
of the Sellers shall automatically be deemed void and terminated, ipso facto,
subject to the condition that if provision 8A.1 (iii) occurs during the
three-year period following the Closing Date, and in such sale, the Purchaser
will receives a price-per-Share equal to $4.00 (four dollars) or more but less
than $5.00 (five dollars), the Purchaser will transfer to the Trustee for such
Seller a sum equal to $1.00 (one dollar), multiplied by 61.5% of the number of
Escrow Shares of such Seller then held by the Trustee, and the Escrow Shares
will be released to the Purchaser or to its order only after the Trustee has
verified that the sums owing to the Sellers have been paid to them.
8A.2 Notwithstanding the provisions of Section 7, in the event that a
Seller exercises his Buy-Back Option (including exercise with respect to a
portion of the number of Shares which could then be purchased under the Buy-Back
Option by such Seller on such date), then the provisions of Sections 7.1 and 7.2
shall no longer apply with respect to such Seller.
9. Co-Sale Rights
---------------------
In the event of exercise of the Buy-Back Option by any Seller, then during the
remainder of the Option Period:
(a) such Seller shall be entitled to join and participate in any Major
Sale (as defined below) effected by the Purchaser, so that such
Seller shall be entitled to sell such number of his shares of the
Company which bears the same ratio to the number of the Company's
shares then held by such Seller as the ratio between the number of
shares of the Company agreed by the Purchaser to be sold in the
Major Sale and the number of the Company's shares then held by the
Purchaser. The sale by such Seller shall be made together with,
and at the same time, and on the same terms and conditions as, the
sale by the Purchaser of its Shares under the Major Sale. A Major
Sale shall be a transaction entered into by the Purchaser for the
sale of more than fifty percent (50%) of the shares in the Company
then held by the Purchaser, at a price-per-share equal to $5.00
(five dollars) or more. For the avoidance of doubt, a Major Sale
includes the Triggering Transaction in respect of which the
Buy-Back Option is being exercised by such Seller. No later than
ten (10) business days prior to effecting a Major Sale, the
Purchaser shall deliver to each Seller who has exercised its
Buy-Back Option (in whole or in part, as aforesaid), a written
notice detailing the then-known particulars of the Major Sale, and
thereafter shall promptly notify such Seller of any update of such
particulars. Only Sellers who have notified the Purchaser in
writing of their decision to participate in the Major Sale within
five (5) business days after delivery to all Exercising Sellers of
the Purchaser's written notice referred to above, will be
permitted to exercise their rights under this Section 9(i).
(ii) if requested in writing by the Purchaser, such Seller shall be
required to join and
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participate in any Major Sale effected by the Purchaser at a
price-per-share equal to $5 (five dollars) or more, so that such
Seller shall be required to sell such number of his shares of the
Company which bears the same ratio to the number of the Company's
shares then held by such Seller as the ratio between the number of
shares of the Company agreed by the Purchaser to be sold in the
Major Sale and the number of the Company's shares then held by the
Purchaser. The sale by such Seller shall be made together with,
and at the same time, and on the same terms and conditions as, the
sale by the Purchaser of its Shares under the Major Sale. However
such Seller shall not be bound to give any representations and/or
warranties and/or any indemnification (other than in respect of
such Seller's title the shares to be sold by such Seller, that the
sale agreement is binding on such Seller, there is not an
agreement to which such Seller is a party which is violated by
such sale, upon the transfer of such shares by such Seller they
will be free of restrictions and liens, and that the Seller has
not canceled or waived any registration rights associated with the
shares being sold by such Seller). No later than ten (10) business
days prior to effecting a Major Sale in which the Purchaser
intends to exercise its rights under this clause 9 (ii), the
Purchaser shall deliver to each Seller who has exercised its
Buy-Back Option (in whole or in part, as aforesaid), a written
notice detailing the then-known particulars of the Major Sale, and
thereafter shall promptly notify such Seller of any update of such
particulars.
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10. Remedies for Breach
--------------------------
In the event of any breach by any party of its obligation under this Agreement,
each aggrieved party shall be entitled to all remedies for breach of rights or
obligations or contract available under law. For purposes of this section, each
Seller shall be a separate party, and the Purchaser and Givol shall also be
considered separate parties. Notwithstanding the aforesaid, no party shall be
entitled to cancel or rescind this Agreement and/or the sale of the Shares to
the Purchaser hereunder due to the fact that one or more of the representations
and warranties of Givol are found to be incorrect, incomplete or misleading.
11. Resignation from Board of Directors
------------------------------------------
At the Closing, the Sellers shall cause A. I. Mlavsky, Xxxxx Xxxx, Xxxxx
Xxxxxxxx and Xxxx Xxxx to resign from the Company's Board of Directors.
12. Registration Rights
--------------------------
The Sellers hereby represent and warrant that they have not waived or canceled
the registration rights granted to them by the Company with respect to the
Shares under the Second Round Share Purchase Agreement dated August 23, 1994
between the Company and certain other parties, and they assign whatever rights
they have under such agreement.
It is hereby agreed that all registration rights attached to Shares purchased by
the Purchaser pursuant to this Agreement or re-purchased by any Seller pursuant
to the Buy-Back Option will be deemed assigned ipso facto to the Purchaser or to
the Exercising Seller, as the case may be, upon consummation of such purchase or
re-purchase, respectively.
13. Governing Law
--------------------
This Agreement shall be governed by the laws of the State of Israel, without
regard to its principles of conflicts of laws, and the parties hereto
irrevocably submit to the exclusive jurisdiction of the courts in Tel-Aviv,
Israel in respect of any dispute or matter arising out of or connected with this
Agreement.
14. Escrow Agreement
-----------------------
Upon the execution of this Agreement the parties and K.H. Trustees Ltd. will
execute an escrow agreement in the form attached hereto as Exhibit F.
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15. 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.
16. Heading, Preamble, and Schedules.
---------------------------------------
The titles and subtitles used in this Agreement are used for convenience only
and are not to be considered in construing or interpreting this Agreement. The
Preamble and Schedules are an integral and inseparable part of this Agreement.
17. Adjustments.
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For purposes of this Agreement, all prices and numbers of Shares (including
Escrow Shares) referred to herein shall be appropriately adjusted as required to
fully reflect the effect of any stock splits, consolidation of share capital,
any distribution in cash or in kind by the Companyin respect of its outstanding
shares (including bonus shares {stock dividends}) and any other similar events
which may occur with respect to the Company's share capital at any time after
the date hereof (It is being understood, that such distribution in itself will
belong to the Purchaser only, and is brought into account for adjustment
purposes only). Any distribution other then in cash shall be valued for such
purposes at the fair market value thereof. Any disagreement between the
Purchaser and the Majority Group as to the fair market value of such
distribution or the necessary adjustments pursuant to the above shall be
resolved and determined by the firm of Xxxx. Xxxxxx Xxxxx and his determination
in such matters shall be final and binding on all parties. Any time period
elapsed from the time such matter is referred to the above firm and until
resolved and determined by such firm shall be added to the six (6) and the sixty
(60) months periods referred to in sections 7 and 8 respectively.
[ End of page]
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18. The Purchaser shall promptly notify each Seller of any Triggering Event
during the Option Period, and will provide a copy of the agreement thereof and
any additional information as may be reasonably requested by any Seller in
connection therewith, including without limitation any updates relating to such
transaction and details of any valuation of the Company or of the New Shares on
which such transaction was based. Each Seller hereby undertakes: (i) to use any
copies or information provided hereunder solely for purposes of monitoring
Purchaser's compliance with the provisions of this Agreement, and (ii) not to
disclose any copies or information provided hereunder to any third party
whatsoever, other than to financial, business or other advisors of such Seller
who have executed customary confidentiality undertakings applicable to such
copies or information.
19. All notices and other communications required or permitted hereunder to be
given to a party to this Agreement shall be in writing and shall be telecopied
or mailed by registered mail, postage prepaid, or otherwise delivered by hand or
by messenger, addressed to such party's address as set forth on Schedule A
hereto or such other address with respect to a party as such party shall notify
each other party in writing as above provided. The address of the Purchaser and
Givol for purposes hereof shall be _Farrow Xxxxx Xxxxxx, Xxxxxxxx Xxxxx, Xxxxx
Xxxxxx Xxxxxx 0 Xxxxxxx Fax: 353-1- 000-0000, Att: Xxxxxx Xxxxxx or such other
address with respect to the Purchaser and/or Givol as the Purchaser and Givol
shall notify the other parties hereto in writing as above provided.
Any notice sent in accordance with this Section shall be effective (i) if
mailed, five (5) business days after mailing by registered mail, (ii) if
delivered by messenger, or transmitted by fax, on the first business day
following such delivery or transmission and telephonic confirmation of receipt.
20. The Sellers will reasonably cooperate with the Purchaser with respect to all
filing requirements with the Securities and Exchange Commission and other
governmental agencies as required under law in connection with the execution of
this Agreement, and the implementation of the transactions contemplated herein.
21. All representations and warranties given herein will survive the Closing of
the transactions contemplated herein.
[End of page]
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22. Any information reported to the Sellers pursuant to Section 4 above will
remain strictly confidential, and will not be disclosed by the Sellers. This
Section 22 shall survive any termination of the Agreement for any reason. The
Sellers obligations under this section shall terminate when such information
becomes public knowledge through no fault of the Sellers.
23. (a) This Agreement may be executed in any number of counterparts and by
facsimile, each of which shall be an original but all of which together shall
constitute one and the same agreement; (b) This Agreement, together with the
Escrow Agreement, constitutes the entire agreement and understanding among the
parties with respect to the matter thereof and may not be modified or terminated
orally or without the consent of the parties; and (c) All provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by and against the respective heirs, executors, administrators, personal
representatives, successors and assigns of the parties.
IT WITNESS WHEREOF, the parties have executed this Agreement as of the last date
written below.
------------------------------------- ------------------------------------
Xxxx Xxxxx X-XxxxxxXXX.xxx LLC
------------------------------------- ------------------------------------
Advent Israel Limited Partnership Advent Israel (Bermude) LP
------------------------------------- ------------------------------------
Advent International Investors SI LP Eventech LTD.
------------------------------------- ------------------------------------
Elron Electronic Industries Ltd. Discount Investment Corporation Ltd.
------------------------------------- ------------------------------------
Trinet Venture Capital Ltd. PEC Israel Economic Corporation
------------------------------------- ------------------------------------
Gemini Israel Fund LP The Unicycle Trading Company
------------------------------------- ------------------------------------
Atid Limited Partnership Xxxxx Xxxxxxxx
------------------------------------- ------------------------------------
Xxxxxxx Xxxxx Manakin Investments B.V.
------------------------------------- ------------------------------------
Xxxx Xxxxxxxx Crompton Ltd.
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-------------------------------------
Xxx Xxxxxxxxx
