REGISTRATION RIGHTS AGREEMENT
This
Registration Rights Agreement (this “Agreement”)
is
made and entered into as of November 20, 2006 by and between SuperCom Ltd.,
an
Israeli corporation (the “Company”),
and
the investors set forth on the signature pages affixed hereto (collectively
“SSF”).
This
Agreement is made pursuant to the Subscription Agreement, dated as of the date
hereof, between the Company and SSF (the “Subscription
Agreement”).
All
capitalized terms used but not defined herein shall bear the meaning ascribed
to
them in the Subscription Agreement.
The
parties hereby agree as follows:
1. Certain
Definitions.
As
used
in this Agreement, the following terms shall have the following
meanings:
“Affiliate”
means,
with respect to any person, any other person which directly or indirectly
controls, is controlled by, or is under common control with, such
person.
“Business
Day”
means
a
day, other than a Friday or Saturday, on which banks in New York City are open
for the general transaction of business.
“Ordinary
Shares”
shall
mean the Company’s Ordinary Shares, par value NIS0.01 per share, and any
securities into which such Ordinary Shares may hereinafter be
reclassified.
“Prospectus”
shall
mean (i) any preliminary or final prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement, with respect
to the terms of the offering of any portion of the Registrable Securities
covered by such Registration Statement and by all other amendments and
supplements to the prospectus, including post-effective amendments and all
material incorporated by reference in such prospectus, and (ii) any “free
writing prospectus” as defined in Rule 163 under the 1933 Act.
“Register,”
“registered”
and
“registration”
refer
to a registration made by preparing and filing a Registration Statement or
similar document in compliance with the 1933 Act (as defined below), and the
declaration or ordering of effectiveness of such Registration Statement or
document.
“Registrable
Securities”
shall
mean (i) the Convertible Bond Shares, (ii) the Warrant Shares, and (iii) any
other securities issued or issuable with respect to any of the securities
referenced in (i) or (ii) above, whether issued or issuable.
“Registration
Statement”
shall
mean any registration statement of the Company filed under the 1933 Act that
covers the resale of any of the Registrable Securities pursuant to the
provisions of this Agreement, amendments and supplements to such Registration
Statement, including post-effective amendments, all exhibits and all material
incorporated by reference in such Registration Statement.
“SEC”
means
the U.S. Securities and Exchange Commission.
“1933
Act”
means
the Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder.
“1934
Act”
means
the Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
2. Registration.
(a) Demand
Registration.
(i) From
the
date of this Agreement until the earlier of (i)
the
four (4) year anniversary of the Closing Date, or (ii) such date that all
Registrable Securities held or entitled to be held upon exercise by SSF may
be
sold under Rule 144(k) (or any successor rule) (the “Registration Period”), SSF
may make up to two (2) requests for registration of its Registrable Securities
(“Demand Request”); provided,
however,
that
the Company shall not be obligated to file any Registration Statement pursuant
to a Demand Request in which the anticipated aggregate offering amount of such
registration does not exceed $750,000. Upon receipt of a Demand Request, the
Company shall prepare and file with the SEC as soon as commercially reasonable,
but in any event within ninety (90) calendar days of the Demand Request) (the
“Filing Deadline”) a registration statement on Form F-1 (or, if Form F-1 is not
then available to the Company, on such form of registration statement as is
then
available to effect a registration for resale of the Registrable Securities)
covering the resale of the Registrable Securities. Subject to any SEC comments,
such Registration Statement shall include the plan of distribution attached
hereto as Exhibit
A.
Such
Registration Statement also shall cover, to the extent allowable under the
1933
Act and the rules promulgated thereunder (including Rule 416), such
indeterminate number of additional shares of Common Stock resulting from stock
splits, stock dividends or similar transactions with respect to the Registrable
Securities. The Registration Statement (and each amendment or supplement
thereto, and each request for acceleration of effectiveness thereof) shall
be
provided to SSF and its counsel prior to its filing or other submission.
(ii)
The
Company shall use commercially reasonable efforts to have the Registration
Statement declared effective as soon as practicable. The Company shall notify
SSF by facsimile or e-mail as promptly as practicable, and in any event, within
twenty-four (24) hours, after any Registration Statement is declared effective
and shall simultaneously provide SSF with copies of any related Prospectus
to be
used in connection with the sale or other disposition of the securities covered
thereby. The Company shall maintain the effectiveness of the Registration
Statement until the earlier of (i) the sale of all of the Registrable Securities
by SSF or (ii) such time as all of the Registrable Securities may be sold by
SSF
pursuant to Rule 144(k) (the “Effectiveness Period”).
(iii) If
(A) a
Registration Statement covering the Registrable Securities is not filed by
the
Filing Deadline, (B) such Registration Statement is not declared effective
by
the SEC prior to the earlier of (i) five (5) Business Days after the SEC shall
have informed the Company that no review of the Registration Statement will
be
made or that the SEC has no further comments on the Registration Statement
or
(ii) the 120th day after the Demand Request or (C) after a Registration
Statement has been declared effective by the SEC, sales cannot be made pursuant
to such Registration Statement for any reason (including without limitation
by
reason of a stop order, or the Company’s failure to update the Registration
Statement), but excluding the inability of SSF to sell the Registrable
Securities covered thereby due to market conditions and except for an Allowed
Delay or an Allowed Suspension (each, an “Event” and the date on which such
Event occurs, the “Event Date”), then SSF shall be permitted to accelerate 15%
of the then outstanding principal amount of its Convertible Bonds and the
accrued, but unpaid, interest on such principal amount. For each additional
30-day period following the Event Date until the Event is cured, SSF shall
be
permitted to accelerate an additional 15% of the outstanding principal amount
of
its Convertible Bonds and the accrued, but unpaid, interest on such principal
amount. Such right of acceleration shall constitute SSF’s exclusive remedy for
such events, but shall not affect the right of SSF to seek injunctive
relief.
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(iv) Notwithstanding
the foregoing obligations, if the Company furnishes to SSF a certificate signed
by the Company’s chief executive officer stating that in the good faith judgment
of the Company’s Board of Directors it would be materially detrimental to the
Company and its stockholders for such registration statement to either become
effective or remain effective for as long as such registration statement
otherwise would be required to remain effective, because such action would
(i)
materially interfere with a significant acquisition, corporate reorganization,
or other similar transaction involving the Company; or (ii) require premature
disclosure of material information that the Company has a bona fide business
purpose for preserving as confidential; then the Company shall have the right
to
defer taking action with respect to such filing
for a
period of not more than 30 consecutive days or 45 days in any 365-day period
(an
“Allowed Delay”); provided,
further,
that
the Company shall not register or maintain the effectiveness of any registration
statement relating to other shares during such deferral period; and provided,
further,
that if
SSF disapproves of the deferral of the registration, it may elect to withdraw
its request by written notice to the Company, in which case such registration,
if effected, shall not be counted for the purposes of this Section
2(a).
(b) Piggyback
Registration.
(i) During
the Registration Period, if the Company proposes, at any time after the lapse
of
a ninety (90)-day period following the Closing Date, to register any of its
securities (other than a registration statement on Form S-8 or any equivalent
or
successor form), for its own account or for the account of any other
person,
it
shall give notice to SSF of such intention. Upon the written request of SSF,
given within twenty (20) days after receipt of any such notice, the Company
shall include in such registration all of the Registrable Securities (as defined
below) indicated in such request, so as to permit the disposition of the shares
so registered in the manner requested by SSF.
(ii) Notwithstanding
any other provision of this Section 2(b), with respect to an
underwritten
public
offering by the Company, if the managing underwriter advises the Company in
writing that marketing or other factors require a limitation of the number
of
shares to be underwritten, then there shall be excluded from such registration
and underwriting to the extent necessary to satisfy such limitation, Registrable
Securities held by SSF and by other shareholders of the Company who are entitled
to have their shares included in such registration, pro rata among them to
the
extent necessary to satisfy such limitation. SSF shall agree not to sell any
Registrable Securities included in the underwritten public offering for such
period as may be required by the managing underwriter. Notwithstanding the
provisions of this Section 2(b)(ii), the Company shall have the right at any
time after it shall have given notice to SSF, to elect not to file any such
proposed registration statement.
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(c) Expenses.
The
Company will pay all expenses associated with each registration, including
filing and printing fees, the Company’s counsel and accounting fees and
expenses, costs associated with clearing the Registrable Securities for sale
under applicable state securities laws and listing fees, but excluding
discounts, commissions, fees of underwriters, selling brokers, dealer managers
or similar securities industry professionals with respect to the Registrable
Securities being sold.
(d) SSF
Information.
Notwithstanding anything herein to the contrary, the Company’s obligations
hereunder shall be suspended with respect to the Registrable Securities in
the
event that SSF fails to provide promptly to the Company such information as
the
Company may reasonably request at any time, provided that the Company shall
request such information only to the extent required to enable the Company
to
comply with any applicable law or regulation or to facilitate preparation of
a
Registration Statement.
(e) Suspension
(i) Subject
to Section 2(e)(ii) below, in the event of: (1) any request by the SEC or any
other U.S. federal or state governmental authority during the Effectiveness
Period for amendments or supplements to a Registration Statement or related
prospectus or for additional information, (2) the issuance by the SEC or any
other U.S. federal or state governmental authority of any stop order suspending
the effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose, (3) the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from
qualification of any of the Registrable Securities for sale in any jurisdiction
or the initiation of any proceeding for such purpose, or (4) any event or
circumstance which necessitates the making of any changes in the Registration
Statement or Prospectus, or any document incorporated or deemed to be
incorporated therein by reference, so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or any
omission to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading, and that in the case of the
Prospectus, it will not contain any untrue statement of a material fact or
any
omission to state a material fact required to be stated therein or necessary
to
make the statements therein, in the light of the circumstances under which
they
were made, not misleading, then the Company shall deliver a certificate in
writing to SSF (“Suspension Notice”) to the effect of the foregoing (which
notice will not disclose the content of any material non-public information
and
will indicate the date of the beginning and end of the intended period of
suspension, if known), and, upon receipt of such Suspension Notice, SSF will
discontinue disposition of Registrable Securities covered by the Registration
Statement or Prospectus (“Suspension”) until SSF's receipt of copies of a
supplemented or amended Prospectus prepared and filed by the Company, or until
SSF is advised in writing by the Company that the current Prospectus may be
used, and have received copies of any additional or supplemental filings that
are incorporated or deemed incorporated by reference in any such prospectus.
In
the event of any Suspension, the Company will use its commercially reasonable
efforts to cause the use of the Prospectus so suspended to be resumed as soon
as
possible after delivery of a Suspension Notice to SSF. The Suspension and
Suspension Notice described in this Section 2(e)(ii) shall be held by SSF in
strictest confidence and shall not be disclosed by SSF. The Company shall not
have the right to impose any Suspension for more than 20 consecutive days or
more than 45 days in any 365-day period (an “Allowed Suspension”).
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3. Company
Obligations.
The
Company will use commercially reasonable efforts to effect the registration
of
the Registrable Securities in accordance with the terms hereof, and pursuant
thereto the Company will, as expeditiously as possible:
(a) prepare
and file with the SEC such amendments and post-effective amendments to the
Registration Statement and the Prospectus as may be necessary to keep the
Registration Statement effective for the applicable periods and to comply with
the provisions of the 1933 Act and the 1934 Act with respect to the distribution
of all of the Registrable Securities covered thereby;
(b) furnish
to SSF (i) promptly after the same is prepared and publicly distributed, filed
with the SEC, or received by the Company (but not later than four (4) Business
Days after the filing date, receipt date or sending date, as the case may be)
one (1) copy of any Registration Statement and any amendment thereto, each
preliminary prospectus and Prospectus and each amendment or supplement thereto,
and each letter written by or on behalf of the Company to the SEC or the staff
of the SEC, and each item of correspondence from the SEC or the staff of the
SEC, in each case relating to such Registration Statement if and to the extent
the Company deems such information to be applicable to SSF (other than any
portion of any thereof which contains information for which the Company has
sought confidential treatment), and (ii) such number of copies of a Prospectus,
including a preliminary prospectus, and all amendments and supplements thereto
and such other documents as SSF may reasonably request in order to facilitate
the disposition of the Registrable Securities owned by SSF that are covered
by
the related Registration Statement;
(c) furnish,
at the request of SSF upon requesting registration of Registrable Securities
pursuant to this Agreement, on the date that such Registrable Securities 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 copy of 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 SSF requesting registration of Registrable
Securities;
(d) 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. SSF shall also enter into and perform
its obligations under such an agreement;
(e) use
commercially reasonable efforts to (i) prevent the issuance of any stop order
or
other suspension of effectiveness and, (ii) if such order is issued, obtain
the
withdrawal of any such order at the earliest possible moment;
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(f) prior
to
any public offering of Registrable Securities, use commercially reasonable
efforts to register or qualify or cooperate with SSF and its counsel in
connection with the registration or qualification of such Registrable Securities
for offer and sale under the securities or blue sky laws of such jurisdictions
requested by SSF and do any and all other commercially reasonable acts or things
necessary or advisable to enable the distribution in such jurisdictions of
the
Registrable Securities covered by the Registration Statement;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to (i) qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(f), (ii) subject itself to general taxation in any jurisdiction where
it would not otherwise be so subject but for this Section 3(f), or (iii) file
a
general consent to service of process in any such jurisdiction;
(g) use
commercially reasonable efforts to cause all Registrable Securities covered
by a
Registration Statement to be listed on each securities exchange, interdealer
quotation system or other market on which similar securities issued by the
Company are then listed;
(h) immediately
notify SSF, at any time prior to the end of the effectiveness, upon discovery
that, or upon the happening of any event as a result of which, the Prospectus
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, and promptly
prepare, file with the SEC and furnish to such holder a reasonable number of
copies of a supplement to or an amendment of such Prospectus as may be necessary
so that such Prospectus shall not include an untrue statement of a material
fact
or omit to state a material fact required to be stated therein or necessary
to
make the statements therein not misleading in light of the circumstances then
existing;
(i) comply
with all applicable rules and regulations of the SEC under the 1933 Act and
the
1934 Act, including, without limitation, Rule 172 under the 1933 Act, file
any
final Prospectus, including any supplement or amendment thereof, with the SEC
pursuant to Rule 424 under the 1933 Act, promptly inform SSF in writing if,
at
any time during the Effectiveness Period, the Company does not satisfy the
conditions specified in Rule 172 and, as a result thereof, SSF is required
to
deliver a Prospectus in connection with any disposition of Registrable
Securities and take such other actions as may be reasonably necessary to
facilitate the registration of the Registrable Securities hereunder; and make
available to its security holders, as soon as reasonably practicable, but not
later than the Availability Date (as defined below), an earnings statement
covering a period of at least twelve (12) months, beginning after the effective
date of each Registration Statement, which earnings statement shall satisfy
the
provisions of Section 11(a) of the 1933 Act, including Rule 158 promulgated
thereunder (for the purpose of this subsection 3(i), “Availability Date” means
the 45th day following the end of the fourth fiscal quarter that includes the
effective date of such Registration Statement, except that, if such fourth
fiscal quarter is the last quarter of the Company’s fiscal year, “Availability
Date” means the 90th day after the end of such fourth fiscal quarter);
and
(j) With
a
view to making available to SSF the benefits of Rule 144 (or its successor
rule)
and any other rule or regulation of the SEC that may at any time permit SSF
to
sell Ordinary Shares to the public without registration, the Company covenants
and agrees to use its commercially reasonable efforts to: (i) make and keep
public information available, as those terms are understood and defined in
Rule
144, until the earlier of (A) such date as all of the Registrable Securities
may
be resold pursuant to Rule 144(k) or any other rule of similar effect or (B)
such date as all of the Registrable Securities shall have been resold; and
(ii)
file with the SEC in a timely manner all reports and other documents required
of
the Company under the 1934 Act; and (iii) furnish to SSF, so long as SSF owns
Registrable Securities, forthwith upon request (A) a written statement by the
Company that it has complied with the reporting requirements of SEC Rule 144
(at
any time after one hundred and twenty (120) days after the effective date of
the
first registration statement filed by the Company), the 1933 Act and the 1934
Act (at any time after it has become subject to such reporting requirements)
and
(B) such other information as may be reasonably requested in order to avail
SSF
of any rule or regulation of the SEC that permits the selling of any such
Registrable Securities without registration.
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4. Information.
The
Company shall not disclose material nonpublic information to SSF, or to advisors
to or representatives of SSF, unless prior to disclosure of such information
the
Company identifies such information as being material nonpublic information
and
provides SSF, such advisors and representatives with the opportunity to accept
or refuse to accept such material nonpublic information for review and SSF,
if
it wishes to obtain such information, enters into an appropriate confidentiality
agreement with the Company with respect thereto.
5. Obligations
of SSF.
(a) SSF
shall
furnish in writing to the Company such information regarding itself, the
Registrable Securities held by it and the intended method of disposition of
the
Registrable Securities held by it, as shall be reasonably required to effect
the
registration of such Registrable Securities and shall execute such documents
in
connection with such registration as the Company may reasonably request. At
least ten (10) Business Days prior to the first anticipated filing date of
any
Registration Statement, the Company shall notify SSF of the information the
Company requires from SSF to have any of the Registrable Securities included
in
the Registration Statement. SSF shall provide such information to the Company
at
least three (3) Business Days prior to the first anticipated filing date of
such
Registration Statement to have any of the Registrable Securities included in
the
Registration Statement.
(b) SSF,
by
its acceptance of the Registrable Securities, agrees to cooperate with the
Company as reasonably requested by the Company in connection with the
preparation and filing of a Registration Statement hereunder.
(c) SSF
agrees that, upon receipt of any notice from the Company of either (i) the
commencement of the applicable suspension pursuant to Section 2(e) above, or
(ii) the happening of an event pursuant to Section 3(h) hereof, SSF will
immediately discontinue disposition of Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities, until SSF is
advised by the Company that such dispositions may again be made.
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6. Indemnification.
(a)Indemnification
by the Company.
The
Company will indemnify and hold harmless SSF and its officers, directors,
employees and agents, successors and assigns, and each other person, if any,
who
controls SSF within the meaning of the 1933 Act, against any losses, claims,
damages or liabilities, joint or several, to which they may become subject
under
the 1933 Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i)
any breach by it of its obligations hereunder; (ii) any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement, any preliminary Prospectus or final Prospectus, or any amendment
or
supplement thereof; (iii) any blue sky application or other document executed
by
the Company specifically for that purpose or based upon written information
furnished by the Company filed in any state or other jurisdiction in order
to
qualify any or all of the Registrable Securities under the securities laws
thereof (any such application, document or information herein called a “Blue Sky
Application”); (iv) the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading; (v) any violation by the Company or its agents of any rule
or
regulation promulgated under the 1933 Act applicable to the Company or its
agents and relating to action or inaction required of the Company in connection
with such registration; or (vi) any failure to register or qualify the
Registrable Securities included in any such Registration in any state where
the
Company or its agents has affirmatively undertaken or agreed in writing that
the
Company will undertake such registration or qualification on SSF’s behalf and
will reimburse SSF, and each such officer, director or member and each such
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided,
however,
that
the Company will not be liable in any such case if and to the extent that any
such loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission so made
in
conformity with information furnished by SSF or any such controlling person
in
writing specifically for use in such Registration Statement or
Prospectus.
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(b)Indemnification
by SSF.
SSF
agrees to indemnify and hold harmless the Company, its directors, officers,
employees, agents, successors and assigns, and each person who controls the
Company (within the meaning of the 0000 Xxx) against any losses, claims,
damages, liabilities and expense (including reasonable attorney fees) resulting
from any untrue statement or alleged untrue statement of a material fact or
any
omission or alleged omission of a material fact required to be stated in the
Registration Statement or Prospectus or amendment or supplement thereto or
necessary to make the statements therein not misleading, to the extent, but
only
to the extent, that such untrue or alleged untrue statement or omission or
alleged omission is contained in information furnished in writing by SSF to
the
Company specifically for inclusion in such Registration Statement or preliminary
Prospectus or Prospectus or amendment or supplement thereto. In no event shall
the liability of SSF be greater in amount than the dollar amount of the proceeds
(net of all expense paid by SSF in connection with any claim relating to this
Section 6 and the amount of any damages SSF has otherwise been required to
pay
by reason of such untrue statement or omission) received by SSF upon the sale
of
the Registrable Securities included in the Registration Statement giving rise
to
such indemnification obligation. For the avoidance of doubt, the provisions
of
this Section 6(b) will remain in full force and effect and survive the sale
by
SSF of the Registrable Securities covered by the Registration
Statement.
(c) Conduct
of Indemnification Proceedings.
Any
person entitled to indemnification hereunder shall (i) give prompt notice to
the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) permit such indemnifying party to assume the defense of such claim
with
counsel reasonably satisfactory to the indemnified party; provided
that any
person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such person unless
(a)
the indemnifying party has agreed to pay such fees or expenses, or (b) the
indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such person or (c) in the reasonable
judgment of any such person, based upon written advice of its counsel, a
conflict of interest exists between such person and the indemnifying party
with
respect to such claims (in which case, if the person notifies the indemnifying
party in writing that such person elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such claim on behalf of such person); and
provided,
further,
that
the failure of any indemnified party to give notice as provided herein shall
not
relieve the indemnifying party of its obligations hereunder, except to the
extent that such failure to give notice shall materially adversely affect the
indemnifying party in the defense of any such claim or litigation. It is
understood that the indemnifying party shall not, in connection with any
proceeding in the same jurisdiction, be liable for fees or expenses of more
than
one separate firm of attorneys at any time for all such indemnified parties.
No
indemnifying party will, except with the consent of the indemnified party,
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 of such
claim or litigation.
(d) Contribution.
If for
any reason the indemnification provided for in the preceding paragraphs (a)
and
(b) is unavailable to an indemnified party or insufficient to hold it harmless,
other than as expressly specified therein, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result
of
such loss, claim, damage or liability in such proportion as is appropriate
to
reflect the relative fault of the indemnified party and the indemnifying party,
as well as any other relevant equitable considerations. No person guilty of
fraudulent misrepresentation within the meaning of Section 11(f) of the 1933
Act
shall be entitled to contribution from any person not guilty of such fraudulent
misrepresentation. In no event shall the contribution obligation of a holder
of
Registrable Securities be greater in amount than the dollar amount of the
proceeds (net of all expenses paid by such holder in connection with any claim
relating to this Section 6 and the amount of any damages such holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission) received by it upon the sale of
the
Registrable Securities giving rise to such contribution obligation.
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7. Miscellaneous.
(a) Amendments
and Waivers.
This
Agreement may be amended only by a writing signed by the Company and SSF. The
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of
SSF.
(b) Notices.
All
notices and other communications provided for or permitted hereunder shall
be
made as set forth in Section 4.1 of the Subscription Agreement.
(c) Assignments
and Transfers.
This
Agreement may not be assigned by either party (whether by operation of law
or
otherwise) without the prior written consent of the other party, provided,
however, that each party may assign its rights and delegate its duties hereunder
to any surviving or successor entity in connection with a merger or
consolidation with such surviving or successor entity, or a sale, transfer
or
other disposition of all or substantially all of the such party’s assets to
another entity after notice duly given to the other party.
(d) Benefits
of the Agreement.
The
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective permitted successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
(e) Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
instrument.
(f) Titles
and Subtitles.
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.
(g) Severability.
Any
provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof but shall be interpreted as if it were written so as to be
enforceable to the maximum extent permitted by applicable law, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law
which
renders any provisions hereof prohibited or unenforceable in any
respect.
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(h) Further
Assurances.
The
parties shall execute and deliver all such further instruments and documents
and
take all such other actions as may reasonably be required to carry out the
transactions contemplated hereby and to evidence the fulfillment of the
agreements herein contained.
(i) Entire
Agreement.
This
Agreement is intended by the parties as a final expression of their agreement
and intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. This Agreement supersedes all prior agreements and understandings
between the parties with respect to such subject matter.
(j) Governing
Law; Consent to Jurisdiction; Waiver of Jury Trial.
This
Agreement shall be governed by, and construed in accordance with, the internal
laws of the State of New York without regard to the choice of law principles
thereof. Each of the parties hereto irrevocably submits to the exclusive
jurisdiction of the courts of the State of New York located in New York County
and the United States District Court for the Southern District of New York
for
the purpose of any suit, action, proceeding or judgment relating to or arising
out of this Agreement and the transactions contemplated hereby. Service of
process in connection with any such suit, action or proceeding may be served
on
each party hereto anywhere in the world by the same methods as are specified
for
the giving of notices under this Agreement. Each of the parties hereto
irrevocably consents to the jurisdiction of any such court in any such suit,
action or proceeding and to the laying of venue in such court. Each party hereto
irrevocably waives any objection to the laying of venue of any such suit, action
or proceeding brought in such courts and irrevocably waives any claim that
any
such suit, action or proceeding brought in any such court has been brought
in an
inconvenient forum. EACH
OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY
LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN
CONSULTED SPECIFICALLY AS TO THIS WAIVER.
-11-
IN
WITNESS WHEREOF, the parties have executed this Agreement or caused their duly
authorized officers to execute this Agreement as of the date first above
written.
|
By:
Name:
Title:
SPECIAL
SITUATIONS FUND III QP, L.P.
By:
Name:
Xxxxx X. Greenhouse
Title:
General Partner
SPECIAL
SITUATIONS FUND III, L.P.
By:
Name:
Xxxxx X. Greenhouse
Title:
General Partner
SPECIAL
SITUATIONS CAYMAN FUND, L.P.
By:
Name:
Xxxxx X. Greenhouse
Title:
General Partner
|
-12-
Exhibit
A
Plan
of
Distribution
The
selling stockholders, which as used herein includes donees, pledgees,
transferees or other successors-in-interest selling Ordinary Shares or interests
therein received after the date of this prospectus from a selling stockholder
as
a gift, pledge, partnership distribution or other transfer, may, from time
to
time, sell, transfer or otherwise dispose of any or all of their Ordinary Shares
or interests therein on any stock exchange, market or trading facility on which
the Ordinary Shares are traded or in private transactions. These dispositions
may be at fixed prices, at prevailing market prices at the time of sale, at
prices related to the prevailing market price, at varying prices determined
at
the time of sale, or at negotiated prices.
The
selling stockholders may use any one or more of the following methods when
disposing of Ordinary Shares or interests therein:
-
ordinary brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
-
block
trades in which the broker-dealer will attempt to sell the Ordinary Shares
as
agent, but may position and resell a portion of the block as principal to
facilitate the transaction;
-
purchases by a broker-dealer as principal and resale by the broker-dealer for
its account;
-
an
exchange distribution in accordance with the rules of the applicable
exchange;
-
privately negotiated transactions;
-
short
sales effected after the date the registration statement of which this
Prospectus is a part is declared effective by the SEC;
-
through
the writing or settlement of options or other hedging transactions, whether
through an options exchange or otherwise;
-
broker-dealers may agree with the selling stockholders to sell a specified
number of such Ordinary Shares at a stipulated price per Ordinary Share;
and
-
a
combination of any such methods of sale.
The
selling stockholders may, from time to time, pledge or grant a security interest
in some or all of the Ordinary Shares owned by them and, if they default in
the
performance of their secured obligations, the pledgees or secured parties may
offer and sell the Ordinary Shares, from time to time, under this prospectus,
or
under an amendment to this prospectus under Rule 424(b)(3) or other applicable
provision of the Securities Act amending the list of selling stockholders to
include the pledgee, transferee or other successors in interest as selling
stockholders under this prospectus. The selling stockholders also may transfer
the Ordinary Shares in other circumstances, in which case the transferees,
pledgees or other successors in interest will be the selling beneficial owners
for purposes of this prospectus.
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In
connection with the sale of Ordinary Shares or interests therein, the selling
stockholders may enter into hedging transactions with broker-dealers or other
financial institutions, which may in turn engage in short sales of the Ordinary
Shares in the course of hedging the positions they assume. The selling
stockholders may also sell Ordinary Shares short and deliver these securities
to
close out their short positions, or loan or pledge the Ordinary Shares to
broker-dealers that in turn may sell these securities. The selling stockholders
may also enter into option or other transactions with broker-dealers or other
financial institutions or the creation of one or more derivative securities
which require the delivery to such broker-dealer or other financial institution
of Ordinary Shares offered by this prospectus, which Ordinary Shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such
transaction).
The
aggregate proceeds to the selling stockholders from the Ordinary Shares offered
by them will be the purchase price of the Ordinary Shares less discounts or
commissions, if any. Each of the selling stockholders reserves the right to
accept and, together with their agents from time to time, to reject, in whole
or
in part, any proposed purchase of Ordinary Shares to be made directly or through
agents. We will not receive any of the proceeds from this offering. Upon any
exercise of the warrants by payment of cash, however, we will receive the
exercise price of the warrants.
The
selling stockholders also may resell all or a portion of the Ordinary Shares
in
open market transactions in reliance upon Rule 144 under the Securities Act
of
1933, provided that they meet the criteria and conform to the requirements
of
that rule.
The
selling stockholders and any underwriters, broker-dealers or agents that
participate in the sale of Ordinary Shares or interests therein may be
"underwriters" within the meaning of Section 2(11) of the Securities Act. Any
discounts, commissions, concessions or profit they earn on any resale of the
Ordinary Shares may be underwriting discounts and commissions under the
Securities Act. Selling stockholders who are "underwriters" within the meaning
of Section 2(11) of the Securities Act will be subject to the prospectus
delivery requirements of the Securities Act.
To
the
extent required, the Ordinary Shares to be sold, the names of the selling
stockholders, the respective purchase prices and public offering prices, the
names of any agents, dealer or underwriter, any applicable commissions or
discounts with respect to a particular offer will be set forth in an
accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this
prospectus.
In
order
to comply with the securities laws of some states, if applicable, the Ordinary
Shares may be sold in these jurisdictions only through registered or licensed
brokers or dealers. In addition, in some states the Ordinary Shares may not
be
sold unless they have been registered or qualified for sale or an exemption
from
registration or qualification requirements is available and is complied
with.
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We
have
advised the selling stockholders that the anti-manipulation rules of Regulation
M under the Exchange Act may apply to sales of the Ordinary Shares in the market
and to the activities of the selling stockholders and their affiliates. In
addition, to the extent applicable we will make copies of this prospectus (as
it
may be supplemented or amended from time to time) available to the selling
stockholders for the purpose of satisfying the prospectus delivery requirements
of the Securities Act. The selling stockholders may indemnify any broker-dealer
that participates in transactions involving the sale of the Ordinary Shares
against certain liabilities, including liabilities arising under the Securities
Act.
We
have
agreed to indemnify the selling stockholders against liabilities, including
liabilities under the Securities Act and state securities laws, relating to
the
registration of the Ordinary Shares offered by this prospectus.
We
have
agreed with the selling stockholders to keep the registration statement of
which
this prospectus constitutes a part effective until the earlier of (1) such
time
as all of the Ordinary Shares covered by this prospectus have been disposed
of
pursuant to and in accordance with the registration statement or (2) the date
on
which the Ordinary Shares may be sold pursuant to Rule 144(k) of the Securities
Act.
-15-
