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EXHIBIT 10.47
REGISTRATION RIGHTS AGREEMENT
Made and entered into this __________ day of August 1997 by and and among AG
Associates (Israel) Ltd., an Israeli company of Ramat Xxxxxxx Industrial Park,
P.O.B. 171, Xxxxxx Haemek 00000, Xxxxxx (the "Company"), AG Associates Inc., a
California corporation of 0000 Xxxxxxx Xxxxx, Xxx Xxxx, Xxxxxxxxxx 00000, XXX
("AGA,'), Clal Electronics Industries Ltd., an Israeli company of Xxxxxxxx 0,
Xxx Xxxx, Xxxxxx ("CLAL"), and each of the Subscribers (as defined herein). All
of the above parties, are collectively referred to herein as the "Parties" and
each party is individually referred to herein as a "Party".
The parties hereby covenant and agrees as follows:
1. Binding Effect
This Registration Rights Agreement shall become effective, be valid and
binding, among and between the Company, AGA, CLAL and each of the
Subscribers (as defined herein), only if and when a Closing under the
Subscription Agreement (as hereinbelow defined), has been held, ipso facto.
2. Definitions
2.1 The "Subscription Agreement" - the Preferred Shares Subscription
Agreement executed by subscribers for the purchase of the Company's
Preferred Shares, to which the form of this Registration Rights
Agreement is attached as an Annex thereto.
2.2 Capitalized terms unless otherwise defined herein shall have the
meanings ascribed to such terms in the Subscription Agreement.
2.3 The term "Subscriber(s) " as used herein shall mean any and all
Subscribers, as this term is defined in the Subscription Agreement
(excluding CLAL), and each of the Subscribers shall herein be
referred to as a "Subscriber".
2.4 The term "Securities Act" as used herein shall mean the U.S.
Securities Act of 1933, as amended, or any similar successor federal
statute and the rules and regulations thereunder, all as the same
shall be in effect from time to time.
2.5 The term "Exchange Act" as used herein shall mean the U.S. Securities
Exchange Act of 1934, as amended, or any similar successor federal
statute and the rules and regulations thereunder, all as the same
shall be in effect from time to time.
2.6 The term "Registrable Securities" as used herein shall mean any of the
following:
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(i) all of the Ordinary Shares of the Company held on the date of
execution hereof by each of CLAL and AGA; and
(ii) all of the Ordinary Shares issued upon conversion of the Preferred
Shares purchased under the Subscription Agreement (and/or upon
conversion of any preferred shares issued by virtue of the
abovesaid Preferred Shares as a result of issuance under the
Anti-Dilution provision set forth in Section 6.2 to the
Shareholders Agreement any stock split, bonus shares or the like);
and
(iii) all Ordinary Shares purchased pursuant to a pre-emptive right and
right of first refusal by virtue of the shares described in this
Section 2.6, and all Ordinary Shares issued on conversion of other
securities so purchased; and
(iv) all Ordinary Shares issued by virtue of such Ordinary Shares
described in clauses (i), (ii) and (iii) above, as a result of any
stock split, bonus shares or the like;
excluding in all cases: (i) any shares sold in a transaction, in which the
rights under this Agreement are not assigned in accordance herewith; and
(ii) shares which have previously been registered; and (iii) shares sold
to the public or pursuant to Rule 144, promulgated under the Securities
Act.
2.7 The term "AGA's Registrable Securities" as used herein shall mean
Registrable Securities which are held by AGA at the time in question and
by any assignee(s) to whom AGA's Registrable Securities were transferred,
provided that such transfer was made in accordance with the terms herein
and in accordance with the terms of any other applicable agreement,
including, without limitation, the Company's Articles of Association.
2.8 The term "CLAL's Registrable Securities" as used herein shall mean
Registrable Securities which are held by CLAL at the time in question and
by any assignee(s) to whom CLAL's Registrable Securities were transferred,
provided that such transfer was made in accordance with the terms herein
and in accordance with the terms of any other applicable agreement,
including, without limitation, the Companys Articles of Association.
2.9 The term "the Subscribers' Registrable Securities" 'as used herein shall
mean Registrable Securities which are held by the Subscribers at the time
in question and by any assignee(s) to whom the Subscribers' Registrable
Securities were transferred, provided that such transfer was made in
accordance with the terms herein and in accordance with the terms of any
other applicable agreement, including, without limitation, the Company's
Articles of Association.
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2.10 The term "Majority Holders" as used herein shall mean holders of
Registrable Securities holding, at the time in question, more than 50% of
the shareholdings of the particular Registrable Securities in question.
2.11 The term "SEC" as used herein means the securities exchange commission or
successor agency that administers the Securities Act.
3. Demand Registration
(a) Request by holders
If the Company receives at any time after the lapse of one hundred and
eighty (180 days) following the Company's initial public offering of
securities, a written demand from the Majority Holders of AGA's
Registrable Securities, or from the Majority Holders of CLAL's
Registrable Securities, or from the Majority Holders of the
Subscribers' Registrable Securities, or from the Majority Holders of
all Registrable Securities (the "Initiating Holders"), that the
Company effect a registration under the Securities Act covering all or
part of the Registrable Securities of such Initiating Holders, the
Company will promptly give each of the holders of Registrable
Securities written notice thereof and as soon as practicable, and
subject to the terms and limitations set forth herein, shall act to
effect such registration of the Registrable Securities requested to be
registered by the Initiating Holders, in the aforesaid written demand
together with the Registrable Securities of holders who are joining in
such request as provided in such holder's written reply received by
the Company within 20 days after deliver of the Company's abovesaid
notice.
The Company shall not be obligated to effect more than a total of four
(4) registrations, in response to a demand made hereunder of which:
one (1) registrations demanded by the Majority Holders of AGA's
Registrable Securities, one (1) registrations demanded by the Majority
Holders of CLAL's Registrable Securities, one (1) registrations
demanded by the Majority Holders of the Subscribers' Registrable
Securities and one (1) registration demanded by the Majority Holders
of all Registrable Securities.
(b) Limitation on demands
The Company shall not be obligated to effect, or to take any action to
effect, any registration in any of the following periods or events:
1. If the demand was made before the lapse of one (1) year after the
Company's initial public offering of securities - in any case,
where the aggregate proceeds of such registration do not exceed US$
10,000,000 (ten million U.S. Dollars); and if the demand was made
after the lapse of one (1) year after the Company's initial public
offering of securities - in any case where the aggregate proceeds
of such registration do not exceed US$ 5,000,000 (five million U.S.
Dollars).
2. During the period beginning upon the Company's receipt of a demand
for registration from any of its shareholders or upon the
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actual beginning of the process of preparing for or actual filing
and effecting of a registration, for its own account (where such
registration is of the kind which, according to Section 4(a)
hereinbelow, may be joined by holders of Registrable Securities),
and ending on a date one hundred and eighty (180) days following the
effective date of any such registration.
3. If in the good faith judgment of the Board of Directors of the
Company, the registration would be seriously detrimental to the
Company, and the Board of Directors of the Company, as a result,
concludes, that it is essential to defer the filing of such
registration statement at such time, and the Company shall furnish
to the Initiating Holders of such demand a certificate signed by the
President or Chief Executive Officer of the Company stating the
above, then the Company shall have the right to defer such filing
for a period of not more than one hundred twenty (120) days after
receipt of the demand of the Initiating Holders, and, provided
further, that the Company shall not defer its obligation in this
manner more than once in any eighteen month period.
(c) Underwriting
If the Initiating Holders intend to distribute the Registrable
Securities, covered by their demand, by means of an underwriting,
then they shall so advise the Company as a part of their demand made
pursuant to clause (a) above, and the Company shall include such
information in its written notice to the other holders of Registrable
Securities as set forth in section 3(a) above. In such event, the
right of any holder of Registrable Securities to join the demand and
to include Registrable Securities in the registration shall be
conditioned upon its participation in the underwriting and the
inclusion of the Registrable Securities, requested by it to be
included, in the underwriting, to the extent provided herein. All
holders proposing to distribute their Registrable Securities in whole
or in part, by joining the demand, shall enter into an underwriting
agreement, in customary form, with the managing underwriter(s)
selected for the offering by the Initiating Holders and provided such
selected underwriter(s) is/are acceptable to the Company.
It is agreed that the underwriter who served as the underwriter for
the Company's IPO and any underwriter who, during the previous
calendar year, executed at least 20 public offerings, each resulting
in gross proceeds to the issuer of at least US $15,000,000, under a
firm commitment underwriting, shall be acceptable to the Company.
4. Piggyback Registrations
(a) If the Company proposes to register any of its securities, either for
its own account or for the account of any of its shareholders, (other
than a registration relating solely to benefit plans, on Form S-8 or
the like a registration in connection with an exchange offer or
merger or a registration on any form which does not include
substantially the same information about the Company as would be
required to be included in a registration covering
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the sale of a Registrable Securities), it shall promptly give to each
holder of Registrable Securities written notice thereof, and shall act to
include in such registration, except as otherwise provided herein, all the
Registrable Securities specified in the written request made by any such
holder of Registrable Securities to whom it sent the aforesaid notice,
which request is delivered to the Company within twenty (20) days after
the written notice of the Company is delivered. The Company may also
include securities for its own account in registrations initiated by
shareholders.
(b) Underwriting. If the registration of which the Company gives notice for
pursuant to this Section 4 is for an underwritten registration, the
Company shall so advise the holders of Registrable Securities, as part of
the Company's notice set forth in clause (a) above. In such event, the
right of any holder of Registrable Securities, to be included in the
registration, shall be conditioned upon such holder's participation in
such underwriting and the inclusion of such holder's Registrable
Securities, which it requested to include in the registration, in the
underwriting, to the extent-provided herein. All holders proposing to
distribute their Registrable Securities, in whole or in part, by joining
the registration, shall enter into an underwriting agreement, in customary
form, with the managing underwriter(s) selected for the offering by the
Company, in case of registration for its own account or by the initiating
shareholders in case of registration for the account of shareholders.
5. Underwriter's cut-back and withdrawal from registration
(a) Notwithstanding any provision herein, if the underwriter(s)
advise(s) the Company that market factors require a limitation of
the number of securities to be underwritten, then the number of
securities that may be included in the underwriting and the
registration shall be reduced as required by the underwriter(s) and
allocated as follows:
(i) If the Company initiated the registration; there will be
included in
the underwritten registration, first all of the securities to
be issued by the Company and second if remaining, the
Registrable Securities of holders executing their piggyback
registration rights, pursuant to Section 4 herein,. pro rata
to their shareholdings of Registrable Securities having
piggyback rights at the time in question.
(ii) If shareholder(s) of the Company initiated the registration
pursuant to Section 3 herein - there will be included in the
underwritten registration, first the securities of the
Initiating Holders and the other joining Holders of
registrable Securities who are joining the registration by
exercising their right under Section 3 and second if
remaining, the securities to be issued by the Company.
(b) If the registration is an underwritten registration, then any holder
who disapproves of the terms of the underwriting, may elect to
withdraw therefrom by written notice to the Company and the
underwriter(s),
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delivered at least ten (10) business days prior to the effective date of the
registration statement. Any securities excluded or withdrawn from such
underwriting shall be excluded and withdrawn from the registration.
If shares are so withdrawn from the registration and if the number of shares to
be included in such registration was previously reduced as a result of marketing
factors as provided in clause (a) above, then the Company shall offer to all
holders who have retained rights to include securities in the registration, the
right to include the additional securities they would have been entitled to
include had the number of shares not been reduced, in the registration, in an
aggregate amount equal to the number of shares so withdrawn, with such shares to
be allocated among such holders requesting additional inclusion, in accordance
with the allocation set forth in Clause (a) above.
6. Expenses
All expenses incurred in effecting a registration pursuant to one demand
initiated hereunder, by each of (i) the holders of AGA's Registrable
Securities; (ii) the holders of CLAL's Registrable Securities; and (iii)
the holders of the Subscribers' Registrable Securities, (i.e., a total of
up to three demands) including, without limitation, all registration,
filing and qualification fees, printing expenses, reasonable fees of one
counsel for the shareholders who are including their shares in such
registration pursuant to Section 3 herein, blue sky fees and expenses,
costs of any regular or special audit if required, shall be paid for and
borne by the Company; provided however that all underwriters' discounts
and commissions, and stock transfer taxes, applicable to the securities of
shareholders included in the registration, and such shareholders' counsel
fees (other than the counsel fees which are to be borne by the Company as
provided in this Section 6 above), shall be paid for by the shareholders
who are including their shares in the registration, pro rata to the number
of shares of such shareholders included in the registration, and shall not
be paid for by the Company.
It is hereby clarified that all expenses incurred in effecting a
registration which is made in response to the demand made by the Majority
Holders of all Registrable Securities, shall be paid for by the
shareholders who are including their shares in such registration, pro rata
to the number of shares of such shareholders included in the registration,
and shall not be paid for by the Company.
Furthermore, in effecting any registration of Registrable Securities which
are included therein as a result of an exercise of the right to join the
registration under Section 4 (a) herein, the additional expenses incurred
as a result of the inclusion thereof in the registration, shall be paid
for by the holders of such Registrable Securities, pro rata. to the number
of shares of such holders included in the registration, and shall not be
paid for by the Company.
7. Obligations of the Company
Whenever required to effect registration of Registrable Securities
pursuant to the terms herein, the Company shall as soon as practicable:
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(a) Prepare and file with the SEC a registration statement with respect to
such Registrable Securities and use all reasonable efforts to cause such
registration statement to become effective, within ninety (90) days after
the lapse of the twenty (20) days period given in Section 4 hereof for the
reply of holders of Registrable Securities to join the registration, and
shall keep such registration effective for a period of ninety (90) days,
or until the holder(s) whom Registrable Securities are included in the
registration have completed the distribution, whichever first occurs;
(b) Prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions
of the Securities Act with respect to the disposition of the securities
covered by such registration statement;
(c) Furnish to the holders of Registrable Securities included in the
registration such number of prospectuses and other documents incident
thereto, including any amendment of or supplement to the prospectus, which
such a holder may reasonably request, from time to time, in order to
facilitate the disposition of the securities;
(d) Notify each holder of Registrable Securities covered by such registration
statement at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of the happening of any event, as a
result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the fight of the
circumstances then existing, and at the request of any such holder prepare
and furnish to such holder copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to
the purchasers of such shares, 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 or incomplete in the fight of the circumstances then existing;
(e) In the event that the Initiating Holders require that the registration
which the Company shall effect in response to their demand, made under
Section 3 herein, shall be underwritten, the Company will, without
derogating from Section 4(b) herein, enter into an underwriting agreement
in form reasonably necessary to effect the offer and sale of the
Registrable Securities to be included in the registration, provided such
underwriting agreement contains customary underwriting provisions, and
that all the shareholders whose Registrable Securities are included in the
registration shall enter into such agreement and perform their obligations
thereunder.
(f) Cause all Registrable Shares registered pursuant hereunder to be fisted on
each securities exchange or NASDAQ on which same class of securities
issued by the Company are then listed.
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(g) Provide a transfer agent and registrar for all Registrable Securities
registered pursuant hereunder and a CUSIP number for all such Registrable
Securities, in each case not later than the effective date of such
registration.
8. Indemnification
(a) To the extent permitted by law, the Company will indemnify each
holder of Registrable Securities which are included in a
registration effected pursuant to the terms herein, each of its
officers, directors and partners, and each person controlling such
holder within the meaning of Section 15 of the Securities Act, and
each underwriter of such registration, if any, and each person who
controls within the meaning of Section 15 of the Securities Act such
underwriter (all of the above entities and persons shall hereinafter
be referred to as the "Holder's Indemnified Persons"), against all
losses and damages by virtue of any liabilities to which they shall
become subject under the Securities Act, the Exchange Act or other
federal or state law insofar as such liabilities arising out of or
based on: (i) any untrue statement (or alleged untrue statement in
case of amounts paid in settlement of liability) of a material fact
contained in such registration statement, including any prospectus,
and any amendments and supplements thereto, or other document
incident to any such registration; or (ii) any omission (or alleged
omission in case of amounts paid in settlement of liability) to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; or (iii)
any violation by the Company of the Securities Act the Exchange Act
any federal or state securities law or any rule or regulation
thereunder applicable to the Company and relating to action or
inaction required of the Company in connection with any such
registration, and will promptly reimburse each of the Holder's
Indemnified Persons for any reasonable legal and other expenses,
incurred by them by reason of defending or settling any such
liability, or action in respect thereof, provided that the Company
will not be liable in any such case to the extent that any such
liability arises out of or is based on any untrue statement or
omission made in reliance upon or in conformity with information
furnished to the Company by any of the Holder's Indemnified Persons
stated to be used with such registration, or in any case where any
of the Holder's Indemnified Persons had an obligation to deliver a
prospectus, amended or supplemented by the Company, to the
purchasers of the shares, prior to or at the time the sale is
confirmed, and failed to do so, if such amended or supplemented
prospectus would have cured the defect giving rise to such
liability. It is agreed that the indemnity agreement contained in
this Section 8(a) shall not apply to amounts paid in settlement of
any such liability or action in respect thereof if such settlement
is effected without the written consent of the Company (which
consent shall not be unreasonably withheld).
(b) To the extent permitted by law, each holder of Registrable
Securities included in the registration which is being effected,
shall indemnify the Company, each other holder of shares included in
the registration, and each of their respective directors, officers,
partners, and representatives (including counsels and accountants)
and each underwriter of such registration, if any,
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and each person who controls the Company, the other holder(s) or such
underwriter, within the meaning of Section 15 of the Securities Act, (all
of the above entities and persons shall hereinafter be referred to as the
"Company's Indemnified Persons") against all losses and damages by virtue
of any liabilities to which they shall become subject under the Securities
Act, the Exchange Act or other federal or state law, insofar as such
liabilities arising out of or based on: (i) any untrue statement (or
alleged untrue statement in case of amounts paid in settlement of
liability) of a material fact contained in any such registration statement
including any prospectus and any amendments and supplements thereto or
other document incident to any such registration; (ii) or any omission (or
alleged omission in case of amounts paid in settlement of liability) to
state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, and will promptly reimburse
the Company's Indemnified Persons for any reasonable legal and other
expenses, incurred in connection with defending any such liability, or
action in respect thereof in each case to the extent, but only to the
extent, that such untrue statement or omission is made in reliance upon
and in conformity with information furnished in writing to the Company by
any of the Holder's Indemnified Persons stated to be used with the
registration, or in any case where any of the Holder's Indemnified Persons
had an obligation to deliver a prospectus, amended or supplemented by the
Company, to the purchasers of the shares, prior to or at the time the sale
is confirmed, and failed to do so, if such amended or supplemented
prospectus would have cured the defect giving rise to such liability. It
is agreed that the indemnity agreement contained in this Section 8(b)
shall not apply to amounts paid in settlement of any such liability or
action in respect thereof if such settlement is effected without the
consent of the indemnifying holder(s) (which consent shall not be
unreasonably withheld), and that the indemnification amounts to be paid by
such holders under this provision, shall not exceed the gross proceeds
received by such holder from the offering with respect to which the
registration was effected.
(c) Each party entitled to indemnification under this Section 8 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified
Party has actual knowledge of any claim or action as to which indemnity
may be sought, and shall permit the Indemnifying Party to assume the
defense of such claim or any litigation resulting therefrom, provided that
counsel for the Indemnifying Party, who shall conduct the defense of such
claim or any litigation resulting therefrom, shall be approved by the
Indemnified Party (whose approval shall not unreasonably be withheld);
provided that the failure of any Indemnified Party to give notice as
provided above shall not relieve the Indemnifying Party of its obligations
under this Section 8, to the extent such failure is not prejudicial. The
Indemnified Party may participate in such defense at such Indemnified
Party's expense; however it is provided that in the event where the
defendants in an action include both the Indemnified Party and the
Indemnifying Party and there is a conflict of interest which would prevent
counsel for the Indemnifying Party from also representing the Indemnified
Party, then to the extent that the Company has to indemnify such party;
such
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indemnification shall also apply to the reasonable attorneys fees of
one counsel on behalf of all Indemnified Parties who shall
participate in the defense of such parties in such case. No
Indemnifying Party, in the defense of any such claim or litigation,
shall, except with the consent of each Indemnified Party, 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 to such claim or
litigation. Each Indemnified Party shall furnish such information
regarding itself or the claim in question, as an Indemnifying Party
may reasonably request and as shall be reasonably required in
connection with defense of such claim and litigation resulting
therefrom.
(d) The foregoing indemnity agreement with respect to any preliminary
prospectus, shall not inure to the benefit of any Holders'
Indemnified Persons if a copy of the prospectus as then amended or
supplemented, eliminating or remedying the untrue statement,
omission, or other violation, was furnished to the holder of
Registrable Securities in question.
(e) If recovery is not available under the foregoing indemnification
provisions, for any reason, except for a reason as specified therein
or except by reason of the exercise of any right or remedy available
to any party - such party which is entitled to indemnification by
the terms hereof shall be entitled to receive contribution to its
liabilities and expenses. In determining the amount of contribution
to which the respective parties are entitled, there shall be
considered the parties' relative knowledge and access to information
concerning the matter with respect to which the underlying claim was
asserted, the opportunity to correct and prevent any statement or
omission, and any other equitable consideration appropriate under
the circumstances.
9. Information by Selling Shareholders
9.1 The Company's obligation to take action pursuant to Sections 3 and 4
hereto, shall be conditioned and subject to the furnishing by the
selling shareholders to the Company, information regarding
themselves, their Registrable Securities and other securities held by
them, if any, and the intended method of disposition of the
securities, which is required for the purpose of the registration.
9.2 Each holder of Registrable Securities undertakes to furnish the
Company, with respect to the registration of such holder's shares,
true and correct information, such that the information contained
therein which was furnished by such holder shall be true and correct
and shall not omit to state any material fact required to be stated
therein or necessary to not make the statement misleading.
10. Delay of Registration
No holder of Registrable Securities shall have any right to obtain or seek
an injunction remaining or otherwise delaying any registration as the
result of any controversy that might arise with respect to the
interpretation or implementation of this Agreement.
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11. Rule 144 Reporting
With a view of making available the benefits of certain rules and
regulations permitting the sale of the Registrable Securities to the
public, without registration, after such time as the Company shall
consummate a public offering for its shares, the Company agrees to:
(i) make and keep public information regarding the Company available, as
those terms are understood and defined in Rule 144 promulgated under
the Securities Act, at all times from and after ninety (90) days
following the effective date of the first registration under the
Securities Act filed by the Company for an offering of its securities
to the general public;
(ii) use reasonable efforts to file with the SEC in a timely manner all
reports and other documents required of the Company under the
Securities Act and the Exchange Act (at any time after it has become
subject to such reporting requirements);
(iii)so long as a holder owns any Registrable Securities, to furnish to
such holder forthwith upon its written request, a written statement
by the Company as to the Company's compliance with the reporting
requirements of said Rule 144 (at any time after 90 days after the
effective date of the first registration statement filed by the
Company for an offering of its securities to the general public), and
of the Securities Act and the Exchange Act (at any time after it has
become subject to the reporting requirements of the Exchange Act), a
copy of the most recent annual or quarterly report of the Company,
and such other reports and documents of the Company as a holder may
reasonably request in availing itself of any rule or regulation
allowing a holder to sell any such securities without registration
(at any time after the Company has become subject to the reporting
requirements of the Exchange Act).
12. Termination of the Company's Obligations
The Company shall have no obligations pursuant to Sections 3 and 4 herein
with respect to: (a) any request or requests for registration made after
the lapse of a seven year period after the closing date of the Company's
initial public offering; or (b) any Registrable Securities that in the
opinion of counsel to the Company, may be sold in a three-month period
without registration under the Securities Act pursuant to Rule 144
promulgated thereunder.
13. Market stand off Agreement
If requested by the Company or by the underwriter(s) of securities of the
Company, any shareholder of the Company shall not sell or otherwise
transfer or dispose of any securities of the Company held by such
shareholder (other than securities sold pursuant to a registration
statement), during the one hundred and eighty (180) day period following
the effective date of a registration statement of the Company filed under
the Securities Act, or for a longer period if requested by the
underwriter(s)s, which shall not exceed the market stand off period which
is customary at the time so requested, and provided that all of the
executive officers and directors of the Company, then holding securities of
the Company, enter into
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agreements with similar terms and that no other parties entering into a market
stand-off agreement, if any, shall be subject to a shorter period.
In order to enforce the foregoing covenants, the Company shall have the right to
place restrictive legends on the certificates representing the shares subject to
this Section and to impose stop transfer instructions with respect to such
securities until the end of such period.
14. Assignment of Registration Rights
The rights to demand that the Company register securities, granted herein,
and the right to join a registration provided under Sections 3 and 4
herein, may be assigned by a holder only to a transferee of Registrable
Securities of the transferor and with respect to such Registrable
Securities transferred only, provided further that the Company is promptly
given written notice of said transfer of the Registrable Securities and the
assignment of the registration rights, stating the name and address of the
assignee and identifying the securities with respect to which such
registration rights are being assigned, and, provided further, that the
assignee of such rights shall receive such rights subject to all of the
terms and conditions herein and shall assume in writing the obligations of
the transferor hereunder, with respect to the Registrable Securities
transferred, including those under this Section 14. It is provided that the
Company shall not have any obligation to any assignee or transferee,
pursuant to the terms of this agreement until it has received the aforesaid
written notice.
15. Amendment of Rights
Any provision of this Agreement may be amended only with the written
consent of the Company and the Majority Holders of each type of Registrable
Securities (i.e. the Majority Holders of AGA's Registrable Securities, the
Majority Holders of CLAL's Registrable Securities and the Majority Holders
of the other Registrable Securities).
16. Governing Law and Forum
This Registration Rights Agreement, its interpretation, validity and breach
shall be governed by the laws of the State of New York, USA, without regard
to its choice of law rules, and any dispute or claim with respect thereto
shall be submitted to the competent courts in New York, USA, who shall have
exclusive jurisdiction in such matter.
17. Entire Agreement
This Registration Rights Agreement constitutes the entire agreement between
the Parties with respect to the subject matter hereof, and no previous
agreements, terms, memoranda, promises, negotiations, consents,
undertakings, representations, warranties and/or any other documents
exchanged or provided prior to the execution hereof between any of the
Parties, shall have any force or effect.
18. Captions
The captions to sections herein have been inserted for identification and
reference purposes only and shall not be used to construe or interpret this
Agreement.
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19. Adjustments for Stock Splits, etc.
Wherever in this Agreement there is a reference to a specific number of
shares of the Company of any class or series then, upon the occurrence of
any subdivision, combination or stock dividend of such class or series of
shares, the specific number of shares so referenced in this Agreement shall
automatically be proportionally adjusted to reflect the affect on the
issued and outstanding shares of such class or series of stock by such
subdivision, combination or stock dividend.
20. Public Offering Not in the U.S.A.
If relevant, and to the extent possible, the provisions of this
Registration Rights Agreement shall apply, mutatis mutandis, on any
registration of securities of the Company, made in any territory other
than the U.S.A. e.g. in the event the Company registers its securities in
Israel then the Company shall also register for trading all of the
Registrable Securities, subject to any applicable law.
21. Counterparts
This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument.
22. Notices
AU notices given by one Party to the other hereunder will be given in
writing, and will be deemed to have been delivered to the addressee
immediately on their delivery, if delivered by hand, or upon transmission
if sent by facsimile and confirmed by machine printout verifying such
sending or by written reply by facsimile, or within seven (7) business days
after being sent by mail, express airmail, or via international courier, as
per the addresses indicated herein, or to such other address or facsimile
number as a Party may thereafter give notice in writing, to the other
Parties hereto.
IN WITNESS WHEREOF the Parties have signed this Registration Rights
Agreement as of the date first hereinabove set forth:
----------------------------- -------------------------------
AG Associates (Israel) Ltd. AG Associates, Inc.
By:__________________ By:__________________
----------------------------- -------------------------------
Clal Electronics Industries Ltd. Charter AGI L.L.C.
By:___________________ By:___________________
----------------------------- -------------------------------
The Israel Private Equity Fund L.P. Evergreen International Investments
N.V.
By:___________________ By:____________________
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----------------------------- -------------------------------
The Israel Private Equity Fund Yarok Az Investment (1994) Ltd.
(Cayman) L.P.
By:_____________________ By:_________________________
-------------------------------
UT Technologies Ltd. Fund
By:_____________________
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Annex "A"
Investment Preferred Shares Preferred Shares
Amount Serial A Serial B
------ -------- --------
Clal Electronics AGA $4,000,000 2,000,000 0
Charterhouse AGI L.L.C. $4,000,000 1,600,000 400,000
IJT Technologies Ltd. Fund $1,000,000 500,000 0
Yarok Az Investment (1994) Ltd. $500,000 250,000 0
Evergreen International Investment $500,000 250,000 0
N.V.
The Israel Private Equity Fund L.P. $2,098,800 1,049,400 0
The Israel Private Equity Fund $901,200 450,600 0
(Cayman) L.P.
Option reserved for employees
Options reserved for the CEO
Total Investment Amount $13,000,000
Total Shares 6,100,000 400,000
