EXHIBIT 10.11
SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (this "Agreement") made as of the 13th day of
January, 2000, by and among Nomura International plc ("Purchaser"), Holland
Venture BV, Ophir Holdings Ltd., Docor International BV, Inventech Ltd., and
Ronchal Investments N.V. (hereinafter collectively as the "Holland
Investors"), Challenge Fund-Etgar, L.P. ("Challenge"), Corex Israeli
Industries Ltd. ("Corex") and the additional persons and entities identified
in SCHEDULE 1 attached hereto (collectively, the Additional Shareholders, and
together with Challenge and Corex, the "Shareholders").
RECITALS
A. The Shareholders and Holland Investors collectively hold shares
of Common Stock and Series A Convertible Preferred Stock (collectively,
"Stock") of Nogatech, Inc., a Delaware corporation (the "Company"); and
B. Challenge and the Additional Shareholders are parties to a
certain Stockholders Agreement dated February 4, 1997 (the "Challenge
Agreement"); and
C. Corex and certain of the Additional Shareholders are parties to
a certain Stockholders Agreement dated August 17, 1997 (the "Corex
Agreement");
D. The Holland Investors and the Additional Shareholders are
parties to a certain Stockholders Agreement dated July 15, 1998 (the "Holland
Agreement"), and together with the Challenge Agreement and the Corex
Agreement, the "Prior Shareholder Agreements"); and
E. Purchaser has entered into a Series B Stock Purchase Agreement
with the Company, dated as of January 13, 2000 (the "Purchase Agreement"),
herein incorporated by this reference; and
F. The Holland Investors, Shareholders and Nomura desire to set
forth certain matters regarding the ownership of Stock in accordance with the
terms and conditions of this Agreement and desire that this Agreement shall
amend and restate the Prior Shareholder Agreements such that the terms and
conditions of the Prior Shareholder Agreements shall have no further force
and effect.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein, and other good and valuable consideration the sufficiency
of which is hereby acknowledged, the parties hereby agree as follows:
1. COMPOSITION of the Board. Each of the Holland Investors and the
Shareholders shall at all times exercise all rights they may have as holders
of Stock to appoint, to vote for, and to otherwise act in favor of
designating as members of the Board of Directors of the Company (the
"Board"): (i) one representative nominated by Challenge, only so long as
Challenge holds at least 25% of the shares
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it received as a result of the merger of Nogatech, Inc. a California
corporation with and into the Corporation, which merger was effectuated on
December 28, 1999 (ii) two representatives nominated by the Holland
Investors, one of whom shall be nominated by Holland Venture, only as long as
the Holland Investors collectively hold at least 10% of the Company's issued
and outstanding share capital, or (iii) one representative nominated by the
Holland Investors, only as long as the Holland Investors collectively hold at
least 5% of the Company's issued and outstanding share capital, in which case
the Holland Investors' representative shall be nominated by Holland Ventures.
Notwithstanding any provision of the Company's Certificate of Incorporation
as may be in effect, each of the Holland Investors and the Shareholders agree
that in any vote or any election for members of the Board, they each shall
take all such actions as are necessary in favor of the individuals designated
by the Purchasers to ensure the appointment of such individuals to serve as
members of the Board. Nothing herein shall derogate form Sections 141 (k) of
the Delaware General Corporation Law.
2. PARTICIPATION ("TAG-ALONG") RIGHTS.
a. Subject to Section 2.b below, in the event that Xxxxxx
Hod and/or Xxxx Xxxxxx, jointly or severally (the "Selling Shareholder"),
initiates or otherwise receives a bona-fide offer from a third party (a
"Proposed Purchaser") to purchase all or any portion of the Stock owned by
the Selling Shareholder (a "Proposed Transfer"), then each Holland Investor
and the Purchaser, severally, shall have the right (the "Participation
Right") to require the Proposed Purchaser to purchase from such each of them
under the same terms and conditions as the Proposed Transfer, up to the
number of shares of Stock owned by each Holland Investor and the Purchaser
multiplied by the ratio between the number of shares of Stock which the
Selling Shareholder is offering to sell and the total number of shares of
Stock held by the Selling Shareholder prior to the sale.
If the Proposed Transfer shall relate to the sale by the
Selling Shareholder of an aggregate of more than 50% of their shares of Stock
in the Company, then each Holland Investor and the Purchaser shall have the
right to require the Proposed Purchaser to purchase from such Holland
Investor and the Purchaser all of the shares of Stock owned by it.
A notification regarding the Proposed Transfer shall be
forwarded to each Holland Investor and the Purchaser by the Selling
Shareholder in writing, 30 days prior to the consummation of the proposed
transaction.
If the Proposed Purchaser refuses to complete a transaction
with any Holland Investor or the Purchaser as described in this Section 2.a.
and the Selling Shareholder completes the Proposed Transfer in derogation of
this Section 2, then the Selling Shareholder shall be obligated to purchase
from such Holland Investor and the Purchaser the same number of shares which
such Holland Investor and the Purchaser would otherwise have been permitted
to sell under this Section and under the same terms and conditions to the
Proposed Purchaser.
b. Notwithstanding anything to the contrary contained
herein, no Participation Right shall arise in the event of:
i. a Proposed Transfer by Xxxx Xxxxxx at any time to
a
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family member; or
ii. a Proposed Transfer by Xxxxxx Hod (a) at any time
to a family member, (b) at any time after termination without cause of his
position as director of the Company, and/or (c) at any time after he is
unable to fulfill the duties of director of the Company by reason of death,
disability, illness, incapacitation, or otherwise.
3. TERMINATION. The foregoing provisions of Section 2 shall
terminate upon the earlier of: (i) the closing of an IPO yielding ten million
US dollars ($10,000,000) to the Company; or (ii) the consummation of a merger
or sale of the Company in which the Company is not the consolidated or
surviving company and the controlling shareholders (or their affiliates) of
the Company are not the controlling shareholders of the surviving company.
Notwithstanding the foregoing, the provisions of Section 2 shall terminate as
to any Investor on the date that such Investor holds less than twenty five
percent (25%) of his/its shares acquired pursuant to his/its respective Stock
Purchase Agreement.
4. MISCELLANEOUS
a. 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.
b. SEVERABILITY. If any provision of this Agreement is held
by a court of competent jurisdiction to be unenforceable under applicable
law, then such provision shall be excluded from this Agreement and the
remainder of this Agreement shall be interpreted as if such provision were so
excluded and shall be enforceable in accordance with its terms; provided,
however, that in such event this Agreement shall be interpreted so as to give
effect, to the greatest extent consistent with and permitted by applicable
law, to the meaning and intention of the excluded provision as determined by
such court of competent jurisdiction.
c. SUCCESSORS AND ASSIGNS. Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors, assigns, heirs, executors and administrators of
the parties hereto.
d. ENTIRE AGREEMENT. This Agreement and the exhibits attached
hereto and the other documents delivered pursuant hereto constitute the full
and entire understanding and agreement between and among the parties with
regard to the subjects hereof and thereof, and supersede all prior agreements
and understandings between and among the parties with regard to the subjects
hereof and thereof, including, without limitation, the Term Sheet dated April
27, 1998 between the Holland Investors and the Nogatech, Inc., a California
corporation , predecessor in interest to the Company and the Term Sheet dated
December 22, 1999 between Purchaser and the Company and the Prior Shareholder
Agreements.
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e. NOTICE. Any notice, payment, report or other
communication required or permitted to be given by one party to any other
party by this Agreement shall be in writing and either (i) served personally
on the other parties; (ii) sent by express, registered or certified first
class mail, postage prepaid, addressed to the other party or parties at its
or their address or addresses as indicated next to their signatures below, or
to such other address as any addressee shall have theretofore furnished to
the other parties by like notice; (iii) delivered by commercial courier to
the other party or parties; or (iv) sent by facsimile. Such notice shall be
deemed received (A) on the third day after sending if sent by one day
courier; (B) to the extent such day is a business day as recognized by the
country of sender's principal place of business, on the day of transmission
of such notice by facsimile, or, to the extent such day is not a business day
as recognized by the country of sender's principal place of business, on the
first business day of the sender following the day of transmission, in each
case if the recipient has the capability to receive a facsimile at its
address, the sender has the capability of obtaining from its facsimile
machine a confirmation of transmission and the sender mails to the recipient
a copy of such confirmation by regular first class mail no later than the
next business day (as recognized by the country of sender's principal place
of business) following such transmission; and (C) upon receipt if sent by
other methods.
f. TITLES AND SUBTITLES. The titles of the Sections and
subsections of this Agreement are for the convenience of reference only and
are not to be considered in construing this Agreement.
g. 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.
h. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware applicable to
contracts between Delaware residents entered into and to be performed
entirely with in the State of Delaware.
i. DISPUTES. Any dispute arising out of the transactions
contemplated by this Agreement shall be adjudicated by a court of competent
jurisdiction sitting in the District of Tel Aviv/Jaffa, subject, in any
event, to the provisions of section 4.8 of this Agreement. The parties hereby
submit themselves to the exclusive jurisdiction of such courts for the
purposes hereof.
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SIGNATURE PAGE OF SHAREHOLDERS AGREEMENT
IN WITNESS WHEREOF the parties have signed this Agreement as of the date
first hereinabove set forth.
CORPORATION:
NOGATECH, INC.
By: /s/ A. Heidann
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(Signature)
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(Print Name & Title)
HOLLAND INVESTORS:
HOLLAND VENTURES, B.V. OPHIR HOLDINGS LTD.
By: /s/ XX Xxxxx By: /s/ X. Xxxxxx
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(Signature) (Signature)
By: /s/ S. Wookamir
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(Signature)
Managing Director Managing Director/Controller
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(Print Name & Title) (Print Name & Title)
DOCOR INTERNATIONAL BV RONCHAL INVESTMENTS N.V.
By: /s/ Xxxxx Xxxxx By: /s/ X. X. xx Xxxxx
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(Signature) (Signature)
Managing Director
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(Print Name & Title) (Print Name & Title)
INVENTECH LTD.
By: /s/ X. Xxxxx
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(Signature)
CEO
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(Print Name & Title)
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SECOND SIGNATURE PAGE OF SHAREHOLDERS AGREEMENT
SHAREHOLDERS:
KENWOOD CORPORATION, TOMEN ELECTRONICS CORP.,
A JAPANESE COMPANY A JAPANESE COMPANY
By: /s/ Yasunobu Namiki By: /s/ Katsuyeshi Taniguchi
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(Signature) (Signature)
Director Corporate Planning
Yasunobu Namiki Katsuyeshi Taniguchi, President
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(Print Name & Title) (Print Name & Title)
XXXXXX HOD XXXX XXXXXX
By: /s/ Xxxxxx Hod By: /s/ Xxxx Xxxxxx
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(Signature) (Signature)
XXX XXXX DREYFUS & CIE, S.A. COREX ISRAELI INDUSTRIES, LTD.
By: /s/ Xxxx Xxxxxxxx By: /s/ Xxxxx X. Xxxxx
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(Signature) (Signature)
Corex Israeli Industries
Basil Xxxxxx Xxxxx
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(Print Name & Title) (Print Name & Title)
Managing Director
CHALLENGE FUND-ETGAR, L.P. XXXXX XXXXXX
BY: /s/ X. Xxxxxxxxxxx /s/ Xxxxx Xxxxxx
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(Signature) (Signature)
X. Xxxxxxxxxxx
President
(Print Name & Title)
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PURCHASER:
NOMURA INTERNATIONAL PLC
By: /s/ K. Yamazoe
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(Signature)
K. Yamazoe, Director
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(Print Name & Title)
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SCHEDULE 1
Kenwood Corporation, a Japanese corporation
Tomen Electronics Corporation, a Japanese corporation
Arie Xxxxxx
Xxxxxx Hod
Xxx Xxxx Dreyfus & Cie, S.A.
Xxxxx Xxxxxx
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