EXHIBIT 1
SHAREHOLDERS AGREEMENT
THIS SHAREHOLDERS AGREEMENT (the "AGREEMENT") is made as of this 3rd day of
September, 2009, by and between (i) Ronex Holdings, Limited Partnership
("RONEX"), an Israeli limited partnership wholly owned by certain limited
partnerships managed by FIMI IV 2007 Ltd. and FIMI Opportunity 2005 Ltd., and
(ii) the persons set forth on the signature page hereto (together, "ALPHA").
WHEREAS, Retalix Ltd. (the "COMPANY") is an Israeli public company, whose
Ordinary Shares, nominal value NIS 1.00 each ("ORDINARY SHARES"),
are traded on the Tel-Aviv Stock Exchange and Nasdaq Global
Select Market ("NASDAQ"); and
WHEREAS, Ronex and its affiliates own, directly and indirectly, as of the
date hereof 3,253,367 Ordinary Shares of the Company; and
WHEREAS, Subject to the consummation of the transactions contemplated
under that certain Purchase Agreement dated as of the date
hereof, by and between Alpha and the Company (the "PURCHASE
AGREEMENT"), Alpha will own at the Closing thereof (the
"CLOSING") such number of Ordinary Shares representing
approximately 20% of the issued and outstanding share capital of
the Company and warrants to purchase from the Company up to
1,250,000 Ordinary Shares; and
WHEREAS, Ronex and Alpha (each, a "SHAREHOLDER" and, collectively, the
"SHAREHOLDERS") wish to set forth the general terms and
conditions with respect to their relationship vis-a-vis the
Company and their holdings of Ordinary Shares of the Company, as
of the date hereof.
NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement, the parties hereto agree as follows:
1. BOARD OF DIRECTORS; CEO.
1.1. The Shareholders hereby agree to vote in any shareholders meeting
during the term of this Agreement, all of the Ordinary Shares of the
Company (including without limitation, Ordinary Shares owned following
the exercise, conversion or exchange of any options or warrants to
purchase Ordinary Shares, or other securities convertible into, or
exercisable for, Ordinary Shares (collectively, "CONVERTIBLE
SECURITIES")), now or hereafter owned or controlled by them, whether
beneficially or otherwise held by them or their affiliates, for the
election to the Company's board of directors ("BOARD") of: (i) six (6)
directors designated by Alpha and three (3) directors designated by
Ronex, and (ii) two (2) external directors designated by Ronex.
1.2. If required under applicable law, one of the persons designated by
Ronex shall be female.
1.3. If and so long as required under applicable law, rules and
regulations, the Shareholders shall cooperate and use reasonable
efforts to designate directors so that: (i) one of the directors shall
qualify as financial expert in accordance with Nasdaq rules and
regulations and, if applicable, Israeli Companies Law, 1999; (ii) a
majority of the Board shall be considered "independent directors" as
defined under Nasdaq rules and regulations; and (iii) the Company
shall have a lawful audit committee, inter alia, taking into account
Section 115 of the Israeli Companies Law, 1999. Until the second
anniversary of the Closing, if Alpha exercises its right to designate
directors to the Company's Board of Directors pursuant to this
Agreement, then, subject to and to the extent permitted by applicable
law, a majority of the Alpha Promoters (as defined below) will be
designated by Alpha to serve as directors (taking into account, for
such purpose, the Alpha Promoters then serving as directors).
1.4. To the maximum extent permitted by applicable law, including fiduciary
duties under applicable law, the Shareholders shall use their
reasonable efforts to cause a number of board designees of Alpha and
Ronex, in the same proportion reflected in the Company's Board
pursuant to Section 1.1 above, to be elected or appointed to the board
of directors of any of the Company's active subsidiaries.
1.5. The identity of the Company's Chief Executive Officer shall be
determined by Board of Directors. Ronex shall be given an opportunity
to meet with the candidate. Alpha shall consult with Ronex prior to
determining the identity of the Company's Chief Executive Officer, and
shall use commercially reasonable efforts to accommodate the views of
Ronex in connection therewith and take them into account in making its
decision.
1.6. Each Shareholder agrees not to, and to cause its respective affiliates
not to, whether directly or indirectly, (i) make, or in any way
participate in any "solicitation" of "proxies" to vote (as such terms
are used in the rules under the Securities Exchange Act of 1934
(collectively, as amended, the "EXCHANGE ACT")), submit any
shareholder proposal to the Company or demand that the Company convene
a shareholders meeting, or (ii) seek to advise or influence any person
or entity with respect to the voting of any voting securities of the
Company; in each case, in respect of any resolution or matter which
conflicts, violates or contravenes the provisions of this Section 1.
1.7. Each Shareholder shall vote, and cause its affiliates to vote, any of
their respective Ordinary Shares now or hereafter owned or controlled
by them, whether directly or beneficially, AGAINST any proposed
resolution which may conflict, violate or contravene any of the
provisions of this Section 1.
2. SALE OF ORDINARY SHARES BY A SHAREHOLDER.
2.1. At any time, and from time to time after the Closing, if a Shareholder
(the "SELLING PARTY") wishes to sell or otherwise transfer (each, a
"TRANSFER"), whether directly or indirectly, in one or a series of
transactions, a block of Ordinary Shares that represents in the
aggregate 5% (five percent) or more of the issued and outstanding
share capital of the Company on the date of the Offer (as defined
below), such Selling Party shall be required to first offer the
Ordinary Shares that such Shareholder wishes to Transfer (the "OFFERED
SHARES") to the other Shareholder(s) (each, the "OFFEREE"). For the
purpose of this Section 2, (i) Transfers of Ordinary Shares to any
person or group of persons (other than to Permitted Transferees) of an
aggregate of 5% (five percent) or more of the issued and outstanding
share capital of the Company during any six months period shall be
subject to this Section; (ii) Transfers of Ordinary Shares that, to
the Selling Party's knowledge (based solely on a representation or
public filing made by the transferee(s) as to their holdings prior to
the Transfer), result in any person or group of persons holding in the
aggregate 5% (five percent) or more of the issued and outstanding
share capital of the Company shall be subject to this Section; (iii)
unless expressly stated otherwise, any reference in this Section to
"Shareholder" shall also include its Permitted Transferees which
following a Permitted Transfer (as defined below) become the holders
or owners of Ordinary Shares, whether directly or beneficially; and
(iv) any Permitted Transferees of the Selling Party, which are or
become the holders or owners of Ordinary Shares, whether directly or
beneficially, shall not be deemed an Offeree in a Transfer by such
Selling Party.
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2.2. The Selling Party shall send the Offeree(s) a written offer in which
the Selling Party shall specify the following information (the
"OFFER"): (i) the number of Offered Shares that the Selling Party
proposes to sell or transfer; (ii) a representation and warranty that
the Offered Shares proposed to be sold or transferred are free and
clear of all liens, pledges, debts, security interests and other third
party interests; and (iii) the price that the Selling Party intends to
receive in respect of the Offered Shares, which shall be stated in
cash, and the requested terms of payment thereof.
2.3. The Offer shall constitute an irrevocable offer made by the Selling
Party to Transfer to such Offeree(s) the Offered Shares covered by the
Offer, upon the terms specified in the Offer and as described below.
In case of more than one Offeree, each Offeree shall be entitled to
purchase its pro rata portion of the Offered Shares and any pro rata
portion that the other Offerees declined or failed to purchase (for
the purposes of this Section 2, "pro-rata portion" of an Offeree shall
mean: a fraction, the nominator of which shall be the number of issued
and outstanding shares held by such Offeree and the denominator of
which shall be the aggregate number of all issued and outstanding
shares held by the Offerees). An Offeree that wishes to purchase the
Offered Shares, shall notify the Selling Party of its agreement to
purchase the Offered Shares by no later than 3 business days of
receipt of the Offer, indicating the maximum number of Offered Shares
it wishes to so purchase (and, without derogation from the above, it
is clarified that the pro-rata portion of the Offered Shares of any
single member comprising of Alpha need not necessarily reflect such
member's pro-rata portion holdings vis-a-vis the other members of
Alpha). The Selling Party shall be obligated to sell the Offered
Shares to the Offeree(s) only if the acceptance(s) of the Offer by the
Offeree(s), in the aggregate, is in respect of all (but not less than
all) of the Offered Shares on the terms and conditions as described in
the Offer.
2.4. If the Offeree(s) decline(s) to purchase the Offered Shares in their
entirety upon the terms specified in the Offer or do(es) not respond
to the Offer within the period mentioned above, the Selling Party may
Transfer all the Offered Shares (but not less than all, and subject to
Section 3 below) to a third party, provided that such Transfer is
consummated (i) in a bona fide transaction, (ii) at a price that is
not lower than that specified in the Offer, and other terms
(including, payment terms) that are no more favorable to the purchaser
than those specified in the Offer, and (iii) within 90 days following
the expiration of the foregoing 3 business-days period. Any
transaction contemplated under the Offer that is not consummated by
the Selling Party in compliance with the preceding sentence, shall
require the Selling Party to again comply with the terms and
conditions of this Section 2.
2.5. If the Offeree(s) agree(s) to purchase the Offered Shares upon the
terms specified in the Offer, the Selling Party shall sell the Offered
Shares to the Offeree(s) against payment by the Offeree(s) of the
aggregate consideration as specified in the Offer. The closing of the
purchase of the Offered Shares shall take place on the later of (i)
the third business day following the acceptance(s) of the Offer by the
Offeree(s), or (ii) such time as the regulatory approvals and
requirements with respect to the purchase of such Offered Shares (if
any) shall have been satisfied (other than the internal corporate
approvals of each of the parties to such transaction which shall be
obtained at the entry into such transaction), at such place in Israel
as the relevant parties shall agree.
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2.6. Without derogating from the provisions of the above sub-Sections in
this Section 2 and Section 3, a Shareholder that wishes to Transfer,
in one or a series of transactions, Ordinary Shares in such amount
that following such Transfer the Shareholder's holding in the Company
will be less than 9% of the then issued and outstanding share capital
of the Company (a "QUALIFIED SALE"), will (i) notify the other
Shareholder in writing of its intention to do so prior to the
consummation of the Qualified Sale, and in any event no less than 60
days in advance; and (ii) will not consummate such Qualified Sale
until the expiration of the no sale period provided for in the
Purchase Agreement (in the case the Selling Party is Alpha). In case a
notice of a Qualified Sale is given pursuant to the preceding
sentence, the Selling Party agrees, that in the event that the Offeree
proposes to cause the Company to adopt takeover defense measures, the
Selling Party shall vote FOR the adoption of any such takeover defense
measures and shall take such other reasonable actions as it shall be
required in order to cooperate with the Offeree(s) in causing the
Company to implement such defense measures prior to the consummation
of the Qualified Sale.
3. TAG ALONG.
3.1. Without derogating from Section 2 above, if the Offeree(s) decline(s)
to purchase the Offered Shares in their entirety upon the terms
specified in the Offer or do(es) not respond to the Offer within the 3
business-days period mentioned in Section 2.3, a Selling Party who
wishes to Transfer a block of Ordinary Shares that represents in the
aggregate 5% (five percent) or more of the issued and outstanding
share capital of the Company on the date of the Tag Along Offer (as
defined below) to a proposed third party purchaser (the "PROPOSED
PURCHASER"), shall send the other Shareholder(s) (each, a "TAG ALONG
SHAREHOLDER") a written notice in which the Selling Party shall
specify the following information (the "TAG ALONG OFFER"): (i) the
number of shares that the Selling Party proposes to sell or transfer
(the "TAG ALONG SHARES"); and (ii) the price that the Selling Party
will receive in respect of the Tag Along Shares, which shall be stated
in cash, and the requested terms of payment thereof; (iii) the
proposed date for sale of the Tag Along Shares; and (iv) the identity
of the proposed third party purchaser. For the purpose of this Section
3, (i) a proposed Transfer of Ordinary Shares to any person or group
of persons (other than to Permitted Transferees) of an aggregate of 5%
(five percent) or more of the issued and outstanding share capital of
the Company during any six months period shall be subject to this
Section; (ii) unless expressly stated otherwise, any reference in this
Section to "Shareholder" shall also include its Permitted Transferees
which become the holders or owners of Ordinary Shares, whether
directly or beneficially following a Permitted Transfer, and (iv) any
Permitted Transferees of the Selling Party, which are or become the
holders or owners of Ordinary Shares, whether directly or
beneficially, shall not be deemed a Tag Along Shareholder in a
Transfer by such Selling Party.
3.2. Each Tag Along Shareholder shall have the right to notify the Selling
Party in writing, within three (3) business days after it is informed
of the Tag Along Offer of its intention to exercise its tag along
right pursuant to this Section 3 (the "TAG ALONG EXERCISE NOTICE"), in
an amount of Ordinary Shares of up to the Tag Along Shareholder's
Pro-Rata Portion (as defined below), as the Tag Along Shareholder
shall specify in the Tag Along Exercise Notice, and on the same terms
and conditions to the Tag Along Shareholder as set forth in the Tag
Along Offer.
3.3. A Tag Along Shareholder's "PRO-RATA PORTION" shall mean the number of
Tag Along Shares multiplied by a fraction, (i) the numerator of which
shall be the number of Ordinary Shares held by such Tag Along
Shareholder and (ii) the denominator of which shall be the total
number of Ordinary Shares held by all Tag Along Shareholder(s) as of
such date, plus the total number of Ordinary Shares held by the
Selling Party as of such date. Without derogating from the above, it
is clarified that the pro-rata portion of any single member comprising
of Alpha of the Tag Along Shareholder's Pro-Rata Portion need not
necessarily reflect such member's pro-rata portion holdings vis-a-vis
the other members of Alpha.
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3.4. In the event that any Tag Along Shareholder exercises its right
hereunder, the Selling Party shall use commercially reasonable efforts
to cause the Proposed Purchaser to add such number of Ordinary Shares
indicated in the Tag Along Exercise Notice(s), in addition to the Tag
Along Shares to be purchased by the Proposed Purchaser from the
Selling Party, as part of the sale agreement; or, in the event that
the Proposed Purchaser declines to purchase the total number of
Ordinary Shares that the parties wish to sell, then the number of Tag
Along Shares proposed to be sold by the Selling Party shall be
accordingly reduced to the extent necessary to provide for the
Transfer by the Tag Along Shareholder(s) of its/their Ordinary Shares
as indicated in its Tag Along Exercise Notice(s); PROVIDED HOWEVER,
that a Tag-Along Shareholder exercising its tag along right pursuant
to this Section in respect of less than its Pro-Rata Portion shall
sell such lower amount, with the balance thereof to be allocated
pro-rata among the other Tag-Along Shareholder(s) and the Selling
Party, and either complete the transaction in accordance with such
revised structure or withdraw from completing the transaction.
3.5. To the extent the Tag Along Shareholder exercised its right under this
Section 3, its Transfer of Ordinary Shares to the Proposed Purchaser
shall be made on the same terms and conditions to the Tag Along
Shareholder as those on which the Selling Party is transferring its
Tag Along Shares.
3.6. In the event the transactions contemplated by a Tag Along Offer shall
not be consummated by the Selling Party for any reason, the Tag Along
Shareholder(s) shall not be required to sell any Ordinary Shares to
the Proposed Purchaser. The Selling Party shall have sole discretion
in deciding whether or not to consummate the transaction contemplated
by the Tag Along Offer (regardless of the exercise by the Tag Along
Shareholder of its rights), and shall have no liability towards the
Tag Along Shareholders if such transactions are not consummated.
3.7. In the event that the Selling Party proposes to effect a Transfer on
terms and conditions less favorable than as set forth in the Tag Along
Offer or in the event that the transaction thereunder is not
consummated within 90 days after the lapse of the 3 businesses-day
period set forth in Section 3.1 above, then the Selling Party shall
not proceed with any Transfer without the Selling Party again
complying with the terms and conditions of this Section 3.
3.8. The proceeds of any Transfer made by a Selling Party not in compliance
with the provisions of this Section 3 shall be deemed to be held by
the Selling Party in constructive trust for each of the Tag-Along
Shareholder(s) in an amount representing each such Tag-Along
Shareholder(s) Pro Rata Portion.
3.9. Notwithstanding the foregoing, a Tag Along Shareholder shall not be
entitled to exercise the tag along rights pursuant to this Section 3
until the third anniversary of the Closing if as a result of the
exercise thereof (i) the Proposed Purchaser will hold 25% or more of
the then issued and outstanding share capital of the Company and (ii)
Alpha and Ronex (and their respective Permitted Transferees) will
jointly hold less than 25% of the then issued and outstanding share
capital of the Company; in which case the Selling Party and each Tag
Along Shareholder shall only be entitled to sell to the Proposed
Purchaser such number of shares equal to their respective pro-rata
portions of the total number of shares permitted to be sold while
complying with the above (the "PERMITTED SHARES") (but in no event
shall the Tag Along Shareholder be required to sell more shares than
as stated in its Tag Along Exercise Notice). Each party's pro-rata
portion shall be equal to the number of shares held by such party
divided by the total number of shares held by all parties
participating in such sale. Without derogating from the above, it is
clarified that the pro-rata portion of any single member comprising of
Alpha of Alpha's pro-rata portion of the Permitted Shares need not
necessarily reflect such member's pro-rata portion holdings vis-a-vis
the other members of Alpha. For the purpose of this Section 3.9,
"holding" shall have the meaning ascribed to it in the Companies Law,
except that it shall include the holding of any convertible securities
as if exercised or converted into Ordinary Shares of the Company.
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4. EXCEPTIONS AND PERMITTED TRANSFEREES.
4.1. Notwithstanding anything to the contrary in this Agreement, the
provisions of Sections 2 and 3 above shall not apply to (i) any
Transfer of Ordinary Shares of the Company by a Shareholder to its
Permitted Transferees (as defined and subject to the conditions set
forth below); (ii) the Transfer by a Shareholder of Ordinary Shares on
a stock exchange in open market transactions; (iii) Transfers pursuant
to a registration statement effected consistent with the Registration
Rights Agreement dated as of the date hereof between the Company and
Alpha, as amended; and (iv) Transfer pursuant to a tender offer.
4.2. For purposes of this Agreement, "PERMITTED TRANSFEREE" means (i) with
respect to Alpha: (a) each member comprising Alpha, its controlling
holder (in case of a corporate entity) or its beneficiary (in case of
a trust) (the "ALPHA PROMOTERS") (b) any grandparents, parents,
siblings, children, lineal descendant of such persons (including step
and adopted children), and any spouse (including, former spouse, widow
or widower) of the Alpha Promoters or any of the foregoing, or trust
of which at least one of the foregoing is the beneficiary thereof; (c)
any affiliate of the Alpha Promoters or the persons indicated in (b)
above; (ii) with respect to Ronex - any limited partnership that is an
investor in Ronex, the partners of any such limited partnership and
any entity controlled by, controlling or under common control with any
such partnership; provided that in each case in (i) and (ii), the
Permitted Transferee has agreed in writing to assume and be bound by
all of a Shareholder's obligations hereunder as if it were an original
party hereto by delivering a counterpart of this Agreement to the
other parties hereto (a "PERMITTED TRANSFER").
4.3. For all purposes under this Agreement, including for the provisions of
Sections 2 and 3, each party and its Permitted Transferees which
become the holders or owners of Ordinary Shares, whether directly or
beneficially, as a consequence of a Permitted Transfer, shall be
considered as one party, enjoying jointly (and only jointly) all the
rights and jointly and severally assuming all of the obligations
pursuant to the terms of this Agreement. To the extent requested by
Alpha or Ronex, the Permitted Transferee shall be required to provide
to the requesting party instruments that may be required under
applicable law to ensure the binding effect of this Section 4.3.
5. DISCUSSIONS PRIOR TO SHAREHOLDER MEETINGS. The Shareholders agree to
cooperate on Company matters and to make reasonable efforts to meet
regularly, and in any event prior to each general meeting of the
shareholders of the Company, in order to review, discuss and, subject to
the provisions of applicable law, to attempt to reach a unified position
with respect to principal issues on the agenda of each such shareholders'
meeting (which, for the avoidance of doubt, shall be subject to and shall
not derogate from the provisions of Section 1 or any other section in this
Agreement). The Shareholders agree to vote AGAINST any proposed change to
the Company's articles of association and/or any other resolution at any
shareholder meeting, which will conflict or otherwise contravene with the
provisions of this Agreement.
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6. JOINT SHAREHOLDERS COMMITTEE. The Shareholders shall appoint a joint
shareholders Committee (the "JOINT COMMITTEE") for consultation purposes,
which shall comprise of four members, two of which shall be designated by
each of Alpha and Ronex. For the avoidance of doubt, the Joint Committee is
not a committee of the Company and/or the Board and shall not bind the
Company in any way.
7. SHARE ADJUSTMENTS. In the event of any share split (bonus shares), share
dividend (including any dividend or distribution of securities convertible
into share capital), recapitalization, reorganization, combination or other
like change with respect to the Company's shares, or the acquisition or
receipt by any Shareholder of additional Ordinary Shares, the provisions of
this Agreement shall apply also to any such Ordinary Shares issued to,
purchased or otherwise held by the Shareholders.
8. STANDSTILL. During the period commencing on the date hereof and until the
Closing or the earlier termination of this Agreement in accordance with its
terms, Ronex shall not, and shall cause its affiliates not to, directly or
indirectly, (i) offer for sale (including short sale), sell, transfer,
exchange, tender, create any Encumbrance, assign, sell any option or
contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase otherwise dispose of, or enter into
any contract or arrangement with respect to, or consent to, or offer any,
of the foregoing, any of the Ordinary Shares owned or controlled by them,
whether beneficially or otherwise held by them or their affiliates, or any
interest therein, to any person; and (ii) except as contemplated by or
permitted by this Agreement, grant any proxies or powers of attorney,
deposit any Ordinary Shares into a voting trust or enter into a voting
agreement with respect to any Ordinary Shares owned or controlled by them,
whether beneficially or otherwise held by them or their affiliates.
"ENCUMBRANCE" shall mean any lien, pledge, hypothecation, charge, equities,
claims, restrictions, options, proxies, security interest, encumbrance, or
any other rights of third parties that would impose any restriction on the
exercise of sole voting power over any security, provided however that with
respect to Ronex, the pledge of shares by Ronex for the benefit of a
banking institution or the transfer of shares in connection with the
realization of a pledge, if any, created by Ronex for the benefit of a
banking institution on the Company's shares held by Ronex, shall not be
deemed an "Encumbrance".
9. NO - SOLICITATION. During the period commencing on the date hereof and
until the Closing or the earlier termination of this Agreement in
accordance with its terms:
9.1. Ronex shall not, and shall cause its affiliates and their respective
employees, officers, directors, agents and other advisors and
representatives not to, whether directly or indirectly (i) solicit,
initiate, encourage or induce the making, submission or announcement
of any Other Proposal (as defined below); (ii) make, or in any way
participate, directly or indirectly, in any Other Proposal or Other
Transaction, (iii) engage or otherwise participate in any discussions
or negotiations regarding, or furnish to any person any non-public
information with respect to, or take any other action to facilitate
any inquiries or the making of any proposal that constitutes or may
reasonably be expected to lead to, any Other Proposal; (iii) respond
to or engage in discussions with any person with respect to any Other
Proposal, except as to the existence of these provisions; (iv)
approve, endorse or recommend any Other Proposal; or (v) enter into
any letter of intent or similar document or any agreement or
commitment contemplating or otherwise relating to any Other
Transaction (as defined below). Ronex shall, and shall cause its
affiliates and their respective employees, officers, directors, agents
and other advisors and representatives to, immediately cease all
existing activities, discussions and negotiations with any person
conducted heretofore with respect to any Other Proposal and request
the return of all confidential information regarding the Company and
its affiliates or pertaining to any Other Proposal provided to any
such person prior to the date hereof pursuant to the terms of any
confidentiality agreement or otherwise.
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9.2. Ronex shall promptly advise Alpha orally and in writing of any
request, statement of intent, inquiry, referral or offer received by
Ronex or its affiliates that could lead to an Other Proposal, the
material terms and conditions thereof, and the identity of the person
or group making any such request, statement of intent, inquiry,
referral, offer or Other Proposal. Ronex will keep Alpha informed in
all respects of the status and details (including material amendments
or proposed amendments) thereof.
9.3. For the purpose of this Section 9, the following terms shall have the
following meanings:
9.3.1. "OTHER PROPOSAL" shall mean any inquiry, offer or proposal
(other than an inquiry, offer or proposal by Alpha or its
affiliates), oral or written, relating to any Other Transaction.
9.3.2. "OTHER TRANSACTION" shall mean any transaction or series of
transactions, other than the transactions contemplated by this
Agreement, the Purchase Agreement and the Related Agreements
thereunder (as defined therein), involving: (i) any merger,
exchange, consolidation, business combination, plan of
arrangement, issuance of securities, acquisition of securities,
reorganization, recapitalization, takeover offer, tender offer,
exchange offer, purchase, sale (including short sale), transfer,
option, proxies or other transaction (A) in which a person or
group of persons directly or indirectly acquires beneficial or
record ownership of securities representing 5% or more of the
outstanding securities of any class of voting securities or debt
securities of the Company or any material subsidiary thereof; or
(B) in which the Company or any material subsidiary thereof
issues securities representing 5% or more of the outstanding
securities of any class of voting securities of the Company or
any material subsidiary thereof or debt securities; (ii) any
sale, lease, exchange, transfer, license, acquisition or
disposition of any business or businesses or assets that
constitute or account for 5% or more of the consolidated net
revenues, consolidated net income or consolidated assets
(including for this purpose the outstanding equity securities of
the Company's subsidiaries) of the Company or any material
subsidiary thereof (but other than in the ordinary course of
business consistent with past practice); (iii) "solicitation" of
"proxies" to vote (as such terms are used under the Exchange Act)
with respect to any Ordinary Shares, calling or seeking to have
called a meeting of shareholders of the Company or execution of
any written consent in lieu of such a meeting, submitting a
shareholder proposal to the Company or a demand that the Company
convene a shareholders meeting, or seeking to advise or
influencing any person or entity with respect to the voting of
any voting securities of the Company; or (iv) seeking control of
the management or the Board of Directors of the Company or
policies of the Company, or any change which results or is
reasonably likely to result in a change in the majority of the
persons who constitute the board of directors of the Company as
of the Closing.
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10. VOTING UNDERTAKING AND PROXY.
10.1. Ronex hereby agrees, at any annual, extraordinary, or special meeting
of the shareholders of the Company called to approve the Series
Agreements (as defined below), and at any postponement(s) or
adjournment(s) thereof, or pursuant to any consent in lieu of a
meeting or otherwise (the "MEETING"), to vote (or cause to be voted)
all Ordinary Shares that Ronex now or hereafter owns or controls,
whether beneficially or otherwise held by it or its affiliates
(including as a result of exercise of the options or other securities
or rights convertible, exercisable or exchangeable into Ordinary
Shares or otherwise) (collectively, the "SHARES") in the following
manner: (i) in favor of the Purchase Agreement, the Related Agreements
(as defined thereunder) and the Separation Agreement between the
Company and its Chief Executive Officer, each of the transactions
contemplated thereby, and any actions required in furtherance thereof
or matter related thereto (collectively, together with this Agreement,
the "SERIES AGREEMENTS"); (ii) against any action or agreement that
would result in a breach in any respect of any covenant,
representation or warranty or any other obligation or agreement of the
Company or Ronex hereunder or under the Series Agreements; (iii)
except as otherwise expressly agreed to in writing in advance by
Alpha, against any Acquisition Proposal or Acquisition Transaction (as
defined in the Purchase Agreement) and any Other Proposal or Other
Transaction; and (v) any other action involving the Company or its
subsidiaries which is intended, or could in any manner be expected, to
impede, interfere with, delay, postpone, or adversely affect the
Series Agreements. Ronex shall not enter into any agreement or
understanding with any person the effect of which would be
inconsistent with or violative of the provisions and undertakings
referred to in this Section 10 and any proxies heretofore given by
Ronex in respect of the Shares are hereby revoked.
10.2. As promptly as possible, but in no event later than 14 days prior to
the date scheduled for the Meeting, Ronex and each of its affiliates
shall deliver to Alpha a validly executed irrevocable proxy, in a form
reasonably requested by Alpha and shall cause any record holder(s) of
the Shares to grant proxy(ies) in substantially similar form,
accompanied by confirmation of ownership for the Meeting from the bank
or other holder with which the Shares are deposited.
10.3. Ronex understands and acknowledges that Alpha is entering into the
Series Agreements in reliance upon Ronex's execution, delivery and
performance of this Agreement. The irrevocable proxy set forth in
Section 10.2 is given in connection with the execution of the Series
Agreements to secure the performance of the duties of Ronex
thereunder. Ronex hereby further affirms that unless this Agreement is
terminated in accordance with its terms, the irrevocable proxy(ies)
pursuant to Section 10.2 may under no circumstances be revoked.
10.4. Without derogating from the provisions of Section 8, the provisions
of this Section 10 and the obligations hereunder shall attach to the
Shares and shall be binding upon any person to which legal or
beneficial ownership of such Shares shall pass, whether by operation
of law or otherwise, including, without limitation, Ronex's successors
and assigns, and notwithstanding any transfer of the Shares, the
transferor shall remain liable for the performance of all obligations
of the transferor hereunder.
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11. TERM; TERMINATION.
11.1. The grant of the approval under the Israeli Restrictive Trade
Practices Law, 1988 and the regulations promulgated thereunder, or the
expiration or waiver of the applicable waiting period thereunder,
shall be a condition precedent to the effectiveness of Sections 1.1,
1.5, 5 and 6.
11.2. This Agreement shall terminate on the earlier to occur of (i) the
fifth anniversary of the Closing, (ii) the termination of the Purchase
Agreement, for any reason, pursuant to its terms, and (iii) the first
date on which either party holds less than 1,100,000 Ordinary Shares
of the Company (as adjusted pursuant to Section 7).
12. MISCELLANEOUS.
12.1. ALPHA. Members comprising Alpha and their respective Permitted
Transferees shall be treated as one group (and accordingly as a single
Shareholder) for purposes of this Agreement.
12.2. INTERPRETATION. The words "include," "includes" and "including" when
used herein shall be deemed in each case to be followed by the words
"without limitation". The words "herein," "hereof," "hereto" and
"hereunder" and words of similar import, when used in this Agreement,
shall refer to this Agreement as a whole and not to any particular
provision of this Agreement; the word "person(s)" shall include an
individual, corporation, partnership, association, trust, enterprise
or other entity or organization, including a government or political
subdivision or an agency or instrumentality thereof; the phrase or
words "beneficial ownership" of any securities or "own" (and words and
phrases of similar import) shall mean beneficial ownership for
purposes of Rule 13d-3 under the Exchange Act (and for the purposes of
Rule 13d-3(d)(1)(i) as if the right to acquire beneficial ownership of
such security would have been within 60 days); the word "affiliate(s)"
(and words of similar import) shall mean as set forth in Rule 405
promulgated under the Securities Act of 1933, as amended, and with
respect to any natural person, also, (i) grandparents, parents,
siblings, lineal descendant of such person or their spouse (including
step and adopted children), and any spouse (including, former spouse,
widow or widower) of such person or any of the foregoing, (ii) any
trust established for the benefit of such natural person or any
affiliate of such natural person, or (iii) any executor or
administrator of the estate of such natural person; the word "group"
shall mean any group of persons acting together in the manner
described in Rule 13d-5(b)(1) under the Exchange Act; and the term
"business day" shall mean normal business hours on a business day in
the place of recipient.
12.3. FEES AND EXPENSES. Each Shareholder shall bear its own legal fees and
all related expenses in connection with this Agreement.
12.4. NOTICES. All notices to be given to a party pursuant to this
Agreement shall be in writing and shall be deemed to have been duly
given to the addressee thereof (i) if hand delivered, upon delivery,
(ii) if given by email or facsimile transmission, upon transmission
and electronic confirmation of receipt (or recipient's electronic
"read receipt" in case of email) or (if transmitted and received on a
non-Business Day) on the first business day following transmission and
electronic confirmation of receipt (or recipient's electronic "read
receipt" in case of email, (iii) if given by air courier, two business
days following the delivery to the courier service, or (iv) if mailed
by registered mail, return receipt requested, seven days following the
date it was mailed, to such party's address as set forth below or at
such other address as such party shall have furnished to the other
party in writing in accordance with this provision (provided, however,
that any notice of change of address shall only be valid upon
receipt):
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If to Alpha:
▇▇. ▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
Facsimile No.: ▇▇▇-(▇)-▇▇▇▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇.▇▇▇
And to:
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
Tel: (972)-(3)-7371111
Fax: (972)-(3)-7371110
Email: ▇▇▇▇@▇▇▇▇▇.▇▇▇
With a copy to (which shall not constitute notice):
Meitar Liquornik Geva & Leshem ▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇. ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, Israel
Tel: (972)-(3)-610-3100
Fax: (972)-(3)-6103-111
Attention: ▇▇▇ ▇▇▇▇, Advocate
▇▇▇▇▇ ▇▇▇▇▇, Advocate
Email: ▇▇▇@▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
If to the Ronex:
c/o FIMI IV 2007 Ltd.
"▇▇▇▇▇▇▇▇▇▇ House"
▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇-▇▇▇▇, ▇▇▇▇▇▇
Tel: (972)-(3)-5652244
Fax: (972)-(3)-5652245
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Email: ▇▇▇▇▇@▇▇▇▇.▇▇.▇▇
With a copy to (which shall not constitute notice):
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇.
▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇-▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Tel: (972)-(3)-6235022
Fax: (972)-(3)-6235106
Attention: ▇▇▇▇▇▇ ▇. Amir, Advocate
Email: ▇▇▇▇▇@▇▇▇▇▇.▇▇▇
or to such other address as the parties may from time to time
designate in writing.
12.5. WAIVER. Any waiver hereunder must be in writing, duly authorized and
signed by the party to be bound, and shall be effective only in the
specific instance and for the purpose for which it was given. No
failure or delay on the part of a Shareholder in exercising any right,
power or privilege under this Agreement shall operate as a waiver
thereof, nor shall any single or partial exercise of any right, power
or privilege hereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.
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12.6. ENTIRE AGREEMENT. This Agreement, the exhibits and the schedules
hereto and the documents furnished by the parties hereto in connection
with the transactions contemplated herein constitute the entire
agreement among the parties hereto with respect to the matter hereof
and supersede any other agreement, written and oral, that may have
been made or entered into by the Shareholders relating to the
transactions contemplated by this Agreement.
12.7. AMENDMENTS. This Agreement may be amended or modified in whole or in
part only by a duly authorized written agreement that refers to this
Agreement and is signed by the majority of the Alpha Promoters and
Ronex. Any amendment effected in accordance with this Section shall be
binding upon all parties to this Agreement.
12.8. LIMITATIONS ON RIGHTS OF THIRD PARTIES. Nothing expressed or implied
in this Agreement is intended or shall be construed to confer upon or
give any person, other than the Shareholders, any rights or remedies
under this Agreement, except that the Company is an intended third
party beneficiary of Section 3.9 hereof.
12.9. CAPTIONS. The captions in this Agreement are inserted for convenience
of reference only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Agreement.
12.10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and by facsimile signature, each of which shall be deemed
an original and enforceable against the parties actually executing
such counterpart, and all of which together shall constitute one and
the same instrument, it being understood that all parties need not
sign the same counterpart. The exchange of an executed Agreement (in
counterparts or otherwise) by facsimile transmission or by electronic
delivery in .pdf format or the like shall be sufficient to bind the
parties to the terms and conditions of this Agreement, as an original.
12.11. GOVERNING LAW. This Agreement shall be governed by, and construed
and enforced in accordance with, the laws of the State of Israel,
regardless of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof. Any dispute arising under or
with respect to this Agreement shall be resolved exclusively in the
appropriate court located in Tel Aviv, Israel.
12.12. FURTHER ASSURANCES. The parties hereto shall execute and deliver
such additional documents and shall take such additional actions
(including without limitation procuring such resolutions or regulatory
approvals) as may be reasonably necessary or appropriate to effect the
provisions and purposes of this Agreement and the consummation of the
transactions contemplated hereby.
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12.13. SEVERABILITY. If any provision of this Agreement is held by a court
of competent jurisdiction to be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions
shall not in any way be affected, impaired or invalidated thereby, and
the application of such provision to other persons or circumstances
will be interpreted so as reasonably to effect the intent of the
parties hereto. The parties further agree to replace such void or
unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the economic,
business and other purposes of such void or unenforceable provision.
12.14. ASSIGNMENT. Except as expressly permitted herein, this Agreement is
not assignable by any party hereto, and each of the parties hereto
shall not assign or otherwise transfer, in whole or in part, this
Agreement, and/or any of its rights, interests or obligations
hereunder to any third party, without the prior written consent of the
other party hereto, and any such assignment without such prior written
consent shall be null and void. Subject to the foregoing, this
Agreement shall be binding upon, inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and
assigns.
[Signature Pages Follow]
- 13 -
IN WITNESS WHEREOF, the Shareholders have each caused this Shareholders
Agreement to be duly executed as of the date first above written.
ALPHA:
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇
By: ▇▇▇▇▇▇▇ ▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
By: ▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
By: ▇▇▇ ▇▇▇▇▇▇
-----------------------------------------
Name: M.R.S.G (1999) LTD. AND ▇▇▇▇▇ ▇▇▇▇▇
By: ▇▇▇▇▇ ▇▇▇▇▇
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IN WITNESS WHEREOF, the Shareholders have each caused this Shareholders
Agreement to be duly executed as of the date first above written.
RONEX:
RONEX HOLDINGS, LIMITED PARTNERSHIP
By: Ronex Holdings Ltd., its General Partner
--------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: CEO
- 15 -