Exhibit 2
REGISTRATION RIGHTS AGREEMENT
among
GILAT COMMUNICATIONS LTD.
(the "Company")
and
SHAMROCK HOLDINGS OF CALIFORNIA, INC.
Dated as of June 30, 2000
<PAGE>
This Registration Rights Agreement (the "Agreement"), dated as of June
30, 2000, is by and among Gilat Communications Ltd., an Israeli company
(the "Company"), and Shamrock Holdings of California, Inc., a California
corporation.
WHEREAS, the Company proposes to issue and sell to the Purchaser
Convertible Notes pursuant to the Note Purchase Agreement (as each such
term is defined herein); and
WHEREAS, as a condition of entering into the Note Purchase Agreement,
the Purchaser has requested that the Company extend it registration rights
and other rights as set forth herein; and
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement and the Note Purchase Agreement, the parties
agree as follows:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under the direct or indirect
common control with such specified person, provided, however, that no
Purchaser shall be deemed an Affiliate of the Company for purposes hereof.
For the purposes of this definition, "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), as
used with respect to any person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management
or policies of such person, whether through the ownership of voting
securities or by agreement or otherwise. For the purposes of this
Agreement, Affiliates of the Purchaser shall include (i) any entity which
50% or more of its voting or equity securities are owned, directly or
indirectly, by Shamrock Holdings, Inc. or Shamrock Holdings of California,
Inc., any executive officers of Shamrock Holdings, Inc. or Shamrock
Holdings of California, Inc. and/or any member of the Roy E. Disney family
(or any trust for his/her benefit) and (ii) any entity in which Shamrock
Holdings Inc. or Shamrock Holdings of California or any of the foregoing
referenced in (i) serves as a general partner or manager.
"Commission" means the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"Conversion Shares" means shares of Ordinary Shares issued upon
conversion of the Convertible Notes.
"Convertible Notes" means the notes issued pursuant to the Note
Purchase Agreement, including the Additional Notes (as defined therein),
and any notes issued in replacement or exchange of such notes.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder, as amended.
"Initiating Holders" means the beneficial owners (as determined
pursuant to Rule 13d-3 of the Exchange Act) of at least 30% of the
Conversion Shares, at the time that a request for registration is made
under Section 2.
"Ordinary Shares" means the Ordinary Shares, nominal value NIS 0.01
each, of the Company.
"Note Purchase Agreement" mean the Convertible Note Purchase
Agreement, dated as of the date hereof, among the Company and the
Purchaser.
"Permitted Transferees" means (i) any Affiliate of Shamrock Holdings
of California, Inc., and (ii) Private Equity Holding, A.G. ("PEH") and any
entity which controls, is controlled by or under common control with, PEH.
"Purchasers" means Shamrock Holdings of California, Inc. and any
subsequent assignee of rights hereunder pursuant to Section 12 herein.
"Registrable Shares" means (i) the Conversion Shares issued and
issuable upon conversion of the Convertible Notes; (ii) any shares of
Ordinary Shares issued or issuable upon conversion of any capital share of
the Company acquired by any Purchaser after the date hereof; and (iii) any
other securities into which or for which any of the securities set forth in
(i) and (ii) may be converted or exchanged pursuant to a plan of
recapitalization, reorganization, merger, sale of assets or otherwise.
Notwithstanding the preceding sentence, the Conversion Shares and other
Ordinary Shares which are Registrable Shares shall cease to be Registrable
Shares upon any sale of such Registrable Shares pursuant to Rule 144.
"Registration Expenses" means the expenses so described in Section 7.
"Rule 144" means Rule 144, as amended, promulgated under the
Securities Act or any successor rule or regulation thereto.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder, as amended.
"Selling Expenses" means the expenses so described in Section 7.
2. Demand Registrations.
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(a) At any time after the 90th calendar day following the closing
of the transactions contemplated by the Note Purchase Agreement, the
Initiating Holders may request the Company to register for sale under the
Securities Act all or any portion of the shares of Registrable Shares held
by such Initiating Holders by submitting a written notice to the Company
requesting such registration and specifying the manner of sale therein;
provided, however, that the Company shall not be obligated to effect a
registration pursuant to this Section 2 if the holders of Registrable
Shares propose to sell Registrable Shares and such other securities (if
any) at an aggregate price to the public (net of any underwriters'
discounts or commissions) of less than $2,500,000. If the Company is a
registrant entitled to use Form F-3 or any successor thereto to register
such shares, then the Company shall use its reasonable best efforts to
register such shares under the Securities Act on Form F-3 or any successor
thereto.
(b) Following receipt of any notice under this Section 2, the
Company shall within ten (10) days of receipt of such notice notify all
holders of Registrable Shares from whom notice has not been received and
shall use its best efforts (subject to the provisions of this Section 2) to
register under the Securities Act for public sale in accordance with the
method of disposition specified in such notice from the Initiating Holders
the number of shares of Registrable Shares specified in such notice (and in
all notices received by the Company from other holders within thirty (30)
days after the giving of such notice by the Company). If such method of
disposition shall be an underwritten public offering, the Initiating
Holders may designate the managing underwriter of such offering, subject to
the approval of the Company, which approval shall not be unreasonably
withheld or delayed. Notwithstanding any other provision of this Section 2,
if the underwriter advises the Initiating Holders in writing that marketing
factors require a limitation of the number of shares to be underwritten,
then the number of shares to be included in such an underwriting will be
allocated, first, to the holders of Registrable Shares (pro rata based on
the number of Registrable Shares), second, to the Company, and third, to
other shareholders, but such allocation shall only be made if and to the
extent that the managing underwriter shall be of the opinion that the
inclusion of such shares in the underwriting would not adversely affect the
marketing of the securities to be sold therein.
(c) Except for registration statements on Form F-4, S-8 or any
successor thereto, and except as requested pursuant to other agreements
existing on the date hereof relating to registration rights (all as
disclosed in Schedule 2.3 to the Note Purchase Agreement) the Company will
not file with the Commission any other registration statement with respect
to its Ordinary Shares, whether for its own account or that of other
shareholders, from the date of receipt of a notice from the Initiating
Holders until thirty (30) days after the completion of the period of
distribution of the registration contemplated thereby.
(d) In addition, the Company shall not be obligated to effect, or
to take any action to effect, any registration pursuant to this Section 2:
(i) After the Company has effected one registration pursuant
to this Section 2, and such registration has been declared or ordered
effective, and provided the registration statement covered all shares of
Registrable Shares specified in notices received as aforesaid, for sale in
accordance with the method of disposition specified by the Initiating
Holders, became effective and, if such method of disposition is a firm
commitment underwritten public offering, all such shares shall have been
sold pursuant thereto;
(ii) During the period from the date hereof until after the
90th calendar day following the closing of the Note Purchase Agreement; or
(iii) If the Company shall furnish to the Initiating Holders
a certificate signed by the President of the Company stating that, in the
good faith judgment of the Board of Directors of the Company, it would not
be in the best interests of the Company and its shareholders for such
registration statement to be filed on or before the date filing would be
required and it is therefore appropriate to defer the filing of such
registration statement. Upon providing the Initiating Holders with said
certificate, the Company may direct that such request for registration be
delayed for a period not in excess of sixty (60) days, provided that such
right to delay shall not be used more than once in any twelve month period.
3. Incidental Registration. If the Company at any time (other than
pursuant to Section 2 or Section 4) proposes to register any of its
securities under the Securities Act for sale to the public (except with
respect to registration statements on Forms F-4, S-8 or another form not
available for registering the Registrable Shares for sale to the public,
other than a registration statement including registration on the request
of other shareholders of the Company), each such time it will give written
notice to all holders of outstanding Registrable Shares of its intention to
do so. Upon the written request of any such holder, received by the Company
within thirty (30) days after the giving of any such notice by the Company,
to register any of its Registrable Shares, the Company will use its
reasonable best efforts (subject to the provisions of the following two
sentences) to cause the Registrable Shares as to which registration shall
have been so requested to be included in the securities to be covered by
the registration statement proposed to be filed by the Company, all to the
extent requisite to permit the sale or other disposition by the holder of
such Registrable Shares so registered. In the event that any registration
pursuant to this Section 3 shall be, in whole or in part, an underwritten
public offering of Ordinary Shares, the number of shares to be included in
such an underwriting will be allocated, first, to the persons initially
requesting such registration (including, if applicable, the Company),
second, to the holders of Registrable Shares and other shareholders of the
Company having incidental registration rights as of the date hereof (pro
rata based on the number of shares beneficially owned (as determined
pursuant to Rule 13d-3 of the Exchange Act) by such holders), and third, to
the other shareholders of the Company then having incidental registration
rights (pro rata based on the number of shares owned by such holders), but
such allocation shall only be made if and to the extent that the managing
underwriter shall be of the opinion that the inclusion of such shares in
the underwriting would not adversely affect the marketing of the securities
to be sold therein. In the event that the Company determines not to proceed
with or consummate a registration of its securities that is subject to this
Section 3, the holders of Registrable Securities shall not have any rights
under this Section 3 with respect to such a registration.
4. Registration on Form F-3. If at any time after the 90th day
following the closing of the Note Purchase Agreement (i) the Initiating
Holders request that the Company file a registration statement on Form F-3
or any successor thereto for a public offering of all or any portion of the
shares of Registrable Shares held by such Initiating Holders, and (ii) the
Company is a registrant entitled to use Form F-3 or any successor thereto
to register such shares, then the Company shall use its reasonable best
efforts to register under the Securities Act on Form F-3 or any successor
thereto, for public sale in accordance with the method of disposition
specified in such notice, the number of Registrable Shares specified in
such notice. Whenever the Company is required by this Section 4 to use its
reasonable best efforts to effect the registration of Registrable Shares,
each of the procedures and requirements of Section 2 (including but not
limited to the requirement that the Company notify all holders of
Registrable Shares from whom notice has not been received and provide them
with the opportunity to participate in the offering) shall apply to such
registration. The number of registrations on Form F-3 which may be
requested by the Initiating Holders and obtained under this Section 4 shall
be unlimited, provided, however, that the Company shall not be obligated to
effect a registration pursuant to this Section 4 (a) more than once every 4
(four) months commencing on such date as the Company is entitled to use
Form F-3 or any successor thereto to register such shares; (b) if the
holders of Registrable Shares propose to sell Registrable Shares and such
other securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $2,500,000; or (c) if
the Company shall furnish to the Initiating Holders a certificate signed by
the President of the Company stating that in the good-faith judgment of the
Board of Directors of the Company, it would be seriously detrimental to the
Company and its shareholders for such Form F-3 registration to be effected
at such time, in which event the Company shall have the right to defer the
filing of the Form F-3 registration statement for a period of not more than
sixty (60) days after receipt of the request of the Initiating Holders
under this Section 4; provided, however, that the Company shall not utilize
this right more than once in any twelve-month period. In the event that any
registration pursuant to this Section 4 is, in whole or in part, an
underwritten public offering of Ordinary Shares, the number of shares to be
included in such an underwriting will be allocated, first, to the holders
of Registrable Shares (pro rata based on the number of Registrable Shares),
second, to the Company, and third, to other shareholders, but such
allocation shall only be made if and to the extent that the managing
underwriter shall be of the opinion that the inclusion of such shares in
the underwriting would not adversely affect the marketing of the securities
to be sold therein.
5. Termination of Registration Rights. Notwithstanding any other
provision of this Agreement, no holder of Registrable Shares shall be
entitled to exercise any right provided for in Sections 2, 3 or 4 after ten
years following the date hereof.
6. Registration Procedures. If and whenever the Company is required by
the provisions of Sections 2, 3 or 4 to use its best efforts (or, where
applicable, reasonable best efforts) to effect the registration of any
shares of Registrable Shares under the Securities Act, the Company will, as
expeditiously as possible:
(a) prepare and file with the Commission a registration statement
(which, in the case of an underwritten public offering pursuant to Section
2, shall be on Form F-1 or other form of general applicability satisfactory
to the Initiating Holders and the managing underwriter selected as therein
provided) with respect to such securities and use its best efforts (or,
where applicable, reasonable best efforts) to cause such registration
statement to become and remain effective for the period of the distribution
contemplated thereby (determined as hereinafter provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for the period specified in paragraph (a) above and
comply with the provisions of the Securities Act with respect to the
disposition of all Registrable Shares covered by such registration
statement in accordance with the sellers' intended method of disposition
set forth in such registration statement for such period;
(c) furnish to each seller of Registrable Shares and to each
underwriter such number of copies of the registration statement (including
any post-effective amendment thereto) and the prospectus included therein
(including each preliminary prospectus) and any amendment or supplement
thereto (including any document incorporated therein by reference) as such
persons reasonably may request in order to facilitate the public sale or
other disposition of the Registrable Shares covered by such registration
statement;
(d) use its best efforts to register or qualify the Registrable
Shares covered by such registration statement under the securities or "blue
sky" laws of such jurisdictions as the sellers of Registrable Shares or, in
the case of an underwritten public offering, the managing underwriter
reasonably shall request, provided, however, that the Company shall not for
any such purpose be required to qualify generally to transact business as a
foreign corporation in any jurisdiction where it is not so qualified or to
consent to general service of process in any such jurisdiction;
(e) use its best efforts to list the Registrable Shares covered
by such registration statement with any securities exchange on which the
Ordinary Shares of the Company is then listed;
(f) notify each seller of Registrable Shares and each underwriter
under 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 of which the Company has knowledge as a result of
which the prospectus contained 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 light of the circumstances then
existing;
(g) if the offering is underwritten and at the request of any
seller of Registrable Shares, use its best efforts to furnish on the date
that Registrable Shares are delivered to the underwriters for sale pursuant
to such registration: (i) an opinion dated such date of counsel
representing the Company for the purposes of such registration, addressed
to the underwriters and to such seller, stating that such registration
statement has become effective under the Securities Act and that (A) to the
knowledge of such counsel after due inquiry, no stop order suspending the
effectiveness thereof has been issued and no proceedings for that purpose
have been instituted or are pending or contemplated under the Securities
Act, (B) the registration statement, the related prospectus and each
amendment or supplement thereof comply as to form in all material respects
with the requirements of the Securities Act (except that such counsel need
not express any opinion as to financial statements contained therein) and
(C) to such other effects as reasonably may be requested by counsel for the
underwriters or by such seller or its counsel and (ii) a letter dated such
date from the independent public accountants retained by the Company,
addressed to the underwriters and to such seller, stating that they are
independent public accountants within the meaning of the Securities Act and
that, in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or any
amendment or supplement thereof, comply as to form in all material respects
with the applicable accounting requirements of the Securities Act, and such
letter shall additionally cover such other financial matters with respect
to such registration as such underwriters reasonably may request; and
(h) make available for inspection by each seller of Registrable
Shares, any underwriter participating in any distribution pursuant to such
registration statement, and any attorney, accountant or other agent
retained by such seller or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant
or agent in connection with such registration statement.
For purposes of Section 6(a) and 6(b) and of Section 2(c), the
period of distribution of Registrable Shares in a firm commitment
underwritten public offering shall be deemed to extend until each
underwriter has completed the distribution of all securities purchased by
it, and the period of distribution of Registrable Shares in any other
registration shall be deemed to extend until the earlier of the sale of all
Registrable Shares covered thereby and 120 (one hundred twenty) days after
the effective date thereof.
In connection with each registration hereunder, the sellers of
Registrable Shares will furnish to the Company in writing such information
with respect to themselves and the proposed distribution by them as
reasonably shall be necessary in order to assure compliance with federal
and applicable state securities laws.
In connection with each registration pursuant to Sections 2, 3 or
4 covering an underwritten public offering, the Company and each seller
agree to enter into a written agreement with the managing underwriter
selected in the manner herein provided in such form and containing such
provisions as are customary in the securities business for such an
arrangement between such underwriter and companies of the Company's size
and investment stature.
7. Expenses. All expenses incurred by the Company in complying
with Sections 2, 3 and 4, including, without limitation, all registration
and filing fees, printing expenses, fees and disbursements of counsel and
independent public accountants for the Company, fees and expenses
(including counsel fees) incurred in connection with complying with state
securities or "blue sky" laws, fees of the National Association of
Securities Dealers, Inc., transfer taxes, fees of transfer agents and
registrars, costs of insurance and fees and disbursements of one counsel
for the sellers of Registrable Shares (or of the Initiating Holders in case
of Section 2), but excluding any Selling Expenses, are called "Registration
Expenses." All underwriting discounts and selling commissions applicable to
the sale of Registrable Shares are called "Selling Expenses."
The Company will pay all Registration Expenses in connection with
each registration statement under Sections 2, 3 or 4. All Selling Expenses
in connection with each registration statement under Sections 2, 3 or 4
shall be borne by the participating sellers in proportion to the number of
shares sold by each, or by such participating sellers other than the
Company (except to the extent the Company shall be a seller) as they may
agree.
8. Indemnification and Contribution.
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(a) In the event of a registration of any of the Registrable
Shares under the Securities Act pursuant to Sections 2, 3 or 4, the Company
will indemnify and hold harmless each seller of such Registrable Shares
thereunder, each underwriter of such Registrable Shares and each other
person, if any, who controls such seller or underwriter within the meaning
of the Securities Act, against any losses, claims, damages or liabilities,
joint or several, to which such seller, underwriter or controlling person
may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in any registration statement
under which such Registrable Shares were registered under the Securities
Act pursuant to Sections 2, 3 or 4, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereof, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each such seller,
each such underwriter and each such controlling person for any legal or
other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action, provided,
however, that the Company will not be liable in any such case if and to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission so made in conformity with information furnished by such
seller, such underwriter or such controlling person in writing specifically
for use in such registration statement or prospectus.
(b) In the event of a registration of any of the Registrable
Shares under the Securities Act pursuant to Sections 2, 3 or 4, each seller
of such Registrable Shares thereunder, severally and not jointly, will
indemnify and hold harmless the Company, each person, if any, who controls
the Company within the meaning of the Securities Act, each officer of the
Company who signs the registration statement, each director of the Company,
each underwriter and each person who controls any underwriter within the
meaning of the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such officer,
director, underwriter or controlling person may become subject under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the registration statement under which such Registrable Shares
was registered under the Securities Act pursuant to Sections 2, 3 or 4, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereof, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company and each such officer, director,
underwriter and controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action, provided, however, that
such seller will be liable hereunder in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with information
pertaining to such seller, as such, furnished in writing to the Company by
such seller specifically for use in such registration statement or
prospectus, and provided, further, however, that the liability of each
seller hereunder shall not in any event to exceed the net proceeds received
by such seller from the sale of Registrable Shares covered by such
registration statement.
(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party shall, if
a claim in respect thereof is to be made against the indemnifying party
hereunder, notify the indemnifying party in writing thereof, but the
omission so to notify the indemnifying party shall not relieve it from any
liability which it may have to such indemnified party other than under this
Section 8 and shall only relieve it from any liability which it may have to
such indemnified party under this Section 8 if and to the extent the
indemnifying party is prejudiced by such omission. In case any such action
shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate in and, to the extent it shall wish, to
assume and undertake the defense thereof with counsel satisfactory to such
indemnified party, and, after notice from the indemnifying party to such
indemnified party of its election so to assume and undertake the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under this Section 8 for any legal expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation and of liaison with counsel so selected,
provided, however, that, if the defendants in any such action include both
the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be reasonable defenses
available to it which are different from or additional to those available
to the indemnifying party or if the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the indemnifying
party, the indemnified party shall have the right to select a separate
counsel and to assume such legal defenses and otherwise to participate in
the defense of such action, with the reasonable expenses and fees of such
separate counsel and other reasonable expenses related to such
participation to be reimbursed by the indemnifying party as incurred.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which either (i)
any holder of Registrable Shares exercising rights under this Agreement, or
any controlling person of any such holder, makes a claim for
indemnification pursuant to this Section 8 but it is judicially determined
(by the entry of a final judgment or decree by a court of competent
jurisdiction and the expiration of time to appeal or the denial of the last
right of appeal) that such indemnification may not be enforced in such case
notwithstanding the fact that this Section 8 provides for indemnification
in such case, or (ii) contribution under the Securities Act may be required
on the part of any such selling holder or any such controlling person in
circumstances for which indemnification is provided under this Section 8;
then, and in each such case, the Company and such holder will contribute to
the aggregate losses, claims, damages or liabilities to which they may be
subject (after contribution from others) the same proportion as their
relative faults in causing such losses, claims, damages or liabilities;
provided, however, that, in any such case, (A) no such holder will be
required to contribute any amount in excess of the net sale proceeds
received by such seller for all such Registrable Shares offered by it
pursuant to such registration statement; and (B) no person or entity guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any person or entity
who was not guilty of such fraudulent misrepresentation.
9. Changes in Ordinary Shares. If, and as often as, there is any
change in the Ordinary Shares by way of a stock split, stock dividend,
combination or reclassification, or through a merger, consolidation,
reorganization or recapitalization, or by any other means, appropriate
adjustment shall be made in the provisions hereof so that the rights and
privileges granted hereby shall continue with respect to the Ordinary
Shares as so changed.
10. Rule 144 Reporting. With a view to making available the benefits
of certain rules and regulations of the Commission which may at any time
permit the sale of the Registrable Shares to the public without
registration, at all times after 90 days after any registration statement
covering a public offering of securities of the Company under the
Securities Act shall have become effective, the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144;
(b) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(c) furnish to each holder of Registrable Shares forthwith upon
request a written statement by the Company as to its compliance with the
reporting requirements of Rule 144 and of the Securities Act and the
Exchange Act, a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents so filed by the Company as
such holder may reasonably request in availing itself of any rule or
regulation of the Commission allowing such holder to sell any Registrable
Shares without registration.
11. Representations and Warranties of the Company. The Company
represents and warrants as follows:
(a) The execution, delivery and performance of this Agreement by
the Company have been duly authorized by all requisite corporate action and
will not violate any provision of law, any order of any court or other
agency of government, the charter documents of the Company or any provision
of any indenture, agreement or other instrument to which it or any of its
properties or assets is bound, conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
such indenture, agreement or other instrument or result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon
any of the properties or assets of the Company.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms.
12. Assignment of Registrable Shares. The rights to cause the Company
to register Registrable Shares pursuant to this Agreement may be assigned
(but only with all related obligations) by a holder of Registrable Shares
to its Permitted Transferees or Affiliates or any purchaser of the
beneficial ownership (as determined pursuant to Rule 13d-3 of the Exchange
Act) of at least 10% of the Conversion Shares, provided the Company is,
within a reasonable time after such transfer, furnished with written notice
of the name and address of such transferee or assignee and the securities
with respect to which such registration rights are being assigned.
13. Lock-Up Agreement. Each holder of Registrable Shares, if requested
by the managing underwriter of a registered public offering of securities
by the Company, shall agree not to sell or otherwise transfer or dispose of
any Registrable Shares or other securities of the Company then held by such
holder (the "Lock-Up") for a specified period of time that is customary
under the circumstances following the effective date of the registration
statement for such offering and required by the lead underwriter, but in no
event to exceed 45 days, provided that this Section 13 shall not apply
unless (a) each other beneficial owner of 5% or more of the outstanding
ordinary shares of the Company, each executive officer and director of the
Company and each Affiliate of each executive officer and director of the
Company enter into a similar agreement covering not less than 45 days, (b)
the Purchaser and its Permitted Transferees collectively beneficially own
at least 5% of the outstanding ordinary shares of the Company, (c) each
holder of Registrable Shares is entitled to participate in such registered
public offering pursuant to the terms of this Agreement, (d) the Initiating
Holders have not requested a registration pursuant to Section 2 hereof
which has not yet become effective, (e) the Lock-Up is requested in
connection with a firm commitment underwritten offering in the United
States of ordinary shares issued by the Company, (f) the holders of
Registrable Shares have not been subject to a Lock-Up in the immediately
preceding 12 month period and (g) the Company is not in default under any
of the Transaction Documents (as defined in the Note Purchase Agreement).
Notwithstanding anything herein to the contrary, nothing herein shall
prohibit or otherwise prevent any sale or other transfer of Registrable
Shares by any holder thereof in compliance with Rule 144.
14. Miscellaneous.
-------------
(a) All covenants and agreements contained in this Agreement by
or on behalf of any of the parties hereto shall bind and inure to the
benefit of the respective successors and assigns of the parties hereto
(including without limitation transferees of any Registrable Shares),
whether so expressed or not.
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be delivered in person, mailed by
certified or registered mail, return receipt requested, or sent by
telecopier or telex, addressed as follows:
if to the Company or the Purchaser, at the addresses of such
party set forth in the Note Purchase Agreement;
if to any subsequent holder of Convertible Notes or
Registrable Shares, to it at such address as may have been furnished to the
Company in writing by such holder;
or, in any case, at such other address or addresses as shall
have been furnished in writing to the Company (in the case of a holder of
Convertible Notes or Registrable Shares) or to the holders of Convertible
Notes or Registrable Shares (in the case of the Company) in accordance with
the provisions of this paragraph.
(c) THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE
STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH
STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION
OTHER THAN SUCH STATE.
(d) If any litigation shall be brought by any party hereto which
arises out of, or is related in any manner to, this Agreement, the parties
hereby consent and submit to the jurisdiction of the state or federal court
of competent jurisdiction sitting within the area comprising the Southern
District of New York on the date of this Agreement. Notwithstanding the
foregoing, a court sitting in Israel may exercise jurisdiction solely in
connection with the enforcement of any judgment rendered by such federal or
state court in the area comprising the Southern District of New York. The
parties hereby irrevocably waive any objection, including, but not limited
to, any objection to the laying of venue or based on the grounds of forum
non conveniens, which it may now or hereafter have to the bringing of any
such litigation in such jurisdiction.
(e) Nothing herein shall affect the right of any party hereto to
serve process in any other manner permitted by applicable law or to
commence legal proceedings or otherwise proceed against the other party in
any other jurisdiction.
(f) The Company hereby waives any right it may have to a trial by
jury in respect of any action, proceeding or litigation directly or
indirectly arising out of, under or in connection with, THIS AGREEMENT.
(g) This Agreement may not be amended or modified, and no
provision hereof may be waived, without the written consent of the Company
and the Purchaser.
(h) This Agreement may be executed in 2 (two) or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(i) The Company shall not grant to any third party any
registration rights more favorable than, as favorable as or inconsistent
with any of those contained herein, so long as any of the registration
rights under this Agreement remains in effect; provided, however, that the
Company may grant registration rights as favorable as those contained
herein to the holders of New Notes (as defined in the Note Purchase
Agreement).
(j) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any
manner affect or render illegal, invalid or unenforceable any other
provision of this Agreement, and this Agreement shall be carried out as if
any such illegal, invalid or unenforceable provision were not contained
herein.
(k) The registration rights set forth in this Agreement shall
apply, mutatis mutandis, to registrations of the Registrable Shares outside
the United States.
IN WITNESS WHEREOF, the Company and the Purchaser have executed this
Registration Rights Agreement as of the day and year first above written.
GILAT COMMUNICATIONS LTD.
By: /s/ Noam Fink
----------------------------
Name: Noam Fink
Title: Executive Vice President
& Chief Financial Officer
SHAMROCK HOLDINGS OF CALIFORNIA, INC.
By: /s/ Robert G. Moskowitz
----------------------------
Name: Robert G. Moskowitz
Title: Executive Vice President
