Form SC 13D Caesarstone Ltd. Filed by: Mifalei Sdot-Yam Agricultural Cooperative Society Ltd.
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E-mail(Rule 13d-101)
Authorized to Receive Notices and Communications)
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CUSIP No. M 20598 104
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13D |
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1
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Names of Reporting Persons
MIFALEI SDOT-YAM AGRICULTURAL COOPERATIVE SOCIETY LTD.
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2
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Check the Appropriate Box if a Member of a Group
(a) ☒ (*)
(b) ☐ |
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3
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SEC Use Only
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4
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Source of Funds (See Instructions)
OO
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5
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Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)
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6
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Citizenship or Place of Organization
Israel
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Number of
Shares Beneficially Owned by Each Reporting Person With |
7
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Sole Voting Power
2,642,437
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8
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Shared Voting Power
8,797,563(**)
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9
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Sole Dispositive Power
2,642,437
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10
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Shared Dispositive Power
8,797,563(**)
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11
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Aggregate Amount Beneficially Owned by Each Reporting Person
11,440,000(**)
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12
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Check if the Aggregate Amount in Row (11) Excludes Certain Shares
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13
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Percent of Class Represented by Amount in Row (11)
32.5%
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14
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Type Of Reporting Person
CO(***)
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CUSIP No. M 20598 104
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13D |
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CUSIP No. M 20598 104
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13D |
| (i) | Tene purchased 1,000,000 Ordinary Shares from Mifalei Sdot Yam for cash consideration in NIS at the last known representative rate exchange equal to a price per Ordinary Share of US$43.50 (the “Share Price”), such that the total consideration paid to Mifalei Sdot Yam on the Closing Date was an amount of US$ 43,500,000; and, |
| (ii) | Mifalei Sdot Yam granted Tene a call option (the “Call Option”), conferring upon Tene for a period of five years thereafter (the “Term”), the right to purchase from Mifalei Sdot Yam, at any time during the Term, up to 2,000,000 Ordinary Shares (the “Option Shares”) at the Exercise Price (as defined below). |
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CUSIP No. M 20598 104
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13D |
| 1. | Mifalei Sdot Yam and Tene agree to vote at general meetings of the shareholders of the Issuer (each, a “General Meeting”) in the same manner, following discussions intended to reach an agreement on any matters proposed to be voted upon, with Tene determining the manner in which both parties shall vote if no agreement is reached, except with respect to certain carved-out matters, with respect to which, Mifalei Sdot Yam will determine the manner in which both parties shall vote if no agreement is reached. Notwithstanding the foregoing each of Mifalei Sdot Yam and Tene is entitled to instruct the other party to oppose to any resolution relating to a merger or transaction, the result of which would transform the Issuer into a private company, in which case, both parties will vote against the adoption of such resolution; |
| 2. | Mifalei Sdot Yam and Tene agree to use their best efforts, in their capacity as shareholders, to prevent any dilutive transactions that would reduce Mifalei Sdot Yam’s holdings in the Issuer below 26% on a fully diluted basis, provided that such agreement shall not apply as of the date on which the percentage of Mifalei Sdot Yam's holdings decreases below 26% of the outstanding Ordinary Shares of the Issuer, on a fully diluted basis, for any reason whatsoever, or if Mifalei Sdot Yam receives a satisfactory written certification from the Israel Land Authority permitting Mifalei Sdot Yam’s holdings in the Issuer to decrease below 26%; |
| 3. | Mifalei Sdot Yam and Tene agree to exercise their best efforts, in their capacity as shareholders, in a manner intended to cause that at least four (4) directors on behalf of the parties shall be elected to the Issuer’s board of directors, provided that the parties will not propose a resolution at the General Meeting that will contradict a recommendation of the Issuer’s board of directors to the shareholders in respect of this matter, and that the parties will obtain the support of other leading shareholders to such proposal; |
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CUSIP No. M 20598 104
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13D |
| 4. | Tene and Mifalei Sdot Yam agree that as of the Closing Date and until the convening of a General Meeting for the purpose of implementing changes in the composition of the Board, Mifalei Sdot Yam will cause two (2) directors appointed on the its behalf to the Board to be replaced by two (2) directors whose identity will be determined by the Tene, by appointing them as alternate directors pursuant to the provisions of applicable law and the articles of association of the Issuer; |
| 5. | Subject to certain exceptions set forth in the Term Sheet, Mifalei Sdot Yam agrees to continue to hold at least 6,850,000 Ordinary Shares of the Issuer at all times prior to expiration of the Term, and in no case fewer than the number of Ordinary Shares that would permit Tene to exercise the Call Option in full; |
| 6. | Tene shall have a tag-along right and a right-of-first-offer with respect to any disposition of Ordinary Shares by Mifalei Sdot Yam, other than Ordinary Shares sold by Mifalei Sdot Yam pursuant to Rule 144 under the Securities Act of 1933, which sale shall not be subject to the Issuer’s tag-along right or right-of-first-offer, but shall be subject to the limitations set forth in Item 5 above; |
| 7. | Mifalei Sdot Yam shall have a tag-along right with respect to any disposition of Ordinary Shares by Tene, to be exercised at a ratio of 1:1 in respect of the number of Ordinary Shares actually disposed of by Tene, which right shall not apply to a sale of shares as part of current trading on the stock exchange; |
| 8. | upon expiration of the Shareholders’ Agreement, Tene agrees to take measures to replace directors who were appointed on its behalf to the Board, with directors whose identity will be determined by Mifalei Sdot Yam, by appointing them as alternate directors pursuant to the provisions of applicable law and the articles of association of the Issuer; and |
| 9. | in any case in which, as a result of the proposed action, the percentage of Mifalei Sdot Yam’s holdings will be diluted by more than an accumulated rate of 25% compared with its holdings on the date of Closing, Mifalei Sdot Yam may direct Tene to vote against the proposed action. |
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CUSIP No. M 20598 104
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13D |
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CUSIP No. M 20598 104
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13D |
| Item 6. | Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer |
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Exhibit Number
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Description
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| 1 | Term Sheet |
| 2 | Registration Rights Agreement |
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CUSIP No. M 20598 104
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13D |
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MIFALEI SDOT-YAM
AGRICULTURAL COOPERATIVE
SOCIETY LTD.,
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By:/s/ Marchella Shani
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By:/s/ Amit Ben Tzvi
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Exhibit 1
Strictly Confidential
Term Sheet
This term sheet (the “Term Sheet”) sets forth the principal understandings related to the transaction set forth below (the “Transaction”), between Tene Investment in Projects 2016, Limited Partnership No. 55-027045-8 (the “Purchaser”), the obligations of which shall be guaranteed by Tene Growth Capital 3 P.E.F., Limited Partnership No. 55-024953-6, and Tene Growth Capital 3 P.E.F. (Parallel), Limited Partnership No. 55-025116-9 (collectively, “Tene”), and between Mifalei Sdot Yam, Agricultural Cooperative Society No. 570045666 (“Sdot Yam”), an agricultural cooperative society, indirectly wholly owned by Kibbutz Sdot Yam, Agricultural Cooperative Society No. 570003509.
| 1. | The Transaction | At the closing of the transaction (the “Closing”), the Purchaser shall purchase from Sdot Yam a total of 1,000,000 (one million) shares of Caesarstone Ltd., Public Company No. 51-143950-7 (the “Purchased Shares” and the “Company,” respectively). | ||
| 2. | The Consideration | The Purchaser shall pay Sdot Yam an amount in New Israeli Shekels equal to US$ 43.5 (forty-three and one-half) for each of the Purchased Shares (the “Share Price”), such that the total consideration to be paid to Sdot Yam on the Closing Date (as defined below) will be an amount in New Israeli Shekels equal to US$ 43,500,000 (forty-three million five hundred thousand US dollars), based on the known representative rate of exchange of the New Israeli Shekel to the US dollar, as determined at the end of the business day immediately preceding the date of Closing. | ||
| 3. | The Call Option |
Beginning on the date of Closing and for a period of 5 (five) years thereafter (the “Term”), the Purchaser shall have a call option (the “Call Option”) to purchase from Sdot Yam, at any time during the Term, up to a total amount of 2,000,000 (two million) additional shares of the Company (the “Option Shares”).
The exercise price of the Call Option (the “Exercise Price”) for the purchase of each of the Option Shares will be an amount in New Israeli Shekels equal to US$ 43 (forty-three US dollars), based on the known representative rate of exchange of the New Israeli Shekel to the US dollar, as determined at the end of the business day immediately preceding the date of the notice of exercise of the Call Option (the “Exercise Date”). Accrued interest (compound interest) shall be added to the Exercise Price as follows: (a) during the first four years following the date of Closing – annual interest at the rate of 3% (three percent) per year; (b) during the fifth year after the date of Closing – annual interest at the rate of 3.5% (three and one-half percent) per year. The above referenced accrued interest will be calculated for the period between the date of Closing and each applicable Exercise Date, whereby once a year the amount of yearly interest accrued until such date shall be added to the Exercise Price (the Exercise Price with the addition of the accrued interest thereon shall be referred to as the “New Exercise Price”), and such New |
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| Exercise Price shall continue to bear such yearly accrued interest thereon, and so on until each applicable Exercise Date of the Option Shares. The Exercise Price will be adjusted to dividends, such that the New Exercise Price (as calculated on the day of an applicable distribution of dividend) will be reduced by an amount equal to the amount of dividend per share that will be distributed, and such reduced amount shall continue to bear the above-mentioned interest until the Exercise Date. | ||||
| 4. | Cashless Exercise |
(1) The Purchaser will be entitled, at its sole discretion, to exercise up to one-half of each Tranche (as defined below) by way of a cashless exercise. In such case, the Purchaser shall so state within the relevant notice of exercise (e.g., if the Purchaser elects to exercise all of the Option Shares, it may exercise up to a total amount of 1,000,000 (one million) Option Shares by way of a cashless exercise).
(2) Sdot Yam will be entitled to determine that the exercise of any additional part of an applicable Tranche (in excess of the part of such Tranche that the Purchaser has sought to exercise by way of a cashless exercise as set forth in subsection (1) above), will be performed (in whole or in part, at Sdot Yam’s sole discretion) by way of a cashless exercise. In such case, Sdot Yam shall give the Purchaser a notice to that effect within 8 (eight) days after receipt of the notice of exercise from the Purchaser (the “Sdot Yam Notice”). If the Sdot Yam Notice is not given within such 8 (eight) day period, then one-half of the Option Shares of such Tranche will be exercised by way of a cashless exercise and the remaining half by way of an ordinary exercise against payment of consideration.
(3) The Purchaser may submit an advance inquiry to Sdot Yam, during a period of up to 14 (fourteen) days before the date planned for the giving of a notice of exercise by it, for the purpose of obtaining Sdot Yam’s position as to the possibility of a cashless exercise under subsection (2) above. In such case, Sdot Yam’s response to such advance inquiry will be considered as the Sdot Yam Notice. Absent a response within 8 (eight) days, and in the event that a notice of exercise is given by the Purchaser within the above-referenced 14-day period, then one-half of the Option Shares exercised in the framework of the applicable Tranche will be exercised by way of a cashless exercise, and the remaining half by way of an ordinary exercise against payment of consideration (without the Purchaser having to wait for an additional period of 8 (eight) days for the Sdot Yam Notice to be given).
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(4) If either of the parties uses its right to perform the exercise by way of a cashless exercise, then shortly after a notice of exercise is given and without payment of any Exercise Price in consideration of the Option Shares being so exercised, Sdot Yam will transfer to the Purchaser the number of Option Shares reflecting the economic benefit embedded in the cashless exercise of the Option Shares being so exercised, provided that the Purchaser shall pay Sdot Yam the Exercise Price due for the Option Shares that are not exercised by way of a cashless exercise in the framework of the applicable Tranche. The above-referenced economic benefit will be calculated as the product of: (a) the number of Option Shares with respect to which a notice of exercise was given and that are exercised by way of a cashless exercise, multiplied by (b) the difference between the Market Price and the Exercise Price. Accordingly, the number of shares transferred without consideration shall be calculated in accordance with the following equation:
R = [(X-Y)/X]*Z
where:
X = Market Price;
Y = Exercise Price;
Z = number of shares with respect to which a notice of exercise was given and that are being exercised by way of a cashless exercise as stated above;
R = the number of shares Sdot Yam shall transfer to the Purchaser (without consideration).
(5) For the purposes of this Section, “Market Price” shall mean: the average closing price of the Company’s shares on NASDAQ during the 7 (seven) trading days immediately preceding the Exercise Date. |
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| 5. | Exercise of the Option in Tranches |
The Purchaser will be given the right, at its exclusive discretion, as and to the extent set forth by it in the relevant notice of exercise, to split the exercise of the Call Option into up to 6 (six) tranches at most (each, a “Tranche”), provided that each notice of exercise will be given with respect to at least 300,000 (three hundred thousand) Option Shares to be exercised in the framework of each such Tranche.
The closing of each Tranche exercise, on which the Purchaser shall pay Sdot Yam the consideration for the Option Shares that will be exercised in the framework of such exercise, and shall receive the applicable Option Shares so exercised, will take place within 15 (fifteen) days after the date on which the notice of exercise is given by the Purchaser, as shall be determined by the Purchaser. |
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| 6. | Shareholders’ Agreement | On the date of Closing, the parties will enter into a shareholders’ agreement (the “Shareholders’ Agreement”), which will remain in effect until the earlier of: (a) the expiry of the Term, or (b) the date on which the Purchaser will hold less than 500,000 shares in the Company. | ||
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The Shareholders’ Agreement will include, inter alia, the following provisions:
(1) Sdot Yam and the Purchaser will vote at the general meetings of the shareholders of the Company in the same manner. Prior to each general meeting of the Company, the parties will conduct discussions on the matters on the agenda of the meeting, with a view to agreeing on the manner in which they will jointly vote. If the parties do not reach an agreement on the manner of voting in respect of a certain matter on the agenda, then the Purchaser will determine the manner in which both parties will vote, and the parties will vote at the meeting according to the agreement to which they have reached, provided that in the absence of an agreement, the parties will vote as the Purchaser shall instruct, and will subsequently sign the voting proxies required for that purpose, which will be submitted to the Company. Notwithstanding the foregoing, in respect of the items enumerated in Appendix A hereto, if the parties do not reach an agreement on the manner of voting on a certain matter on the agenda, then Sdot Yam will determine the manner in which both parties will vote, and the parties will vote at the meeting according to the agreement to which they have reached, provided that in the absence of an agreement, the parties will vote as Sdot Yam shall instruct, and will subsequently sign the voting proxies required for that purpose, which will be submitted to the Company.
Notwithstanding the provisions of this subsection (1) and Appendix A, in the following cases, the parties will vote as follows:
(a) In any case that involves a proposal for a merger or a transaction, the outcome of which is the transformation of the Company into a private company (for example, by way of a reverse triangular merger), each party will be entitled to instruct the other party to oppose such transaction, in which case both parties will vote against the adoption of such resolution at the general meeting;
(b) In any case in which, as a result of the proposed action, the percentage of Sdot Yam’s holdings will be diluted below a level of 26%, on a fully diluted basis, and provided that on that date, the provisions set forth in Section 6(2) of this Term Sheet are in effect, the parties will vote as Sdot Yam determines;
(c) In any case in which, as a result of the proposed action, the percentage of Sdot Yam’s holdings will be diluted below a level of 26%, on a fully diluted basis, and provided that on that date, the provisions set forth in Section 6 (2) of this Term Sheet are not in effect, the parties will vote as the Purchaser determines, provided further that if the action also falls within subsection (d) below, subsection (d) will apply; |
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(d) In any case in which, as a result of the proposed action, the percentage of Sdot Yam’s holdings will be diluted by more than an accumulated rate of 25% compared with its holdings on the date of Closing (i.e. the total amount of shares of the Company shall be higher than 45,762,097 as a result of such action), the parties will vote as Sdot Yam determines.
(2) Sdot Yam and the Purchaser will use best efforts, in their capacity as shareholders, to exercise their power as shareholders and to take all the required actions, in order to prevent and to thwart any issuance of shares (including employee options) and/or transaction and/or merger and the like, as a result of which the percentage of Sdot Yam’s holdings of the shares of the Company will decrease below 26% (on a fully diluted basis). This section will not apply as of the date on which the percentage of Sdot Yam’s holdings decreases below 26% of the outstanding shares of the Company, on a fully diluted basis, for any reason whatsoever (if and to the extent it actually so decreases). In addition, this section will not apply in the event Sdot Yam obtains a certification in writing from the Israel Land Authority, to its satisfaction, allowing a decrease in its holdings below the above-referenced threshold, without derogating from its rights in the lands included in the various authorized person agreements (Heskemei Bar Reshut) between Sdot Yam and the Company. Sdot Yam will notify to the Purchaser immediately upon the receipt of such certification.
(3) The parties will exercise their best efforts, in their capacity as shareholders, in a manner intended to cause that at least 4 (four) directors on behalf of the parties shall be elected to the Company’s board of directors, provided that the parties will not propose a resolution at the general meeting that will contradict a recommendation of the Company’s board of directors to the shareholders in respect of this matter, and that the parties will obtain the support of other leading shareholders to such proposal. Without derogating from the foregoing, the parties undertake to take the required measures and to vote in favor of: (a) the appointment of one (1) director to the Company’s board of directors whose identity will be determined by Sdot Yam with no requirement to provide the grounds for its election – and any vote that will be required at the general meeting in order to preserve such director’s seat on the Company’s board of directors; and (b) the appointment of two (2) directors to the Company’s board of directors whose identity will be determined by the Purchaser with no requirement to provide grounds for its election – and any vote that will be required at the general meeting in order to preserve such directors’ seats on the Company’s board of directors. To the extent 4 (four) directors are elected on behalf of the parties to the Company’s board of |
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directors, the parties will vote in favor of the appointment of an additional director whose identity will be determined by Sdot Yam, provided that the appointment of such additional director will require the consent of the Purchaser.
(4) Subject to any required regulatory approval, on the date of Closing and until the convening of a meeting of shareholders of the Company for the purpose of implementing the changes in the composition of the board of directors set forth in subsection (3) above, Sdot Yam will take measures to replace two (2) of the directors who were appointed on its behalf to the Company’s board of directors with two (2) directors whose identity will be determined by the Purchaser, by appointing them as alternate directors pursuant to the provisions of the Companies Law, 5759-1999, and the articles of association of the Company.
(5) Until the expiry of the Term, Sdot Yam will continue to hold at least 6,850,000 shares of the Company constituting, on the signing date of this Term Sheet, no less than approximately 20% of the issued share capital of the Company, and will not encumber, sell or otherwise dispose shares in the Company, if immediately after the consummation of such action, the number of shares that are held by it would be reduced below the above-mentioned threshold. Notwithstanding the foregoing and subject to the provisions of subsection (6) below, Sdot Yam will be entitled to sell any amount of shares, at its discretion and without limitation, at a price that is higher than US$ 70 per share, provided that, following such sale, Sdot Yam will continue to hold a sufficient amount of shares allowing the Purchaser to exercise the Call Option.
(6) The Purchaser will have a tag along right and a right of first offer with respect to any sale of shares in the Company by Sdot Yam, in which case the closing passage of subsection (7) referring to a notice of sale will apply mutatis mutandis to this subsection (6). Notwithstanding the foregoing, Sdot Yam will be entitled to sell shares of the Company pursuant to Rule 144 of the United States Securities and Exchange Commission, which sale will not be subject to the Purchaser’s tag along right or right of first offer, but will be subject to the limitations set forth in subsection (5) above.
(7) Sdot Yam will have a tag along right with respect to a sale of shares of the Company by the Purchaser, at a ratio of 1:1, in which case, if Sdot Yam chooses to exercise this right, the number of shares that the Purchaser will sell in an applicable sale will be identical to the number of shares that Sdot Yam will sell. For the purpose of a sale as set forth in this subsection, the Purchaser will be entitled to exercise the Call Option by way of a cashless exercise, in respect of all of the Option Shares exercised in such applicable Tranche. In such event, the Purchaser will provide Sdot Yam with a notice informing it of the occurrence of negotiations in preparation for the |
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performance of a sale of shares at least 14 (fourteen) days in advance, along with all of the details relevant to such sale which are in its possession at that time, including the manner of the sale, the identity of the purchaser, the agreed or expected price, commissions and expenses related to the sale, and so forth. As of the giving of such notice, the Purchaser will update Sdot Yam with respect to any change regarding any of the details relevant to the sale. Sdot Yam will provide its decision as to whether to join the sale within 10 (ten) days as of the date on which it receives the Purchaser’s notice. To the extent that Sdot Yam has decided to join the sale, it will be entitled to change its decision until the actual date of sale, if there are material changes in the terms of the sale, compared to those which were in its possession before it provided notice of its decision to join the sale, provided that Sdot Yam shall notify the Purchaser of such change in its decision within 7 (seven) days as of the date on which it becomes aware of such material change in the terms of the sale. The provisions of this subsection (7) will not apply to a sale of shares as part of current trading on the stock exchange (as opposed to the sale of a bulk of shares not as part of current trading, such as by using an underwriter or an investment banker, in which case this subsection will apply).
(8) The parties will hold regular ongoing meetings among themselves, in their capacity as shareholders, in order to discuss the state of the Company, its performance, its future plans and the like, to exchange opinions, to consult with each other and to share each other’s thoughts, ideas and initiatives related to the Company and its development, all subject to confidentiality restrictions applicable to the content of the meetings and information related to the Company, and in full compliance with all of the requirements applicable to a public company under any law.
Upon the expiry of the Term or on the date when the Purchaser holds less than 500,000 shares of the Company, whichever is earlier, the Shareholders’ Agreement (including the voting agreement) will expire, and each of the parties will be entitled to act at its discretion without being subject to any of the limitations set forth in this Section 6. Upon such expiry of the Shareholders’ Agreement, the Purchaser will take measures to replace the directors who were appointed on its behalf to the Company’s board of directors with directors whose identity will be determined by Sdot Yam, by appointing them as alternate directors pursuant to the provisions of the Companies Law, 5759-1999, and the articles of association of the Company, for a period extending until the convening of the next general meeting to be held after such expiry of the Shareholders’ Agreement. |
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| 7. | Internal Approvals and Binding Date | Immediately following the signing of this Term Sheet, the parties will put it to a vote in the relevant institutions of each party, including the general meeting of Kibbutz Sdot Yam (the “Internal Approvals”). | ||
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Upon receipt of all Internal Approvals (the “Binding Date”), this Term Sheet will enter into force and effect, and from that day onwards, will be binding upon both of the parties for all intents and purposes, and neither of the parties will be entitled to withdraw from the Transaction. In the event all of the Internal Approvals are not obtained within 21 (twenty-one) days of the date of signing of this Term Sheet, this Term Sheet will be deemed void for all intents and purposes and it will not be binding upon the parties, except for Section 12 (Confidentiality) which will continue to be in effect. |
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| 8. | Detailed Agreement |
It is hereby agreed that the Closing of the Transaction is not contingent upon the signing of a detailed agreement. Nonetheless, insofar as possible, the parties will take measures toward the signing of a detailed agreement. As of the signing date of the detailed agreement, to the extent is shall be signed, this Term Sheet will cease to be in effect. Unless and until a detailed agreement is signed, this Term Sheet will remain as the valid agreement and will be binding upon the parties, and will also serve as the Shareholders’ Agreement between the parties.
The Transaction and the Closing (including the closing of each exercise of Option Shares), shall be made whereby the Company’s state will be as it is as of the signing date of this Term Sheet, and as it will be on the relevant Closing date (“as is”), without Sdot Yam and/or any person on its behalf making any representation whatsoever, of any type and kind, with respect to the Company and/or its state. Sdot Yam solely represents and warrants that (a) it owns and has sole possession in all of the Purchased Shares and the Option Shares, and (b) it will transfer them to the Purchaser free and clear of any pledge and/or encumbrance and/or attachment and/or lien and/or debt and/or liability and/or undertaking and/or claim and/or right of first refusal and/or right of option (including a call option) and/or any other similar third-party right, and (c) it will ensure that, at any time, there will be a sufficient number of free and clear Option Shares to enable the exercise of the Call Option. |
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| 9. | Closing Conditions |
The Closing of the Transaction will be conditioned upon the satisfaction of the following conditions precedent:
(1) Obtaining the approval of the Israeli Antitrust Commissioner (the “Commissioner”), which shall be granted unconditionally or subject to conditions that are acceptable to both parties. It is hereby agreed that if such approval is not obtained by the date of Closing, then, to the extent possible under applicable law, the parties will complete the Closing in respect of that part of the Transaction that can be consummated without obtaining such approval, and without postponing the date of Closing. In the event such partial Closing takes place before having obtained the approval of the Commissioner, all of the provisions of this Term Sheet that can be upheld under law will apply. In the event of the above-referenced partial Closing, which shall take |
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place prior to the receipt of approval from the Commissioner for the Transaction, the provisions of the Shareholders’ Agreement provided in subsections 6(1), 6(2), 6(3) and 6(8) above and in Appendix A attached hereto will apply, solely and exclusively with respect to Sdot Yam’s and the Purchaser’s holdings that jointly represent, at any time, only 25% (twenty-five percent) of the Company’s issued capital, provided that such provisions will not apply to the balance of Sdot Yam’s holdings, and provided further that such interim applicability of provisions of this Term Sheet shall also be approved by the Commissioner. Accordingly, until receipt of approval from the Commissioner to the Transaction, Sdot Yam shall be entitled to vote the balance of its holdings (in excess of the above-mentioned 25%) at its sole discretion, with no obligation to perform the provisions of the voting agreement. As of the date of receipt of approval from the Commissioner for the Transaction, and subject to its receipt, the provisions of the above-referenced sections shall apply to the joint holdings of Sdot Yam and the Purchaser, in their entirety.
(2) The absence of any injunction, court order or other legal provision that prevents the Closing of the Transaction pursuant to the terms thereof, provided that the party relying on such order has not applied for or sought after it.
(3) The absence of any material adverse change in the business, the assets or the state of the Company, provided that such a change will be defined as an exceptional and unexpected change for the worse, which took place during the period between the signing date of this Term Sheet and the date of Closing, provided that a drop (even a significant drop) in the share price of the Company on NASDAQ, in and of itself, will not constitute a material adverse change.
(4) The absence of any extraordinary actions in the Company during the period between the signing date of this Term Sheet and the date of Closing, that have an adverse effect on the Company or on the value of the Purchased Shares (for the sake of the example only – the sale of a significant part of the Company’s activity or a significant change in the Company’s capital).
(5) The absence of any substantive breach of Sdot Yam’s representations with respect to its ownership of the Purchased Shares and the Option Shares, and/or to their being free and clear.
The Closing will take place within 7 (seven) days of the Binding Date (i.e., within 7 days as of the date on which all of the Internal Approvals are obtained) (the “Closing Date”), even if by that date the condition set forth in subsection (1) above is not yet fulfilled (subject to the provisions of Section 9 (1) above), and provided that none of the events set forth in subsections (2) through (5) above have taken place. |
| 10. | Transfer of Shares |
Sdot Yam will act to split the single share certificate in its possession today, representing all of the shares that it holds, into share certificates that represent the Purchased Shares and the Option Shares separately from the remaining shares that are held by Sdot Yam. In the event that the process of splitting the share certificate is not completed by the Closing Date, the parties will perform the Closing without splitting the share certificate, by way of issuing a share transfer deed, a notice to the Israeli Registrar of Companies and a notice to the Company with respect to the transfer of the shares, provided that the parties will thereafter complete the split process of the share certificate and subsequently the delivery of a separate share certificate to the Purchaser (representing the Purchased Shares). In addition, Sdot Yam shall assist the Purchaser in depositing the Purchased Shares and the Option Shares, as applicable, into the book entry system of the Company’s transfer agent, including executing the medallion guaranteed stock powers required to that effect, provided that this shall not derogate from any rights Sdot Yam has in respect of such shares and/or pursuant to this Term Sheet and/or impose any costs on Sdot Yam. If the Purchaser wishes to pledge the Purchased Shares in favor of a financing bank, and the granting of such pledge would not be possible due to the absence of suitable share certificates, Sdot Yam will pledge in favor of such financing bank, by way of granting a pledge for the benefit of a third party, its contractual rights to up to one million shares that are owned by it, provided that such pledge shall remain in effect until such shares are transferred to the Purchaser, and provided further that the granting of such pledge will not impose any financial liability whatsoever upon Sdot Yam vis-à-vis the financing bank.
The parties hereby agree that the documents attesting to the pledging and/or encumbrance of shares by either of the parties will be subject to all of the provisions of this Term Sheet, including the provisions of Section 6 above. |
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| 11. | Listing of Shares for Trading | As part of the purchase of the Purchased Shares and the Option Shares, as applicable, Sdot Yam shall assign to the Purchaser, to the extent possible, the rights associated with the Purchased Shares, and the rights associated with the exercised Option Shares (following exercise thereof), pursuant to Sections 3 and 5 of the Registration Rights Agreement, dated July 21, 2011 (as amended on February 13, 2012) (the “Registration Rights Agreement”), in accordance with the provisions of the Registration Rights Agreement, provided that the Purchaser will confirm that it agrees to be bound by the terms of the Registration Rights Agreement. Sdot Yam will not assign to the Purchaser its right pursuant to Section 2 of the Registration Rights Agreement to demand registration of shares for trading (the “Demand Registration Right”) in respect of any shares, provided however that it is hereby agreed that the Purchaser will be entitled to participate in the registration for trading initiated by Sdot Yam by virtue of the Demand Registration Right. Sdot Yam will exercise, on | ||
| the earliest appropriate date as agreed upon by the parties, the Demand Registration Right, in accordance with Section 2 of the Registration Rights Agreement, and will demand that the Company registers for trading on NASDAQ all of the shares of the Company that will be held by it at that time, including the Option Shares that have not yet been exercised at that time, and to the extent possible, the Purchased Shares and the Option Shares that will have been exercised before the above referenced date. The parties will cooperate between themselves and with the Company and will take the measures required, with a view to causing all of the above-referenced shares to be registered for trading on NASDAQ. | ||||
| 12. | Changes in Capital and Dividends | To the extent changes occur in the Company’s share capital (such as a stock split or consolidation of the share capital, issuance of bonus shares, issuance of rights, and the like) or a dividend is distributed, prior to the Closing of the Transaction or during the Term, then the number of Purchased Shares and/or the number of Option Shares, as the case may be, shall be adjusted accordingly. | ||
| 13. | Cooperation | The parties will act in cooperation and will aim (but do not undertake, as the matter depends upon the Company’s discretion) to cause the Purchaser, during the period between the signing date of this Term Sheet and the Closing Date, to be given access to non-public information with respect to the Company, including the holding of meetings with the Company’s senior staff and the receipt of information directly from its officeholders, subject to signing of a confidentiality agreement by the Purchaser, as customary. | ||
| 14. | Confidentiality | Both parties agree to keep this Term Sheet and its specific conditions and provisions confidential, other than disclosure to directors, officers, employees, consultants and other representatives on a need-to-know basis, and other than disclosure as required under any applicable law (including the NASDAQ rules), in which case, such disclosure will be coordinated between the parties in advance, to the extent possible. This confidentiality clause will be binding upon the parties upon signing of this Term Sheet and even before the Binding Date. Notwithstanding the foregoing, the parties agree that this Term Sheet will be presented, in its entirety, to the Economic Council of Kibbutz Sdot Yam and to the members’ meeting of Kibbutz Sdot Yam, and that every member of Kibbutz Sdot Yam will be entitled to receive and review a complete copy of this Term Sheet, with all involved therein and implied thereby, and the Purchaser hereby waives any claim in this regard, including in any case in which this Term Sheet and/or any part hereof is disclosed to any third parties. | ||
| 15. | No Shop | As of the date on which the Economic Council of Sdot Yam approves the Transaction (even if such approval is granted prior to the Binding Date) and subject to its approval, and until the date of expiration of this Term Sheet (if and insofar as it expires, pursuant to the closing passage of Section 7 above) or until the Closing Date, as applicable, Sdot Yam will not conduct negotiations and will not engage in agreements or understandings, and will not consummate | ||
| any transaction with any third party whatsoever, in any wording whatsoever, and will not engage in or support any other transaction with respect to the Purchased Shares or the Option Shares, which will preclude or conflict with the consummation of the Transaction. | ||||
| 16. | Applicable Law; Jurisdiction | This Term Sheet shall be subject to the laws of the State of Israel without regard to its choice of law provisions. The competent courts in the city of Tel Aviv shall have sole and exclusive jurisdiction to adjudicate any dispute that arises in connection with this Term Sheet. | ||
| 17. | English Version | Simultaneously with, or shortly after to the execution of the Hebrew version of this Term Sheet, the parties shall also sign this English version, which shall be attached to the filings required by the NASDAQ (to the extent required). To the extent possible, the English version and the Hebrew version shall be construed in a uniform and identical manner, provided however that in any event of an explicit discrepancy between both versions, the Hebrew version shall prevail. | ||
| 16. | General Provisions |
(1) This Term Sheet may not be amended or altered other than by a written instrument executed by all parties hereto.
(2) This Term Sheet constitutes the complete and entire agreement between the parties with respect to the subject-matter hereof, and as of its signing no prior agreement, understanding or arrangement preceding the signing of this Term Sheet shall be valid.
(3) All notices to be granted by a party to this Term Sheet shall be delivered in writing (a) by registered or certified mail, or (b) by hand or by courier to the respective party at the registered addresses of such party, or to such address as a party may designate in writing to the other parties, or (c) by facsimile to a number designated by each of the parties. Any notice granted in accordance with this Section shall be deemed given (i) if sent by registered or certified mail, 3 (three) business days after sending thereof, (ii) if sent by courier, upon delivery, and (iii) if sent by facsimile, upon delivery and the receipt of an electronic confirmation of receipt, or (if sent and received on a day which is not a business day), on the first business day after delivery and receipt of an electronic confirmation of receipt thereof. |
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[Remainder of Page Intentionally Left Blank; Following is the Signature Page]
In witness whereof the parties have affixed their signature, this 5 day of September 2016:
| Mifalei Sdot Yam, Agricultural Cooperative Society Ltd. | ||||||||
| By: |
/s/ Amit Ben-Zvi |
By: |
/s/ Marchella Shani |
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| Position: |
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Position: |
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| Tene Investment in Projects 2016, Limited Partnership | ||||||||
| By: |
/s/ Ariel Halperin |
By: |
/s/ Eyal Attia |
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| Position: |
|
Position: |
|
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We the undersigned hereby guarantee, by way of a complete and absolute guarantee that cannot be canceled under any circumstances, all of the Purchaser’s undertakings pursuant to the Term Sheet above:
| Tene Growth Capital 3 P.E.F., Limited Partnership | ||||||||
| By: |
/s/ Ariel Halperin |
By: |
/s/ Eyal Attia |
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| Position: |
|
Position: |
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| Tene Growth Capital 3 P.E.F. (Parallel), Limited Partnership | ||||||||
| By: |
/s/ Ariel Halperin |
By: |
/s/ Eyal Attia |
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| Position: |
|
Position: |
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Appendix A
| 1. | Allotment or issuance of shares or any other securities of the Company. |
| 2. | Consolidation, division, cancellation, reduction or increase in the share capital of the Company. |
| 3. | Merger or reorganization of the Company with or into another entity, whether or not the Company is the surviving entity. |
| 4. | Sale of all or a significant part of the Company’s assets, or all or a significant part of the Company’s issued and paid-up share capital. |
| 5. | Any other event or action, resulting in the dilution of the percentage of Sdot Yam’s holdings in the shares of the Company. |
| 6. | Merger or a transaction, the outcome of which is the transformation of the Company into a private company (for example, by way of a reverse triangular merger). |
| 7. | Dissolution or liquidation of the Company, or any similar event, the result of which is the cessation of all or a significant part of the Company’s business. |
| 8. | Change in the Company’s field of activity, such that, after the change, the majority of the Company’s activity will be in a field of activity that is outside the sector of construction products. |
| 9. | Change in any of the agreements that were entered into between the Company and Sdot Yam, prior to the initial public offering of the Company’s shares (the authorized person agreement in Kibbutz Sdot Yam, the authorized person agreement in Bar Lev, the personnel agreement, the services agreement, the registration agreement and the additional covenants) and the agreement for the purchase of the additional area and the construction at Bar-Lev – all as amended and/or modified prior to the signing of this Term Sheet. |
| 10. | Any transaction between the Company and Tene, or with any party related to Tene, directly or indirectly, or that Tene has a personal interest in the transaction with such related party. |
Subject to Section 6(1) of the Term Sheet, it is hereby agreed that the exceptions set forth in subsections 1 through 5 above will not apply in any case where one of the actions set forth therein will be required pursuant to a resolution of the Company’s board of directors, provided that all of the following will apply: (a) as a result of the action, the percentage of Sdot Yam’s holdings will not be diluted by more than an accumulated rate of 25%, compared to its holdings on the Closing Date (that is, the total amount of shares of the Company shall be higher than 45,762,097 as a result of such action); (b) as a result of the action, the percentage of Sdot Yam’s holdings will not be diluted to less than 26% of the shares in the Company, on a fully diluted basis, provided however that this condition will only apply as long as the provisions of Section 6(2) of this Term Sheet remain in effect and will cease to apply on the date on which such provisions are no longer in effect.
Exhibit 2
CAESARSTONE SDOT-YAM LTD.
REGISTRATION RIGHTS AGREEMENT
DATED JULY 21, 2011
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of the 21st day of July, 2011 (the “Effective Date”) by and among CaesarStone Sdot-Yam Ltd., an Israeli company (the “Company”), Kibbutz Sdot-Yam Agricultural Cooperative Society Ltd. (the “Kibbutz”) and the Tene entities listed on Schedule A hereof (“Tene”, and together with the Kibbutz, the “Existing Shareholders”).
WHEREAS, the Company and the Existing Shareholders are parties to that certain Investment Agreement, dated July 4, 2006 (the “Investment Agreement”), which among other things provides for certain registration rights of the Existing Shareholders, as described in Section 15.5 thereto; and
WHEREAS, the Company and the Existing Shareholders desire to set forth the registration rights in a separate and independent agreement that will replace and cancel the provisions of Section 15.5 of the Investment Agreement;
NOW, THEREFORE, the parties hereby agree as follows:
1. Certain Definitions. In addition to the terms defined above, the following terms used in this Agreement shall be construed to have the meanings set forth or referenced below.
“Articles” means the Company’s Amended and Restated Articles of Association in effect, as such may be amended from time to time.
“Board of Directors” means the Board of Directors of the Company.
“Business Day” means any day that is not a Saturday, a Sunday or any other day on which banks are required or authorized by law to be closed in The City of New York and in Israel.
“Commission” or “SEC” means the United States Securities and Exchange Commission, or any other federal agency at the time administering the Securities Act and the Exchange Act.
“Disclosure Package” means, with respect to any offering of securities, (i) the preliminary prospectus, (ii) each free writing prospectus and (iii) all other information, in each case, that is deemed, under Rule 159 promulgated under the Securities Act, to have been conveyed to purchasers of securities at the time of sale of such securities (including a contract of sale).
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any similar successor federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.
“FINRA” means the Financial Industry Regulatory Authority, Inc.
“Form F-3” means such form under the Securities Act as in effect on the date hereof or any registration form under the Securities Act subsequently adopted by the SEC that permits incorporation of substantial information by reference to other documents filed by the Company with the SEC.
“Holder” means any holder of Registrable Securities who is a party to this Agreement.
“Initiating Holder” means the Holder (together with any of its affiliates that are Holders) who properly initiates a registration request under Section 2 or 3 of this Agreement.
“IPO” means the initial public offering of the Company’s Ordinary Shares including a sale of shares by the Existing Shareholders pursuant to an effective registration under the Securities Act
“Majority Interest” means the holders representing at least 50.1% of the voting power of the then issued and outstanding Registrable Securities, calculated on an as converted basis, voting as a single class.
“Ordinary Shares” means the Ordinary Shares, NIS 1.00 par value per share, of the Company.
“Preferred Shares” means the Preferred Shares, par value NIS 1.00 per share, of the Company.
“Person” means an individual, a corporation, a partnership or other incorporated entity.
“Registrable Securities” means any and all of the following: (i) Ordinary Shares held by the Kibbutz; (ii) any Ordinary Shares issuable or issued upon conversion of the Preferred Shares held by Tene; (iii) any Ordinary Shares held by Tene or (iv) any Ordinary Shares issued and issuable with respect to any such shares described in clauses (i), (ii) and (iii) above by way of a share dividend or share split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization; provided, however, that the following shall not be deemed Registrable Securities: (i) any Ordinary Shares sold in a registered sale pursuant to an effective registration statement under the Securities Act (including Ordinary Shares sold in an IPO, including as part of the exercise of the underwriters’ over-allotment option) or sold pursuant to Rule 144 thereunder or that may be sold (as confirmed by an unqualified opinion to counsel of the Company) without restriction as to volume or otherwise pursuant to Rule 144 under the Securities Act; (ii) shares sold in a transaction in which the transferor’s rights under this Agreement are not assigned in accordance with the provisions herein; or (iii) Ordinary Shares acquired by the Kibbutz or Tene from a third party except in a transaction in which the transferor’s rights under this Agreement are assigned in accordance with the provisions herein.
“Registration Expenses” means the expenses so described in Section 11 hereof.
“Rule 144” means Rule 144 promulgated by the SEC under the Securities Act (or any comparable successor rules).
“Securities Act” means the Securities Act of 1933, as amended from time to time, or any similar successor federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.
“Selling Expenses” means all underwriting discounts, selling commissions, and share transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of counsel for any Holder, except for the fees and disbursements of the selling Holder counsel borne and paid by the Company as provided in Section 11.
2. Demand Registrations.
(a) Following the Closing of the IPO, but subject to the terms of any “lock-up agreement” entered into with an underwriter (unless waived by such underwriter), a Holder may request that the Company register under the Securities Act all or any portion of the Registrable Securities held by such Holder, having an anticipated aggregate offering price, net of Selling Expenses, of not less than US$5,000,000. Upon receipt of such request, the Company shall within seven (7) days deliver notice of such request to all Holders (the “Demand Notice”), if any, who shall then have seven (7) days to notify the Company in writing of their desire to be included in such registration. If the request for registration contemplates an underwritten public offering, the Company shall state such in the written notice and in such event the right of any holder of Registrable Securities to participate in such registration shall be conditioned upon their participation in such underwritten public offering and the inclusion of their Registrable Securities in the underwritten public offering to the extent provided herein. Subject to the provisions of Section 3(b) below, the Company will use its reasonable best efforts to file a registration statement as promptly as practicable, but not later than sixty (60) days after such Demand Notice (subject, however, to the Company’s independent auditors providing any required consent), and shall use its reasonable best efforts to cause such registration statement to be declared effective under the Securities Act as promptly as practicable after the filing thereof.
(b) Notwithstanding the foregoing, the Company shall not be required to effect registration pursuant to a request of a Holder under this Section 2: (i) more than two (2) times for each of the Kibbutz and Tene separately, (ii) during the period that is thirty (30) days before the Company’s good faith estimate of the date of filing of a Company-initiated registration or Company Underwritten Offering (as defined below), provided, however, that the Company is actively employing reasonable best efforts to cause such registration statement to be filed and to become effective or to cause such Company Underwritten Offering to be effected, and provided, further that nothing in this subparagraph (ii) shall derogate from the Company’s obligations under Section 5 hereof, (iii) during the period that is one hundred and eighty (180) days following the effective date of, a Company-initiated registration or Company Underwritten Offering, or (iv) if the Initiating Holder proposes to dispose of Registrable Securities that may be immediately registered on Form F-3 pursuant to a request made pursuant to Section 3 hereof.
(c) If the Company shall furnish to such Holders a letter signed by the Chief Executive Officer of the Company stating that in the good faith judgment of the Company’s Board of Directors a Potential Material Event (as defined below) has occurred (a “Management Letter”), the Company’s obligation to use its reasonable best efforts to effect such registration under Section 2(c) shall be deferred from the date of receipt of the Management Letter until such Holders receive written notice from the Company that such Potential Material Event either has been disclosed to the public or no longer constitutes a Potential Material Event, such period not to exceed sixty (60) days, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly. A registration will not count as a requested registration under this Section 2 until the registration statement relating to such registration has been declared effective by the Commission and the shares have been registered for trade.
For purposes of this Agreement, a “Potential Material Event” means any of the following: (a) the possession by the Company of material information that the Company has a bona fide business purpose for preserving as confidential, or (b) any significant acquisition, corporate reorganization, or other similar transaction involving the Company which would, in the good faith determination of the Board of Directors, be adversely affected by disclosure in a registration statement at such time.
(d) Notwithstanding anything in this Agreement to the contrary, including the provisions of Section 2(a) or Section 3, but subject to Section 2(e) below, if a requested registration under Section 2 or Section 3 involves an underwritten public offering and the managing underwriter(s) of such offering determine(s) that the number of securities sought to be offered should be limited due to market conditions, then the number of securities to be included in such underwritten public offering shall be reduced to a number deemed satisfactory by such managing underwriter with shares being excluded in the following sequence: (i) first, all shares sought to be registered by the Company for its own account; and (ii) second, all other Registrable Securities. If there is a reduction of the number of Registrable Securities, without limiting the preceding sentence, such reduction with respect to the selling Holders shall be made on a pro rata basis (based upon the aggregate number of Registrable Securities held by the Holders and subject to the priorities set forth in the preceding sentence).
(e) Notwithstanding Section 2(d) above, if the Company registers Registrable Securities at the request of a Holder pursuant to Section 2(a) above, then if the requested registration involves an underwritten public offering and the managing underwriter of such offering determines that the number of securities sought to be offered should be limited due to market conditions, then all the Registrable Securities held by Tene on such date, shall be first registered before all other securities. If the Registrable Securities held by Tene are registered based on the priority set forth in this Section 2(e), then it shall be deemed as if Tene had been the Initiating Holder for purposes of such registration under Section 2(a) even if the request for registration under Section 2(a) had originally been initiated by the Kibbutz.
3. Form F-3.
(a) At any time when the Company is eligible to use a Form F-3 registration statement, if the Company receives a request from a Holder that the Company file a Form F-3 registration statement with respect to outstanding Registrable Securities of such Holders having an anticipated aggregate offering price, net of Selling Expenses, of at least US$1,000,000, then the Company shall (i) within ten (10) days after the date such request is given, provide a Demand Notice to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within thirty (30) days after the date such request is given by the Initiating Holders, file such Form F-3 registration statement under the Securities Act covering all Registrable Securities requested to be included in such registration by any other Holders, as specified by notice given by such Holder to the Company within fifteen (15) days of the date the Demand Notice is given, and in each case, subject to the limitations of Section 3(b) and Section 3(c).
(b) The Company shall use its reasonable best efforts to effect promptly, subject to the provisions of Section 3(c) below, the registration of all shares on Form F-3 to the extent requested by such Holder or Holders; provided, however, that the provisions of Section 2(c) shall also apply to this Section 3.
(c) The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to a request of a Holder under this Section 3 (i) more than two (2) times during any twelve (12)-month period, (ii) during the period that is thirty (30) days before the Company’s good faith estimate of the date of filing of a Company-initiated registration or Company Underwritten Offering, provided, however, that the Company is actively employing in reasonable best efforts to cause such registration statement to be filed and to become effective or to cause such Company Underwritten Offering to be effected and provided, further that nothing in this subparagraph (ii) shall derogate from the Company’s obligations under Section 5 hereof, or (iii) during the period that is ninety (90) days following the effective date of a Company-initiated registration or Company Underwritten Offering (as such period may be extended pursuant to FINRA Rule 2711(f) in connection with any such offering).
4. Underwriting Requirements.
(a) If, pursuant to Sections 2 or 3, the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to the applicable Section, and the Company shall include such information in the Demand Notice. The underwriter(s) shall be selected by the Initiating Holders and shall be reasonably satisfactory to the Company. In such event (and in the event any Holder wants to participate pursuant to Section 5 in a Company registration of Ordinary Shares which the Company intends to distribute by means of an underwriting), the right of any Holder to include such Holder’s Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company as provided in Section 6(g)) enter into an underwriting agreement in customary form with the underwriter(s) selected for such underwriting.
(b) For purposes of Sections 2 and 3, a registration shall not be counted as “effected” if, as a result of an exercise of the underwriter’s cutback provisions in Section 2(d) or Section 2(e), fifty percent (50%) of the Registrable Securities the Initiating Holder requested to include in such registration statement are not actually included.
5. Piggyback Registration.
(a) If at any time the Company proposes to file (i) a prospectus supplement to an effective shelf registration statement, or (ii) a registration statement, other than a shelf registration statement for a delayed or continuous offering pursuant to Rule 415 under the Securities Act (a “Shelf Registration Statement”), in either case, for the sale of Ordinary Shares for its own account to an underwriter on a firm commitment basis for reoffering to the public or in a “bought deal” or “registered direct offering” with one or more investment banks (collectively, a “Company Underwritten Offering”) then as soon as practicable but not less than ten (10) days prior to the filing of (x) any preliminary prospectus supplement relating to such Company Underwritten Offering pursuant to Rule 424(b) under the Securities Act, (y) the prospectus supplement relating to such Company Underwritten Offering pursuant to Rule 424(b) under the Securities Act (if no preliminary prospectus supplement is used) or (z) such registration statement, as the case may be, the Company shall give notice of such proposed Company Underwritten Offering to the Holders and such notice shall offer the Holders the opportunity to include in such Company Underwritten Offering such number of Registrable Securities (the “Included Registrable Securities”) as each such Holder may request in writing. The notice required to be provided in this Section 5(a) to Holders shall be provided on a Business Day and receipt of such notice shall be confirmed by such Holder. Each such Holder shall then have twenty (20) days after receiving such notice to request inclusion of Registrable Securities in the Company Underwritten Offering, except that such Holder shall have one (1) Business Day after such Holder confirms receipt of the notice to request inclusion of Registrable Securities in the Company Underwritten Offering in the case of a “bought deal”, “registered direct offering” or “overnight transaction” where no preliminary prospectus is used. If no request for inclusion from a Holder is received within the specified time, such Holder shall have no further right to participate in such Company Underwritten Offering.
(b) Unless the Company qualifies as a well-known seasoned issuer (within the meaning of Rule 405 under the Securities Act) (a “WKSI”) (i) the Company shall give each Holder twenty (20) days notice prior to filing a Shelf Registration Statement and, upon the written request of any Holder, received within fifteen (15) days of such notice, the Company shall include in such Shelf Registration Statement a number of Ordinary Shares equal to the number of Registrable Securities requested to be included without naming the Holder as a selling shareholder and including only a generic description of the holder of such securities (“Undesignated Registrable Securities”), (ii) the Company shall not be required to give notice to any Holder in connection with a filing pursuant to Section 5(a)(i) unless such Holder provided such notice to the Company pursuant to this Section 5(b) and included Undesignated Registrable Securities in the Shelf Registration Statement related to such filing, and (iii) at the request of a Holder given more than thirty (30) days before the Company’s good faith estimate of a Company Underwritten Offering (or such shorter period to which the Company in its sole discretion consents), the Company shall file a post-effective amendment or, if available, a prospectus supplement to a Company Shelf Registration Statement to include such Undesignated Registrable Securities as any Holder may request, provided (x) that the Company is actively employing in reasonable best efforts to effect such Company Underwritten Offering, and (y) the Company shall not be required to effect a post-effective amendment more than twice in any 12-month period.
(c) In connection with any Company Underwritten Offering conducted pursuant to this Section 5, if the Company is advised by any managing underwriter of the Company’s securities being offered in such Company Underwritten Offering that marketing factors require a limitation on the number of shares to be sold by Persons other than the Company (collectively, the “Selling Shareholders”) is greater than the amount which can be offered without adversely affecting the offering, the Company may reduce the amount offered for the accounts of Selling Shareholders (including Selling Shareholders holding Registrable Securities) to a number (if any) deemed satisfactory by such managing underwriter with shares being excluded in the following sequence: (i) first, all the Registrable Securities, provided that Tene shall be granted preferred registration rights over the other Holders such that it shall be permitted to include the number of Registrable Securities which reflect a ratio that assumes that Tene holds twice as many Registrable Securities as it actually holds in the event that market conditions require a limitation on the number of shares to be included. For the sake of clarity should Tene hold 10% of the Registrable Securities it shall be permitted pursuant to this Section 6(c)(i) to have included in the such Company Underwritten Offering an amount of Registrable Securities to reflect 20% of such Company Underwritten Offering, and (ii) second, all shares sought to be registered by the Company for its own account. If there is a reduction of the number of Registrable Securities, without limiting the preceding sentence, such reduction with respect to the Selling Shareholders shall be made on a pro rata basis (based upon the aggregate number of Registrable Securities held by the Holders and subject to the priorities set forth in the preceding sentence).
(d) The Company shall have the right to terminate or withdraw any registration or Company Underwritten Offering initiated by it under this Section 5 prior to the effectiveness of such registration whether or not the Holders have elected to include shares in such registration.
6. Registration Procedures. If and whenever the Company is required by the provisions of this Agreement to use its reasonable best efforts to effect the registration of any of the Holders under the Securities Act, the Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration statement on the appropriate form under the Securities Act with respect to such securities, which form shall comply as to form with the requirements of the applicable form and include all financial statements required by the Commission to be filed therewith, and use its reasonable best efforts to cause such registration statement to become effective and, in the case of a registration pursuant to Section 2 or 3, keep such registration statement effective for a period of up to one hundred and twenty (120) days or, if earlier, until the distribution contemplated in the registration statement has been completed;
(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 comply with the provisions of the Securities Act with respect to the sale or other disposition of all securities covered by such registration statement;
(c) furnish to each selling Holder whose Registrable Shares are being registered such number of copies of such registration statement, any amendments thereto, any documents incorporated by reference therein, the prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as such selling Holder may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such selling Holder and covered by the registration;
(d) use its reasonable best efforts to register or qualify the securities covered by such registration statement under the securities or state “blue sky” laws of such jurisdictions as each selling Holder may reasonably request; provided that the Company shall not be required to register or qualify the securities in any such states or jurisdictions which require it to qualify to do business, subject itself to taxation or consent to general service of process therein;
(e) within a reasonable time before each filing of the registration statement or prospectus or amendments or supplements thereto with the Commission, upon request of the Holders furnish to counsel selected by the Holders copies of such documents proposed to be filed;
(f) make available to each selling Holder, any managing underwriter participating in any disposition pursuant to a registration statement, and any attorney, accountant or other agent or representative retained by the selling Holders or underwriter (collectively, the “Inspectors”), all financial and other records, pertinent corporate documents and properties of the Company (collectively, the “Records”), as shall be reasonably necessary to enable them to exercise their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such Inspector in connection with such registration statement, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct appropriate due diligence in connection therewith, subject, in each case, to such confidentiality agreements as the Company shall reasonably request;
(g) enter into any reasonable underwriting agreement, in usual and customary form, required by the proposed managing underwriter or underwriter(s) for the selling Holders; each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement;
(h) cause the securities covered by such registration statement to be listed on the securities exchange or quoted on the quotation system on which the similar securities issued by the Company are then listed or quoted (or, if the Ordinary Shares are not yet listed or quoted, then on such exchange or quotation system as the selling Holders and the Company shall determine);
(i) appoint a transfer agent and registrar for all Registrable Securities covered by a registration statement not later than the effective date of such registration statement;
(j) notify each selling Holder, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any prospectus forming a part of such registration statement has been filed; and
(k) after such registration statement becomes effective, notify each selling Holder of any request by the SEC that the Company amend or supplement such registration statement or prospectus.
7. Termination of Registration Rights. The right of any Holder to request registration or inclusion of Registrable Securities in any registration pursuant to Sections 2, 3, 4 or 5 shall terminate upon the lapse of seven (7) years from the date of the Company’s IPO or when all of such Holder’s Registrable Securities could be sold without restriction pursuant to Rule 144 under the Securities Act.
8. Lock-Up Agreements. The Company and each Holder hereby agree that if requested by the managing underwriter(s), the Company and such Holder will enter into a customary “lock-up agreement” with the managing underwriter(s) pursuant to which the Company and such Holder will agree not to sell or transfer any securities or any interest in securities of the Company during a period of up to one hundred and eighty (180) days following the date of the final prospectus related to the Company’s IPO and ninety (90) days following the date of the final prospectus related to any offering conducted pursuant to Section 2, 3 or 5 hereof, subject to extension in connection with any earnings release or other release of material information pursuant to FINRA Rule 2711(f) to the extent applicable . In addition, no Holder may participate in any underwritten registration hereunder unless such person (a) agrees to sell such person’s securities on the basis provided in any customary underwriting agreement and (b) provides any relevant information and completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents required under the terms of such underwriting arrangements.
9. Confidentiality. Each Holder agrees that any information obtained pursuant to (x) the provisions of this Agreement or (y) that certain Management Letter issued to the Holder, if applicable, on even date herewith, will be held in strict confidence, will not be disclosed or exposed to any person or entity without the prior written consent of the Company and will not be used for any purpose, other than with respect to exercise of such Holder’s rights as a shareholder in the Company; unless such confidential information (a) is known or becomes known to the public in general, (b) is or has been independently developed or conceived by such Holder without use of the Company’s confidential information, or (c) is or has been made known or disclosed to such Holder by a third party without a breach of any obligation of confidentiality such third party may have to the Company and without any restrictions as to its disclosure; provided, however, that such Holder may disclose confidential information (i) to its attorneys, accountants, consultants, principals and officers and other professionals to the extent necessary to obtain their services in connection with monitoring its investment in the Company, if such persons are bound by confidentially provisions; (ii) to any partner, member, or shareholder of such Holder in the framework of reports to such partner, member, or shareholder in the ordinary course of business, provided that such Holder informs such Person that such information is confidential and directs such Person to maintain the confidentiality of such information and such Holder is responsible for any breach of the provisions of this paragraph; or (iii) as may otherwise be required by law, provided that such Holder promptly notifies the Company of such disclosure and takes reasonable steps to minimize the extent of any such required disclosure.
10. Delay of Registration. No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any registration pursuant to this Agreement as the result of any controversy that might arise with respect to the interpretation or implementation of Sections 2, 3, 4 or 5.
11. Expenses. All expenses incurred in effecting a registration provided for in Sections 2, 3, 4 and 5, including, without limitation, all registration and filing fees, printing expenses, reasonable fees and disbursements of counsel for the Company and for one U.S. counsel and one Israeli counsel (together, the “Selling Special Counsel”) for the Holders participating in such registration as a group (selected by a majority in interest of the Holders participating in the registration), underwriting expenses (other than share transfer taxes, underwritten discounts or commissions), expenses of any audits incident to or required by any such registration (all of such expenses referred to collectively, as the “Registration Expenses”), shall be paid by the Company. All underwriting discounts, selling commissions, and stock transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of counsel for any Holder (except for the Selling Special Counsel) relating to Registrable Securities registered pursuant to this Agreement shall be borne and paid by the Holders, pro rata on the basis of the number of Registrable Securities registered on their behalf.
12. Furnish Information. It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Agreement with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as is reasonably required to effect the registration of such Holder’s Registrable Securities.
13. Indemnification.
(a) Incident to any registration statement referred to in this Agreement, and subject to applicable law, the Company shall indemnify and hold harmless each selling Holder that are included in the registration and the partners, and the shareholders, partners, directors, officers, employee, agents, and legal counsel and accountants for each such Holder, and each person who controls such Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (a “Controlling Person”), from and against any and all losses, claims, expenses, damages or liabilities, joint or several (including any investigation, legal and other expenses incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted), as the same are incurred to which they, or any of them, may become subject under the Securities Act, the Exchange Act, other federal or state statutory law or regulation, at common law, or otherwise, insofar as such losses, claims, expenses, damages or liabilities (or action in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of any material fact contained, on the effective date thereof, in any registration statement under which such securities were registered under the Securities Act (including any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, or any free writing prospectus or the Disclosure Package), (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, or (iii) any violation by the Company of the Securities Act, any state securities or “blue sky” laws or any rule or regulation thereunder in connection with such registration. The Company shall not be liable to any indemnified party, however, in any such case, to the extent that any such liability arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, preliminary or final prospectus, or amendment or supplement thereto in reliance upon and in conformity with information furnished in writing to the Company by an indemnified party specifically for use therein.
(b) Subject to applicable law, each selling Holder included in such registration being effected shall, severally and jointly, indemnify and hold harmless the Company (including its directors and officers, employees and agents), legal counsel and accountants of the Company, any other selling Holder included in such registration, and each person who controls the Company or such other Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against any and all losses, claims, damages, expenses and liabilities, joint or several, to which they, or any of them, may become subject under the Securities Act, the Exchange Act or other federal or state statutory law or regulation, at common law, or otherwise, insofar as such losses, claims, damages, expenses or liabilities (or actions in respect thereof) arises out of or is based upon (i) any untrue statement or alleged untrue statement of any material fact contained, on the effective date thereof, in any registration statement under which such securities were registered under the Securities Act (including any preliminary prospectus or final prospectus contained therein, or any amendment or supplement thereto, or any free writing prospectus or the Disclosure Package), (ii) any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in the case of both (i) and (ii) to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in such registration statement, preliminary or final prospectus, amendment or supplement thereto, or any free writing prospectus or the Disclosure Package, in reliance upon and in conformity with information furnished in writing to the Company by such selling Holder specifically for use therein. In no event, however, shall the liability of any selling Holder for indemnification under this Section 13 in its capacity as a seller of Registrable Securities exceed the amount equal to the gross proceeds (net of underwriting discounts and commissions) to such selling Holder of the securities sold in any such registration, except in the case of fraud or willful misconduct by such selling Holder.
(c) Promptly after receipt by an indemnified party under this Section 13 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 13, notify the indemnifying party in writing of the commencement thereof; but the failure to so notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent such action and such failure results in material prejudice to the indemnifying party and forfeiture by the indemnifying party of substantial rights and defenses; and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, except as provided in the next sentence, after notice from the indemnifying party to such indemnified party of its election to so assume the defense thereof, the indemnifying party shall not be liable to such indemnified party for any legal expenses of other counsel or any other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. Notwithstanding the indemnifying party’s rights in the prior sentence, the indemnified party shall have the right to employ its own counsel (and one local counsel), and the indemnifying party shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest; (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it which are different from or additional to those available to the indemnifying party; (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party within a reasonable time after notice of the institution of such action; or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. No indemnifying party shall, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general circumstances or allegations, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all indemnified parties. An indemnifying party shall not be liable under this Section 13 to any indemnified party regarding any settlement or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent is consented to by such indemnifying party. No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement or compromise unless such settlement or compromise (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (ii) does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 13 for any reason is held by a court of competent jurisdiction to be unavailable to an indemnified party in respect of any losses, claims, damages, expenses or liabilities referred to therein, then each indemnifying party under this Section 13, in lieu of indemnifying such indemnified party thereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, expenses or liabilities in such proportion as is appropriate to reflect the relative fault of the Company and the selling Holders in connection with the statements or omissions which resulted in such losses, claims, damages, expenses or liabilities, as well as any other relevant equitable considerations. The relative fault of the Company and the selling Holders shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the selling Holders and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(e) The Company, the selling Holders and the underwriters agree that it would not be just and equitable if contribution pursuant to this Section 13 were determined by pro rata or per capita allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. In no event, however, shall a selling Holder be required to contribute any amount under this Section 13(e) in excess of the gross proceeds (net of underwriting discounts and commissions) received by such selling Holder from its sale of Registrable Securities under such registration statement, except in the case of fraud or willful misconduct by such selling Holder. No Person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not found guilty of such fraudulent misrepresentation.
(f) The indemnification and contribution provided for in this Section 13 will remain in full force and effect regardless of any investigation made by or on behalf of the indemnified parties or any officer, director, employee, agent or controlling person of the indemnified parties.
14. Compliance with Rule 144. In the event that the Company (a) registers a class of securities under Section 12 of the Exchange Act, or (b) shall commence to file reports under Section 13 or 15(d) of the Exchange Act, the Company shall use its reasonable best efforts thereafter to file with the Commission such information as is required under the Exchange Act for so long as there are Holders (and at any time after the Company has become subject to such reporting requirements); and at all times from and after ninety (90) days following the effective date of the first registration filed by the Company for the IPO, the Company shall use its reasonable best efforts to take all action as may be required as a condition to the availability of Rule 144 under the Securities Act. The Company shall furnish to any Holder upon request a written statement executed by the Company as to the steps it has taken to comply with the current public information requirement of Rule 144 (or such comparable successor rules) (at any time after the Company has become subject to such reporting requirements).
15. Amendments. The provisions of this Agreement may be amended only with the written consent of the Company and the Majority Interest (which shall also include the consent of each of the Kibbbutz or Tene, respectively, for so long as either of them hold at least 20% of the outstanding Registrable Securities). Any amendment effected in accordance with this Section 15 shall be binding on all parties hereto, regardless of whether any such party has consented thereto. Notwithstanding the foregoing, any right granted specifically to Tene may not be amended or terminated and the observance of such right may not be waived without, in addition to the requirement set forth in this Section 15, the written consent of Tene.
16. Transferability of Registration Rights. The registration rights contained in this Agreement shall bind and inure to the benefit of the successors and permitted assigns of the parties hereto, provided, however, that registration rights conferred herein on the Holders hereunder shall only inure to the benefit of a transferee of Registrable Securities if (i) duly transferred in accordance with the Company’s Articles, (ii) immediately after such assignment or other transfer, such transferee will hold ten thousand (10,000) Registrable Securities (subject to adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization affecting such shares), and (iii) each subsequent Holder agrees in writing to be bound by the terms and conditions of this Agreement in order to acquire the rights granted pursuant hereto.
17. Effectiveness. Upon effectiveness this Agreement, Section 15.5 of the Investment Agreement shall be terminated and shall be considered null and void, with no further action to be taken by any party to such agreement. This Agreement and all rights and obligations set forth herein shall become effective upon the closing of an IPO, provided that such closing of an IPO shall occur on or before 31.12.2011. For the removal of doubt in the event that the closing of an IPO shall not occur on or before 31.12.2011 this Agreement shall be considered null and void and treated as if it was never entered into by the parties hereto and the provisions of Section 15.5 of the Investment Agreement shall continue in full force and effect.
18. Miscellaneous.
(a) All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (a) personal delivery to the party to be notified, (b), if sent by electronic mail or facsimile (with electronic confirmation of receipt) on the recipient’s next Business Day, (c) five (5) Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) two (2) Business Days after deposit with a nationally recognized overnight courier, freight prepaid, specifying next Business Day delivery, with written verification of receipt. All communications shall be sent to the respective parties at their address as set forth in the signature page, or to such e-mail address, facsimile number or address as subsequently modified by written notice given in accordance with this Section 18.
(b) This Agreement shall be governed by and construed according to the laws of the State of Israel, without regard to the conflict of laws provisions thereof. Any dispute arising under or in relation to this Agreement shall be resolved exclusively in the competent court for Tel Aviv-Jaffa district, and each of the parties hereby irrevocably submits to the exclusive jurisdiction of such court.
(c) This Agreement may be executed in two or more counterparts, each of which shall deemed an original, but all of which together shall constitute one and the same instrument.
(d) 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.
(d) This Agreement constitutes the full and entire understanding and agreement between the parties with regard to the subject matters hereof and supersedes all prior agreements (including Section 15.5 of the Investment Agreement), understandings and negotiations, both written and oral, between the parties with respect to the subject matter hereof.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first written above.
| COMPANY | ||
| CAESARSTONE SDOT-YAM LTD. | ||
| By: |
/s/ Joseph Shiran, Yair Averbuch |
|
| Name: |
Joseph Shiran, Yair Averbuch |
|
| Title: |
CEO, CFO |
|
Address:
Kibbutz Sdot-Yam,
MP Menashe, Israel 38805
Facsimile: +972-4- 636-4400
Attention: Joseph Shiran, CEO
EXISTING SHAREHOLDERS
| KIBBUTZ SDOT YAM | TENE SURFACES INVESTMENTS | |||||||
| AGRICULTURAL COOPERATIVE | LIMITED PARTNERSHIP | |||||||
| SOCIETY LTD. | ||||||||
| TENE QUARTZ SURFACES | ||||||||
| INVESTMENTS (PARALLEL) | ||||||||
| LIMITED PARTNERSHIP | ||||||||
| By: |
/s/ Eitan Shachar, Marchella Shani |
|||||||
| Name: |
Eitan Shachar, Marchella Shani |
|||||||
| Title: |
|
|||||||
| By: |
/s/ Dori Brown, Ariel Halperin |
|||||||
| Name: |
Dori Brown, Ariel Halperin |
|||||||
| Title: |
|
|||||||
| Address: | ||||||||
| , | ||||||||
| , Israel | ||||||||
| Facsimile: +972- - - | Address: | |||||||
| Attention: | , | |||||||
| , Israel | ||||||||
| Facsimile: +972- - - | ||||||||
| Attention: | ||||||||
[Signature Page to Registration Rights Agreement]
Schedule A
Tene Entities
| • | Tene Quartz Surfaces Investments Limited Partnership |
| • | Tene Quartz Surfaces Investments (Parallel) Limited Partnership |
Extension of Registration Rights Agreement dated July 21, 2011
THIS EXTENTION is made as of the 13th day of February, 2012
By and Among:
(1) CAESARSTONE SDOT YAM LTD, an Israeli Company (the “Company”)
(2) Kibbutz Sdot Yam Agricultural Cooperative Society Ltd. (the “Kibbutz”); and
(3) The Tene entities listed below
(“Tene” and together with the Kibbutz, the “Existing Shareholders”)
Recitals:
WHEREAS, the Company, the Kibbutz and Tene are parties to that certain Registration Rights Agreement dated July 21, 2011 (the “Agreement”); and
WHEREAS, the effectiveness of the Agreement is subject to the closing of an IPO (as such term is defined in the Agreement) prior to December 31, 2011;
WHEREAS, the parties wish to extend the term of the aforementioned suspension condition until December 31, 2012, pursuant to the terms of this Extension set forth below;
NOW, THEREFORE, the parties hereby agree as follows:
| 1. | Notwithstanding Section 17 to the Agreement, the Agreement shall become effective upon the closing of an IPO before December 31, 2012, and shall not be considered void prior thereto. |
| 2. | Pursuant to Section 1 above, Section 17 to the Agreement shall be amended, so that references to “December 31, 2011”, shall be deleted replaced with “December 31, 2012”. |
| 3. | Except as specifically amended herein, all other terms and conditions of the Agreement shall remain unchanged and with the same force and effect as prior to the date of this Amendment. |
IN WITNESS WHEREOF this Extension has been executed by the parties as of the date set forth above.
| Caesarstone Sdot Yam Ltd |
| By: /s/ Caesarstone Sdot Yam Ltd |
| Name: Caesarstone Sdot Yam Ltd |
| Title: |
| Kibbutz Sdot Yam Agricultural Cooperative Society Ltd. |
| By: /s/ Eitan Shachar, Marchella Shani |
| Name: Eitan Shachar, Marchella Shani |
| Title: |
| Tene Surfaces Investments Limited Partnership |
| Tene Quartz Surfaces Investments (Parallel) Limited Partnership |
| By: /s/ Dori Brown, Ariel Halperin |
| Name: Dori Brown, Ariel Halperin |
| Title: |
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