-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, R8nALDlOuYoWXaEJbb0YDRDJFtchgURo4j57iY/JeqnVCVF9AQycXh1qZ5UtG/rR ZcgCWpniz2aBZ3FnFilqNQ== 0000912057-99-008934.txt : 19991213 0000912057-99-008934.hdr.sgml : 19991213 ACCESSION NUMBER: 0000912057-99-008934 CONFORMED SUBMISSION TYPE: F-3 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19991210 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUR MACROPRINTERS LTD CENTRAL INDEX KEY: 0000946394 STANDARD INDUSTRIAL CLASSIFICATION: PRINTING TRADES MACHINERY & EQUIPMENT [3555] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: F-3 SEC ACT: SEC FILE NUMBER: 333-92493 FILM NUMBER: 99772244 BUSINESS ADDRESS: STREET 1: 5 DAVID NAVON STREET STREET 2: MOSHAV MAGSHIMIM CITY: PETAH-TIKVA ISRAEL STATE: L3 BUSINESS PHONE: 01197239087676 MAIL ADDRESS: STREET 1: P O BOX 8440 STREET 2: MOSHAV MAGSHIMIM CITY: ISRAEL STATE: L3 FORMER COMPANY: FORMER CONFORMED NAME: NUR ADVANCED TECHNOLOGIES LTD DATE OF NAME CHANGE: 19950607 F-3 1 FORM F-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 10, 1999 REGISTRATION NO. 333- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------- FORM F-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------------- NUR MACROPRINTERS LTD. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) --------------------- ISRAEL NOT APPLICABLE (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.) 5 DAVID NAVON STREET MOSHAV MAGSHIMIM 56910 ISRAEL (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) --------------------- CT CORPORATION SYSTEM 1633 BROADWAY NEW YORK, NEW YORK 10019 (NAME AND ADDRESS OF AGENT FOR SERVICE) (212) 246-5070 (TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) COPY TO: RUBI FINKELSTEIN, ESQ. ORRICK, HERRINGTON & SUTCLIFFE LLP 666 FIFTH AVENUE NEW YORK, NEW YORK 10103 (212) 506-5000 (PHONE) (212) 506-5151 (FAX) APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as practicable after the effective date of this Registration Statement. If the only securities being registered on this Form are to be offered pursuant to dividend or interest reinvestment plans, please check the following box: / / If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: /X/ If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / / If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / / CALCULATION OF REGISTRATION FEE
- ----------------------------------------- -------------------- -------------------- -------------------- ------------------- AMOUNT PROPOSED PROPOSED AMOUNT OF TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE REGISTRATION TITLE OF SECURITIES TO BE REGISTERED REGISTERED (1) PRICE PER SHARE OFFERING PRICE FEE - ----------------------------------------- -------------------- -------------------- -------------------- ------------------- Ordinary shares, NIS 1.0 nominal value per share 1,998,697 shares $10.75 (2) $21,485,992 (2) $5,672.31 - ----------------------------------------- -------------------- -------------------- -------------------- ------------------- Ordinary shares, NIS 1.0 nominal value per share (3) 6,464,476 shares $0 $0 $0 - ----------------------------------------- -------------------- -------------------- -------------------- ------------------- - ----------------------------------------- -------------------- -------------------- -------------------- ------------------- Total ordinary shares, NIS 1.0 nominal value per share (4) 8,463,173 shares -- -- $5,672.31 - ----------------------------------------- -------------------- -------------------- -------------------- -------------------
(1) Pursuant to Rule 416, this registration statement shall be deemed to cover an indeterminate number of additional ordinary shares in the event the number of outstanding shares of Nur Macroprinters Ltd. is increased by stock split, stock divided and/or similar transactions. (2) Pursuant to Rule 457(c), the proposed maximum offering price per ordinary share and the proposed maximum aggregate offering price have been calculated on the basis of $10.75 per share, the average of the bid and asked price of the ordinary shares on the Nasdaq National Market on December 3, 1999. (3) Pursuant to Rule 429, these 6,464,476 ordinary shares are being carried forward from a Registration Statement on Form F-1 (No. 333-66103) along with filing fees of $5,503.21 associated with such securities that were previously paid with the F-1 Registration Statement, as amended. (4) Including 705,000 ordinary shares underlying warrants. PURSUANT TO RULE 429 OF THE SECURITIES ACT OF 1933, THE PROSPECTUS INCLUDED AS A PART OF THIS REGISTRATION STATEMENT ALSO RELATES TO A REGISTRATION STATEMENT ON FORM F-1 (NO. 333-66103). THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IS NOT AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION DATED DECEMBER 10, 1999 PROSPECTUS 8,463,173 NUR MACROPRINTERS LTD. ORDINARY SHARES ----------------- The selling security holders identified in this prospectus are offering up to 8,463,183 of our ordinary shares. Our ordinary shares are traded on the Nasdaq National Market under the symbol "NURM." The last reported sale price for our ordinary shares on the Nasdaq National Market on December 9, 1999 was $11.75 per share. We will not receive any proceeds from the sale of ordinary shares by the selling security holders. We are not offering any ordinary shares for sale under this prospectus. See "Selling Security Holders" for a list of the selling security holders. See "Plan of Distribution" for a description of how the ordinary shares can be sold. ----------------- INVESTING IN OUR ORDINARY SHARES INCLUDES RISKS. FOR MORE INFORMATION, PLEASE SEE "RISK FACTORS" BEGINNING ON PAGE 6. ----------------- NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED WHETHER THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ----------------- The date of this prospectus is December __, 1999 TABLE OF CONTENTS
PAGE Available Information.........................................................2 Incorporated Documents........................................................3 The Company...................................................................4 Risk Factors..................................................................6 Special Note Regarding Forward-Looking Statements............................15 Use of Proceeds..............................................................15 Selling Security Holders.....................................................16 Plan of Distribution.........................................................22 Legal Matters................................................................23 Experts......................................................................23 SEC Position on Indemnification for Securities Act Liabilities...............24
You should rely only on the information incorporated by reference or provided in this prospectus or any supplement. We have not authorized anyone else to provide you with different information. The ordinary shares are not being offered in any state where the offer is not permitted. You should not assume that the information in this prospectus or any supplement is accurate after the date of such document. AVAILABLE INFORMATION We are subject to the information reporting requirements of the Securities and Exchange Act of 1934 as a foreign private issuer as defined in Rule 3b-4 of the Exchange Act. In accordance with these reporting requirements, we will file reports and other information with the Securities and Exchange Commission. Such reports and other information can be inspected and copied at the Public Reference Room of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's regional offices at 500 West Madison Street, Suite 1400, Chicago, IL 60661-2511 and 7 World Trade Center, 13th Floor, New York, NY 10048, at prescribed rates. The Commission also maintains a web site that contains reports, proxy and information statements and other information regarding registrants, such as ourselves, that file electronically with the Commission. The address of such web site is HTTP://WWW.SEC.GOV. You may also obtain information from the Public Reference Room by calling the Commission at 1-800-SEC-0330. In addition, our ordinary shares are quoted on the Nasdaq National Market System, so our reports and other information can be inspected at the offices of the National Association of Securities Dealers, Inc. at 1735 K Street, N.W., Washington, D.C. 20006. We intend to furnish our security holders with annual reports containing additional financial statements and a report thereon by independent certified public accountants prior to each of our annual meetings. 2 INCORPORATED DOCUMENTS The Securities and Exchange Commission allows us to "incorporate by reference" information into this prospectus. This means that we can disclose important information to you by referring you to another document filed by us with the Commission. Information incorporated by reference is deemed to be part of this prospectus, except for any information superseded by this prospectus. The following documents are incorporated herein by reference: (a) Our Annual Report on Form 20-F for the fiscal year ended December 31, 1998 as filed with the Commission on May 4, 1999; (b) Our Current Reports on Form 6-K filed with the Commission on January 27, 1999, February 26, 1999, March 2, 1999, April 27, 1999, May 13, 1999, August 12, 1999 and November 5, 1999 (as amended on November 15, 1999); and (c) The description of our ordinary shares contained in the registration statements under the Exchange Act on Form 8-A as filed with the Commission on July 25, 1995 and September 15, 1995, and including any subsequent amendment or report filed for the purpose of updating such description. In addition, all documents we have filed or subsequently file under Sections 13(a), 13(c) and 15(d) of the Exchange Act, before the termination of this offering, are incorporated by reference. We will provide without charge to any person (including any beneficial owner) to whom this prospectus has been delivered, upon the oral or written request of such person a copy of any document incorporated by reference in the registration statement (not including exhibits to the information that is incorporated by reference unless such exhibits are specifically incorporated by reference into the information that the registration statement incorporates), of which this prospectus forms a part. Such requests should be directed to Hilel Kremer, Chief Financial Officer, Nur Macroprinters Ltd., P.O. Box 8440, Moshav Magshimim 56910, Israel. Our telephone number at that location is 972-3-908-7676. Our corporate web site address is http:/www.nur.com. The information on our web site is not intended to be a part of this prospectus. 3 THE COMPANY INTRODUCTION Nur Macroprinters Ltd. is a world leader in the market for the sale of super wide and wide format digital printing systems. We develop, manufacture, sell and service digital color printers for the printing of large images such as billboards, posters, and banners. We also supply our customers with the inks, solvents and print substrates for use with our printers. On October 6, 1995, we completed our initial public offering and our shares are listed on the Nasdaq National Market under the symbol NURM. There is no non-United States trading market for our shares. OUR PRODUCTS Our printers allow customers to print large color images on demand, generally in substantially less time, with less labor, and at a lower cost than traditional methods of printing. One of our principal products is the Blueboard printer, a second generation of super wide format printer introduced in early 1997. The Blueboard printer can print in variable widths from 0.9 to 5 meters (approximately 3 to 16.4 feet). The Blueboard printer is based on our own continuous ink-jet digital printing technology and is designed to improve quality and ease of use. In April 1998, we introduced a faster version of the Blueboard printer, the Blueboard 2, in response to demand from our customers for increased productivity. The Blueboard 2 is now also one of our main products. In February 1999, we introduced the Blueboard HiQ, which produces higher quality prints with higher resolution than the Blueboard and the Blueboard 2 printers. In February 1999 we introduced the NUR Fresco, a new printing system, which is in beta testing, targeted at the wide format (widths of up to 1.8 meters (6 feet)) screen printing market. The NUR Fresco is a high-quality digital production press, bringing a combination of speed and productivity to the wide format market. The Fresco printer is based on our drop-on-demand digital printing technology. The ink we sell to our customers for use with our Blueboard printers is resistant to water and ultraviolet rays and is well suited for indoor and outdoor use. The substrates we sell to our customers are also suitable for indoor and outdoor use and are made of vinyl, PVC, paper, and mesh. 4 OUR CUSTOMERS We sell our printers and related products primarily to commercial printers, design and service firms, screen printers, outdoor media companies, and trade shops. Our customers use our products to print large images such as billboards, posters, banners, and point of purchase displays for advertising, as well as decorations and backdrops for showrooms, museums, and exhibits. OUR STRATEGY Our strategy is to: - - strengthen our position as a world leader in the super wide format printing market by supplying the most productive and cost-effective super wide format digital printers; - - introduce large format digital ink jet printers to replace a significant portion of the current large format screen printers process; - - be our customers' vendor of choice for all of their ink and substrate needs; - - enable our customers to develop new ways to profit from our printing systems; and - - provide our customers with highly responsive and capable support, service and supplies. Where you can obtain additional information: Mailing Address Executive Office --------------- ---------------- P.O. Box 8440 5 David Navon Street Moshav Magshimim 56910 Moshav Magshimim 56910 Israel Israel Phone: 972-3-908-7676 Website: HTTP://WWW.NUR.COM The information on our web site is not intended to be a part of this prospectus. 5 RISK FACTORS In this section we highlight some of the risks associated with our business and operations. Investing in our shares is very risky. You should be able to bear a complete loss of your investment. To understand the level of risk, you should carefully consider the following risk factors, as well as the other information found in this prospectus, when evaluating an investment in the ordinary shares. WE NEED ADDITIONAL FINANCING. We believe that our revenues from operations together with our capital resources and credit facilities will be sufficient to fund our current activities at their present rate without our planned expansion through December 2000. If we want to proceed with the planned expansion of our operations, we will require additional funds, to be raised WE NEED TO RAISE MORE through public or private financing of debt MONEY TO SUCCESSFULLY or equity, to ensure our ability to maintain RUN OUR BUSINESS. our operations after July 2000. If we are unable to raise such funds, we will have to reduce or eliminate certain planned expenditures for research and development, production, or marketing of our products, any one of which could have a negative impact on our financial results. In this regard, how much money we will need depends on numerous factors, including the success of our marketing and customer service efforts, our research and development activities, and the demand for our products and services. We cannot guarantee that additional financing will be available or that, if available, it will be obtained on terms we find favorable. We currently have no commitments for additional financing. WE DEPEND ON A FEW KEY We are highly dependent upon the sale of our PRODUCTS IN A BUSINESS SUBJECT principal products, the NUR Blueboard TO RAPID TECHNOLOGICAL CHANGE. printers and the NUR Fresco printer. Rapid changes in technology, customer preferences and evolving industry standards increasingly characterize the market for our printers. As a result of these factors, our growth and future financial performance will depend upon our ability to develop and market new products and keep pace with the latest technological advances in the industry. We must also improve our existing products to accommodate technological advances and customer preferences. During 1998 and the OUR SUCCESS DEPENDS ON first nine months of 1999, we invested THE RESEARCH AND approximately $5.03 million and $3.7 DEVELOPMENT OF NEW respectively, in research and development PRODUCTS. projects of which, in 1998, $1.95 million was related to the acquisition of technology that caused a one-time write-off assigned to research and development. Our business could seriously suffer if we fail to anticipate or respond adequately to changes in technology and customer preferences, or if our products are delayed in their development or introduction. Other events beyond our control 6 could also hurt our business. For example, one of our competitors could develop and market a printer that customers prefer over our printers. We cannot make assurances that we will successfully develop any new products. Finally, we cannot predict how the introduction of new products by our competitors will affect sales of our existing products. OUR NEW PRODUCT, THE The NUR Fresco was introduced in February NUR FRESCO, IS STILL IN 1999 and is still in beta testing. Much of BETA TESTING. our success may depend upon our ability to complete testing and introduce the product to our intended market. OVER THE NEXT THREE YEARS WE In September 1998 we acquired all rights to WILL MAKE SIGNIFICANT ROYALTY a certain drop-on-demand inkjet technology PAYMENTS. suitable for large format digital printers. Until September 2001 we must pay royalty payments to the seller of up to $1.3 million. If we do not make certain minimum royalty payments, the seller of the technology will have the option to buy-back the technology. OUR SUCCESS DEPENDS ON OUR We currently purchase all of the ink and SUPPLIERS AND SUBCONTRACTORS. ink-jets used in our NUR Blueboard printers from one supplier, Imaje, a French manufacturer of ink-related products, and purchase all of our ink-jet printheads used in the NUR Fresco from another supplier. We have been able to obtain adequate supplies of ink and ink-jets in the past, although Imaje has occasionally delivered the IMAJE IS OUR ONLY supplies late. If these sole suppliers SUPPLIER OF INK AND INK- experience any problem that results in JETS FOR THE NUR production delays, our sales to new BLUEBOARD PRINTERS. customers and existing customers that rely on our ink and/or ink-jet components to operate their printers could be hurt. Because the success of our business depends on the sale of our printers, such a supply problem could have a severe effect on our financial results. Also, if Imaje reduces or changes the credit or payment terms it extends to us, our business could be hurt. WE RELY ON A LIMITED We employ a limited number of unaffiliated NUMBER OF subcontractors to manufacture components for SUBCONTRACTORS. our printers. The assembly of our NUR Blueboard printers is currently conducted by a 50% owned subsidiary. Our subcontractors have, in the past, been late in delivering components. We have, however, been able to obtain adequate supplies of the components and raw materials necessary to produce our printers and we have not had any serious problems with our subcontractors. Because we rely on subcontractors, we cannot be sure that we will be able to maintain an adequate supply of components. Moreover, we cannot be sure that any of the components we purchase will satisfy our quality standards and be delivered on 7 time. Our business could suffer if we fail to maintain our relationships with our subcontractors or fail to develop alternative sources for our printer components. Also, as our business grows, we will need to purchase greater quantities of components on a timely basis, and any delay in supply could hurt our sales. We cannot guarantee that we will develop alternative sources of production for our products. OUR BUSINESS IS EXTREMELY The printing equipment industry is extremely COMPETITIVE. competitive and many of our competitors have greater management, financial, technical, manufacturing, marketing, sales, distribution, and other resources than we do. Our ability to compete depends on factors both within and outside of our control, including the performance and acceptance of our current printers and any products we develop in the future. We compete against several companies that market digital printing systems based on WE HAVE NUMEROUS electrostatic, drop-on-demand inkjet, COMPETITORS IN THE airbrush, and other technologies. We also MARKET FOR OUR PRINTERS. face competition from existing conventional wide-format and super-wide format printing methods, including hand painting, screen printing, and offset printing. Our competitors could develop new products, with existing or new technology, that could be competitive in price and performance with our printers. We can offer no assurance that we can compete effectively with any such products. WE ALSO FACE We also compete with independent COMPETITION IN THE manufacturers in the market for printer MARKET FOR PRINTING supplies, in particular, the inks we supply. SUPPLIES. In 1998 and during the first nine months of 1999, ink sales accounted for 23.6% and 23.25% of our total sales, respectively. We cannot guarantee that we will be able to remain the exclusive or even principal ink manufacturer for our printers. We recently entered the substrate business, which is also highly competitive and characterized by a large number of suppliers worldwide. We are developing substrates through subcontractors that have a high added-value when used with our printers. We believe we are well positioned, both in our technical knowledge and in the minds of our customers, to succeed in selling high value-added substrates to our customers. We can not assure you that we will be able to compete effectively or achieve significant revenues in the substrate business. WE DEPEND ON OUR KEY Our success depends to a significant extent EMPLOYEES. upon the contributions of key personnel and our senior executives. Our business could seriously suffer if one or more of our key personnel or senior executives were to leave our company. In addition, we do not have, and do not contemplate getting, 8 "key-man" life insurance for any of our key employees. Our future success will also depend in part on our continuing ability to retain our key personnel and senior executives and to attract other highly qualified employees. We cannot assure our continued success in attracting or retaining highly qualified personnel. WE RELY ON TRADE SECRETS, We rely on a combination of trade secrets, PATENTS AND PROPRIETARY licenses, patents, and non-disclosure and RIGHTS. confidentiality agreements to establish and protect our proprietary rights in our products. We cannot guarantee that our existing patents or any future patents will not be challenged, invalidated, or circumvented, or that our competitors will not independently develop or patent technologies that are substantially equivalent or superior to our technology. We cannot be sure that we will receive further patent protection in Israel, the United States, or elsewhere, for existing or new products or applications. Even if we do secure further patent protection, we cannot guarantee it will be effective. In some countries, meaningful patent protection is not available. We are not aware of any infringement claims against us involving our proprietary rights. Third parties may assert infringement claims against us in the future, and the cost of responding to such assertions, regardless of their validity, could be significant. In addition, such claims could be found to be valid and result in large judgments against us. Even if such claims are not valid, the cost could be substantial to protect our patent rights. IT IS DIFFICULT TO PROTECT We believe that our success is less OUR PROPRIETARY RIGHTS. dependent upon the legal protection afforded by patent and other proprietary rights than on the knowledge, ability, experience, and technological expertise of our employees and our key suppliers. Our policy is to have employees sign confidentiality agreements, to have selected parties, including key suppliers, sub-contractors, and distributors, sign non-competition agreements, and to have third parties that we deal with sign non-disclosure agreements. Although we take precautionary measures to protect our trade secrets, we cannot guarantee that others will not acquire equivalent trade secrets or steal our exclusive technology. Moreover, we may not be able to meaningfully protect our rights that are not protected by patents. WE RELY ON INTERNATIONAL SALES. Our printers and supplies are sold worldwide, with revenues generated in various currencies. There are a number of risks inherent in international business activities, including unexpected changes in regulatory requirements, political instability, tariffs and other trade barriers, as well as the 9 burdens of complying with different foreign laws. To date, fortunately, these risks have not materially affected our business or financial situation. We cannot predict, however, when exchange or price controls or other restrictions on the conversion of foreign currencies could impact our business. CURRENCY FLUCTUATIONS Because we have revenues and expenses in ARE A RISK WE FACE ON A various currencies, including the U.S. DAILY BASIS. dollar, the NIS, and certain European currencies, our financial results are subject to the effects of fluctuations of foreign currency exchange rates. In the future, currency fluctuations could hurt our profitability. We do not hedge against fluctuations in currency exchange rates, but we may do so in the future. ENVIRONMENTAL CONCERNS. We mix the ink used in our NUR Blueboard printers with a methyl ethyl-ketone solvent. Methyl ethyl-ketone solvent is a hazardous substance and is subject to various government regulations relating to its transfer, handling, packaging, use, and disposal. We store the ink at warehouses in Europe, the United States and Israel, and a shipping company ships it at our direction. We face potential responsibility for problems that may arise when we ship the ink to customers. We believe that we are in material compliance with all applicable environmental laws and regulations. If we fail to comply with these laws or an accident involving our ink waste or methyl ethyl-ketone solvent occurs then our business and financial results could be adversely affected. WE RELY ON GOVERNMENT We have been favorably affected by certain GRANTS, TAX BENEFITS, AND OTHER Israeli and Belgian Government programs and FUNDING FROM THIRD PARTIES. tax legislation principally related to research and development and sales and marketing grants and capital investment incentives. Our operations could be adversely affected if these programs or tax benefits are reduced or eliminated and not replaced with equivalent programs or benefits, or if our ability to participate in these programs were significantly reduced. We cannot assure you that such programs and tax legislation will continue in the future or that the available benefits will not be reduced or that we will continue to meet the conditions to benefit from such programs and legislation. WE RECEIVE TAX BENEFITS Pursuant to the Law of Encouragement of FROM THE ISRAELI Capital Investments, the Israeli government GOVERNMENT. has granted "Approved Enterprise" status to some of our production facilities. Consequently, these facilities are eligible for certain tax benefits for the first several years in which they generate taxable income. If we fail to obtain additional grants, or if 10 our tax benefits are significantly reduced, our financial condition could suffer. WE MUST COMPLY WITH To receive grants and tax benefits, we must CONDITIONS TO RECEIVE comply with a number of conditions. If we GRANTS AND TAX BENEFITS. fail to comply with these conditions, the grants and tax benefits that we receive could be partially or fully canceled and we would be forced to refund the amount of the canceled benefits received, adjusted for inflation and interest. We believe that we have operated and will continue to operate in compliance with the required conditions, although we cannot be sure. We further believe that the likelihood is remote that we will be required to refund grants or tax benefits that we receive from the Israeli government, the Marketing Fund, and under our "Approved Enterprise" status. WE HAVE EXPERIENCED In the past we experienced financial FINANCIAL DIFFICULTIES IN THE difficulties. As of December 31, 1996, we PAST. have written off $3.8 million due to outstanding debts owed to us by Moshe Nur, our previous chairman of our board of directors and former major shareholder, and companies controlled by Mr. Nur. These companies are now in various insolvency proceedings. The written off debts resulted, in part, from ineffective controls, which failed to prevent unauthorized transactions and the misappropriation of funds. These difficulties resulted in losses of $10.1 million in the year ended December 31, 1996, and reduced our shareholders' equity to approximately $1.8 million at such date. In April 1997, Moshe Nur transferred control of the Company and subsequently resigned from our board of directors. We have reached a settlement agreement resolving all outstanding material claims related to the insolvency proceedings of Moshe Nur and his companies. Despite this settlement, in the future we may be exposed to claims arising from Moshe Nur's actions. Liabilities arising from any such claims and the cost to defend our company may be substantial. WE HAVE CHANGED OUR In April 1997, when Moshe Nur transferred LEADERSHIP AND HAVE LIMITED control of Nur Macroprinters, we replaced MANAGEMENT RESOURCES TO most of the members of our board of MANAGE FUTURE GROWTH. directors. We also made several management changes at such time and changed our Chief Financial Officer. Our recent growth has placed, and will continue to place, a significant strain on our management team, facilities, and other resources. In order to support our growth, our new leadership adopted financial controls and reporting systems and expanded our management, facilities, financial, and other resources. To avoid any negative effects on our business, we 11 must successfully implement financial controls, expand our manufacturing, sales, marketing, and service organizations, and update our accounting, operational, and management information systems. Failure to do so effectively could have a material adverse effect on our business and financial results. OUR OPERATING RESULTS TEND TO Our revenues may vary significantly from FLUCTUATE. quarter to quarter as a result of, among other factors, the timing of new product announcements and releases by our competitors and us. We do not typically have a material backlog of orders at the beginning of each quarter. We generally ship and record a significant portion of our revenues for orders placed within the same quarter, primarily in the last month of the quarter. We may not learn of shortfalls in sales until late in, or shortly after the end of, such fiscal period. As a result, our quarterly earnings may be subject to significant variations. WE HAVE AN UNEVEN We have an uneven history of financial HISTORY OF FINANCIAL results. We incurred an operating loss of RESULTS. approximately $0.32 million in 1991 and $0.22 million in 1992. In 1993 we made an operating profit for the first time, earning approximately $0.04 million, which increased to approximately $0.92 million in 1994, and to $1.49 million in 1995. In 1996 we incurred an operating loss of $9.2 million. In 1997 we achieved an operating income of $0.91 million, in 1998 had an operating income of $2.38 million and during the first nine months of 1999 had an operating income of $5.84 million. We cannot assure profitability in the future. IMPORTANT FACILITIES AND Our most important facilities and operations OPERATIONS ARE LOCATED IN and many of our subcontractors are located ISRAEL. entirely in the State of Israel. Political and military conditions in Israel directly affect operations. Since Israel was established in 1948, a state of hostility has existed, varying in degree and intensity, between Israel and certain Arab countries. Although Israel has entered into agreements with some of these countries, the Palestine Liberation Organization and the Palestinian Authority, and the feuding parties have signed various declarations in hopes of resolving some of the hostilities, we cannot predict the future of the volatile Middle East and of Israel in particular. To date, Israel has not entered into a peace treaty with Lebanon or Syria, with whom Israel shares its northern borders, or with certain other Arab countries with whom a state of hostility exists. Any major hostilities involving Israel, the Palestinian Authority, or Arab countries in the Middle East could have a serious negative impact on our business 12 operations. SOME OF OUR OFFICERS AND Furthermore, all nonexempt male adult EMPLOYEES ARE ON citizens of Israel, including some of our MILITARY RESERVE. officers and employees, are obligated to perform military reserve duty and are subject to being called for active duty under emergency circumstances. While we have operated effectively under these conditions in the past, we cannot predict the full impact of such conditions on us in the future, particularly if emergency circumstances occur. WE ARE SENSITIVE TO ECONOMIC Inflation in Israel and devaluation of the CONDITIONS IN ISRAEL. NIS have an impact on our financial results. Although Israel has substantially reduced the rates of inflation and devaluation in recent years, they are still relatively high and we could experience losses due to inflation or devaluation. If inflation rates in Israel increase again and hurt Israel's economy as a whole, our operations and financial condition could be negatively impacted. WE DO NOT KNOW THE Israeli law limits foreign currency IMPACT OF RECENT POLICY transactions and transactions between CHANGES ON FOREIGN Israeli and non-Israeli residents. The CURRENCY TRANSACTIONS. Controller of Foreign Exchange at the Bank of Israel, through "general" and "special" permits, may regulate or waive these limitations. Until recently, transactions in foreign currency were strictly regulated. In May 1998, the Bank of Israel liberalized its foreign currency regulations by issuing a new "general permit" pursuant to which foreign currency transactions are generally permitted, although certain restrictions still apply. Restricted transactions include foreign currency transactions by institutional investors, including futures contracts by foreign residents for periods of more than one month, and investments outside of Israel by pension funds and insurers. Under the new general permit, all foreign currency transactions must be reported to the Bank of Israel. We cannot currently assess what impact, if any, this liberalization will have on us. We also cannot predict its impact on the value of the NIS compared to the dollar and the corresponding effect on our financial statements. SERVICE OF PROCESS AND We are organized under the laws of Israel ENFORCEMENT OF JUDGMENTS. and our headquarters are in Israel. Certain of our officers and directors reside outside of the United States. Therefore, you may not be able to enforce any judgment obtained in the U.S. against us or any of such persons. You may not be able to enforce civil actions under U.S. securities laws if you file a lawsuit in Israel. However, we have been advised by our 13 Israeli counsel that subject to certain limitations, Israeli courts may enforce a final judgment of an U.S. court for liquidated amounts in civil matters after a hearing in Israel. If a foreign judgment is enforced by an Israeli court, it will be payable in Israeli currency. WE ARE PREPARING FOR THE Many computer systems and software products YEAR 2000. will not function properly commencing in the year 2000 due to a once-common programming standard that represents years using only the last two-digits. This is known as the Year 2000 problem. We have finalized the process of upgrading our computers to avoid any material complications due to the Year 2000 problem. As part of this program, we identified those systems and applications that require modification, redevelopment or replacement. We believe that we are Year 2000 compliant with respect to our internal systems and our current products. Providing upgrades and changes to our older products could cost up to $15,000 in the aggregate. If we do not attain compliance for our products in time to avoid complications, we have a contingency plan in place that we believe will protect our customers. We do not believe that the failure of our vendors or other third-party providers' systems to be Year 2000 compliant will have a materially negative impact on our business. 14 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus, and the other reports we have filed from time to time with the Securities and Exchange Commission, contain forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements deal with our current plans, intentions, beliefs and expectations and statements of future economic performance. Statements containing terms like "believes," "does not believe," "plans," "expects," "intends," "estimates," "anticipates," and other phrases of similar meaning are considered to imply uncertainty and are forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties that may cause our actual results in future periods to differ materially from what is currently anticipated. We make cautionary statements throughout this prospectus, including under "Risk Factors." You should read these cautionary statements as being applicable to all related forward-looking statements wherever they appear in this prospectus, the materials referred to in this prospectus, the materials incorporated by reference into this prospectus, and our press releases. We cannot guarantee our future results, levels of activity, performance or achievements. Neither we nor any other person assumes responsibility for the accuracy and completeness of these statements. We are under no duty to update any of the forward-looking statements after the date of this prospectus. USE OF PROCEEDS We will not receive any of the proceeds from the sale of ordinary shares by the selling security holders. 15 SELLING SECURITY HOLDERS Our ordinary shares to which this prospectus relates are being registered for resales by the selling security holders. The selling security holders may resell all, a portion or none of such ordinary shares from time to time. The table below sets forth with respect to each selling security holder, based upon information available to us as of December 6, 1999, the number of ordinary shares beneficially owned, the number of ordinary shares registered by this prospectus and the number and percent of outstanding ordinary shares that will be owned after the sale of the registered ordinary shares assuming the sale of all of the registered ordinary shares.
SHARES BENEFICIALLY SHARES BENEFICIALLY OWNED BEFORE OWNED AFTER THE OFFERING (1) (2) THE OFFERING(1) (3) ---------------------- --------------------- SHARES PERCENT SHARES OFFERED SHARES PERCENT ------------------------------------------------------------------------------- Purjes, Dan(4) 4,509,263(5) 36.6% 724,119(6) 270,000 2.1% WBM I LLC(7) 2,918,780 25.1 2,918,780 0 * Isal Amlat Investment (1993) Ltd. 715,700 6.1 675,000(6) 40,700 * J. Partners, L.P.(8) 451,200 3.9 451,200 0 * Shachar, Erez(9) 326,668 2.7 50,000 276,668 2.2 Ben-Porat, Yoram(10) 253,108 2.2 228,442 24,666 * Carafe Investment Co. Ltd. 250,000 2.2 250,000 0 * Omotsu Holdings Limited 250,000 2.2 250,000 0 * Fuchs, David(11) 206,500 1.7 65,000(6) 141,500 1.1 Purjes, Esther 200,000 1.7 200,000 0 * Horizon Fund Ltd. 171,240 1.5 171,240 0 * Clalit Capital Fund L.P. 150,000 1.3 150,000 0 * Trefoil Israel Investments, L.L.C. 150,000 1.3 150,000 0 * Weisman, Scott(12) 131,169 1.1 31,169(6) 100,000 * Owesh, Tajunnisa 125,000 1.1 125,000 0 * Hussey, Robert F.(13) 90,000 * 70,000 20,000 * Margolin, Michael & Shoshana 85,664 * 85,664 0 * Gross, Joy 75,000 * 75,000 0 * Dovrat & Co. Ltd. 75,000 * 75,000(6) 0 * Zevi, Ron(14) 69,731 * 69,731 0 * Noy, Amir(15) 65,000 * 10,000 55,000 * Sheib, Fredda 65,000 * 65,000 0 * Gelman, Gary 60,000 * 60,000 0 * JLR Profit Sharing Plan C FBO Dan Purjes(4) 55,000 * 55,000 0 * Davis, Peter S. 50,000 * 50,000 0 * DeGennaro, Ruth B. 50,000 * 50,000 0 * Duggal, Baldev 50,000 * 50,000 0 * Eastlane Corporation Ltd. 50,000 * 50,000 0 * First Comet Corporation 50,000 * 50,000 0 * Holistica International Ltd. 50,000 * 50,000 0 * Ornstein, Richard 50,000 * 50,000 0 *
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SHARES BENEFICIALLY SHARES BENEFICIALLY OWNED BEFORE OWNED AFTER THE OFFERING (1) (2) THE OFFERING(1) (3) ---------------------- --------------------- SHARES PERCENT SHARES OFFERED SHARES PERCENT ------------------------------------------------------------------------------- Josephthal & Co. Inc.(16) 35,664 * 35,664 0 * Israeli, Eyal(17) 33,334 * 10,000 23,334 * Grotenstein, Alan 30,000 * 30,000 0 * Fitzgerald, Paul 29,546 * 29,546(6) 0 * Rice, Lawrence R. 27,516 * 27,516(6) 0 * Sheib, James C. 26,000 * 25,000 1,000 * Berman, Michael 25,000 * 25,000 0 * Birn, Dora 25,000 * 25,000 0 * Dorigol, S.A. 25,000 * 25,000 0 * Heymann, Jerry 25,000 * 25,000 0 * Padan, Uzi 25,000 * 25,000 0 * Purjes, Esther IRA Delaware Charter 25,000 * 25,000 0 * Trokel, Michael 25,000 * 25,000 0 * Vitullo, Mary & Purjes, Dan(4)(18) 25,000 * 25,000 0 * Wagner, George P. Jr. 25,000 * 25,000 0 * Dovrat, Shrem Skies Fund Ltd. 22,830 * 22,830 0 * Dovrat, Shrem Rainbow Fund, Ltd. 20,930 * 20,930 0 * Roden, Charles 20,180 * 20,180(6) 0 * Ben-Moshe, Boaz & Susan 20,000 * 20,000 0 * Card, H.W. III 20,000 * 20,000 0 * Card, H.W., Jr. & Card, Garrison Good 20,000 * 20,000 0 * Darbyshire, Christopher 20,000 * 20,000 0 * Gell, Brian D. 20,000 * 20,000 0 * Murphy, William F. 20,000 * 20,000 0 * Ordinance Capital, L.P. 20,000 * 20,000 0 * Stein, Raymond 20,000 * 20,000 0 * Trokel, Stephen L. 20,000 * 20,000 0 * Wiener, David M. 20,000 * 20,000 0 * Chenes, Charles A. 15,000 * 15,000 0 * JLR Profit Sharing Plan C FBO Frank Garriton 15,000 * 15,000 0 * Purjes, Dan, Custodian for UGMA Lianna * 15,000 0 Purjes(19) 15,000 * Zamir & Barak 15,000 * 15,000 0 * Goodfriend, David 14,500 * 14,500 0 * Bailey-Beck, Adriane & Purjes, Dan(4)(20) 12,500 * 12,500 0 * Chnapko, Michelle 12,500 * 12,500 0 * Friedland, Stephen 12,500 * 12,500 0 * Jacob, Varughese & Leela 12,500 * 12,500 0 * Khan, Khurshid 12,500 * 12,500 0 * The Shaar Fund Ltd. 12,500 * 12,500 0 * Cohen, Morris 10,000 * 10,000 0 * Colbert, James IRA 10,000 * 10,000 0 * Handa, Sameer 10,000 * 10,000 0 * Lowe, James F. 10,000 * 10,000 0 *
17
SHARES BENEFICIALLY SHARES BENEFICIALLY OWNED BEFORE OWNED AFTER THE OFFERING (1) (2) THE OFFERING(1) (3) ---------------------- --------------------- SHARES PERCENT SHARES OFFERED SHARES PERCENT ------------------------------------------------------------------------------- Mahtani, Gordan G. 10,000 * 10,000 0 * Morgan, John R. 10,000 * 10,000 0 * Naz, Mohammad & Rasheeda 10,000 * 10,000 0 * Patel, Chandu & Kala 10,000 * 10,000 0 * Rao, Sanjeeva 10,000 * 10,000 0 * Weisner, Gary 10,000 * 10,000 0 * Palma, Susan 9,500 * 9,500 0 * Balk, Matthew 8,843 * 8,843(6) 0 * Miakinkoff, Regina 8,000 * 8,000 0 * Casajuana, Simon(21) 8,000 * 5,000 0 * Sheib, Peter, Estate of 7,549 * 7,549(6) 0 * HSB Capital 7,500 * 7,500 0 * JLR Profit Sharing Plan C FBO Ursula D. Mell 7,500 * 7,500 0 * Mayer, Charles 7,000 * 7,000 0 * Porush, Naftali & Elaine 7,000 * 7,000 0 * Porush, Naomi 7,000 * 7,000 0 * Sectal Capital Markets, Ltd. 6,400 * 6,400(6) 0 * Antoniades, Adam 5,000 * 5,000 0 * Bear Stearns Securities Corp. FBO Cindy 5,000 * 5,000 0 * Cerruto IRA Bear Stearns Securities Corp. FBO James Welton 5,000 * 5,000 0 * IRA Bear Stearns Securities Corp. FBO James Zogby 5,000 * 5,000 0 * IRA Block Reed, Annmary 5,000 * 5,000 0 * Continental Stock Transfer Corp. 5,000 * 5,000 0 * Dransfield, Mark 5,000 * 5,000 0 * Hawryluk, James B. 5,000 * 5,000 0 * JLR Profit Sharing Plan C FBO Anthony Guzzi 5,000 * 5,000 0 * JLR Profit Sharing Plan C FBO Ralph DeMarco 5,000 * 5,000 0 * JLR Profit Sharing Plan C FBO Raymond A. Mando 5,000 * 5,000 0 * JLR Profit Sharing Plan C FBO Salvatore Agosta 5,000 * 5,000 0 * Menikdiwela, Gayathri 5,000 * 5,000 0 * Relyea, William 5,000 * 5,000(6) 0 * Shaw, Larry & Winstead, Dennis 5,000 * 5,000 0 * Sheib, Fredda Custodian for Benjamin Kohn 5,000 * 5,000 0 * Volpe, Michael 5,000 * 5,000 0 * Larkin, Sherwood P. 4,435 * 4,435(6) 0 * JLR Profit Sharing Plan C FBO Robert N. Martz 3,500 * 3,500 0 *
18
SHARES BENEFICIALLY SHARES BENEFICIALLY OWNED BEFORE OWNED AFTER THE OFFERING (1) (2) THE OFFERING(1) (3) ---------------------- --------------------- SHARES PERCENT SHARES OFFERED SHARES PERCENT ------------------------------------------------------------------------------- Arvai, Emilia M. 3,000 * 3,000 0 * Bailey-Beck, Adriane IRA 3,000 * 3,000 0 * Bear Stearns Securities Corp. FBO Robert 3,000 * 3,000 0 * Housner IRA Futernik, Alexander 3,000 * 3,000 0 * JLR Profit Sharing Plan C FBO Kenneth P. 3,000 * 3,000 0 * Cerruto Mench, James Frederick & Dorothy 3,000 * 3,000 0 * Messing, Andrew 3,000 * 3,000 0 * Pallen, Glenn F. IRA Rollover 3,000 * 3,000 0 * Loew, Michael 2,996 * 2,996(6) 0 * Caparelli, Richard F. 2,000 * 2,000 0 * Chapman, Sandra L. 2,000 * 2,000 0 * Sugarhouse Follies Inc.(22) 2,000 * 2,000 0 * Satloff, Averell W. 1,528 * 1,528(6) 0 * Zimmerman, Bernard 1,500 * 1,500 0 * Malone, Ena 500 * 500 0 * White, Laurence 330 * 330 0 * Borgman, Lawrence 156 * 156(6) 0 * Burke, Dennis 156 * 156(6) 0 * Kowitski, Steven 156 * 156(6) 0 * Guzzi, Anthony 67 * 68(6) 0 * Mando, Raymond 45 * 45(6) 0 *
* Less than 1% (1) As used in this table, "beneficial ownership" means the sole or shared voting and investment power of ordinary shares. Unless otherwise indicated, each selling security holder listed below has sole voting and investment power with respect to the ordinary shares indicated as beneficially owned thereby. A person is deemed to have "beneficial ownership" of any ordinary shares that such person has a right to acquire within sixty days of the date of this prospectus. In accordance with Rule 13d-3 of the Exchange Act, any ordinary shares that any selling security holder has the right to acquire within sixty days of the date of this prospectus are deemed to be outstanding for the purpose of computing the beneficial ownership percentage of such selling security holder, but have not been deemed outstanding for the purpose of computing the percentage for any other selling security holder. (2) These ordinary shares include up to an aggregate of 828,168 ordinary shares which may be acquired by the selling security holders within sixty days of the date of this prospectus upon the exercise of options granted under our stock option plans and up to an aggregate of 705,000 ordinary shares which may be acquired by the selling security holders within sixty days of the date of this prospectus upon the exercise of warrants granted by us. (3) With respect to the selling security holders, it has been assumed that all ordinary shares so offered will be sold. These ordinary shares include up to an aggregate of 828,168 ordinary shares which may be acquired by the selling security holders within sixty days of the date of this prospectus upon the exercise of options granted under our stock option plans. (4) Dan Purjes is the chairman of our board of directors. 19 (5) These ordinary shares include (i) 2,918,780 ordinary shares held by WBM I LLC, a Delaware limited liability company of which Dan Purjes owns all of the equity interests, and of which ordinary shares Dan Purjes has sole voting and investment power, (ii) 451,200 ordinary shares held by J. Partners, L.P., a Delaware partnership of which Dan Purjes owns 100% of the equity of the general partner and is also a limited partner, and of which ordinary shares J. Partners, L.P. and Dan Purjes share voting and investment power, (iii) 55,000 ordinary shares held by JLR Profit Sharing Plan C FBO Dan Purjes, his profit sharing plan, (iv) 35,664 ordinary shares held by Josephthal & Co. Inc., an entity of which he is the chairman of the board of directors, chief executive officer and indirect controlling shareholder, and of which ordinary shares Josephthal & Co. Inc. and Dan Purjes share voting and investment power, (v) 25,000 ordinary shares held in joint tenancy by Dan Purjes and Mary Vitullo, and of which ordinary shares Mary Vitullo and Dan Purjes share voting and investment power, (vi) 15,000 ordinary shares held by Dan Purjes as custodian for UGMA Lianna Purjes, an entity which holds the shares for the benefit of Lianna Purjes, the minor daughter of Dan Purjes, of which ordinary shares Dan Purjes has sole voting and investment power, (vii) 12,500 ordinary shares held in joint tenancy by Dan Purjes and Adriane Bailey-Beck, and of which ordinary shares and Adriane Bailey-Beck and Dan Purjes share voting and investment power, and (viii) 2,000 shares held by Sugarhouse Follies Inc., a Vermont company of which Dan Purjes is the president and sole shareholder and director, and of which ordinary shares Dan Purjes has sole voting and investment power. (6) Includes ordinary shares underlying warrants. (7) WBM I LLC is a Delaware limited liability company of which Dan Purjes owns all of the equity interests. Dan Purjes has sole voting and investment power with respect to these ordinary shares. (8) J. Partners, L.P. is a Delaware partnership of which Dan Purjes owns 100% of equity of the general partner and is also a limited partner. J. Partners, L.P. and Dan Purjes share voting and investment power with respect to these ordinary shares. (9) Erez Shachar is our president, chief executive officer and one of our directors. (10) Yoram Ben-Porat is one of our directors, the president and a director of Nur Media Solutions S.A., a subsidiary of ours, previously named Nur International S.A., and was the president and a director of Nur Advanced Technologies (Europe) S.A., a subsidiary of ours, until 1998. (11) David Fuchs is a former director of ours and acted as our chief financial officer from April through October 1997. (12) Scott Weisman is a former director of ours. (13) One of our directors. (14) Ron Zevi is a brother-in-law of Yoram Ben-Porat, who is one of our directors, the president and a director of Nur Media Solutions S.A., a subsidiary of ours, previously named Nur International S.A., and was the president and a director of Nur Advanced Technologies (Europe) S.A., a subsidiary of ours, until 1998. (15) Amir Noy is the managing director of Nur Asia Pacific Ltd., as subsidiary of ours, and was our vice president of marketing until March, 1999. (16) Dan Purjes is the chairman of the board of directors, chief executive officer and indirect controlling shareholder of Josephthal & Co. Inc. Josephthal & Co. Inc. and Dan Purjes share voting and investment power with respect to these ordinary shares. (17) Eyal Israeli is our vice president of operations. (18) Mary Vitullo and Dan Purjes share voting and investment power with respect to these ordinary shares. (19) Lianna Purjes is the minor daughter of Dan Purjes. Mr. Purjes is the custodian for and has sole voting and investment power with respect to these ordinary shares. (20) Adriane Bailey-Beck and Dan Purjes share voting and investment power with respect to these ordinary shares. (21) One of our employees. 20 (22) Sugarhouse Follies Inc. is a Vermont company of which Dan Purjes is the president and sole director and shareholder. Dan Purjes has sole voting and investment power with respect to these ordinary shares. The information provided in the table above with respect to the selling security holders has been obtained from such selling security holders. Except as otherwise disclosed above or in documents incorporated herein by reference, the selling security holders have not within the past three years had any position, office or other material relationship with our company. Because the selling security holders may sell all or some portion of the ordinary shares beneficially owned by them, only an estimate (assuming the selling security holders sells all of the shares offered hereby) can be given as to the number of ordinary shares that will be beneficially owned by the selling security holders after this offering. In addition, the selling security holders may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time or from time to time since the dates on which they provided the information regarding the ordinary shares beneficially owned by them, all or a portion of the ordinary shares beneficially owned by them in transactions exempt from the registration requirements of the Securities Act. 21 PLAN OF DISTRIBUTION This prospectus covers the sale of ordinary shares by the selling security holders. As used herein, "selling security holders" include donees, pledgees, transferees or other successors in interest selling shares received from a selling security holder after the date of this prospectus as a gift, pledge, partnership distribution or other non-sale related transfer. Any distribution of any such securities by the selling security holders in interest may be effected from time to time in one or more of the following transactions: - to underwriters who will acquire securities for their own account and resell them in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale (any public offering price and any discount or concessions allowed or reallowed or paid to dealers may change from time to time); - through brokers, acting as principal or agent, in transactions (which may involve block transactions) on the Nasdaq National Market or on such other market or exchange on which the securities are then listed, in special offerings, exchange distributions pursuant to the rules of the applicable exchanges or in the over-the-counter market or otherwise, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices or at fixed prices; - directly or through brokers or agents in private sales at negotiated prices; - through put or call options transactions relating to the ordinary shares, or through short sales of ordinary shares at market prices prevailing at the time of sale or at negotiated prices; or - by any other legally available means. Josepthal & Co., Inc., which may participate in the distribution of the securities, may be deemed to be an affiliate of Nur Macroprinters by virtue of the fact that Dan Purjes, our Chairman and the Chairman of Josephthal, owns over 10% of each of Nur Macroprinters and Josephthal. Accordingly, the offering is being conducted in accordance with Rule 2720 of the National Association of Securities Dealers, Inc.'s Conduct Rules. We will not receive any proceeds from the sale of the ordinary shares. The aggregate proceeds to the selling security holders from the securities offered hereby will be the offering price less applicable commissions or discounts, if any. We do not know if the selling security holders will sell any of the securities offered hereby. The selling security holders and such underwriters, brokers, dealers or agents, upon effecting a sale of securities, may be considered "underwriters" as that term is defined in the Securities Act. The selling security holders will be subject to the prospectus delivery requirements because the selling security holders may be deemed to be "underwriters" within meaning of Section 2(a)(11) of the Securities Act. Sales effected through agents, brokers or dealers will ordinarily involve payment of customary brokerage commissions although some brokers or dealers may purchase such securities as agents for others or as principals for their own account (compensation as to a particular broker-dealer might be in excess of customary commissions). The selling security holders will pay any sales commissions or similar selling 22 expenses applicable to the sale of ordinary shares. A portion of any proceeds of sales and discounts, commissions or other sellers' compensation may be deemed to be underwriting compensation for purposes of the Securities Act. Selling security holders also may resell all or a portion of the ordinary shares in open market transactions in reliance upon Rule 144 under the Securities Act, provided they meet the criteria and conform to the requirements of such rule. Pursuant to applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the securities offered hereby may not simultaneously engage in market activities for the ordinary shares for a period of five business days prior to the commencement of such distribution. In addition, each selling security holder and any other person who participates in a distribution of the securities will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which provisions may limit the timing of purchases and may affect the marketability of the securities and the ability of any person to engage in market activities for the ordinary shares. At the time a particular offering of securities is made, to the extent required, a prospectus supplement will be distributed which will set forth the number of securities being offered and the terms of the offering, including the purchase price or the public offering price, the name or names of any underwriters, dealers or agents, the purchase price paid by any underwriters for securities purchased from the selling security holders, any discounts, commissions and other items constituting compensation from the selling security holders and any discounts, commissions or concessions allowed or reallowed or paid to dealers. In addition, we will file a supplement to this prospectus upon a selling security holder notifying us that a donee, pledgee, transferee or other successor-in-interest intends to sell more than 500 shares. In order to comply with the securities laws of certain states, if applicable, the securities will be sold in such jurisdictions, if required, only through registered or licensed brokers or dealers. In addition, in certain states the securities may not be sold unless the securities have been registered or qualified for sale in such state or an exemption from registration or qualification is available and the conditions of such exemption have been satisfied. We have agreed that we will bear all costs, expenses and fees in connection with the registration or qualification of the ordinary shares under federal and state securities laws. We and each selling security holder have agreed to indemnify each other and certain other persons against certain liabilities in connection with the offering of the securities, including liabilities arising under the Securities Act. LEGAL MATTERS The validity of the ordinary shares offered hereby will be passed upon for Nur Macroprinters by Shimonov Barnea & Co. EXPERTS 23 The consolidated financial statements of us and our subsidiaries as of December 31, 1997 and 1998 and for each of the three years in the period ended December 31, 1998 in this prospectus from our Annual Report on Form 20-F have been so incorporated by reference in reliance on the report of Kost Forer & Gabbay (a member of Ernst & Young International), independent accountants, and Willy Knyrim, independent accountant, which reports are incorporated by reference, given on the authority of said firm as experts in auditing and accounting. SEC POSITION ON INDEMNIFICATION FOR SECURITES ACT LIABILITIES Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by one of our directors, officers or controlling persons in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. 24 =============================================================================== No dealer, salesperson or other person is authorized to give any information or represent anything not contained in this prospectus. This prospectus does not offer to sell or buy any shares in any jurisdiction where it is unlawful. The information in this prospectus is current only as of its date. 8,463,173 NUR MACROPRINTERS LTD. ORDINARY SHARES --------------- PROSPECTUS --------------- December __, 1999 =============================================================================== PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION The following are the estimated expenses expected to be incurred by Nur Macroprinters Ltd. (on behalf of itself and the selling security holders) in connection with this offering.
NATURE OF FEES AND EXPENSES AMOUNT TO BE PAID --------------------------- ----------------- SEC Registration Fee.......................... $ 5,672.31 Legal Fees, Accounting Fees and Expenses...... 35,000 Printing Expenses............................. 10,000 Miscellaneous................................. 10,000 ---------- Total................................ $60,672.31 ==========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Pursuant to Nur Macroprinters's Articles of Association, Nur Macroprinters may indemnify its Office Holders, as defined in the Israeli Companies Ordinance (New Version), 1983 (the "Israeli Companies Ordinance") for (a) any monetary obligation imposed upon them for the benefit of a third party by a judgment, including a settlement approved by Nur Macroprinters or an arbitration decision certified by court, as a result of an act or omission of such person in his capacity as an Office Holder and (b) reasonable litigation expenses, including legal fees, incurred by such Office Holder or which he is obligated to pay, in proceedings brought against him by or on behalf of Nur Macroprinters or by others, or in connection with criminal proceedings in which he was acquitted, in each case relating to acts or omissions of such person in his capacity of Office Holder of Nur Macroprinters. The Israeli Companies Ordinance defines "Office Holder" to include directors, managing director, general manager, chief executive officer, executive vice president, vice president, other manager directly subordinate to the managing director and any person assuming the responsibilities of the foregoing positions without regard to such person's title. In addition, pursuant to the Israeli Companies Ordinance, indemnification of, and procurement of insurance coverage for, an Office Holder of Nur Macroprinters is permitted if it is permitted by Nur Macroprinters's Articles of Association and if it is approved by Nur Macroprinters's Audit Committee and Board of Directors. Nur Macroprinters's Articles of Association permit such indemnification and procurement of insurance coverage. In certain circumstances, the Israeli Companies Ordinance also requires approval of such indemnification and insurance by Nur Macroprinters's shareholders. The approval of indemnification agreements and procurement of insurance for all of Nur Macroprinters's directors will require shareholder approval. In addition, the approval of indemnification and procurement of insurance for certain directors who may be deemed to hold 25% or more of the share capital of Nur Macroprinters requires the consent of disinterested shareholders subject and pursuant to the Israeli Companies Ordinance. II-1 Nur Macroprinters has purchased directors' and officers' liability insurance policy insuring its Office Holders with respect to those matters permitted by the Israeli Companies Ordinance. ITEM 16. EXHIBITS.
EXHIBIT NUMBER NAME -------- ---- 3.1 Memorandum of Association of the Registrant, in Hebrew with a translation to English. (1) 3.2 Amended Articles of Association of the Registrant. 3.3 Certificate of Name Change. (2) 4.1 Specimen Certificate for Ordinary Shares. (1) 4.2 Representative's Warrant Agreement dated October 12, 1995. (1) 4.3 Form of Representative's Warrant Certificate. (1) 4.4 Forms of Placement Agent's Warrant Agreement and Certificate. (3) 4.5 Forms of Qualified Independent Underwriter's Warrant Agreement and Certificate. (3) 4.6 Warrant Agreement among Nur Macroprinters Ltd., Dovrat & Co. Ltd. and Isal Amlat Investment (1993) Ltd. and Warrant Certificate 5.1 Opinion of Shimonov Barnea & Co. 10.1 1995 Stock Option / Stock Purchase Plan. (1) 10.2 Amendment to the 1995 Stock Option / Stock Purchase Plan. (3) 10.3 1997 Stock Option Plan. (4) 10.4 1998 Non-Employee Director Share Option Plan. (5) 10.5 Lease Agreement between the Registrant and Mr. Moshe Nur dated October 4, 1993, as amended on May 29, 1995, in Hebrew with a translation to English. (1) 10.6 Lease Agreement for office space in Brussels, Belgium between Nivellease, S.A. and the Registrant dated November 25, 1996. (3) 10.7 Lease Agreement for office space in Newton Centre, Massachusetts between WHTR Real Estate Limited Partnership and the Registrant dated July 10, 1998. (3)
II-2 10.8 Qualified Independent Underwriting Agreement. (3) 10.9 Distribution Agreement between Imaje S.A. and the Registrant dated June 26, 1995. (1) 10.10 Settlement Agreements relating to Moshe Nur and his affiliated companies. (3) 10.16 Bank Hapoalin revolving loan agreement. (3, 6) 10.17 Agreement between I.T.S. Machinery Development Ltd. and the Registrant dated February 10, 1997. (3) 10.18 Form of confidentiality agreement. (3) 10.19 Agreement dated September 13, 1998 between "Meital" Electronic Technology Ltd. and Markowitz Yaakov and NUR Macroprinters Ltd. (3) 21 List of Subsidiaries of Nur Macroprinters. 23.1 Consent of Krost Forer & Gabbay. 23.2 Consent of Willy Knyrim. 23.3 Consent of Shimonov Barnea & Co. (included in Exhibit 5.1). 24.1 Power of Attorney (included on signature page).
1/ Previously filed with the Commission on July 25, 1995 as part of Nur Macroprinters' Registration Statement (File No. 33-93160) on Form F-1 and incorporated by reference herein. 2/ Previously filed with the Commission on January 7, 1998 as part of Nur Macroprinters' Report on Form 6-K and incorporated by reference herein. 3/ Previously filed with the Commission on February 23, 1999 a part of Nur Macroprinters' Amendment No. 1 to Form F-1 on Form F-1/A (File No. 333-66103) and incorporated by reference herein. 4/ Previously filed with Nur Macroprinters' Form 20-F for the year ended December 31, 1997 and incorporated by reference herein. 5/ Previously filed with Nur Macroprinters' Form 6-K dated November 13, 1998 and incorporated by reference herein. 6/ Filed in summary form. Original filed in paper format pursuant to Form SE. ITEM 17. UNDERTAKINGS (a) The undersigned Nur Macroprinters hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: II-3 (i) to include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set for the in the "Calculation of Registration Fee" table in the effective registration statement; (iii) to include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in the registration statement; PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or provided to the Commission by Nur Macroprinters pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this registration statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) To file a post-effective amendment to the registration statement to include any financial statements required by Rule 3-19 of Regulation S-X at the start of any delayed offering or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Securities Act need not be furnished, provided, that Nur Macroprinters includes in the prospectus, by means of a post-effective amendment, financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in the prospectus is at least as current as the date of those financial statements. Notwithstanding the foregoing, a post-effective amendment need not be filed to include financial statements and information required by Section 10(a)(3) of the Securities Act or Rule 3-19 of Regulation S-X if such financial statements and information are contained in periodic reports filed with or furnished to the commission by Nur Macroprinters pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this registration statement. (b) The undersigned Nur Macroprinters hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of Nur Macroprinters's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of Nur Macroprinters pursuant to the foregoing provisions, or otherwise, Nur Macroprinters has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities II-4 (other than the payment by Nur Macroprinters of expenses incurred or paid by a director, officer or controlling person of Nur Macroprinters in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, Nur Macroprinters will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-5 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, Nur Macroprinters certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in The State of Israel, on November 18, 1999. NUR MACROPRINTERS LTD. By: /s/ Erez Shachar ------------------------------------- Erez Shachar President and Chief Executive Officer KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Erez Shachar his or her true and lawful agent, proxy and attorney-in-fact, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to (i) act on, sign and file with the Securities and Exchange Commission any and all amendments (including post-effective amendments) to this Registration Statement together with all schedules and exhibits thereto,(ii) act on, sign and file with the Securities and Exchange Commission any registration statement relating to this Offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended, (iii) act on, sign and file with the Securities and Exchange Commission any exhibits to such registration statement or pre-effective or post-effective amendments, (iv) act on, sign and file such certificates, instruments, agreements and other documents as may be necessary or appropriate in connection there with, (v) act on and file any supplement to any prospectus included in this registration statement or any such amendment and (vi) take any and all actions which may be necessary or appropriate in connection therewith, granting unto such agents, proxies and attorneys-in-fact, and each of them, full power and authority to do and perform each and every act and thing necessary or appropriate to be done (including any prospectus included in this registration statement), as fully for all intents and purposes as he or she might or could do in person, hereby approving, ratifying and confirming all that such agents, proxies and attorneys-in-fact, any of them or any of his, her or their substitute or substitutes may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.
SIGNATURE TITLE OF CAPACITIES DATE --------- ------------------- ---- /s/ Dan Purjes Chairman of the Board of Directors November 18, 1999 - ------------------------------- Dan Purjes /s/ Erez Shachar President and Chief Executive Officer November 18, 1999 - ------------------------------- and Director Erez Shachar /s/ Hilel Kremer Chief Financial Officer and Secretary November 18, 1999 - ------------------------------- Hilel Kremer /s/ Yoram Ben-Porat Director November 18, 1998 - ------------------------------- Yoram Ben-Porat /s/ Robert L. Berenson Director November 18, 1999 - ------------------------------- Robert L. Berenson /s/ Robert F. Hussey Director November 18, 1999 - ------------------------------- Robert F. Hussey /s/ Hugo Chaufon Director November 18, 1999 - ------------------------------- Hugo Chaufon
II-6 EXHIBIT INDEX
EXHIBIT NUMBER NAME 3.1 Memorandum of Association of the Registrant, in Hebrew with a translation to English. (1) 3.2 Amended Articles of Association of the Registrant. 3.3 Certificate of Name Change. (2) 4.1 Specimen Certificate for Ordinary Shares. (1) 4.2 Representative's Warrant Agreement dated October 12, 1995. (1) 4.3 Form of Representative's Warrant Certificate. (1) 4.4 Forms of Placement Agent's Warrant Agreement and Certificate. (3) 4.5 Forms of Qualified Independent Underwriter's Warrant Agreement and Certificate. (3) 4.6 Warrant Agreement among Nur Macroprinters Ltd., Dovrat & Co. Ltd. and Isal Amlat Investment (1993) Ltd. and Warrant Certificate 5.1 Opinion of Shimonov Barnea & Co. 10.1 1995 Stock Option / Stock Purchase Plan. (1) 10.2 Amendment to the 1995 Stock Option / Stock Purchase Plan. (3) 10.3 1997 Stock Option Plan. (4) 10.4 1998 Non-Employee Director Share Option Plan. (5) 10.5 Lease Agreement between the Registrant and Mr. Moshe Nur dated October 4, 1993, as amended on May 29, 1995, in Hebrew with a translation to English. (1) 10.6 Lease Agreement for office space in Brussels, Belgium between Nivellease, S.A. and the Registrant dated November 25, 1996. (3) 10.7 Lease Agreement for office space in Newton Centre, Massachusetts between WHTR Real Estate Limited Partnership and the Registrant dated July 10, 1998. (3) 10.8 Qualified Independent Underwriting Agreement. (3) 10.9 Distribution Agreement between Imaje S.A. and the Registrant dated June 26, 1995. (1)
10.10 Settlement Agreements relating to Moshe Nur and his affiliated companies. (3) 10.16 Bank Hapoalin revolving loan agreement. (3, 6) 10.17 Agreement between I.T.S. Machinery Development Ltd. and the Registrant dated February 10, 1997. (3) 10.18 Form of confidentiality agreement. (3) 10.19 Agreement dated September 13, 1998 between "Meital" Electronic Technology Ltd. and Markowitz Yaakov and NUR Macroprinters Ltd. (3) 21 List of Subsidiaries of Nur Macroprinters. 23.1 Consent of Krost Forer & Gabbay. 23.2 Consent of Willy Knyrim. 23.3 Consent of Shimonov Barnea & Co. (included in Exhibit 5.1). 24.1 Power of Attorney (included on signature page).
- ----------------- (1) Previously filed with the Commission on July 25, 1995 as part of Nur Macroprinters' Registration Statement (File No. 33-93160) on Form F-1 and incorporated by reference herein. (2) Previously filed with the Commission on January 7, 1998 as part of Nur Macroprinters' Report on Form 6-K and incorporated by reference herein. (3) Previously filed with the Commission on February 23, 1999 a part of Nur Macroprinters' Amendment No. 1 to Form F-1 on Form F-1/A (File No. 333-66103) and incorporated by reference herein. (4) Previously filed with Nur Macroprinters' Form 20-F for the year ended December 31, 1997 and incorporated by reference herein. (5) Previously filed with Nur Macroprinters' Form 6-K dated November 13, 1998 and incorporated by reference herein. (6) Filed in summary form. Original filed in paper format pursuant to Form SE. EX-3.2 2 EXHIBIT 3.2 Exhibit 3.2 THE COMPANIES ORDINANCE A COMPANY LIMITED BY SHARES AMENDED ARTICLES OF NUR MACROPRINTERS LTD. PRELIMINARY 1. SECOND SCHEDULE EXCLUDED The articles contained in the Second Schedule of the Ordinance and all provisions thereof shall not apply to the Company. 2. INTERPRETATION 2.1 In these Articles the following terms shall bear the meaning ascribed to them below: The "Company" shall mean the above named company. The "Ordinance" shall mean the Companies Ordinance [New Version], 5743-1983. The "Memorandum" shall mean the Memorandum of Association of the Company, as originally registered and as it may from time to time be amended. The "Articles" shall mean the articles of association contained in the Articles, as originally registered and as they may from time to time be amended. The "Board" shall mean the Company's Board of Directors. The "Register of Members" shall mean the Company's Register of Members. 2.2 Terms and expressions used in the Articles and not defined herein, shall bear the same meaning as in the Ordinance in force on the date when the Articles first become effective. 2.3 Sections 2,3,4,5,6,7,8 and 10 of the Interpretation Law, 5741-1981, shall apply, mutatis mutandis, to the interpretation of the Articles. 2.4 The captions in the Articles are for convenience only and shall not be deemed a part hereof or affect the interpretation of any provision hereof. SHARE CAPITAL 3. SHARE CAPITAL The share capital of the Company is as will be specified in the Memorandum from time to time. 4. ALTERATION OF SHARE CAPITAL The Company may, from time to time, by a Special Resolution (as such term is defined in Article 23.2): 4.1 Increase its share capital in an amount it thinks expedient by the creation of new shares. The power to increase the share capital may be exercised by the Company whether or not all of the shares then authorized have been issued and whether or not all of the shares theretofore issued have been called up for payment. Such Special Resolution shall set forth the amount of the increase, the number of the new shares created thereby, their nominal value and class, and may also provide for the rights, preferences of deferred rights that shall be attached to the newly created shares and the restrictions to which such shares shall be subject; 4.2 Consolidate all or any of its issued or unissued share capital and divide same into shares of nominal value larger than the one of its existing shares; 4.3 Subdivide all or any of its issued or unissued share capital, into shares of nominal value smaller than the one stipulated in the Memorandum; provided, however, that the proportion between the amount paid and the amount unpaid on each share which is not fully paid-up shall be retained in the subdivision; 4.4 Convert all or any of its fully paid-up share into stock. The provisions of the Articles applicable to fully paid-up shares shall further apply to stock, and the words "share" and "shareholder" herein contained shall further include "stock" and "stockholder", respectively; 4.5 Reconvert all or any of its stock into fully paid-up shares of any denomination or class; 4.6 Cancel any shares which, as at the date of the adoption of a Special Resolution, have not been issued or agreed to be issued, and thereby reduce the amount of its share capital by the aggregate nominal value of the shares so canceled; 4.7 Subject to any approval or consent required by law, reduce its share capital in any manner whatsoever and any capital redemption reserve in manner it deems fit, and also to exercise some or all of the possibilities indicated in Section 151 of the Ordinance. SHARES 5. RIGHTS ATTACHED TO SHARES 5.1 Subject to any contrary provisions of the Memorandum or the Articles, same rights, obligations and restrictions shall be attached to all the shares of the Company regardless of their denomination or class. 5.2 If at any time the share capital is divided into different classes of shares, the rights attached to any class may be modified or abrogated by a Special Resolution, subject to the consent in writing of the holders of seventy-five percent (75%) of the issued share of such class or the adoption of a Special Resolution approving same modification or -2- abrogation at a separate General Meeting of the holders of the shares of such class. The provisions of the Articles relating to General Meeting of the Company shall apply, mutatis mutandis, to any separate General Meeting of the holders of the shares of a specific class, provided, however, that the requisite quorum at any such separate General Meeting shall be one or more members present in person or by proxy and holding not less than thirty three and one third percent (33 1/3%) of the issued shares of such class. 5.3 The creation of additional shares of a specific class, or the issuance of additional shares of a specific class, shall not be deemed, for purposes of article 5.2, a modification or abrogation of rights attached to shares of such class or of any other class. 6. ISSUANCE OF SHARES Issuance of shares of the Company shall be under the control of the Board, who shall have the exclusive authority to issue the Company's shares, in whole or in part, otherwise dispose of them or grant options to acquire shares, to such persons and on such terms and conditions as the Board may think fit. 7. SHARE CERTIFICATES 7.1 Each member shall be entitled, not later than 60 days from the date of issuance or the date of transfer, to receive from the Company one share certificate in respect of all the shares of any class registered in his name on the Register of Members or, if approved by the Board, several share certificates, each for one or more of such shares. 7.2 Each share certificate issued by the Company shall be numerated, denote the class and serial numbers of the shares represented thereby and the name of the owner, thereof as registered on the Register of Members, and may also specify the amount paid-up thereon, A share certificate shall be signed by the Company. 7.3 A share certificate denoting two or more persons as joint owners of the shares represented thereby shall be delivered to any one of the persons named on the Register of Members in respect of such joint ownership. 7.4 A share certificate defaced or defective, may be replaced upon being delivered to the Company and being canceled. A share certificate lost or destroyed may be replaced upon furnishing of evidence to the satisfaction of the Board proving such loss or destruction and subject to the submission to the Company of an indemnity letter and/or securities as the Board may think fit. A member requesting the replacement of a share certificate shall bear all expenses incurred by the Company in connection with the provisions of this Article. 8. REGISTERED OWNER The Company shall be entitled to treat the person registered on the Register of Members as the holder of any share, as the absolute owner thereof, and accordingly, shall not be bound to acknowledge any trust or other right, whether at law or in equity, of any other person to or in -3- respect of such share, provided it has not been determined otherwise by a judicial decision or by operation of law. 9. CALLS ON SHARES 9.1 The Board may, from time to time, make calls upon members to perform payment of any amount of the consideration of their shares not yet paid, provided same amount is not, by the terms of issuance of same shares, payable at a definite date. Each member shall pay to the Company the amount of every call so made upon him at the time(s) and place(s) designated in such call. Unless otherwise stipulated in the resolution of the Board, each payment with respect to a call shall be deemed to constitute a pro-rata payment on account of all of the shares in respect of which such call was made. A call may contain a demand for payment in installments. 9.2 A call shall be made in writing and shall be delivered to the member(s) in question not less than fourteen (14) days prior to the date of payment stipulated therein. Prior to the due date stipulated in the call the Board may, by delivering a written notice to the member(s), revoke such call, in whole or in part, postpone the designated date(s) of payment or change the designated place of payment. 9.3 If, according to the terms of issuance of any share, any amount is due at a definite date, such amount shall be paid on same date, and the holder of the same share shall be deemed, for all intents and purposes, to have duly received a call in respect of such amount. 9.4 The joint holders of a share shall be bound jointly and severally to pay all calls in respect thereof. A call duly made upon one of the joint holders shall be deemed to have been duly made upon all of the joint holders. 9.5 Any amount not paid when due shall bear an interest from its due date until its actual payment at a rate equal to the then prevailing rate of interest for unauthorized overdrafts as charged by Bank Hapoalim Ltd, unless otherwise prescribed by the Board. The provisions of this Article 9.5 shall in no way deprive the Company of, or derogate from any other rights and remedies the Company may have against such member pursuant to the Articles or any pertinent law. 9.6 The Board may agree to accept prepayment by any member of any amount due with in respect to his shares, and may direct the payment of interest for such prepayment at a rate as may be agreed upon between the Board and the member so prepaying. 9.7 Upon the issuance of shares of the Company, The Board may stipulate similar or different terms with respect to the payment of the consideration thereof by their respective holders. 10. FORFEITURE AND SURRENDER 10.1 If any member fails to pay when due any amount payable pursuant to a call, or interest thereon as provided for herein, the Company may, by a resolution of the Board, at any -4- time thereafter, so long as said amount or interest remains unpaid, forfeit all or any of the shares in respect of which said call had been made. All expenses incurred by the Company with respect to the collection of any such amount of interest, including, inter-alia, attorney's fees and costs of legal proceedings, shall be added to, and shall constitute a part of the amount payable to the Company in respect of such call for all purposes (including the accrual of interest thereon). 10.2 Upon the adoption of a resolution of forfeiture, the Board shall cause the delivery of a notice thereof to the member in question. Same notice shall specify that, in the event of failure to pay the entire amount due within the period stipulated in the notice (which period shall be not less the thirty (30) days), same failure shall cause, ipso facto, the forfeiture of the shares. Prior to the expiration of such period, the Board may extend the period specified in the notice of forfeiture or nullify the resolution of forfeiture, but such nullification shall not estop nor derogate from the power of the Board to adopt a further resolution of forfeiture in respect of the non-payment of said amount. 10.3 Whenever shares are forfeited as herein provided, all dividends theretofore declared in respect thereof and not actually paid shall be deemed to have been forfeited together with the shares. 10.4 The Company, by a resolution of the Board, may accept the voluntary surrender by any member of all or any part of his shares. 10.5 Any share forfeited or surrendered as provided herein shall thereupon constitute the property of the Company, and may be reissued or otherwise disposed of as the Board may think fit. 10.6 Any member whose shares have been forfeited or surrendered shall cease to be a member in respect of the forfeited or surrendered shares, but shall, notwithstanding, be obligated to pay to the Company all amounts at the time of forfeiture or surrender due to the Company with respect thereof, including interest and expenses as aforesaid until actual repayment, whether the maturity date of same amounts is on or prior to the date of forfeiture or surrender or at any time thereafter, and the Board, in its discretion, may enforce payment of such amounts or any part thereof. In the event of such forfeiture or surrender, the Company, by a resolution of the Board, may enforce payment of such amount or any part thereof. In the event of such forfeiture or surrender, the Company, by a resolution of the Board, may accelerate the maturity date(s) of any or all amounts then owed to the Company by same member and not yet due, however, arising whereupon all of such amounts shall forthwith become due and payable. The Board may, at any time before any share so forfeited or surrendered shall have been reissued or otherwise disposed of to a third party, nullify the forfeiture or the acceptance of the surrender on such conditions as it thinks fit, but such nullification shall not estop nor derogate from the power of the Board to re-exercise its powers of forfeiture pursuant to this Article 10. 11. LIEN 11.1 The Company shall have, at all times, a first and paramount lien upon all the shares registered in the name of each member on the Register of Members, upon all the -5- dividends declared in respect of such shares and upon the proceeds of the sale thereof, as security for his obligations. For the purposes of this Article 11 and of Article 12, the term "Obligation" shall mean any and all present and future indebtedness owed to the Company by a member with respect to his shares, however arising, whether such indebtedness is absolute or contingent, joint or several, matured or unmatured, liquidated or non-liquidated. 11.2 Shall a member fail to fulfill any or all of his Obligations, the Company may enforce the lien, after same member was provided with a period of fourteen (14) days to fulfill the Obligations so breached. 11.3 A member shall be obliged to reimburse the Company for all expenses thereby incurred with respect to the enforcement of a lien upon same member's shares, and such obligation shall be secured by the shares which are subject to same lien. 12. SALE OF SHARES AFTER FORFEITURE OR SURRENDER OR IN ENFORCEMENT OF LIEN 12.1 Upon any sale of shares after forfeiture or surrender or in the course of enforcement of a lien, the Company may appoint any person to execute an adequate instrument of transfer or any other instrument required to effect the sale, and shall be entitled to register the purchaser on the Register of Members as the holder of the shares so purchased. The purchaser shall not be obliged to check the regularity of the proceedings of forfeiture, surrender or enforcement of a lien or the use that was made consideration thereby paid with respect to the shares. As of the entry of the purchaser's name in the Register of Members in respect of such shares, the validity of the sale shall not be rebutted, and the sole remedy of any person aggrieved by the sale shall be in damages, and against the Company solely. 12.2 The net proceeds of any such sale, after payment of the selling expenses, shall serve for repayment of the Obligations of the respective member, and the balance if any shall be paid to the member, his inheritors, the executors of his will, the administrators of his estate, and to persons on his behalf. 13. REDEEMABLE SHARES Subject to any applicable law, the Company may issue redeemable shares and redeem the same. 14. EFFECTIVENESS OF TRANSFER OF SHARES A transfer of title to shares of the Company, whether voluntarily or by operation of law, shall not confer upon the transferee any rights whatsoever towards the Company unless and until such time as the transfer has been registered in the Register of Members. 15. PROCEDURE ON VOLUNTARY TRANSFER OF SHARES A member desiring to transfer to another person title to his shares, or any part thereof, shall deliver to the Company a notice to the effect accompanied by an instrument of transfer, in a form to be prescribed by the Board, duly executed by such member and the transferee, and subject to the prior fulfillment of the provisions of Article 16 below, The Board shall instruct the -6- registration of same in the Register of Members. 16. TRANSFER OF SHARES 16.1 The transfer of shares of the Company and any other securities issued by the Company (in this Article 16 and in Article 17, hereinafter: "Securities") shall be made in writing in a conventional manner or as established by the Board; it may be effected by the signature of the transferor only, on the condition that an appropriate share transfer deed shall be submitted to the Company. 16.2 Shares that are not paid up in full or are subject to any lien or pledge may not be transferred unless the transfer is approved by the Board, which may at its sole discretion withhold its approval without having to show grounds. 16.3 Any transfer of shares that are not paid up in full shall be subject to the signature of the transferee and the signature of a witness in verification of the authenticity of the signatures on the share transfer deed. 16.4 The transferor shall be deemed to be the owner of the transferred Securities until the name of the transferee is entered in the Register of Members. 16.5 The share transfer deed shall be submitted to the office for registration together with the certificates to be transferred and such other evidence as the Company may require with regard to the transferor's title or right to transfer the Securities. The share transfer deeds shall remain with the Company after their registration. 16.6 The Company may demand payment of a transfer registration fee at a rate to be determined by the Board from time to time. 16.7 The Board may close the Register of Members for a period no longer than 30 days every year. 16.8 Upon the death of the holder of Securities of the Company, the Company shall recognize the guardians, administrators of the estate, executors of the will, and in the absence of such persons, the inheritors of the deceased person as the only ones entitled to hold Securities of the Company, subject to proof of their rights in a manner established by the Board. 16.9 In the event of the deceased member being a holder of a security jointly with other persons, the Company shall approve of the surviving member as member of the Company in respect of the said Securities without exempting the estate of the deceased joint holder from any of the obligations relating to the jointly held Securities. 16.10 A person acquiring a right to a security by virtue of his being a guardian or administrator of the estate or inheritor of the deceased member, or receiver, liquidator or trustee in liquidation proceedings regarding a corporate member, or by any operation of law, may be subject to submission of such proof of entitlement as the Board may establish be entered as the holder of the respective security or transfer the Security subject to the provisions of the Articles with regard to such transfer. -7- 16.11 A person acquiring a security as a result of a transfer by operation of law shall be entitled to dividend and other rights in respect of the security and also to receive and certify the receipt of dividends and other sums of money in connection with the said security; however, such person shall not be entitled to receive notices of the convening of General Meetings of the Company or to participate or vote therein or to exercise any right conferred by the security with the exception of the aforementioned rights, pending the registration of such person in the Register of Members. 17. ISSUANCE OF SHARES 17.1 In case of issuance of shares the proceeds of which are intended for covering the expenses involved in the construction of installations or buildings or for plant equipment not expected to yield profits over an appreciable period of time, the Company shall be entitled to pay interest on the paid-up portion of the respective share capital for the period and subject to the conditions and limitations stated in Section 140 of the Ordinance and to enter the so paid interest on the principal as part of the cost involved in the construction of the respective installation, building of plant equipment. 17.2 The Company may pay a commission (including underwriting fees) to any person at a rate not exceeding ten percent of the price at which the Securities of the Company are issued, in consideration of such person's subscribing or consent to cause other persons to subscribe applications, conditionally or unconditionally, for Securities of the Company subject to the provisions of Section 135 of the Ordinance. The payments contemplated in this article may be effected in cash or in Securities of the Company or in any combination of the foregoing. 18. ANNUAL GENERAL MEETING 18.1 An Annual General Meeting shall be held once in every calendar year at such time (within a period of not more than fifteen (15) months after the last preceding Annual General Meeting) and at such place as may be determined by the Board. 18.2 The general meeting shall: a. Discuss the report by the Board on the status of the Company; b. Discuss the statement of profit and loss and the balance sheet as of the date of closure of the statement of profit and loss; c. Appoint auditors and establish their remuneration, or empower the Board to establish their remuneration; d. Appoint the directors as stipulated in Article 31 below, and establish their remuneration; e. Discuss any other business to be transacted at an ordinary general meeting according to the Articles or by operation of law. -8- 19. EXTRAORDINARY GENERAL MEETING 19.1 All General Meeting other than Annual General Meetings shall be called "Extraordinary General Meetings". 19.2 The Board may, whenever it thinks fit, convene an Extraordinary General Meeting, and shall be obligated to do so upon receipt of a requisition in writing in accordance with Section 109 of the Ordinance. 19.3 Members of the Company shall not be authorized to convene a General Meeting except as provided in Section 110 of the Ordinance. 20. NOTICE OF GENERAL MEETINGS 20.1 Prior to any General Meeting a written notice thereof shall be delivered to all those members entitled to attend thereat. Such notice shall specify the place, the day and the hour of the General Meeting and the general nature of the matters to be discussed thereat. If the General Meeting is to consider the adoption of a Special or an Extraordinary Resolution, the notice shall set out the proposed terms of such resolution. The notice will be delivered not less then seven (7) days prior to any General Meeting, provided, however, that a twenty-one (21) day prior notice will be delivered if the General Meeting is to consider the adoption of a Special Resolution. 20.2 The accidental omission to give notice of a General Meeting, or the non-receipt of a notice by a member entitled to receive notices of General Meeting, shall not invalidate the proceedings of such a General Meeting. 20.3 A member entitled to received notices of General Meeting may waive such right before such meeting of expost, and shall be deemed to have waived such right with respect to any General Meeting at which he was present, in person or by proxy. 21. QUORUM 21.1 Two or more members present in person or by proxy and holding shares conferring in the aggregate more than thirty three and one third percent (33 1/3%) of the total voting power attached to the shares of the Company, shall constitute a quorum at General Meetings. No business shall be considered or determined at a General Meeting, unless the requisite quorum is present when the General Meeting proceeds to consider and/or determine same business. 21.2 If within half an hour from the time appointed for the General Meeting a quorum is not present, the General Meeting shall, if convened upon requisition under Section 110 of the Ordinance, be dissolved, but in any other case it shall stand adjourned to the same day in next week, at the same time and place. The requisite quorum at an adjourned General Meeting shall be one or more members, present in person or by proxy, holding not less than thirty three and a third percent (33 1/3%) of the total voting power attached to the shares of the Company. At an adjourned General Meeting the only businesses to be considered shall be those matters which might have been lawfully considered at the General Meeting originally called if a requisite quorum had been present, and the only resolutions to be adopted are such types of resolutions which could have been adopted -9- at the General Meeting originally called. 22. CHAIRMAN The Chairman, of the Board, or if there is no such chairman, or if he is not present, any other person appointed by the members present, shall preside as Chairman at General Meeting of the Company. The Chairman of any General Meeting shall have no additional or casting vote. 23. ADOPTION OF RESOLUTION AT GENERAL MEETINGS 23.1 An Ordinary Resolution shall be deemed adopted at a General Meeting if supported by members present, in person or by proxy, vested with more than fifty percent (50%) of the total voting power attached to the shares who holders were present, in person or by proxy, at such General Meeting and voted thereon. 23.2 A Special or an Extraordinary Resolution shall be deemed adopted at a General Meeting if supported by members, present in person or by proxy, vested with seventy-five percent (75%) or more of the total voting power attached to the shares whose holders were present, in person or by proxy, at such General Meeting and voted thereon. 23.3 Any proposed resolution put to vote at a General Meeting shall be decided by a poll. 23.4 Subject to approval by a meeting with a quorum, the chairman may, and is obligated to at the request of the General Meeting, adjourn the meeting from time to time and from place to place, everything as decided by the meeting. If the meeting is adjourned by more than seven days, a notice of the adjourned meeting shall be given in the same manner as for the original meeting. Except for the foregoing, no member shall be entitled to receive any notice of adjournment or on the agenda of the adjourned meeting. An adjourned meeting may only transact such business as left unfinished at the original meeting. 23.5 A declaration by the Chairman of the General Meeting that a proposed resolution has been adopted or rejected, shall constitute a conclusive evidence of the adoption or rejection, respectively, of same resolution, and no further proof verifying the contents of such deceleration or the number or proportion of the votes recorded in the favor of or against such resolution shall be required. 24. RESOLUTION IN WRITING A resolution in writing agreed upon by all members of the Company then entitled to vote at General Meetings, or a resolution in writing included in a number of identically worded documents, each of them signed by one or more members, shall be deemed to have been adopted by a General Meeting duly convened and held. Unless otherwise specified in the resolution, same shall be deemed to have been adopted as an Ordinary Resolution. 25. VOTING POWER 25.1 Subject to the provisions of Article 26.1 below and subject to any other provision hereof pertaining to voting rights attached or not-attached to shares of the Company, whether in general or in respect of a specific matter or matters, every member shall have one -10- vote for each share registered in his name on the Register of Members, regardless of its denomination or class. 25.2 In case of equality of votes, the resolution shall be deemed to have been rejected. 26. ATTENDANCE AND VOTING RIGHTS AT GENERAL MEETING 26.1 Unless provided otherwise by the terms of issue of the shares, no member shall be entitled to be present or vote at a General Meeting (or be counted as part of the quorum thereat) unless all amounts due as at the date designated for same General Meeting with respect to his shares were paid. 26.2 A corporate body being a member of the Company and entitled to vote and/or attend at a General Meeting may exercise such rights by authorizing any person, whether in general or for a specific General Meeting, to be present and/or vote on its behalf. Upon the request of the Chairman of the General Meeting, a writing evidence of such authorization and its validity (in a form acceptable to the Chairman) shall be furnished thereto. 26.3 A member entitled to vote and/or attend at a General Meeting may appoint a proxy, whether is general or for a specific General Meeting, to exercise such rights, as follows: a. The appointment of a proxy shall be in writing and shall be in the following form or in other similar form: "I, the undersigned, ____________________________________________ (name of member) being a member of _______________________________________ hereby (name of the Company) appoint ______________________________________________________ (name of proxy) of __________________________________________________________ (address of proxy)
as my proxy to attend [and vote] on my behalf at [any General Meeting of the Company] [the General Meeting of the Company to be held on the ____ day of ______, 19__] and at any adjournment thereof. Signed this ______ day of ________, 19____. -----------------------." (Signature of member) b. The instrument appointing a proxy shall be delivered to the Company not later than forty-eight (48) hours before the time designated for the General Meeting at which the person named in the instrument proposes to vote and/or attend. c. A proxy may not delegate his powers to any other person. d. Termination of the appointment of a proxy shall be governed by the provisions of Section 14 of the Agency Law, 5725-1965. -11- 26.4 A member entitled to vote and/or attend at a General Meeting and is legally incapacitated, may exercise such rights by his custodian. 26.5 If two or more persons are registered as joint owners of any share, the right to attend at a General Meeting, if attached to such share, shall be conferred upon all of the joint owners, but the right to vote at a General Meeting and/or the right to be counted as part of the quorum thereat, if attached to such share, shall be conferred exclusively upon the senior amongst the joint owners attending the General Meeting, in person or by proxy; and for this purpose seniority shall be determined by the order in which the names stand on the Register of Members. 26.6 The voting on the terms of the instrument of proxy shall be legal even in case of prior death or incapacity or bankruptcy of the principal, and in respect of a corporate principal, in case of its winding up or revocation of the instrument of proxy or transfer of the respective share, unless a notice in writing of such death or incapacity or bankruptcy or winding up or revocation of share transfer shall have been received by the Register of Members. The written notice on revocation of the proxy shall be valid if signed by the principal and received by the Register of Members not later than one hour before the start of voting. 26.7 No proxy shall be valid after expiry of 12 months from the date of its issue. In case of deposition of a proxy of power of attorney of other document of notarized copy thereof with regard to a specified General Meeting it shall not be required to resubmit a proxy as aforesaid prior to an adjourned meeting of the same original meeting. BOARD OF DIRECTORS 27. POWERS OF THE BOARD 27.1 The Board shall be vested with the exclusive authority to exercise all of the Company's powers which are not, by the Ordinance, the Memorandum, the Articles or any applicable law, required to be exercised by a resolution in a General Meeting. 27.2 Without derogating from the above, the management of the business of the Company shall be vested exclusively in the Board. 27.3 Without derogating from the above, the Board may from time to time and at its sole discretion obtain, borrow or secure the payment of money for purposes of the Company. The Board may obtain or secure the repayment of the said money at its own discretion and in particular by the issue of debentures or debenture stock secured by a lien on the assets and rights of the Company or part thereof, including the uncalled capital of the Company. 28. EXERCISE OF POWERS OF THE BOARD 28.1 The powers conferred upon the Board shall be vested in the Board as collective body, and not in each one or more of the directors individually, and all such powers may be -12- exercised by the Board by adopting resolutions in accordance with the provisions of the Articles. 28.2 A resolution shall be deemed adopted at a meeting of the Board if supported by a majority of the directors attending such meeting and voting thereon. 28.3 A resolution agreed upon by all the directors then in office in writing, or by telegram or by facsimile, shall be deemed to have been adopted unanimously by the Board in a meeting duly convened and held. 29. COMMITTEES OF DIRECTORS 29.1 The Board may delegate any or all of its powers to committees, each consisting of two or more directors, and it may, from time to time, revoke or alter the powers so delegated. Each committee shall, in the exercise of the powers so delegated, conform to any regulations and conditions prescribed by the Board upon the delegation or at any other time. 29.2 The Board will designate from among it's members an audit committee. 29.3 The provision of the Articles with respect to the meetings of the Board, their convening, adoption of resolutions thereat and adoption of resolution in writing shall apply, mutatis mutandis, to the meetings of any such committee, unless otherwise prescribed by the Board. 30. NUMBER OF DIRECTORS Unless otherwise prescribed by an Ordinary Resolution of the Company, the Board shall consist of not less then four (4) nor more then twelve (12) directors. 31. APPOINTMENT AND REMOVAL OF DIRECTORS 31.1 a. The directors shall be elected annually at a General Meeting as aforesaid and shall remain in office until the next Annual General Meeting unless their office is vacated previously as stipulated in the Articles. The elected directors shall assume office on the day of their election. b. The directors shall retire from office at every Annual General Meeting. A retiring director may be reelected. Pending the convening of an Annual General Meeting at which the directors are to retire from office, all directors shall remain in office until the convening of the Annual General Meeting of the Company except in case of prior vacation of a director's office according to the Articles. c. If no directors are elected at the Annual General Meeting, all the retiring directors shall remain in office pending their replacement by a General Meeting of the Company. 31.2 Except with regard to a director whose tenure of office expires upon the convening of a General Meeting or a person recommended by the Board to serve as director, no motions for appointment of a candidate as a director shall be made unless a notice in writing signed by a member of the Company (other than the candidate himself) who is -13- entitled to participate in and vote at the meeting, stating the intent of the said member to propose a candidate for election to the office of director, together with a document in writing by the candidate expressing his consent to be so elected, shall have been received at the office of the Company within a period of not less than forty-eight (48) hours and not more than forty-two (42) days before the appointed date of the General Meeting. 31.3 The General Meeting may by way of an Ordinary Resolution remove a director from office before the expiry of his tenure, and it may, be way of an Ordinary Resolution, appoint another person to serve as director of the Company in his place, and also appoint a number of directors in the event of the number of directors having decreased below the minimum established by the General Meeting. 32. QUALIFICATION OF DIRECTORS No person shall be disqualified to serve as a director by reason of his not holding shares in the Company or by reason of his having served as director in the past. 33. VACATION OF DIRECTOR'S OFFICE The office of a director shall be vacated: a. Upon his death; b. On the date at which he is declared a bankrupt or, if the director is corporation - on the date at which a liquidation order was issued in respect thereof; c. On the date he is declared legally incapacitated; d. On the date stipulated therefor in the resolution of his election or the notice of his appointment, as the case may be; e. On the date stipulated therefor in the resolution or notice of his removal or on the date of the delivery of such notice to the Company, whichever is later; f. On the date stipulated therefor in a written notice of resignation thereby delivered to the Company or upon its delivery to the Company, whichever is later. 34. REMUNERATION OF DIRECTORS The directors shall be entitled to remuneration by the Company for their services as directors. The remuneration may be established as a global sum or as a fee for participation in meetings. In addition to such remuneration, every director shall be entitled to refund of reasonable expenses for travel, per diem money, and other expenses related to the discharge of his duties as a director. 35. CONFLICT OF INTERESTS 35.1 The Company may consider and approve, by an Ordinary Resolution of the Board, a transaction to which the Company is a party to, and in which an officer of the Company -14- has an interest; Provided that the transaction does not impair the benefit of the Company and that such officer shall not participate in the meeting, where such resolution is considered and shall not vote in such meeting. 35.2 The Company may consider and approve, by an Ordinary Resolution of the Board, a transaction between the Company and an officer of the Company; Provided that the officer is acting in good faith and the transaction is not determental to the interests of the Company and on the further condition that directors who have a personal interest in the transaction shall neither attend nor vote in discussions on the approval of the transaction. 36. ALTERNATE DIRECTOR 36.1 Subject to the approval of the Board, a director may, by delivering a written notice to the Company, appoint an alternate for himself (hereinafter referred to as "Alternate Director"), remove such Alternate Director and appoint another Alternate Director in place of any Alternate Director appointed by him whose office has been vacated for any reason whatsoever. The appointment of the Alternate Director shall be for an indefinite period and for all purposes, unless restricted to a specific period, to a specific meeting or act of the Board, to a specific matter or in any other manner, and same restriction was specified in the appointment instrument or in a written note delivered to the Company. 36.2 Any notice delivered to the Company pursuant to Article 36.1 shall become effective on the date specified therefor therein or upon delivery thereof to the Company or upon approval of the Board, whichever is later. 36.3 An Alternate Director shall be vested with all rights and shall bear all obligations of the director who appointed him, provided, however, that he shall not be entitled to appoint an alternate for himself (unless the instrument appointed him expressly provides otherwise), and provided further that the Alternate Director shall have no standing at any meeting of the Board or any committee thereof whereat the director who appointed him is present. 36.4 Any person, whether or not a director, may act as Alternate Director. One person may act as Alternate Director for several directors, and in such event he shall have a number of votes (and shall be deemed as the number of persons for purposes of establishing a quorum) equal to the number of directors for whom he acts as Alternate Director. If an Alternate Director is also a director in his own right, his right as an Alternate Director shall be in addition to his rights as a director. 36.5 The Alternate Director solely shall be responsible for his own acts and omissions, and he shall not be deemed an agent of the director(s) who appointed him. 36.6 The office of an Alternate Director shall be vacated under the circumstances, mutatis mutandis, set forth in Article 33, and such office shall further be ipso facto vacated if the director who appointed such Alternate Director ceases to be a director. 37. MEETING OF THE BOARD -15- 37.1 Subject to Articles 39 and 40 below, the Board may meet, adjourn its meeting and otherwise determine and regulate such meetings and their proceedings as it deems fit. 37.2 Upon the vacation of the office of a director, the remaining directors may continue to discharge their functions until the number of remaining directors decreases below the minimum established in the Articles. In the latter case the remaining directors may only act to convene a General Meeting of the Company. 37.3 The directors may at any time appoint any person to serve as director as replacement for a vacated office or in order to increase the number of directors, subject to the condition that the number of directors shall not exceed the maximum established in these Articles. Any so appointed director shall remain in office until the next General Meeting, at which he may be reelected. 38. CONVENING MEETINGS OF THE BOARD 38.1 The Chairman of the Board may, at any time, convene a meeting of the Board, and shall be obliged to do so upon receipt of a written demand from the majority of the directors then in office. In the event there is no such Chairman or a meeting of the Board was not convened to a date which is no later then ten (10) days of the following delivery of such written demand, the majority of the directors then in office may convene a meeting of the Board. Convening a meeting of the Board shall be made by delivering a notice thereof to all of the directors not later than four (4) days prior to the date thereof. Such notice shall specify the exact time and place of the meeting so called and the general nature of the business to be considered thereat. 38.2 The accidental omission to give notice of a meeting, or the non-receipt of notice by any director, shall not invalidate the proceedings of such meeting. 38.3 A director may waive his right to receive notice of any meeting, or to receive four (4) days prior notice, in general or in respect of a specific meeting, and shall be deemed to have waived such right with respect to any meeting at which he was present. 39. QUORUM A majority of the number of directors then in office shall constitute a quorum at meetings of the Board. No business shall be considered or determined at any meeting of the Board unless the requisite quorum is present when the meeting proceeds to consider or determine same business. 40. CHAIRMAN OF THE BOARD The Board may from time to time elect one of its members to be the Chairman of the Board, remove such Chairman from office and appoint another in his place. The Chairman of the Board shall preside at every meeting of the Board, but if there is no such Chairman, or if he is not present or he is unwilling to take the chair at any meeting, the directors present shall elect one of their members to be chairman of such meeting. The Chairman of the Board shall have no additional or casting vote. 41. VALIDITY OF ACTS OF DIRECTORS DESPITE DEFECTS -16- All acts done bona fide at any meeting of the Board, or of a committee of the Board shall, notwithstanding that it may afterwards be discovered that there was a defect in the appointment or qualification of the participants thereat, or any of them, be as valid as if there was no such defect. GENERAL MANAGER 42. GENERAL MANAGER 42.1 The Board may, from time to time, appoint one or more persons, whether or not directors, as General Manager(s) of the Company, either for a definite period or without any limitation of time, and may confer powers, authorities and rights and/or impose duties and obligations upon such person or persons and determine his or their salaries as the Board may deem fit and subject to the provisions stipulated in Part D of Chapter D1 of the Ordinance. 42.2 Notwithstanding the provisions of any agreement between the General Manager and the Company, the Company shall be vested with the power, exercisable by a resolution of the Board and subject to the provisions stipulated in Part D of Chapter D1 of the Ordinance, to remove the General Manager from his office or to revoke or alter his powers, authorities, rights, duties, obligations or salary. MINUTES 43. MINUTES 43.1 The proceedings of each General Meeting of the Board and meeting of committee of the Board shall be recorded in the minutes of the Company. Such minutes shall set forth the names of the persons present at every such meeting and all resolutions adopted thereat and shall be signed by the chairman of the meeting. 43.2 All minutes purposing to be executed and signed as aforesaid, shall constitute evidence that the meeting was duly convened and held and as recorded in the minutes, unless proven otherwise. DIVIDENDS AND PROFITS 44. DECLARATION OF DIVIDENDS 44.1 The Board may from time to time declare interim dividend at a rate as the Board may deem for considering the profits of the Company. 44.2 The General Meeting may, by an Ordinary Resolution, declare a final dividend for a fiscal year of the Company, provided that the amount of dividend so declared does not exceed the amount of final dividend recommended by the Board. -17- 44.3 Subject to any special or restricted rights conferred upon the holders of shares as to dividends, all dividends shall be declares and paid in accordance the paid-up capital of the Company attributable to the shares in respect of which the dividends are declared and paid. The paid-up capital attributable to any share (whether issued at its nominal value, at a premium or at a discount), shall be nominal value of such share. Provided, however that if the entire consideration for same share was not yet paid to the Company, the paid-up capital attribute thereto shall be such proportion of the nominal value as the amount paid to the Company with respect to the share bears to its full consideration, and further provided the amounts which have been prepaid on account of shares and the Company has agreed to pay interest thereon shall not be deemed, for the purposes of this Article, to be payments on account of such shares. In the event no amount has been paid with respect to any shares whatsoever, dividends may be declared and paid according to the nominal value of the shares. 44.4 Notice of the declaration of dividends shall be delivered to all those entitles to such dividends. 45. RIGHTS TO PARTICIPATE IN THE DISTRIBUTION OF DIVIDENDS 45.1 Subject to special rights with respect to the Company's profits to be conferred upon any person pursuant to these Articles and further subject to the provisions of the Articles with respect to reserved funds and special funds, all the profits of the Company may be distributed among the members entitled to participate in the distribution of dividends. 45.2 Notwithstanding for foregoing, a holder of share shall not be attributed with the right to participate in the distribution of dividends which were declared for a period preceding the date of the actual issuance. 46. INTEREST ON DIVIDENDS The Company shall not be obligated to pay, and shall not pay interest on declared dividends. 47. PAYMENT OF DIVIDENDS Subject to Article 48, a declared dividend may be paid by a check made to the order of the person entitled to receive such dividend (and if there are two or more persons entitled to the dividend in respect of the same share - to the order of any one of such persons) or to the order of such person as the person entitled thereto may direct in writing. Same check shall be sent to the address of the person entitled to the dividend, as notified to the Company. 48. PAYMENT IN SPECIE Upon the recommendation of the Board, if approved by an Ordinary Resolution at a General Meeting, dividends may be paid, wholly or partly, by the distribution of specific assets of the Company and/or by the distribution of shares and/or debentures of the Company and/or of any other company, or in any combination of such manners. 49. SETTING-OFF DIVIDENDS -18- The Company's obligation to pay dividends or any other amount in respect of shares, may be set-off by the Company against any indebtedness, however arising, liquidated or non-liquidated, of the person entitled to receive the dividend. The provisions contained in this Article shall not prejudice any other right or remedy vested with the Company pursuant to the Articles or any applicable law. 50. UNCLAIMED DIVIDENDS 50.1 Dividends unclaimed by the person entitled thereto within thirty (30) days after the date stipulated for their payment, may be invested or otherwise used by the company, as it deems fit, until claimed; but the Company shall not be deemed a trustee in respect thereof. 50.2 Dividends unclaimed within the period of seven (7) years from the date stipulated for their payment, shall be forfeited and shall revert to the Company, unless otherwise directed by the Board. 51. RESERVES AND FUNDS 51.1 The Board may, before recommending the distribution of dividends, determine to set aside out of the profits of the Company or out of an assets revaluation fund and carry to reserve or reserves such sums as it deems fit, and direct the designation, application and use of such sums. The Board may further determine that any such sums which it deems prudent not to distribute as dividends will not be set aside for reserve, but shall remain as such at the disposal of the Company. 51.2 The Board may, from time to time, direct the revaluation of the assets of the Company, in whole or in part, and the creation of an assets revaluation fund out of the revaluation surplus, if any. 52. CAPITALIZATION OF PROFITS 52.1 Upon the recommendation of the Board, the Company may determine by an Ordinary Resolution at a General Meeting that it is desirous of capitalizing all or any part of the sums or assets allocated to the credit of any reserve fund or to the credit of the profit and loss account or being otherwise distributable as dividends (including sums or assets received as premiums on the issuance of shares or debentures), and direct accordingly that such sums or assets be released for distribution amongst the members who would have been entitled thereto if distributed by way of dividends and in the same proportion; provided that same sums or assets be not paid in cash or in specie but be applied for the payment in full or in part of the unpaid consideration of the issued shares held by such members and/or for the payment in full of the consideration (as shall be stipulated in said resolution) for shares or debentures of the Company to be issued to such members subsequent to the date of said resolution, credited as fully paid up. 52.2 In the event a resolution as aforesaid shall have been adopted, the Board shall make all adjustments and applications of the moneys or assets resolved to be capitalized thereby, and shall do all acts and things required to give effect thereto. The Board may authorize -19- any person to enter into agreement with the Company on behalf of all members entitled to participate in such distribution, providing for the issuance to such members of any shares or debentures, credited as fully paid, to which they may be entitled upon such capitalization or for the payment on behalf of such members, by the application thereto of the proportionate part of the money or assets resolved to be capitalized, of the amounts or any part thereof remaining unpaid on their existing shares, and any agreement made under such authority shall be effective and binding upon all such members. 52.3 The Board may announce the distribution of interim bonus shares. 53. ACCOUNTING BOOKS 53.1 The Board shall cause the Company to hold proper accounting books and to prepare an annual balance sheet, a statement of Profit and Loss, and such other financial statements as the Company may be required to prepare under law. The accounting books of the Company shall be held at the office or at a place deemed fit by the Board, and they shall be open to inspection by the directors. 53.2 The Board may determine at its sole discretion the terms on which any of the accounts and books of the Company shall be open to inspection by members, and no member (other than a director) shall be entitled to inspect any account or ledger or document of the Company unless such right is granted by law or by the Board. 53.3 Not later than eighteen (18) months from the incorporation of the Company and at least once a year thereafter, the Board shall submit to the General Meeting of the Company a statement of Profit and Loss for the period from the previous statement or in case of submission of the first statement, for the period from the incorporation of the Company, covering a period up to a date not earlier than six months before the meeting, and pursuant to the relevant provisions of the law, a balance sheet shall be prepared for every year and submitted to the Company at its General Meeting, covering the same period as the statement of profit and loss. The balance sheet shall be accompanied by an auditors' report and a report by the Board on the position of the Company, including a recommendation as to the amount to be distributed as dividend and the amount to be set aside in a reserve fund, or concerning the allotment of bonus shares. BRANCH REGISTERS 54. AUTHORITY TO KEEP BRANCH REGISTERS The Company may keep branch registers in any reciprocal state. 55. PROVISIONS IN RESPECT OF KEEPING BRANCH REGISTERS Subject to the provisions contained in Part E of Chapter C of the Ordinance, the Board shall be authorized to make such rules and procedures in connection with the keeping of branch registers as it may, from time to time, think fit. -20- STAMP AND SIGNATURES 56. THE COMPANY'S STAMP 56.1 The Company shall have an official stamp. 56.2 The Company may keep an official stamp for documents made for foreign purposes, and may authorize, from time to time a person appointed for this purpose to make use of such stamp. The provisions of Section 102 of the Ordinance shall apply to this Article, and the term "seal" shall have the meaning of "stamp". 57. THE COMPANY'S SIGNATURE 57.1 A document shall be deemed signed by the Company upon the fulfillment of the following: a. The Company's stamp was thereon by a person authorized therefor by the Board, or it bears the name of the Company in print; b. It bears the signature of one or more persons authorized therefor by the Board; c. The act of the person authorized by the Board as aforesaid was within its authority and without deviation therefrom. 57.2 An authorization of one or more persons by the Board to sign on a document on behalf of the Company shall be deemed to include the authority to stamp the Company's stamp thereon, unless otherwise provided by the Board. 57.3 An authorization by Board as provided in Article 57.2 may be for a specific document or for a certain sort of document or for a certain sort of documents or for all the Company's documents or for a definite period of time or for an unlimited period of time, provided that any such authority may be terminated by Board, at will. 57.4 The provisions of this Article shall apply both to the Company's documents executed in Israel and the Company's documents executed abroad. NOTICES 58. NOTICES IN WRITING 58.1 Notices pursuant to the Ordinance, the Memorandum and the Articles shall be made in the manner prescribed by the Board from time to time. 58.2 Unless otherwise prescribed by the Board, all notices shall be made in writing and shall be sent by registered mail. 59. DELIVERY OF NOTICES -21- 59.1 Each member and each director shall notify the Company in writing of his address for the receipt of notices, documents and other communications relating to the Company, it's business and affairs. 59.2 Any notice, document or other communication shall be deemed to have been received at the time received by the addressee or at its address, or if sent by registered mail to same address within seven (7) days from its dispatch, whichever is earlier. 59.3 The address for the purposes of Article 59.2 shall be the address furnished pursuant to Article 59.1, and the address of the Company for the purposes of Article 59.2 shall be its registered address or principal place of business. 59.4 A director who is absent from Israel shall not, for the duration of his stay abroad, be entitled to receive notices of board meetings unless he shall have requested that such notices be sent to his proxy. INDEMNITY AND INSURANCE 60. INDEMNITY OF OFFICERS The Company may indemnify any officer for any of the following: a. A monetary liability imposed upon an officer toward another person by a judgment, including a judgment giving effect to a compromise and an arbitration award approved by a court, with respect to an act performed by same officer in his capacity as an officer of the Company; b. Reasonable litigation expenses, including attorney's fees, incurred by an officer or imposed upon him by a court, in a proceeding brought against him by the Company or on its behalf or by another person, or in a criminal proceeding in which he was acquitted, and all with respect to an act thereby performed in his capacity as an officer of the Company. 61. INSURANCE OF OFFICER The Company may enter into an agreement for the insurance of the liability of an officer, in whole or in part, for any of the following: a. A breach of a cautionary duty toward the Company or toward another person; b. A breach of a fiduciary duty toward the Company, provided the officer has acted bona fide and has had a reasonable ground to assume that the act would not impair the benefit of the Company; c. A monetary liability imposed upon an officer toward another person with respect to an act performed by same officer in his capacity as an officer of the Company; -22- WINDING UP 62. DISTRIBUTION OF ASSETS If the Company be wound up, then, subject to provisions of any applicable law and to any special or restricted rights attached to a share, the assets of the Company in excess of its liabilities shall be distributed among the members in proportion to the paid-up capital of the Company attributable to the shares in respect of which such distribution is being made. The paid-up capital attributable to any share (whether issued at its nominal value, at a premium or at a discount), shall be a nominal value of such share, provided, however, that if the entire consideration for same share was not yet paid to the Company, the paid-up capital attributable thereto shall be such proportion of the nominal value as the amount paid to the Company with respect to the share bears to its full consideration. -23- EX-4.6 3 EXHIBIT 4.6 Exhibit 4.6 WARRANT AGREEMENT THIS WARRANT AGREEMENT (the "AGREEMENT") made as of 18th day of August, 1999, by and among NUR MACROPRINTERS LTD., an Israeli company (the "COMPANY"), DOVRAT & CO. LTD. ("DOVRAT") and ISAL AMLAT INVESTMENT (1993) LTD. ("ISAL"). WHEREAS concurrently with the execution of this Agreement the parties have executed a Share and Warrant Purchase Agreement, dated August 18, 1999, to which this Agreement is appended to (the "INVESTMENT AGREEMENT"), according to which Dovrat and Isal were granted warrants (the "WARRANTS") to purchase up to 15,000 and 135,000 (respectively) Ordinary Shares of par value NIS 1.00 each of the Company ("ORDINARY SHARES"); and WHEREAS the parties wish to determine the terms and conditions of the Warrants, as set forth herein. NOW, THEREFORE, in the consideration of the mutual promises and covenants set forth herein, the parties agree as follows: 1. GRANT. Subject to the terms and conditions hereof, the Company hereby grants the Holder (as defined in Section 3 hereof), the right to purchase, at any time from August 18, 1999 until 5:30 P.M. Israel time, on August 17, 2003 (the "EXERCISE PERIOD"), at the initial exercise price per share of US$8.00 (subject to adjustment as provided in Article 8 hereof), up to such amount of fully paid and non-assessable Ordinary Shares as set forth opposite the names of Isal and Dovrat in SCHEDULE 1 ("WARRANT SHARES"). 2. WARRANT CERTIFICATES. The warrant certificates (the "WARRANT CERTIFICATES") delivered and to be delivered pursuant to this Agreement shall be in the form set forth in EXHIBIT A attached hereto and made a part hereof, with such appropriate insertions, omissions, substitutions, and other variations as required or permitted by this Agreement. 3. EXERCISE OF WARRANT. 3.1 DISCRETIONARY EXERCISE. The Warrants are exercisable at an initial exercise price (subject to adjustment as provided in Section 8 hereof) per Ordinary Share set forth in Section 6 hereof, payable by certified check. Upon surrender of a Warrant Certificate with the annexed Form of Election to Purchase duly executed, together with payment of the Purchase Price (as hereinafter defined) for the Ordinary Shares purchased at the Company's principal offices (presently located at 5 David Navon Street, Moshav Magshimim, Israel, 56910) the registered holder of a Warrant Certificate (the "HOLDER" or "HOLDERS") shall be entitled to receive a certificate or certificates for the Ordinary Shares so purchased. The purchase rights represented by each Warrant Certificate are exercisable at the option of the Holder thereof, in whole or in part (but not as to fractional Ordinary Shares underlying the Warrants). Warrants may be exercised to purchase all or part of the total number of Ordinary Shares requested thereby. In the case of the purchase of less than all the Ordinary Shares purchasable under any Warrant Certificate, the Company shall cancel said Warrant Certificate upon the surrender thereof and shall execute and deliver a new Warrant Certificate of like tenor for the balance of the Ordinary Shares purchasable thereunder. 3.2 COMPULSORY EXERCISE. Notwithstanding the aforesaid, prior to the expiry of the Exercise Period, the Company may demand the exercise by the Holder of the Warrant Shares in the event that: (i) the price of one (1) Ordinary Shares, as quoted on the Nasdaq National List, is US$11 or more for a consecutive period of twenty (20) days in which trading was conducted in the Company's shares on Nasdaq; or (ii) the closing of a public offering by the Company, at an effective price per Ordinary Share (i.e. taking into account the economical value of other securities offered, if any) of US$11 or more (any of the foregoing, an "EXERCISE EVENT"). Upon the occurrence of an Exercise Event, the company shall send to the Holders written notices of the particulars of the Exercise Event, after which the Holders shall be entitled, within 10 days after receipt of such notice (the "COMPULSORY EXERCISE PERIOD"), transfer to the Company the Exercise Price for any Warrant Share such Holder wishes to exercise, according to the procedure set forth in Section 3.1 above. 3.3 Without derogating from the aforesaid, immediately after the end of the Exercise Period or the Compulsory Exercise Period, as applicable, the right of the Holders to exercise the Warrants shall automatically expire. 4. ISSUANCE OF CERTIFICATES. Upon the exercise of the Warrants, the issuance of certificates for Ordinary Shares or other securities, properties or rights underlying such Warrants, shall be made forthwith (and in any event within five (5) business days thereafter) without charge to the Holder thereof, and such certificates shall (subject to the provisions of Sections 5 and 7 hereof) be issued in the name of, or in such names as may be directed by, the Holder thereof; provided, however, that the Company shall only be required to pay taxes which are due as a direct result of the issuance of the Ordinary Shares or other securities, properties or rights underlying such Warrants (e.g. stamp duty), and will not be required to pay any tax which may be (i) due as a result of the specific identity of the Holder or (ii) payable in respect of any transfer involved in the issuance and delivery of any such certificates in a name other than that of the Holder and the Company shall not be required to issue or deliver such certificates unless or until the person or persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid. The Warrant Certificates and the certificates representing the Ordinary Shares (and/or other securities, property or rights issuable upon the exercise of the Warrants) shall be executed on behalf of the Company by the manual or facsimile signature of Company's authorized signatory(ies) under its corporate stamp reproduced thereon, attested to by the manual or facsimile signature of the then present Secretary or Assistant Secretary of the Company. Warrant Certificates shall be dated the date of execution by the Company upon initial issuance, division, exchange, substitution or transfer. 5. RESTRICTION ON TRANSFER OF WARRANTS. The Holder of a Warrant Certificate, by its acceptance thereof, covenants and agrees that the Warrants described therein are being acquired as an investment and not with a view to the distribution thereof. The Holder shall not assign or transfer any of the Warrant and/or Warrant Certificates to any third party, other than following a bona fide sale or transfer by the Holder to any unaffiliated transferee thereof of all the Ordinary Shares purchased by such Holder under the Investment Agreement and/or transfer by each of the Holders of up to 10% of the Warrants to Mt. Mordechai Weiss and/or Mr. Eylon Peuchas, provided however, that Section 7 below shall not pertain to the Ordinary Shares underlying the Warrant Certificates transferred as aforesaid. The Holder may assign or transfer any of the Warrant Certificates to entities controlling, controlled or under common control with, such Holder. For purpose of this Section 5, "CONTROL" shall bear the meaning of such term in Section 1 of the Israeli Securities Law, 1968. 6. EXERCISE PRICE. 6.1 INITIAL AND ADJUSTED EXERCISE PRICE. Except as otherwise provided in Section 8 hereof, the initial exercise price of each Warrant shall be US$8.00 per Ordinary Share. The adjusted exercise price of each Warrant shall be the price which shall result from time to time from any and all adjustments of the initial exercise price in accordance with the provisions of Section 8 hereof. 6.2 EXERCISE PRICE. The term "Exercise Price" herein shall mean the initial exercise price or the adjusted exercise price, depending upon the context. 7. REGISTRATION RIGHTS. 7.1 REGISTRATION UNDER THE SECURITIES ACT OF 1933. (a) The Warrants, and the Ordinary Shares issuable upon exercise of the Warrants, have not been registered under the Securities Act of 1933, as amended (the "Act"). Upon exercise, in part or in whole, of the Warrant certificates representing the Ordinary Shares and any other securities issuable upon exercise of the Warrants shall bear the following legend: The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended ("Act"), and may not be offered or sold except pursuant to (i) an effective registration statement under the Act, (ii) to the extent applicable, Rule 144 under the Act (or any similar rule under such Act relating to the disposition of securities), or (iii) an opinion of counsel, if such opinion shall be reasonably satisfactory to counsel to the issuer, that an exemption from registration under such Act is available. (b) Holders of the Ordinary Shares shall be entitled to all of the rights and privileges relating to registration rights afforded to the Holders in the Investment Agreement (including the Registration Rights Agreement attached thereto), which is incorporated herein by reference and expressly made a part hereof. 8. ADJUSTMENTS TO EXERCISE PRICE AND NUMBER OF SECURITIES. 8.1 SUBDIVISION AND COMBINATION. In case the Company shall at any time subdivide or combine the outstanding Ordinary Shares, the Exercise Price shall forthwith be proportionately decreased in the case of subdivision or increased in the case of combination. 8.2 STOCK DIVIDENDS AND DISTRIBUTIONS. In case the Company shall pay a dividend on, or make a distribution of, Ordinary Shares or of the Company's capital stock convertible into Ordinary Shares, the Exercise Price shall forthwith be proportionately decreased. An adjustment made pursuant to this Section 8.2 shall be made as of the record date for the subject stock dividend or distribution. 8.3 ADJUSTMENT IN NUMBER OF SECURITIES. Upon each adjustment of the Exercise Price pursuant to the provisions of this Section 8, the number of Ordinary Shares issuable upon the exercise of each Warrant shall be adjusted to the nearest full amount by multiplying a number equal to the Exercise Price in effect immediately prior to such adjustment by the number of Ordinary Shares issuable upon exercise of the Warrants immediately prior to such adjustment and dividing the product so obtained by the adjusted Exercise Price. 8.4 DEFINITION OF ORDINARY SHARES. For the purpose of this Agreement, the term "Ordinary Shares" shall mean (i) the class of shares designated as Ordinary Shares in the Articles of Association of the Company as may be amended as of the date hereof, or (ii) any other class of shares resulting from successive changes or reclassifications of such Ordinary Shares consisting solely of changes in nominal value, or from nominal value to no nominal value, or from no nominal value to nominal value. 8.5 MERGER OR CONSOLIDATION. In case of any consolidation of the Company with, or merger of the Company with, or merger of the Company into, or sale by the Company of all or substantially all of its assets to another corporation (other than a consolidation or merger which does not result in any reclassification or change of the outstanding Ordinary Shares), the corporation formed by such consolidation or merger or acquiror of such assets shall execute and deliver to the Holder a supplemental warrant agreement providing that the Holder of each Warrant then outstanding or to be outstanding shall have the right thereafter (until the expiration of such Warrant) to receive, upon exercise of such Warrant, the kind and amount of shares of stock and other securities and property receivable upon such consolidation or merger, by a holder of the number of Ordinary Shares of the Company for which such Warrant might have been exercised immediately prior to such consolidation, merger, sale or transfer. Such supplemental warrant agreement shall provide for adjustments which shall be identical to the adjustments provided in Section 8. The above provision of this Subsection shall similarly apply to successive consolidations or mergers. 8.6 NO ADJUSTMENT OF EXERCISE PRICE IN CERTAIN CASES. No adjustment of the Exercise Price shall be made. (a) Upon the issuance or sale of the Warrants or the Ordinary Shares issuable upon the exercise of the Warrants or the options, rights and Warrants issued and outstanding on the date hereof; or (b) If the amount of said adjustment shall be less than 2 cents ($.02) per Ordinary Share, provided, however, that in such case any adjustment that would otherwise be required then to be made shall be carried forward and shall be made at the time of and together with the next subsequent adjustment which, together with any adjustment so carried forward, shall amount to at least 2 cents ($.02) per Ordinary Share. 9. EXCHANGE AND REPLACEMENT OF WARRANT CERTIFICATES. Each Warrant Certificate is exchangeable without expense, upon the surrender thereof by the registered Holder at the principal executive office of the Company, for a new Warrant Certificate of like tenor and date representing in the aggregate the right to purchase the same number of Ordinary Shares in such denominations as shall be designated by the Holder thereof at the time of such surrender. Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of any Warrant Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it, and reimbursement to the Company of all reasonable expenses incidental thereto, and upon surrender and cancellation of the Warrants, if mutilated, the Company will make and deliver a new Warrant Certificate of like tenor, in lieu therof. 10. ELIMINATION OF PRACTICAL INTERESTS. The Company shall not be required to issue certificates representing fractions of Ordinary Shares upon the exercise of the Warrants, nor shall it be required to issue scrip or pay cash in lieu of fractional interests, it being the intent of the parties that all fractional interests shall be eliminated by rounding any fraction up to the nearest whole number of Ordinary Shares, or other securities, properties or rights 11. RESERVATION AND LISTING OF SECURITIES. The Company shall at all times reserve and keep available out of its authorized Ordinary Shares, solely for the purpose of issuance upon the exercise of the Warrants, such number of Ordinary Shares or other securities, properties or rights as shall be issuable upon the exercise thereof. The Company covenants and agrees that, upon exercise of the Warrants and payment of the Exercise Price therefor, all Ordinary Shares and other securities issuable upon such exercise shall be duly and validly issued, full paid, non-assessable and not subject to the preemptive rights of any stockholder. As long as the Warrants shall be outstanding, the Company shall use its best efforts to cause all Ordinary Shares issuable upon the exercise of the Warrants to be listed (subject to official notice of issuance) on all securities exchanges, if any, on which the Ordinary Shares issued to the public in connection herewith may then be listed and/or quoted on NASDAQ. 12. NOTICES TO WARRANT HOLDERS. Nothing contained in this Agreement shall be construed as conferring upon the Holders the right to vote or to consent or to receive notice as a stockholder in respect of any meetings of stockholders for the election of directors or any other matter, or as having any rights whatsoever as a stockholder of the Company. If, however, at any time prior to the expiration of the Warrants and their exercise, any of the following events shall occur: (a) the Company shall take a record of the holders of its Ordinary Shares for the purpose of entitling them to receive a dividend or distribution payable otherwise than in cash, or a cash dividend or distribution payable otherwise than out of than current or retained earnings, as indicated by the accounting treatment of such dividend or distribution on the books of the Company; or (b) the Company shall offer to all the holders of its Ordinary Shares any additional shares of capital stock of the Company or securities convertible into or exchangeable for shares of capital stock of the Company, or any option, right or warrant to subscribe thereof; or (c) a dissolution, liquidation, or winding up of the Company (other than in connection with a consolidation or merger) or a sale of all or substantially all of its property, assets and business as an entirety shall be proposed. then, in any one or more of said events, the Company shall give written notice of such event at least fifteen (15) days prior to the date fixed as a record date or the date of closing the transfer books for the determination of the stockholders entitled to such dividend, distribution, convertible or exchangeable securities or subscription rights, or entitled to vote on such proposed dissolution, liquidation, winding up or sale. 13. NOTICES. All notices, requests, consents and other communications hereunder shall in writing, and shall be deemed to have been duly made when delivered, or mailed by registered or certified mail, return receipt requested; (a) If to the registered Holder of the Warrants, to the address of such Holder as shown on the books of the Company; or (b) If to the Company, at P.O. Box 8440, Moshav Magshimim, Israel, 56910 or to such other address as the Company may designate by notice to the Holders. 14. SUPPLEMENTS AND AGREEMENTS. The Company and the Holder may from time to time supplement or amend this Agreement without the approval of any Holders of Warrant Certificates in order to cure any ambiguity, to correct or supplement any provision contained herein which may be defective or inconsistent with any provisions herein, or to make any other provisions in regard to matters or questions arising hereunder which the Company and Josephthal may deem necessary or desirable and which the Company and Josephthal deem shall not adversely affect the interests of the Holders of Warrant Certificates. 15. SUCCESSORS. All the covenants and provisions of this Agreement shall be binding upon and inure to the benefit of the Company, the Holders and their respective successors and assigns hereunder. 16. TERMINATION. This Agreement shall terminate at the close of business on August 17, 2003. 17. GOVERNING LAW: SUBMISSION TO JURISDICTION. This Agreement and each Warrant Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Israel and for all purposes shall be construed in accordance with the laws of said State, without giving effect to the rules of said State governing the conflicts of laws. The Company and the Holders hereby agree that any action, proceeding or claim against it arising out of, or relating in any way to, this Agreement shall be brought and enforced in the courts of the State of New York or of the United States of America for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company and the Holders hereby irrevocably waive any objection to such exclusive jurisdiction or inconvenient forum. Any such process or summons to be served upon any of the Company and the Holders (at the option of the party bringing such action, proceeding or claim) may be served by transmitting a copy thereof, by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 13 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the party so served in any action, proceeding or claim. The Company and the Holders agree that the prevailing party(ies) in any such action or proceeding shall be entitled to recover from the other party(ies) all of its/their reasonable legal costs and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor. 18. ENTIRE AGREEMENT: MODIFICATION. This Agreement (including the Investment Agreement to the extent portions thereof are referred to herein) contains the entire understanding between the parties hereto with respect to the subject matter hereof and may not be modified or amended except by a writing duly signed by the party against whom enforcement of the modification or amendment is sought. 19. SEVERABILITY. If any provision of this Agreement shall be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision of this Agreement. 20. CAPTIONS. The caption headings of the Sections of this Agreement are for convenience of reference only and are not intended, nor should they be construed as, a part of this Agreement and shall be given no substantive effect. 21. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be construed to give to any person or corporation other than the Company and any other Holder(s) of the "Warrant Certificates or Ordinary Shares any right, remedy or claim under this Agreement; and this Agreement shall be for the sole and exclusive benefit of the Company any other Holder(s) of the Warrant Certificates or Ordinary Shares. 22. COUNTERPARTS. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and such counterparts shall together constitute but one and the same instrument. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed, as of the day and year first above written. NUR MACROPRINTERS LTD. By: /s/ Erez Shachar ----------------------------------- Erez Shachar President & Chief Executive Officer DOVRAT & CO. LTD. ISAL AMLAT INVESTMENT (1993) LTD. By: /s/ Illegible By: /s/ Illegible ----------------------- ---------------------------------- Name: Name Title: Title: EXHIBIT A THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE UPON EXERCISE HEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), (ii) TO THE EXTENT APPLICABLE, RULE 144 UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE. THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN. No. W- Warrants ----------------------- --------- WARRANT CERTIFICATE This Warrant Certificate certifies that __________________, or registered assigns, is the registered holder of a warrant exercisable, at any time from August ___, 1999 until 5:30 p.m. Israel time on August ___, 2003 (the "EXERCISE PERIOD" and "EXPIRATION DATE"), up to _____ fully-paid and non-assessable Ordinary Shares, NIS 1.0 nominal value per share (the "ORDINARY SHARES" and "WARRANT SHARES") of Nur Macroprinters Ltd., an Israeli corporation (the "COMPANY"), at the initial exercise price, subject to adjustment in certain events of US$8.00 per Ordinary Share (the "EXERCISE PRICE"); upon surrender of this Warrant Certificate and payment of the applicable Exercise Price at an office or agency of the Company, but subject to the conditions set forth herein and in the Warrant Agreement dated as of August 18, 1999 between the Company, Dovrat & Co. Ltd. and Isal Amlat Investment (1993) Ltd. (the "WARRANT AGREEMENT"). Payment of the applicable Exercise Price shall be made by certified check payable to the order of the Company. Notwithstanding the aforesaid, as set forth in the Warrant Agreement, prior to the expiry of the Exercise Period, the Company may demand the exercise by the Holder of the Warrant Shares in the event that: (i) The price of one (1) Ordinary Share, as quoted on the Nasdaq National List, is US$11 or more for a consecutive period of twenty (20) days in which trading was conducted in the Company's shares on Nasdaq; or (ii) The closing of a public offering by the Company, at an effective price per Ordinary Share (i.e. taking into account the economical value of other securities offered, if any) of US$11 or more. No Warrant may be exercised after 5:30 p.m., Israel time, on the Expiration Date, at which time all Warrants evidenced hereby, unless exercised prior thereto, shall thereafter be void. The Warrants evidenced by this Warrant Certificate are part of a duly authorized issue of Warrants issued pursuant to the Warrant Agreement, which Warrant Agreement is hereby incorporated by reference herein and made a part of this instrument and is hereby referred to for a description of the rights, limitation of rights, obligations, duties and immunities thereunder of the Company and the holders (the words "HOLDERS" or "HOLDER" meaning the registered holders or registered holder) of the Warrants. The Warrant Agreement provides that upon the occurrence of certain events, the then applicable Exercise Price and the type and/or number of the Company's securities issuable thereupon may, subject to certain conditions, be adjusted. In such event, the Company will, at the request of the holder, issue a new Warrant Certificate evidencing the adjustment in the then applicable Exercise Price and the number and/or type of securities issuable upon the exercise of the Warrants; provided, however, that the failure of the Company to issue such new Warrant Certificates shall not in any way change, after, or otherwise impair, the rights of the holder as set forth in the Warrant Agreement. Upon due presentment for registration of transfer of this Warrant Certificate at an office or agency of the Company, a new Warrant Certificate or Warrant Certificates of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this Warrant Certificate, subject to the limitations provided herein and in the Warrant Agreement, without any charge except for any tax or other governmental charge imposed in connection with such transfer. Upon the exercise of less than all of the Warrants evidenced by this Certificate, the Company shall forthwith issue to the holder hereof a new Warrant Certificate representing such number of unexercised Warrants. The Company may deem and treat the registered holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof and of any distribution to the holder(s) hereof, and for all other purposes, and the Company shall not be affected by any notice to the contrary. All terms used in this Warrant Certificate which are defined in the Warrant Agreement shall have the meanings assigned to them in the Warrant Agreement. IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly executed under its corporate stamp. Dated August 18, 1999 NUR MACROPRINTERS LTD. By: /s/ Erez Shachar ----------------------------------- Erez Shachar President & Chief Executive Officer [FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3] The undersigned hereby irrevocably elects to exercise the right, represented by this Warrant Certificate, to purchase [CHECK APPROPRIATE BOX]: all the Ordinary Shares under the Warrant Certificate; or part [___________][INDICATE NUMBER] of the Ordinary Shares under the Warrant Certificate: and herewith tenders in payment for such securities a certified check payable to the order of NUR MACROPRINTERS LTD. in the amount of $________, all in accordance with the terms hereof. The undersigned requests that a certificate for such securities be registered in the name of _____________________________ _______________________________________ whose address is _____________________ _____________________________________________ such Certificate be delivered to ________________________________________ whose address is ____________________ _________________________________________________. Dated: Signature __________________________________ (Signature must conform in all respects to name of holder as specified on the face of the Warrant Certificate.) (Insert Social Security or Other Identifying Number of Holder) [FORM OF ASSIGNMENT] (To be executed, subject to the limitations set forth in the Warrant Agreement, by the registered holder if such holder desires to transfer the Warrant Certificate.) FOR VALUE RECEIVED hereby sells, assigns and transfers unto (Please print name and address of transferee) this Warrant Certificate, together with all right, title and interest therein, and hereby irrevocably constitutes and appoints ______________________ ______________ Attorney, to transfer the within Warrant Certificate on the books of the within-named Company, with full power of substitution. Dated: Signature __________________________________ (Signature must conform in all respects to name of holder as specified on the face of the Warrant Certificate.) (Insert Social Security or Other Identifying Number of Assignee). SCHEDULE 1 ----------
- ---------------------------------------------------------------------------------------------- DOVRAT ISAL TOTAL INVESTMENT -------------------------- ------------------------- ------------------------- ORDINARY US$ ORDINARY US$ ORDINARY in US$ SHARES SHARES SHARES - ---------------------------------------------------------------------------------------------- ISSUED 60,000 330,000 540,000 2,970,000 600,000 3,300,000 SHARES - ---------------------------------------------------------------------------------------------- WARRANTS 15,000 120,000 135,000 1,080,000 150,000 1,200,000 - ---------------------------------------------------------------------------------------------- TOTAL 75,000 450,000 675,000 4,050,000 750,000 4,500,000 - ----------------------------------------------------------------------------------------------
SCHEDULE 9 REGISTRATION RIGHTS AGREEMENT The following provisions shall govern the registration of Issued Shares and the Warrant Shares (upon the exercise thereof): 1. DEFINITIONS. Unless otherwise defined herein, all capitalized terms shall bare the meaning ascribed thereto in the Investment Agreement (as defined below). As used herein, the following terms have the following meaning: "AGREEMENT" means this Registration Rights Agreement "INVESTMENT AGREEMENT" means that certain Share and Warrant Purchase Agreement, date August __, 1999, between Nur Macroprinters Ltd., Dovrat & Co. Ltd. and Isal Amlat Investment (1993) Ltd. "ORDINARY SHARES" means Ordinary Shares of par value NIS 1.00 each of the Company. "HOLDER" means any holder of outstanding Registrable Shares or shares convertible into Registrable shares, who acquired such Registrable Shares or shares convertible into Registrable Shares in a transaction or series of transactions not involving any registered offering. "COMMISSION" refers to the Securities and Exchange Commission. "REGISTER", "REGISTERED", and "REGISTRATION" refer to a registration effected by filing a registration statement in compliance with the Securities Act and the declaration or ordering by the commission of effectiveness of such registration statement, or the equivalent actions under the laws of another jurisdiction. "REGISTRABLE SHARES" means the Ordinary Shares purchased by Isal and Dovrat pursuant to the Investment Agreement and any Ordinary Shares exercised under the Warrant (as defined therein). "SECURITIES ACT" shall mean the U.S. Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time. 2. INCIDENTAL REGISTRATION. If the Company at any time proposes to register any of its securities, other than in a demand registration under Section 3 or Section 5 of the Agreement, on any form (other than a Registration Statement on Form S-8 or any successor form for securities to be offered to employees of the Company pursuant to any employer benefit plan), for its own account or for the account of any other person, including in an initial public offering, it shall give notice to the Holder of such intention. Upon the written request of the Holder given within twenty (20) days after receipt of any such notice, the Company shall include in such registration all of the Registrable Shares indicated in such request, so as to permit the disposition of the shares so registered in the manner requested by the Holder. Notwithstanding any other provision of this Section 2, with respect to an underwritten initial public offering by the Company, if the managing underwriter advises the Company in writing that marketing or other factors require a limitation of the number of shares to be underwritten, then there shall be excluded from such registration and underwriting to the extent necessary to satisfy such limitation, shares held by the Holder and by other shareholders of the Company who are entitled to have their shares included in such registration, pro rata among them to the extent necessary to satisfy such limitation. To the extent Registrable Securities are excluded from such underwriting, the Holder shall agree not to sell its Registrable Shares included in the registration statement for such period, not to exceed 180 days, as may be required by the managing underwriter, and the Company shall keep effective and current such registration statement for such period as may be required to enable the Holder to complete the distribution and resale of its Registrable Shares. 3. DEMAND REGISTRATION. The Holders are entitled once (1) to request in writing that all or part of the Registrable Shares shall be registered under the Securities Act ("DEMAND"). Such Demand must request the registration of shares in a minimum of two million United States Dollars ($2,000,000). Thereupon, the Company shall effect the registration, on Form F-1 or on Form F-3 (or F-3, or any successor form for securities to be offered in a transaction of the type referred to in Rule 415 under the Securities Act, and any related qualification or compliance), of all Registrable Shares as to which it has received such request for registration as promptly as practicable; provided, however, that the Company shall not be required to effect any registration under this Section 3 within a period of one hundred and eighty (180) days, (but shall be required to prepare and file the registration statement within such period), following the effective date of a previous registration in which the Holder had the right to participate pursuant to Section 2. Should the lock-up in accordance with Section 12 below be for a period short than 180 days, then the 180 period of the preceding sentence shall be shortened accordingly. In the event that the Holders shall exercise the Warrants in full (according to the terms of the Investment Agreement), and prior to such exercise the Holders shall also have exercised the Demand, then the Holders shall be entitled to one additional demand registration (on F-1 or F-3 forms, if available) with respect to the Warrant Shares, and the provisions of this Section 3 above shall apply to such demand registration. 4. DELAY OF REGISTRATION. The Company may delay the filing or effectiveness of any registration statement prepared pursuant to Section 3 for a period of up to 180 days (and, if the Company makes a good faith determination that further delay is necessary, for up to an additional 60 days) after the date of a request for registration pursuant to Section 3, if the Company determines in good faith that (a) it is in possession of material, non-public information concerning an acquisition, 2 merger, recapitalization, consolidation, reorganization, or other material transaction by or of the Company, and (b) disclosure of such information would jeopardize any such transaction or otherwise materially harm the Company; provided, however, that the Company may exercise such right to delay the filing of a registration statement only once and that such delay period will not delay the effectiveness of a registration statement demanded under Section 3 beyond a period of 180 days following the effective date of a previous registration. 5. TERMINATION OF REGISTRATION RIGHTS 5.1 No Holder shall be entitled to exercise any right provided for in Sections 2 or 3 hereof, after four years following the date of the Closing of the Investment Agreement. 5.2 In addition, the right of any Holder to request registration pursuant to Sections 2 and 3 shall terminate with respect to such Holder upon such date that all shares of Registrable Securities held or entitled to be held upon conversion by such Holder may immediately be sold under Rule 144 (or any successor rule) during any sixty-day period. 6. DESIGNATION OF UNDERWRITER. 6.1 In the event of any registration effected pursuant to Section 3, the Holders that submitted the request for registration may provide their recommendation of candidates to be the managing underwriter(s) in any underwritten offering and the Company shall have the sole discretion to accept such candidate or offer a different managing underwriter(s). 6.2 In the case of any registration initiated by the Company, the Company shall have the right to designate the managing underwriter in any underwritten offering. 7. EXPENSES. All expenses incurred in connection with any registration under Section 2 or Section 3 shall be borne by the Company; provided, however, that the Holder shall pay its pro rata portion of the discounts payable to any underwriter. 8. INDEMNITIES. In the event of any registered offering of Ordinary Shares pursuant to this Agreement: 8.1 The Company will indemnify and hold harmless, to the fullest extent permitted by law, the Holder and any underwriter for the Holder, and each person, if any, who controls the Holder or such underwriter, from and against any and all losses, damages, claims, liabilities, joint or several, costs, and expenses (including any amounts paid in any settlement effected with the Company's consent) to which the Holder or any such underwriter or controlling person may become subject under applicable law or otherwise, insofar as such losses, damages, claims, liabilities (or actions or proceedings in respect thereof), costs, or expenses arise out of are based 3 upon (i) any untrue statement or alleged untrue statement of any material fact contained in the registration statement or included in the prospectus, as amended or supplemented, or (ii) the omission or alleged omission to state therein a material fact required to be started therein or necessary to make the statement therein, in the light of the circumstances in which they are made, not misleading, and the Company will reimburse the Holder, such underwriter, and each such controlling person of the Holder or the underwriter, promptly upon demand, for any reasonable legal or any other expenses incurred by them in connection with investigating, preparing to defend, or defending against, or appearing as a third-party witness in connection with such loss, claim, damage, liability, action, or proceeding; PROVIDED, HOWEVER, that the Company will not be liable in any such cease to the extent that any such loss, damage, liability, cost, or expense arises solely out of or is based solely upon an untrue statement or alleged untrue statement, or omission or alleged omission, so made in conformity with information furnished to the Company in writing by the Holder, such underwriter, or such controlling persons in writing specifically for inclusion therein; PROVIDED, FURTHER, that this indemnity shall not be deemed to relieve any underwriter of any of its due diligence obligations; and PROVIDED, FURTHER, that the indemnity agreement contained in this Sub-Section 8.1 shall not apply to amounts paid in settlement of any such claim, loss, damage, liability, or action if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Holder, the underwriter, or any controlling, person of the Holder or the underwriter, and regardless of any sale in connection with such offering by the Holder. Such indemnity shall survive the transfer of securities by a Holder. 8.2 The Holder participating in a registration hereunder will indemnify and hold harmless the Company, any underwriter for the Company, and each person, if any, who controls the Company or such underwriter, from and against any and all losses, damages, claims, liabilities, costs, or expenses (including any amount paid in any settlement effected with the Holder's consent) to which the Company or any such controlling person and/or any such underwriter may become subject under applicable law or otherwise, insofar as such losses, damages, claims, liabilities (or actions or proceedings in respect thereof), costs, or expense arise out of or are based on (i) any untrue or alleged untrue statement of any material fact contained in the registration statement or included in the prospectus, as amended or supplemented, or (ii) the omission or the alleged omission to state therein a material fact required to be started therein or necessary to make the statements therein, in the light of the circumstance in which they were made, not misleading, and the Holder will reimburse the Company, any underwriter, and each such controlling person of the Company or any underwriter, promptly upon demand, for any reasonable legal or other expenses incurred by them in connection with investigating, preparing to defend, or defending against, or appearing as a third-party witness in connection with such loss, claim, damage, action, or proceeding; in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was so made in strict conformity with written information furnished in a certificate by the Holder specifically for inclusion therein. The foregoing indemnity agreement is subject to the condition that, insofar as it relates to any such untrue statement (or alleged untrue statement), or omission (or alleged omission) made in the preliminary prospectus but eliminated or remedied in the amended prospectus at the time the 4 registration statement becomes effective in the Final Prospectus, such indemnity agreement shall not inure to the benefit of (i) the Company and (ii) any underwriter, if a copy of the Final Prospectus was not furnished to the person or entity asserting the loss, liability, claim, or damage at or prior to the time such furnishing is required by the Security Act; PROVIDED, FURTHER, that this indemnity shall not be deemed to relive any underwriter of any of its due diligence obligations; PROVIDED, FURTHER, that the indemnity agreement contained in this Sub-Section 8.2 shall not apply to amounts paid in settlement of any such claim loss, damage, liability, or action if such settlement is effected without the consent of the Holder, as the case may be, which consent shall not be unreasonably withheld. In no event shall the liability of the Holder exceed the gross proceeds from the offering received by the Holder. 8.3 Promptly after receipt by an indemnified party pursuant to the provisions of Section 8.1 of 8.2 of notice of the commencement of any action involving the subject matter of the foregoing indemnity provisions, such indemnified party will, if a claim thereof is to be made against the indemnifying party pursuant to the provisions of said Section 8.1 or 8.2, promptly notify the indemnifying party of the commencement thereof; but the omission to notify the indemnifying party shall only relieve it from any liability which it may have to any indemnified party to the extent that such indemnifying party has been damaged by such omission to notify hereunder. In case such action is brought against any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party shall have the right to participate in, and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party; PROVIDED, HOWEVER, that if the defendants in any action include both the indemnified party and the indemnifying party and if in the reasonable judgment of the indemnified party there are separate defenses that are available to the indemnified party or there is a conflict of interest which would prevent counsel for the indemnifying party from also representing the indemnified party, the indemnified party or parties shall have the right to select, at the expense of the indemnifying party, separate counsel to participate in the defense of such action on behalf of such indemnified party or parties; PROVIDED, FURTHER, HOWEVER, that if the Holder are the indemnified party, the Holder shall be entitled to one separate counsel at the expense of the Company and if underwriters are also indemnified parties who are entitled to counsel separate from the indemnifying party, then all underwriters as a group shall be entitled to one separate counsel at the expense of the Company. After notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party pursuant to the provisions of said Section 8.1 or 8.2 for any legal or other expense subsequently incurred by such indemnified party in connection with the defense thereof, unless (i) the indemnified party shall have employed counsel in accordance with the provision of the preceding sentence, (ii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified party within a reasonable time after the notice of the commencement of the action and within 15 days after written notice of the indemnified party's intention to employ separate counsel pursuant to the previous sentence, or (iii) the indemnifying party has authorized the employment of counsel for the indemnified party at the expense of the indemnifying party. No indemnifying party will consent to entry of any judgment of enter into any settlement which does not include as an unconditional term thereof the 5 giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation. 8.4 If recovery is not available under the foregoing indemnification provisions, for any reason other than as specified therein, the parties entitled to indemnification by the terms thereof shall be entitled to contribution to liabilities and expenses. In determining the amount of contribution to which the respective parties are entitled, there shall be considered the parties' relative knowledge and access to information concerning the matter with respect to which was asserted, the opportunity to correct and prevent any statement or omission, and any other equitable consideration appropriate under the circumstances. In no event shall any party that is found liable for fraudulent misrepresentation within the meaning of Section 1(f) of the Securities Act be entitled to contribution hereunder from any party not found so liable, and in no event shall any contribution from any Holder be more than the gross proceeds from the offering received by such Holder. 9. OBLIGATIONS OF THE COMPANY. Whenever required under this Agreement to effect the registration of any Registrable Shares, the Company shall, as expeditiously as possible: 9.1 Prepare and file with the Commission a registration statement with respect to such Registrable Shares and use its best efforts to cause such registration statement to become effective, and, upon the request of the Holder, keep such registration statement effective for a period of up to 90 days (for any registration other than under Form F-3 or S-3 which shall be kept effective subject to the provisions of Rule 415), or, if sooner, until the distribution contemplated in the Registration Statement has been completed. 9.2 Prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all Registrable Shares covered by such registration statement. 9.3 Furnish to the Holder such numbers of copies of a prospectus, including a preliminary prospectus, in conformity with the requirement of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Shares owned by them. 9.4 In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering. The Holder participating in such underwriting shall also enter into and perform its obligations under such agreement. 9.5 Notify each holder of Registrable Shares covered by such registration statement at any time which a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an 6 untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, and promptly amend such prospectus by filing a post effective supplement so that such prospectus does not contain an untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and deliver copies thereof to the Holder. 9.6 Cause all Registrable Shares registered pursuant hereunder to be listed on each securities exchange or Nasdaq on which similar securities issued by the Company are then listed. 9.7 Provide a transfer agent and registrar for all Registrable Shares registered pursuant hereunder and a CUSIP number for all such Registrable Shares, in each case not latter than the effective date of such registration. 9.8 Furnish, at the request of the Holder requesting registration of Registrable Shares pursuant to this Agreement, on the date that such Registrable Shares are delivered to the underwriters for sale in connection with a registration pursuant to this AGreement, if such securities are being sold through underwriters, or, if such securities are not being sold through underwriters, on the date that the registration statement with respect to such securities becomes effective, (i) an opinion, dated such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to the Holder requesting registration of Registrable Shares, and (ii) a letter dated such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering addressed to the underwriters, if any, and to the Holder requesting registration of Registrable Shares. 9.9 CONDITIONS TO REGISTRATION. The Company shall not be obligated to effect the registration of the Registrable Shares pursuant to this Agreement unless the Holder participating therein consent to customary conditions of a reasonable nature that are imposed by the Company, including, but no limited to, the following: (a) conditions prohibiting the sale of Registrable Shares by the Holder form 30 days before the filing of the registration statement until the registration statement becomes effective; (b) conditions requiring the Holder to comply with all applicable provisions of the Securities Act and the United States Securities Exchange Act of 1934, as amended, (the "Exchange Act"), including, but not limited to, the prospectus delivery requirement, and to furnish to the Company information about sales made in such public offering; and (c) conditions prohibiting the Holder, upon receipt of written notice from the Company that it is required by law to correct or update the 7 registration statement or prospectus, from effecting sales of the Registrable Shares until the Company has completed the necessary correction or updating. 10. ASSIGNMENT OF REGISTRATION RIGHTS: The Holder may assign its rights to cause the Company to register Shares pursuant to this Agreement to a transferee of ALL or any part of its Registrable Shares. The transferor shall, within twenty (20) days after such transfer, furnish the Company with written notice of the name and address of such transferee and the securities with respect to which such registration rights are being assigned, and the transferee's written agreement to be bound by this Agreement. 11. LOCK-UP. In any registration of the Company's shares, the Holder acknowledge that any sales of Registrable Shares may be subject to a "lock-up" period restricting such sales beginning thirty (30) days prior to, and for up to one hundred and eighty (180) days following, the effective date of such registration, and the Holder will agree to abide by such customary "lock-up" period as is required by the underwriter in such registration. 12. CUSTOMARY ARRANGEMENTS. The Holder may not participate in any underwritten offering pursuant to a registration filed hereunder unless such person (a) agrees to sell such person's securities on the basis provided in any customary underwriting arrangements, 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; provided, however, that the Holder participating in the underwritten registration may appoint one legal or other representative to negotiate the underwriting arrangements. 13. PUBLIC INFORMATION. At any time and from time to time after the earlier of the close of business on such date as (a) a registration statement filed by the Company under the Securities Act becomes effective, or (b) the Company registers a class of securities under Section 12 of the Exchange Act, the Company shall undertake to make publicly available and available to the Investors adequate current public information within the meaning of, and as required pursuant to, Rule 144. 14. NON-UNITED STATES OFFERING. In the event of a public offering of securities of the Company outside of the United States, the Company will afford the Holder registration rights in accordance with applicable law and comparable in substance to the foregoing registration rights. EX-5.1 4 EXHIBIT 5.1 Exhibit 5.1 [LETTERHEAD OF SHIMONOV BARNEA & CO.] December 9, 1999 Nur Macroprinters Ltd. 5 David Navon Street Magsimim Israel Re: Nur Macroprinters Ltd. -- Registration Statement on Form F-3 ------------------------------------------------------------ Dear Sirs: We have acted as special Israeli counsel for Nur Macroprinters Ltd., an Israeli company (the "CORPORATION"), in connection with the preparation and filing under the United States Securities Act of 1933, as amended (the "ACT"), of a registration statement on Form F-3 (the "REGISTRATION STATEMENT") with the Securities and Exchange Commission connection with: (i) Up to 7,758,173 Ordinary Shares par value NIS 1.0 each of the Corporation, comprising part of the existing issued share capital of the Corporation, which are to be sold by shareholders of the Corporation, as detailed in the Registration Statement (the "SELLING SHAREHOLDERS SHARES"), and (ii) up to 705,000 Ordinary Shares par value NIS 1.0 each of the Corporation issuable upon exercise of Warrants granted by the Corporation (the "WARRANT SHARES"). As such special counsel, we have examined originals and copies, certified or otherwise identified to our satisfaction, of all such agreements, certificates and other 1 of 2 statements of the Corporation's officers and other representatives, and other documents as we have deemed necessary as a basis for this opinion. In our examination we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity with the originals of all documents submitted to us as copies. We have, when relevant facts material to our opinion were not independently established by us, relied, to the extent we deemed such reliance proper, upon written or oral statements of officers and other representatives of the Corporation. In giving the opinion expressed herein, no opinion is expressed as to the laws of any jurisdiction other than the State of Israel. Based upon and subject to the foregoing, we are of the opinion that: (i) The Selling Shareholders Shares have been duly and validly authorized and are validly issued, fully paid and non-assessable. (ii) The Warrant Shares have been duly authorized for issuance by the Corporation, and upon issuance and delivery against payment therefor, will be validly issued, fully paid and non-assessable. We consent to the filing of this opinion with the Securities and Exchange Commission as an exhibit to the Registration Statement and to the references to our name under the headings "Legal Matters" in the Registration Statement. Very truly yours, /s/Shimonov Barnea & Co. Shimonov Barnea & Co. 2 of 2 EX-21 5 EXHIBIT 21 Exhibit 21
LIST OF SUBSIDIARIES Jurisdiction Percent Owned Name of Subsidiary of Incorporation by Registrant - ------------------ ---------------- ------------- Active - ------ NUR Media Solutions S.A. Belgium 100% NUR Advanced Technologies (Europe) S.A. Belgium 100% NUR America Inc. Delaware 100% M.NUR Marketing & Communication GmbH Germany 84% NUR Middle East & Africa, Ltd. Israel 100% NUR Asia Pacific Ltd. Hong Kong 100% NUR Pro Engineering Ltd. Israel 50% Stilachem S.A. Belgium 50% Inactive - -------- NUR Hungaria KFT (1) Hungary 100% Good-Lux S.A. (1) Luxembourg 100% M.B.T. (NUR) Industries Ltd. Israel 100% NUR Print Technologies (1993) Ltd. Israel 100% N.A.T. Holdings and Investments (1997) Ltd. Israel 100%
- ---------------------- (1) Represents the percentages of ownership of NUR Media Solutions S.A. in these subsidiaries. EX-23.1 6 EXHIBIT 23.1 Exhibit 23.1 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Registration Statement on Form F-3 of Nur Macroprinters Ltd. and in the related Prospectus of our report dated March 1, 1999, with respect to the consolidated financial statements of Nur Macroprinters Ltd. included in its Annual Report (Form 20-F) for the year ended December 31, 1998, filed with the Securities and Exchange Commission. Yours truly, Tel-Aviv, Israel /s/ Kost Forer & Gabbay December 6, 1999 -------------------------------------- Kost Forer & Gabbay A member of Ernst & Young International EX-23.2 7 EXHIBIT 23.2 Exhibit 23.2 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the incorporation by reference of our report dated April 21, 1999 of Nur Macroprinter Ltd. in its Registration Statement on Form F-3 filed with the Securities and Exchange Commission and pertaining for the registration of Ordinary Shares of Nur Macroprinters Ltd. Kost, Germany /s/ Willy Knyrim November 30, 1999 ------------------------- Willy Knyrim -----END PRIVACY-ENHANCED MESSAGE-----