Registration Rights Agreement – Given Imaging Ltd.

REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT made as of July 18, 2007 by and among Given
Imaging Ltd., an Israeli corporation (the “Company“),
and the holders of Ordinary Shares in the C ompany
whose signature is affixed hereto (the “Shareholders”).

WHEREAS the Company and the Shareholders previously entered into an Investors
Rights Agreement whereby the Shareholders were provided, inter alia, with
certain registration rights which expired on October 10, 2006 (“Original
Agreement”);

WHEREAS, the Shareholders wish to enter into a new Registration Rights
Agreement with the Company providing the Shareholders with registration rights
with substantially similar terms to those provided in the Original Agreement;
and

WHEREAS, the Audit Committee and the Board of Directors of the Company have
determined that it is in the best interests of the Company that the Company
enter into this Agreement.

NOW, THEREFORE, subject to Section 5 below, in consideration of the covenants
and agreements set forth herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby mutually acknowledged, the
parties hereto covenant and agree as follows:

1. GENERAL PROVISIONS

1.1 Shares Subject to this Agreement. The Parties hereto
expressly agree that the terms and restrictions of this Agreement shall apply to
all shares of the Company’s share capital which any of them now owns or
hereafter acquires by any means, including without limitation by purchase,
assignment or operation of law, or as a result of any share dividend, share
split, reorganization, reclassification, whether voluntary or involuntary, or
other similar transaction, whether by sale, merger, consolidation or other
similar transaction, or by purchase, assignment or operation of law (the
“Shares“).

1.2 Certain Definitions. As used in this Agreement, the
following terms shall have the following respective meanings:

“Affiliate” has the meaning ascribed to that term in Rule 12b-2 under
the Exchange Act, or any successor rule.

“Articles” shall mean the Articles of Association of the Company as
may hereafter be amended in accordance with their terms from time to time.

“Commission” shall mean the Securities and Exchange Commission and any
successor agency of the Federal government administering the Securities Act and
the Exchange Act.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, and any successor Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.

“Ordinary Shares” shall mean (i) the
ordinary shares, NIS 0.05 par value per share, of the Company,
(ii) any other capital shares of the Company,
however designated, authorized on or after the date hereof, which shall neither
be limited to a f ixed sum or percentage of par
value in respect of the rights of the holders thereof to participate in
dividends nor entitled to a preference prior or equal to any class of preferred
shares of the Company in the distribution of assets upon the voluntary or
involuntary liquidation, dissolution or winding up of the Company; and
(iii) any other securities of the Company into
which or for which any of the securities described in (i) or (ii) may be
converted or exchanged pursuant to any recapitalization, reorganization, merger,
consolidation, sale of assets or other similar event.

“Permitted Transferee” shall mean with respect to any Shareholder, any
Person that controls, is controlled by or is under common control with such
Shareholder.

“Person” means an individual, corporation, partnership, limited
liability company, joint venture, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.

The terms “register“, “registered”
and “registration” shall refer to a registration effected by preparing
and filing a registration statement in compliance with the Securities Act and
applicable rules and regulations thereunder, and the declaration or ordering of
the effectiveness of such registration statement, or, as the context may
require, under the Exchange Act or applicable state securities laws.

“Registrable Securities” shall mean (i) Ordinary Shares held by the
Shareholders from time to time and (ii) other Ordinary Shares or other
securities of the Company, in each case, issued or issuable to the Shareholders
or their Permitted Transferees with respect to such Ordinary Shares in
connection with any share split, share dividend, recapitalization,
reorganization, merger, consolidation, sale of assets or similar event,
excluding in any event securities which have been (a) registered under the
Securities Act pursuant to an effective registration statement filed thereunder
and disposed of in accordance with the registration statement covering them,
(b) publicly sold pursuant to Rule 144 under the
Securities Act, or (c) sold by a person in a transaction in which the holder153s
registration rights have not been assigned in accordance with Section 3.14
hereof.

“Registration Expenses” shall mean the expenses so described in
Section 3.8.

“Securities Act” shall mean the Securities Act of 1933, as amended,
and any successor Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.

“Selling Expenses” shall mean the expenses so described in Section
3.8.

“Subsidiary” or “Subsidiaries”
shall mean any corporation, partnership, trust or other entity of which the
Company and/or any of its other Subsidiaries directly or indirectly owns at the
time a majority of the outstanding shares of any class of equity security of
such corporation, partnership, trust or other entity.

2. Reserved

3. TRANSFER OF
REGISTRABLE SECURITIES; REGISTRATION

3.1 Restrictive Legend. Each certificate
representing Registrable Securities (“Restricted
Securities”) shall, except as otherwise provided in this Section 3.1 or in
Section 3.2, be stamped or otherwise imprinted with a legend substantially in
the following form (in addition to any legend required under applicable state
securities laws):

“The securities represented by this certificate
have not been registered under the Securities Act of 1933 or any other
securities laws. These securities have been acquired for investment and not with
a view to distribution or resale. Such securities may not be offered for sale,
sold, delivered after sale or transferred in the absence of an effective
registration statement covering such securities under the Securities Act of 1933
and any other applicable securities laws, unless the holder shall have obtained
an opinion of counsel reasonably satisfactory to the corporation that such
registration is not required.”

Upon request of a holder of such a certificate, the Company shall remove the
foregoing legend from the certificate if (i) there is an effective registration
statement covering the securities represented by such certificate, or (ii) with
such request, the Company shall have received either the opinion referred to in
Section 3.2(a)(i) or the “no-action” letter referred to in Section 3.2(a)(ii),
or (iii) pursuant to any other express provision hereof such legend is no longer
required.

3.2 Notice of Proposed Transfer.

(a) Prior to any proposed sale or other transfer of any
Restricted Securities (other than under the
circumstances described in Section 3.4 or 3.5), the holder thereof shall give
written notice to the Company of its intention to effect such sale or other
transfer. Each such notice shall describe the manner of the proposed sale, or
other transfer and, if requested by the Company shall be accompanied by either
(i) an opinion of counsel reasonably satisfactory
to the Company to the effect that the proposed sale or other transfer may be
effected without registration under the Securities Act or
(ii) a “no action” letter from the Commission to
the effect that the distribution of such securities without registration will
not result in a recommendation by the staff of the Commission that action be
taken with respect thereto, whereupon the holder of such share shall be entitled
to transfer such share in accordance with the terms of its notice. Each
certif icate for Restricted Securities transferred
as above provided shall bear the appropriate restrictive legend set forth in
Section 3.1, except that such certif icate shall
not bear such legend if (i) such transfer is in accordance with the provisions
of Rule 144 (or any other rule permitting public sale without registration under
the Securities Act), or (ii) the opinion of counsel or “no-action” letter
referred to above is to the further effect that the transferee and any
subsequent transferee (other than an Affiliate of the Company) would be entitled
to transfer such securities in a public sale without registration under the
Securities Act or that such legend is not required to establish compliance with
any provisions of the Securities Act. Notwithstanding any other provision
hereof, the restrictions provided for in this Section 3.2 shall not apply to
securities which are not required to bear the legend prescribed by Section 3.1
in accordance with the provisions of that Section. The Company will not
unreasonably refuse to accept an opinion of counsel required hereby signed by
counsel for a Shareholder.

(b) No such opinion of counsel or “no action” letter from the Commission, as
set forth in Section 3.2(a) above, shall be required in the event of a sale or
other transfer of any Registrable Securities to (i)
any Affiliate of a Shareholder, including, without limitation, any venture
capital limited partnership now existing or hereafter formed which controls, is
controlled by or is under common control with such Shareholder; (ii) one or more
partners or members of the transferor (in the case of a transferor that is a
partnership, limited liability company or fund), to a shareholder (in the case
of a transferor that is a corporation) or to a trust grantor (in the case of a
transferor that is a trust) in each case in respect of the beneficial interest
of such partner, shareholder or trust ; or (iii)
any successors or assigns of any of the foregoing persons, provided that
the transferee agrees in writing to be subject to this Agreement to the same
extent as if such transferee were originally a signatory.

3.3 Reserved

3.4 Required Registration

(a) One or more of the Shareholders holding Registrable Securities
constituting at least 5% of the total number of Ordinary Shares then outstanding
may request the Company to register for sale under the Securities Act all or any
portion of the Ordinary Shares held by such requesting holder or holders for
sale in the manner specified in such notice; provided, however,
that the proposed aggregate offering price of the Ordinary Shares held by such
holder or holders must be at least US$15,000,000.

(b) Following receipt of any notice under this Section 3.4, the Company shall
promptly notify all holders of Registrable Securities from whom notice has not
been received and such holders shall then be entitled within thirty (30) days
after receipt of such notice from the Company to request the Company to include
in the requested registration all or any portion of their Ordinary Shares. The
Company shall use its best efforts to register under the Securities Act, for
public sale in accordance with the method of disposition specified in the notice
from requesting holders described in paragraph (a) above, within 180 days of its
receipt of such notice, the number of shares of Registrable Securities specified
in such notice (and in all notices received by the Company from other holders
within thirty (30) days after the receipt of such notice by such holders). The
Company shall be obligated to register the Ordinary Shares pursuant to this
Section 3.4 on two (2) occasions only, provided, however, that
such obligation shall be deemed satisfied only when a registration statement
covering all of the Ordinary Shares specified in notices received as aforesaid
(except to the extent reduced by the managing underwriter pursuant to Section
3.4(d)) shall have become effective and, if such method of disposition is a firm
commitment underwritten public offering, all such shares shall have been sold
pursuant thereto; provided, further, that, upon effectiveness of
the registration statement satisfying the second registration obligation set
forth in this Section 3.4, the Company shall have no further obligation to
register any Ordinary Shares not otherwise included in the notices described
above. Notwithstanding anything to the contrary contained herein, no request may
be made under this Section 3.4 during the period commencing 60 days prior to the
Company153s good faith estimate of the effectiveness of a registration statement
filed by the Company covering a firm commitment underwritten public offering
(other than pursuant to this Section 3.4) and prior to the later to occur of the
completion of the period of distribution for such offering or 120 days after the
effective date of such registration statement.

(c) If the holders requesting such registration intend to distribute the
Registrable Securities covered by their request by means of an underwriting,
they shall so advise the Company as a part of their request made pursuant to
this Section 3.4 and the Company shall include such information in the written
notice referred to in paragraph (b) above. The right of any holder to
registration pursuant to this Section 3.4 shall be conditioned upon such
holder’s agreeing to participate in such underwriting and to permit inclusion of
such holder’s Ordinary Shares in the underwriting. If such method of disposition
is an underwritten public offering, the Company may designate the managing
underwriter(s) of such offering, which managing underwriter(s) shall be
reasonably acceptable to the holders of at least a majority in interest of the
shares of Registrable Securities to be sold in such offering. A holder may elect
to include in such underwriting all or a part of the Registrable Securities it
holds.

(d) A registration statement filed pursuant to this Section 3.4 may, subject
to the following provisions, include (i) Ordinary Shares for sale by the Company
for its own account, (ii) Ordinary Shares held by officers or directors of the
Company and (iii) Ordinary Shares held by other holders of Registrable
Securities to be included in the securities to be covered by such registration
statement in accordance with Section 3.5 and Ordinary Shares held by other
holders of Ordinary Shares who may from time to time have the right to seek to
include such Ordinary Shares in such registration statement (the holders
referred to in this clause (iii), collectively, “Other Shareholders”), in each
case for sale in accordance with the method of disposition specified by the
requesting holders. If such registration shall be underwritten, the Company,
such officers and directors and Other Shareholders proposing to distribute their
shares through such underwriting shall enter into an underwriting agreement in
customary form (including representations, warranties and indemnification
provisions customary for a transaction of this kind) with the representative of
the underwriter or underwriters selected for such underwriting on terms no less
favorable to such officers, directors or Other Shareholders than the terms
afforded the holders of Registrable Securities. If and to the extent that the
managing underwriter determines that marketing factors require a limitation on
the number of shares to be included in such registration, then the Ordinary
Shares held by officers or directors (other than Registrable Securities) of the
Company or by Other Shareholders (other than Registrable Securities) and
Ordinary Shares to be sold by the Company for its own account shall be excluded
from such registration to the extent so required by such managing underwriter,
and unless the holders of such shares and the Company have otherwise agreed in
writing, such exclusion shall be applied first to the Ordinary Shares of the
Company to be included for its own account to the extent required by the
managing underwriter, and then to the shares held by the directors and officers
and the Other Shareholders to the extent required by the managing underwriter,
ratable among them on the basis of the respective number of shares held by each
of them. If the managing underwriter determines that marketing factors require a
limitation of the number of Registrable Securities to be registered under this
Section 3.4, then Registrable Securities shall be excluded in such manner that
the securities to be sold shall be allocated among the selling holders pro rata
based on their ownership of Registrable Securities. In any event all securities
to be sold other than Registrable Securities will be excluded prior to any
exclusion of Registrable Securities. No Registrable Securities or any other
security excluded from the underwriting by reason of the underwriter’s marketing
limitation shall be included in such registration. If any holder of Registrable
Securities, officer, director or Other Shareholder who has requested inclusion
in such registration as provided above, disapproves of the terms of the
underwriting, such holder of securities may elect to withdraw therefrom by
written notice to the Company and the managing underwriter. The securities so
withdrawn shall also be withdrawn from registration. Except for registration
statements on Form S-4, S-8 or any comparable form or successor thereto, the
Company will not file with the Commission any other registration statement with
respect to its Ordinary Shares, whether for its own account or that of other
shareholders, from the date of receipt of a notice from requesting holders
pursuant to this Section 3.3 until the completion of the period of distribution
of the registration contemplated thereby or 120 days after the effective date of
such registration, whichever is earlier, if in the good faith judgment of the
managing underwriter marketing factors would materially adversely affect the
price of the Registrable Securities subject to such underwritten registration.

3.6 Registration on Form F-3.

(a) In addition to the rights provided in Section 3.4, provided that at least
nine (9) months have elapsed since the most recent registration in which the
shareholder seeking to make a request under this Section 3.6 was entitled to
request that any of its Registrable Securities be included therein, if at any
time (i) any holder or holders of the Registrable Securities request that the
Company file a registration statement on Form F-3 or any comparable or successor
form thereto for a public offering of all or any portion of the shares of
Registrable Securities held by such requesting holder or holders, the reasonably
anticipated aggregate price to the public of which would exceed US$15,000,000
(in case of an underwritten offering) or $5,000,000 (in case of a
non-underwritten offering), and (ii) the Company is a registrant entitled to use
Form F-3 or any comparable or successor form thereto to register such shares,
then the Company shall use its best efforts to register under the Securities Act
on Form F-3 or any comparable or successor form thereto, for public sale in
accordance with the method of disposition specified in
such notice, the number of Registrable Securities specified in such notice.
Whenever the Company is required by this Section 3.6 to use its best efforts to
effect the registration of Registrable Securities, each of the procedures and
requirements of Section 3.4 (with all holders of Registrable Securities being
treated equally), including but not limited to the requirement that the Company
notify all holders of Registrable Securities from whom notice has not been
received and provide them with the opportunity to participate in the offering,
shall apply to such registration,
provided , however, that except as
provided above, there shall be no limitation on the number of registrations on
Form F-3 which may be requested and obtained under this Section 3.6.

(b) The Company shall use its best efforts to qualify for registration on
Form F-3 or any comparable or successor form or forms; and to that end the
Company shall register (whether or not required by law to do so) the Ordinary
Shares under the Exchange Act in accordance with the provisions of that Act
following the effective date of the first registration of any securities of the
Company on Form F-1 or any comparable or successor form.

3.7 Registration Procedures. If and
whenever the Company is required by the provisions of Sections 3.4, 3.5 or 3.6
to use its best efforts to effect the registration of any
Registrable Securities under the Securities Act, the
Company will, as expeditiously as possible:

(a) prepare and file with the Commission a registration statement (which, in
the case of an underwritten public offering pursuant to Section 3.4, shall be on
Form F-1 or other form of general applicability satisfactory to the managing
underwriter selected as therein provided) with respect to such securities
including executing an undertaking to file post-effective amendments and use its
best efforts to cause such registration statement to become and remain effective
for the period of the distribution contemplated thereby (determined as provided
below);

(b) prepare and file with the Commission such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective for the period
specified herein and comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities covered by such
registration statement in accordance with the sellers’ intended method of
disposition set forth in such registration statement for such period;

(c) furnish to each seller of Registrable Securities and to each underwriter
such number of copies of the registration statement and each such amendment and
supplement thereto (in each case including all exhibits) and the prospectus
included therein (including each preliminary prospectus) as such persons
reasonably may request in order to facilitate the public sale or other
disposition of the Registrable Securities covered by such registration
statement;

(d) use its best efforts to register or qualify the Registrable Securities
covered by such registration statement under the securities or “blue sky” laws
of such jurisdictions as the sellers of Registrable Securities or, in the case
of an underwritten public offering, the managing underwriter reasonably shall
request, provided, however, that the Company shall not for any
such purpose be required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified or to consent to
general service of process in any such jurisdiction, unless the Company is
already subject to service in such jurisdiction;

(e) use its best efforts to list the Registrable Securities covered by such
registration statement with any securities exchange on which the Ordinary Shares
of the Company are then listed;

(f) comply with all applicable rules and
regulations under the Securities Act and Exchange Act relating to such
registration;

(g) immediately notify each seller of Registrable Securities and each
underwriter under such registration statement, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act, of the
happening of any event of which the Company has knowledge as a result of which
the prospectus contained in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing, and promptly prepare
and furnish to such seller a reasonable number of copies of a prospectus
supplemented or amended so that, as thereafter delivered to the purchasers of
such Registrable Securities, such prospectus shall not
include an untrue statement of a 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;

(h) if the offering is underwritten and at the request of any seller of
Registrable Securities, use its best efforts to furnish on the date that
Registrable Securities are delivered to the underwriters for sale pursuant to
such registration: (i) an opinion dated such date of
counsel representing the Company for the purposes of such registration,
addressed to the underwriters to such effects as reasonably may be requested by
counsel for the underwriters, and (ii) a letter
dated such date from the independent public accountants retained by the Company,
addressed to the underwriters stating that they are independent public
accountants within the meaning of the Securities Act and that, in the opinion of
such accountants, the f inancial statements of the
Company included in the registration statement or the prospectus, or any
amendment or supplement thereof, comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, and such letter
shall additionally cover such other financial matters (including information as
to the period ending no more than five (5) business days prior to the date of
such letter) with respect to such registration as such underwriters reasonably
may request;

(i) make available for inspection by each seller of Registrable Securities,
any underwriter participating in any distribution pursuant to such registration
statement, and any attorney, accountant or other agent retained by such seller
or underwriter, all at the cost and expense of such sellers or underwriters, as
the case may be, reasonable access to all financial and other records, pertinent
corporate documents and properties of the Company, as such parties may
reasonably request, and cause the Company’s officers, directors and employees to
supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such
registration statement, all subject to the recipients’ signing non-disclosure
undertakings in form designated by the Company;

(j) cooperate with the selling holders of Registrable Securities and the
managing underwriter, if any, to facilitate the timely preparation and delivery
of certificates representing Registrable Securities to be sold, such
certificates to be in such denominations and
registered in such names as such holders or the managing underwriter may request
at least two business days prior to any sale of Registrable Securities;

(k) permit any holder of Registrable Securities
which holder, in the sole and exclusive judgment, exercised in good faith, of
such holder, would be deemed to be a controlling person of the Company, to
participate in good faith in the preparation of such registration statement and
to require the insertion therein of material, furnished to the Company in
writing, which in the reasonable judgment of such holder and its counsel,
reasonably concurred in by the Company153s counsel, should be included; and

(l) in the event of any underwritten public offering, enter into and perform
its obligations under an underwriting agreement reasonably acceptable to the
Company, in usual and customary form, with the managing underwriter of such
offering.

For purposes of this Agreement, the period of distribution
of Registrable Securities in a firm commitment
underwritten public offering shall be deemed to extend until each underwriter
has completed the distribution of all securities purchased by it, and the period
of distribution of Registrable Securities in any other registration shall be
deemed to extend until the earlier of the sale of all
Registrable Securities covered thereby or 180 days
after the effective date thereof, provided,
however , in the case of any registration of
Registrable Securities on Form F-3 or a comparable or successor form which are
intended to be offered on a continuous or delayed basis, such 180 day-period
shall be extended, if necessary, to keep the registration statement effective
until all such Registrable Securities are sold (but in no event longer than nine
months after the effective date of such registration statement), provided that
Rule 415, or any successor rule under the Securities Act, permits an offering on
a continuous or delayed basis, and provided, further, that
applicable rules under the Securities Act governing the obligation to file a
post effective amendment, permit, in lieu of filing a post-effective amendment
which (y) includes any prospectus required by
Section 10(a)(3) of the Securities Act or (z)
reflects facts or events representing a material or fundamental change in or
omission from the information set forth in the registration statement, the
incorporation by reference of information required to be included in (y) and (z)
above contained in periodic reports filed pursuant to Section 13 or 15(d) of the
Exchange Act in the registration statement.

In connection with each registration hereunder, the
sellers of Registrable Securities will furnish to the Company in writing such
information requested by the Company with respect to themselves and the proposed
distribution by them as shall be reasonably necessary in order to assure
compliance with Federal and applicable state securities laws.

3.8 Expenses.

(a) All expenses incurred by the Company in complying with Sections 3.4, 3.5
and 3.6, including, without limitation, all registration and filing fees,
printing expenses, fees and disbursements of counsel and independent public
accountants for the Company, fees and expenses (including counsel fees) incurred
in connection with complying with state securities or “blue sky” laws, fees of
the National Association of Securities Dealers, Inc., transfer taxes, fees of
transfer agents and registrars, costs of any insurance which might be obtained
by the Company with respect to the offering by the Company, and fees and
disbursements of one counsel selected by the holders of at least two-thirds
(2/3) of the Registrable Securities being sold, but excluding any Selling
Expenses, are called “Registration Expenses”. All underwriting discounts and
selling commissions applicable to the sale of Registrable Securities are called
“Selling Expenses”.

(b) The Company will pay all Registration Expenses in connection with each
registration statement under Sections 3.4, 3.5 or 3.6; provided,
that, in the event of a registration pursuant to Section 3.4 hereof which
is withdrawn at the request of the Shareholders other than
(i) as a result of the Company’s failure to perform
its obligations hereunder,
(ii) as a result of a cutback by the underwriter
of such registration in the amount of Registrable
Securities which may be included in such registration by more than 25% or
(iii) as a result of information concerning a
materially adverse change in the Company’s business or
f inancial condition that is made known to the
Shareholders after the date on which such registration was requested, the
Shareholders shall pay the Registration Expenses with respect to such
registration. In the event that a registration pursuant to Section 3.4 hereof is
withdrawn pursuant to clauses (i), (ii) or (iii) of this Section 3.8(b), the
Shareholders shall, immediately following such withdrawal, be entitled to that
number of registration requests pursuant to Section 3.4 hereof to which they
would have been entitled not taking into account the withdrawn request. All
Selling Expenses in connection with each registration statement under Sections
3.4, 3.5 or 3.6 shall be borne by the participating sellers in proportion to the
number of shares registered by each, or by such participating sellers other than
the Company (except to the extent the Company shall be a seller) as they may
agree.

3.9 Indemnification and Contribution.

(a) In the event of a registration of any of the Registrable Securities under
the Securities Act pursuant to any of Sections 3.4, 3.5 or 3.6, the Company will
indemnify and hold harmless each holder of Registrable
Securities, its officers, directors and partners, each underwriter of such
Registrable Securities thereunder and each other person, if any, who controls
such holder or underwriter within the meaning of the Securities Act (each, an
“Indemnitee”), against any losses, claims, damages
or liabilities, joint or several, to which such Indemnitee may become subject
under the Securities Act or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in any prospectus, offering circular or other document incident to
such registration (including any related
notif ication, registration statement under which
such Registrable Securities were registered under the Securities Act pursuant to
any of Sections 3.4, 3.5, or 3.6 any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereof), (ii) any blue sky
application or other document executed by the Company specifically for that
purpose or based upon written information furnished by the Company filed in any
state or other jurisdiction in order to qualify any or all of the Registrable
Securities under the securities laws thereof (any such application, document or
information herein called a “Blue Sky
Application “), (iii) any omission or alleged
omission to state in any such registration statement, prospectus, amendment or
supplement or in any Blue Sky Applications executed or filed by the Company, a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (iv) any violation by
the Company of the Securities Act or any rule or regulation promulgated under
the Securities Act or any state law applicable to the Company and relating to
action or inaction required of the Company in connection with such registration,
and will reimburse each Indemnitee for any legal
or other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action, promptly after
being so incurred, provided ,
however , that the Company will not be liable
to an Indemnitee if and to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission so made in conformity with written
information furnished by such Indemnitee, in writing specifically for use in
such registration statement or prospectus; provided further, however, that,
other than in a firm commitment underwriting, the foregoing indemnity agreement
with respect to any preliminary prospectus shall not inure to the benefit of any
Indemnitee from whom the person asserting any such losses, claims, damages or
liabilities purchased shares in the offering, if a copy of the prospectus (as
then amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) was not sent or given by or on behalf of such Indemnitee
to such person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the shares to such person, and if the
prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage or liability.

(b) In the event of a registration of any of the Registrable Securities under
the Securities Act pursuant to any of Sections 3.4, 3.5 or 3.6, each seller of
such Registrable Securities thereunder, severally and not jointly, will
indemnify and hold harmless the Company, each person, if any, who controls the
Company within the meaning of the Securities Act, each officer of the Company
who signs the registration statement, each director of the Company, each other
seller of Registrable Securities, each underwriter and each person who controls
any underwriter within the meaning of the Securities Act, against all losses,
claims, damages or liabilities, joint or several, to which the Company or such
officer, director, other seller, underwriter or controlling person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in any prospectus, offering circular or other document incident to
such registration (including any related notification, registration statement
under which such Registrable Securities were registered under the Securities Act
pursuant to any of Sections 3.4, 3.5 or 3.6, any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereof), or any
Blue Sky Application or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse the
Company and each such officer, director, other seller, underwriter and
controlling person for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action, promptly after being so incurred, provided,
however, that such seller will be liable
hereunder in any such case if and only to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in reliance upon and in conformity with information pertaining to
such seller, as such, fu rnished in writing to the
Company by such seller specifically for use in such registration statement or
prospectus; and provided, further ,
however , that the liability of each seller
hereunder shall be limited to the proceeds received by such seller from the sale
of Registrable Securities covered by such registration statement. Not in
limitation of the foregoing, it is understood and agreed that the
indemnification obligations of any seller hereunder pursuant to any underwriting
agreement entered into in connection herewith shall be limited to (or be
reasonably comparable to, in the event an underwriter reasonably requires the
use of its form of underwriting agreement) the obligations contained in this
subparagraph (b).

(d) In order to provide for just and equitable contribution to joint
liability under the Securities Act in any case in which either
(i) any indemnified party makes a claim for
indemnification pursuant to this Section 3.9 but it is judicially determined (by
the entry of a final judgment or decree by a court of competent jurisdiction and
the expiration of time to appeal or the denial of the last right of appeal) that
such indemnification may not be enforced in such case notwithstanding the fact
that this Section 3.9 provides for indemnification in such case, or
(ii) contribution under the Securities Act may be
required on the part of any such indemnified party in circumstances for which
indemnification is provided under this Section 3.9; then, and in each such case,
the indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities to which such party may be
subject in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and the indemnified party on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and the indemnified
party shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of material fact related to information
supplied by the indemnifying party or the indemnified party and the parties153
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. Notwithstanding the foregoing (A) no such
holder of Registrable Securities will be required to contribute any amount in
excess of the proceeds received from the sale of all such Registrable Securities
offered by it pursuant to such registration statement; and
(B) no person or entity guilty of fraudulent
misrepresentation (within the meaning of Section
11(f) of the Securities Act) will be entitled to
contribution from any person or entity who was not guilty of such fraudulent
misrepresentation.

(e) The indemnities and obligations provided in this Section 3.9 shall
survive the transfer of any Registrable Securities by such holder.

3.10 Changes in Ordinary Shares. If, and as
often as, there is any change in the Ordinary Shares by way of a share split,
share dividend, combination or reclassification, or through a merger,
consolidation, reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions hereof so that the rights
and privileges granted hereby shall continue with respect to the Ordinary Shares
as so changed.

3.11 Rule 144 and 144A Reporting. With a
view to making available the benefits of certain rules
and regulations of the Commission which may at any time permit the sale of the
Registrable Securities to the public without registration, except as provided in
paragraph (c) below, at all times after any
registration statement covering a public offering of securities of the Company
under the Securities Act shall have become effective, the Company agrees to:

(a) use its best efforts to comply with all of the applicable reporting
requirements of the Exchange Act and shall comply with all other public
information reporting requirements of the Commission as a condition to the
availability of an exemption from the Securities Act for the sale of any of the
Registrable Securities by any holder of Registrable Securities pursuant to Rule
144 or Rule 144A thereof, as amended from time to time, or any successor rule
thereto or otherwise;

(b) cooperate with each holder of Registrable Securities in supplying such
information as may be necessary for such holder of Registrable Securities to
complete and file any information reporting forms presently or hereafter
required by the Commission as a condition to the availability of an exemption
from the Securities Act under Rule 144 or Rule 144A thereunder for the sale of
any of the Registrable Securities by any holder of Registrable Securities; and

(c) furnish to each holder of Registrable Securities forthwith upon request a
written statement by the Company as to its compliance with the reporting
requirements of such Rule 144 or Rule 144A (or any successor rule) and, at any
time after it has become subject to such reporting requirements, of the
Securities Act and the Exchange Act, a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents so filed
by the Company as such holder may reasonably request in availing itself of any
rule or regulation of the Commission allowing such holder to sell any
Registrable Securities without registration.

3.12 “Market
Stand-Off‘ Agreement. Each of the Shareholders agrees,
severally and not jointly, if requested by the Company and an underwriter of
Ordinary Shares (or other securities) of the Company, not to sell or otherwise
transfer or dispose of any Ordinary Shares (or other securities) of the Company
held by such Shareholder during a period not to exceed ninety (90) days
following the effective date of any registration statement filed by the Company
under the Securities Act, and to enter into an agreement to such effect;
provided, that, all of the Company’s officers, directors and
holders of at least 5% of the outstanding Ordinary Shares (or securities
convertible into at least 5% of the Ordinary Shares) also enter into agreements
to such effect.

The Company may impose stop-transfer instructions with respect to the shares
(or securities) subject to the foregoing restriction until the end of said
period.

3.13 Reserved

3.14 Assignment of Registration Rights.
The rights to cause the Company to register Registrable Securities
pursuant to this Article 3 may be assigned (but only with all related
obligations) by a holder of Registrable Securities to a transferee or assignee
of such securities who is not engaged in a business activity competitive with
the Company (as reasonably determined by the Company’s Board of Directors) and
who, after such assignment or transfer, holds at least 500,000 shares of
Registrable Securities (subject to appropriate adjustment for share splits,
share dividends, combinations and similar recapitalization events),
provided, that, the Company is, within a reasonable time after
such transfer, furnished with written notice of the
name and address of such transferee or assignee and the securities with respect
to which such registration rights are being assigned; and provided,
further, that such assignment shall be effective only if (i) immediately
following such transfer the further disposition of such securities by the
transferee or assignee is restricted under the Securities Act and (ii) the
transferee or assignee shall acknowledge in writing that the transferred or
assigned Registrable Securities shall remain subject to this Agreement. For the
purposes of determining the number of shares of Registrable Securities held by a
transferee or assignee, the holdings of transferees and assignees of a
partnership who are partners or retired partners of such partnership (including
spouses and ancestors, lineal descendants and siblings of such partners or
spouses who acquire Registrable Securities by gift, will or intestate
succession) shall be aggregated together and with the partnership;
provided, that, all assignees and transferees who would not
qualify individually for assignment of registration rights shall have a single
attorney-in-fact for the purpose of exercising any rights, receiving notices or
taking any action under this Article 3.

3.15 Blockage Periods. Notwithstanding any
other provision of this Agreement, the Company shall be permitted to defer the
filing of any registration statement under Sections 3.4 or 3.6 if the Company153s
Board of Directors determines in good faith, as certified in writing by the
Company153s President or Chief Executive Officer to the holder of Registrable
Securities requesting registration pursuant to any of the said Sections, that
the filing of such a registration statement at such time would be seriously
detrimental to the business of the Company. The Company may decline to file any
registration statement for this reason only once in any 12-month period and only
for a maximum period of 90 days at any one time.

3.16 Termination of Registration Rights.
The rights under this Section 3 will expire with respect to each of the
Shareholders and their respective successors, assigns and transferees, upon the
earlier of (i) five years after the date of the approval of this Agreement by
the Company’s shareholders or (ii) with respect to a particular holder or any of
it successors, assigns or transferees, the earlier of such person’s ceasing to
hold any Registrable Securities or at such time as such person is entitled to
sell all of its Registrable Securities within a consecutive 90-day period
pursuant to Rule 144.

4. MISCELLANEOUS

4.1 Notices. All notices, requests,
consents and other communications hereunder shall be
in writing, shall be addressed to the receiving party’s address set forth below
or to such other address as a party may designate by notice hereunder, and shall
be either (i) delivered by hand,
(ii) made by telecopy or facsimile transmission,
(iii) sent by overnight courier, or
(iv) sent by registered or certified mail, return
receipt requested, postage prepaid.

If to the Company: Given Imaging Ltd.

2 Ha153Carmel Street

New Industrial Park

P.O. Box 258

Yoqneam 20692

Israel

Attn: the CEO

972-4-959-2466 (Fax)

If to the Shareholders: To the addresses set forth on Exhibit A

All notices, requests, consents and other communications
hereunder shall be deemed to have been given either
(i) if by hand, at the time of the delivery
thereof to the receiving party at the address of such party set forth above,
(ii) if made by telecopy or facsimile
transmission, on the next business day following the day such notice is
transmitted, or (iii) if sent by registered or certified mail, on the fifth
business day following the day such mailing is made.

4.2 Entire Agreement. This Agreement
embodies the entire

agreement and understanding between the parties hereto with respect to the
subject matter hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly set
forth in this Agreement shall affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.

4.3 Modifications and Amendments. This
Agreement may be amended or modified, and any provision hereof may be waived,
only with the written consent of (i) the Company and (ii) the holders of at
least two-thirds (2/3) of the Registrable Securities whose rights under Section
3 have not terminated according to the provisions of this Agreement. Any waiver
or consent hereunder shall be effective only in the specific instance and for
the purpose for which it was given, and shall not constitute a continuing waiver
or consent.

4.4 Assignment. The rights and obligations
under this Agreement may not be assigned by the Company without the prior
written consent of at least a majority of the holders
of Registrable Securities, unless specifically
permitted by the terms hereof.

4.5 Benefit. All statements,
representations, warranties, covenants and agreements in this Agreement shall be
binding on the parties hereto and shall inure to the benefit of the respective
successors and permitted assigns of each party hereto. Nothing in this Agreement
shall be construed to create any rights or obligations except among the parties
hereto, and no person or entity shall be regarded as a third-party beneficiary
of this Agreement.

4.6 Governing Law. This Agreement and the
rights and obligations of the parties hereunder shall
be construed in accordance with and governed by the law of the State of New
York, without giving effect to the conflict of law principles thereof (other
than Section 5-1401 of the General Obligations Law of the State of New
York).

4.7 Jurisdiction and Service of Process.
Any legal action or proceeding with respect to this Agreement shall be
brought in the courts of the State of New York or of the United States of
America for the District of New York. By execution and delivery of this
Agreement, each of the parties hereto accepts for itself and in respect of its
property, generally and unconditionally, the jurisdiction of the
aforesaid courts. Each of the parties hereto
irrevocably consents to the service of process of any of the
aforementioned courts in any such action or
proceeding by the mailing of copies thereof by certified mail, postage prepaid,
to the party at its address set forth in Section 4.1 hereof.

4.8 Severability. In the event that any
court of competent jurisdiction shall determine that any provision, or any
portion thereof, contained in this Agreement shall be unenforceable in any
respect, then such provision shall be deemed limited to the extent that such
court deems it enforceable, and as so limited shall remain in full force and
effect. In the event that such court shall deem any such provision, or portion
thereof, wholly unenforceable, the remaining provisions of this Agreement shall
nevertheless remain in full force and effect.

4.9 Interpretation. The parties hereto
acknowledge and agree that: (i) each party and its
counsel reviewed and negotiated the terms and provisions of this Agreement and
have contributed to its revision; (ii) the rule of
construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement;
and (iii) the terms and provisions of this
Agreement shall be construed fairly as to all parties hereto and not in favor of
or against any party, regardless of which party was generally responsible for
the preparation of this Agreement.

4.10 Headings and Captions. The headings
and captions of the

various subdivisions of this Agreement are for convenience of reference only
and shall in no way modify or affect the meaning or construction of any of the
terms or provisions hereof.

4.11 Enforcement. Each of the parties
hereto acknowledges and agrees that the rights acquired by each party hereunder
are unique and that irreparable damage would occur in the event that any of the
provisions of this Agreement to be performed by the other parties were not
performed in accordance with their specific terms or were otherwise
breached. Accordingly, in addition to any other remedy
to which the parties hereto are entitled at law or in equity, each party hereto
shall be entitled to an injunction or injunctions to prevent breaches of this
Agreement by any other party and to enforce specifically the terms and
provisions hereof in any federal or state court to which the parties have agreed
hereunder to submit to jurisdiction.

4.12 No Waiver of Rights, Powers and Remedies.
No failure or delay by a party hereto in exercising any right, power or
remedy under this Agreement, and no course of dealing among the parties hereto,
shall operate as a waiver of any such right, power or remedy of the party, other
than as provided by Section 4.3 above. No single or partial exercise of any
right, power or remedy under this Agreement by a party hereto, nor any
abandonment or discontinuance of steps to enforce any such right, power or
remedy, shall preclude such party from any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The election of any
remedy by a party hereto shall not constitute a waiver of the right of such
party to pursue other available remedies. No notice to or demand on a party not
expressly required under this Agreement shall entitle the party receiving such
notice or demand to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the party giving such
notice or demand to any other or further action in any circumstances without
such notice or demand.

4.13 Counterparts. This Agreement may be
executed in one or more counterparts, and by different parties hereto on
separate counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.

5. Condition Precedent The execution,
delivery and performance of this Agreement is conditional upon obtaining the
approval of the shareholders of the Company in accordance with applicable law.
If such approval is not obtained, this Agreement shall be deemed null and void
ab initio.

IN WITNESS WHEREOF, the parties hereto have
executed this Investor Rights Agreement or caused this Agreement to be executed
by their duly authorized
represe ntatives ; as
of the date first written above.

GIVEN IMAGING LTD.

By:	/s/ Nachum Shamir
	Mr. Nahum (Homi) Shamir
	President and Chief
	Executive Officer

By:	/s/ Yuval Yanai
	Mr. Yuval Yanai
	Chief Financial Officer

SHAREHOLDERS:

DISCOUNT INVESTMENT CORPORATION LTD.

By:	/s/ Shlomo Cohen
Name:	Shlomo Cohen
Title:	Legal Counsel

By:	/s/ Michel Dahan
Name:	Michel Dahan
Title:	VP and Controller

ELRON ELECTRONIC INDUSTRIES LTD.

By:	/s/ Doron Birger
Name:	Doron Birger
Title:	Chief Executive Officer

By:	/s/ Paul Weinberg
Name:	Paul Weinberg
Title:	General Counsel

RDC RAFAEL DEVELOPMENT CORPORATION LTD.

By:	/s/ Avishai Friedman
Name:	Avishai Friedman
Title:	Chief Executive Officer

By:	/s/ Ofir Gomeh
Name:	Ofir Gomeh
Title:	Chief Financial Officer

EXHIBIT A

RDC Rafael Development Corporation Ltd.

Address:

Building 7

New Industrial Park

Yoqneam 20692

Israel

Discount Investment Corporation Ltd.

Address:

Triangular Tower

44^th Floor

3 Azrieli Center

Tel Aviv 67023

Israel

Elron Electronic Industries Ltd.

Address:

Triangular Tower

42^nd Floor

3 Azrieli Center

Tel Aviv 67023

Israel

Was this helpful?

Why was this helpful?

Easy to understand

Solved my problem

Other

Why was this not helpful?

Missing the information I need

Too complicated / too many steps

Out of date

Other

Stay Up-to-Date With How the Law Affects Your Life

Enter your email address to subscribe:

Learn more about FindLaw’s newsletters, including our terms of use and privacy policy.