UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D/A
(Rule 13d-101)
Under the Securities Exchange Act of 1934
(Amendment No. 2)
KOOR INDUSTRIES LTD.
(Name of Issuer)
ORDINARY SHARES, PAR VALUE NIS 0.001
(Title of Class of Securities)
500507108(1)
(CUSIP Number)
DISCOUNT INVESTMENT CORPORATION LTD.
THE TRIANGULAR TOWER, 44TH FLOOR
3 AZRIELI CENTER, TEL AVIV 67023
ISRAEL
ATTN: KURT KEREN, ADV.
TELEPHONE #: +972-3-607-5888
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
JULY 3, 2006
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f), or 13d-1(g), check the following
box: [_]
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes).
------------------
(1) The CUSIP Number corresponds to the Issuer's American Depository Shares
(individually, an "ADS"), which are publicly traded on the New York Stock
Exchange. Each ADS represents 0.20 Ordinary Share. The ISIN for the Issuer's
Ordinary Shares, which are traded on the Tel Aviv Stock Exchange, is
IL006490127.
Page 1 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Discount Investment Corporation Ltd.
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF --------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 5,081,033
OWNED BY --------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON --------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
5,081,033
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
5,081,033
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[_]
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
30.9%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
CO
--------------------------------------------------------------------------------
Page 2 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
IDB Development Corporation Ltd.
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
CO
--------------------------------------------------------------------------------
------------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of Clal Insurance Enterprises Holdings Ltd.
("CIEH"), a subsidiary of IDB Development, for its own account. Does not include
(i) 624,846 Ordinary Shares and (ii) options to purchase 126,616 Ordinary
Shares, which are exercisable within 60 days of July 3, 2006, all of which are
held for members of the public through, among others, provident funds, mutual
funds, pension funds and insurance policies, which are managed by companies
controlled by CIEH (the "CIEH Shares"). See also Item 5.
o Excludes the CIEH Shares.
Page 3 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
IDB Holding Corporation Ltd.
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
CO
--------------------------------------------------------------------------------
---------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. Does not include the
CIEH Shares. See also Item 5.
o Excludes the CIEH Shares.
Page 4 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Nochi Dankner
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
---------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. Does not include the
CIEH Shares. See also Item 5.
o Excludes the CIEH Shares.
Page 5 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Shelly Bergman
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
---------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. Does not include the
CIEH Shares. See also Item 5.
o Excludes the CIEH Shares.
Page 6 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Ruth Manor
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
---------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. Does not include the
CIEH Shares. See also Item 5.
o Excludes the CIEH Shares.
Page 7 of 33 pages
SCHEDULE 13D
CUSIP NO. 500507108
--------------------------------------------------------------------------------
1) NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Avraham Livnat
--------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [X]
(b) [_]
--------------------------------------------------------------------------------
3) SEC USE ONLY
--------------------------------------------------------------------------------
4) SOURCE OF FUNDS
Not applicable
--------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(D) OR 2(E) [_]
--------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Israel
--------------------------------------------------------------------------------
7) SOLE VOTING POWER
0
NUMBER OF -------------------------------------------------------------
SHARES 8) SHARED VOTING POWER
BENEFICIALLY 6,712,047 *
OWNED BY -------------------------------------------------------------
EACH 9) SOLE DISPOSITIVE POWER
REPORTING 0
PERSON -------------------------------------------------------------
WITH 10) SHARED DISPOSITIVE POWER
6,712,047 *
--------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
6,712,047 *
--------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[X]o
--------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
40.8%
--------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
---------------
* Includes (i) 5,081,033 Ordinary Shares held by DIC and (ii) 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. Does not include the
CIEH Shares. See also Item 5.
o Excludes the CIEH Shares.
Page 8 of 33 pages
This Amendment No. 2 amends and supplements the Statement on Schedule 13D
in respect of the Ordinary Shares, par value NIS 0.001 each ("Ordinary Shares"),
of Koor Industries Ltd. (the "Issuer"), initially filed by IDB Development
Corporation Ltd., IDB Holding Corporation Ltd., Mr. Nochi Dankner, Mrs. Shelly
Bergman, Mrs. Ruth Manor and Mr. Avraham Livnat (collectively, the "Initial
Reporting Persons"), with the Securities and Exchange Commission on June 6, 2005
(as amended from time to time, the "Statement"). The Initial Reporting Persons
together with Discount Investment Corporation Ltd. ("DIC") are hereinafter
referred to as the "Reporting Persons."
Capitalized terms used herein but not otherwise defined herein shall have
the meanings ascribed to such terms in the Statement.
The following amends and supplements Items 2, 3, 4, 5, 6 and 7 of the
Statement.
ITEM 2. IDENTITY AND BACKGROUND
(a) - (c)
DIC is hereby added as a Reporting Person. DIC is an Israeli public corporation,
with its principal office at the Triangular Tower, 44th floor, 3 Azrieli Center,
Tel Aviv 67023, Israel. DIC organizes, acquires interests in, finances and
participates in the management of companies. The outstanding shares of DIC are
listed for trading on the Tel Aviv Stock Exchange. DIC is a majority owned
subsidiary of IDB Development. Nochi Dankner is the Chairman of the Board of
Directors, and Zehava Dankner (the mother of Nochi Dankner and Shelly Bergman),
Isaac Manor (the husband of Ruth Manor), Dori Manor (the son of Ruth Manor and
Isaac Manor) and Zvi Livnat (the son of Avraham Livnat) are directors, of DIC.
Since July 3, 2006, DIC owns directly Ordinary Shares of the Issuer.
As of July 3, 2006:
o IDB Development owned approximately 74% of the outstanding shares of
DIC.
o Nochi Dankner (together with a private company controlled by him) and
Shelly Bergman owned approximately 56.7% and 12.8%, respectively, of
the outstanding shares of Ganden Holdings Ltd. Other than Shelly
Bergman, only one of Ganden Holdings' other shareholders, owning in
the aggregate approximately 1.7% of Ganden Holdings' outstanding
shares, has a tag along right granted to it by Nochi Dankner to
participate in certain sales of Ganden Holdings' shares by Nochi
Dankner, and such shareholder agreed to vote all its shares of Ganden
Holdings in accordance with Nochi Dankner's instructions.
The name, citizenship, residence or business address and present principal
occupation of the directors and executive officers of DIC, IDB Development and
IDB Holding are set forth in Schedules A, B and C attached hereto, respectively,
and incorporated herein by reference.
(d) None of the Reporting Persons or, to the knowledge of the Reporting
Persons, any director or executive officer named in Schedules A, B and C to this
Amendment, has, during the last five years, been convicted in any criminal
proceeding, excluding traffic violations and similar misdemeanors.
(e) None of the Reporting Persons or, to the knowledge of the Reporting
Persons, any director or executive officer named in Schedules A, B and C to this
Amendment, has, during the last five years, been a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction which as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, Federal or state securities laws or finding any violation with respect to
such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The funds for the purchases reported herein were provided from DIC's
working capital.
ITEM 4. PURPOSE OF TRANSACTION.
The Closing of the Purchase Agreement occurred on July 3, 2006, such that
DIC completed the purchase of an aggregate of 5,081,033 Ordinary Shares,
representing approximately 30.9% of the Issuer's outstanding share capital, for
an aggregate purchase price of US$393,780,057, or US$77.5 per Ordinary Share.
Page 9 of 33 pages
In connection with the Closing, the parties to the Purchase Agreement
amended it by way of entering into an Amendment Agreement, dated July 3, 2006
(the "Amendment Agreement"). Pursuant to the Amendment Agreement: (1) the number
of Ordinary Shares being acquired by DIC at the Closing was reduced by 672,174
shares, which represent approximately 4.1% of the Issuer's outstanding share
capital, held by Anfield Ltd., one of the Sellers (the "Anfield Shares"), i.e.,
from 5,753,207 Ordinary Shares to 5,081,033 Ordinary Shares; (2) Anfield was
granted a put option, exercisable during the period commencing on December 1,
2006 and ending on December 24, to sell the Anfield Shares to DIC on December
28, 2006, for an aggregate consideration of NIS 235,806,912 (equating to
approximately US$53,109,665), or approximately NIS 350.81 per Ordinary Share
(equating to approximately US$79), subject to adjustments for distributions made
by the Issuer and linked to the Israeli Consumer Price Index; and (3) Anfield
received at the Closing an interest-bearing loan from DIC in the amount of NIS
231,295,073 (equating to approximately US$52,093,485), a portion of the proceeds
of which are intended to secure the release of security interests that exist
over the Anfield Shares. The loan, which matures in December 2006, was granted
pursuant to the terms of a Loan Agreement, dated July 3, 2006, by and between
DIC and Anfield (the "Loan Agreement") and is secured by (i) a first ranking
fixed charge over the Anfield Shares in favor of DIC pursuant to the terms of a
Debenture by and between DIC and Anfield of even date (the "Debenture") and (ii)
depositing the Anfield Shares in escrow.
In addition, DIC and Anfield entered into a Guarantee Facility Agreement,
dated July 3, 2006, whereby DIC undertook to provide a US$10,000,000 guaranty to
a bank in order to assist Anfield to obtain a credit facility from one of the
four major Israeli banks in an amount of US$40,000,000 for the sole purpose of
purchasing publicly-traded securities of companies at Anfield's discretion,
subject to the terms and conditions set forth therein.
THE FOREGOING DESCRIPTION OF THE AMENDMENT AGREEMENT, LOAN AGREEMENT AND
DEBENTURE DOES NOT PURPORT TO BE COMPLETE AND IS SUBJECT TO, AND QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO, THE PROVISIONS OF THE AMENDMENT AGREEMENT, LOAN
AGREEMENT AND DEBENTURE FILED AS EXHIBIT 1, 2 AND 3 HERETO, RESPECTIVELY.
The Ordinary Shares acquired by DIC pursuant to the Purchase Agreement were
purchased for investment purposes. The Reporting Persons intend to review on a
continuing basis their investment in the Ordinary Shares and take such actions
with respect to such investment as they deem appropriate in light of the
circumstances existing from time to time. Such actions could include, among
other things, purchasing additional Ordinary Shares subject to applicable laws.
In this respect, DIC expects to commence, until or during the month of December
2006, a tender offer to purchase additional Ordinary Shares, representing at
least 5% of the Issuer's voting rights, such that following the tender offer and
prior to the exercise, if any, of Anfield's put option, the holdings of DIC
(together with its affiliates) will be more than 45.0% of the aggregate voting
power of the Issuer, to generally allow DIC to comply with Israeli law in the
event Anfield exercises its put option. The Reporting Persons could also
determine to dispose of the Ordinary Shares, in whole or in part, at any time,
subject to applicable laws. Any such decision would be based on an assessment by
the Reporting Persons of a number of different factors, including, without
limitation, the business, prospects and affairs of the Issuer, the market for
the Ordinary Shares, the condition of the securities markets, general economic
and industry conditions and other opportunities available to the Reporting
Persons.
To the best knowledge of the Reporting Persons, the directors and executive
officers of DIC, IDB Development and IDB Holding may purchase or dispose of
Ordinary Shares on their own account from time to time, subject to applicable
laws.
In connection with the Closing, seven members of the Board of Directors of
the Issuer resigned and five members, designated by DIC, were appointed to the
Board of Directors of the Issuer. DIC learned that the continuing two external
directors of the Issuer intend to resign as well shortly. DIC currently intends
to propose to the Board of Directors of the Issuer, subject to applicable law
(i) to appoint additional directors to be designated by DIC, (ii) to appoint one
of DIC's executives to the position of Chief Executive Officer of the Issuer,
and (iii) to designate Mr. Jonathan Kolber, the current Chief Executive Officer
of the Issuer, to be the Chairman of the Board of Directors of the Issuer.
DIC also intends to explore, together with the Issuer's management,
transactions relating to the Issuer's current holdings, including possible
dispositions of the Issuer's holdings in some of its subsidiaries and additional
investments in increasing the Issuer's holdings in some of its other
subsidiaries. There is no assurance that any of these plans or transactions will
be pursued or, if one is pursued, the terms on which it would occur. In
particular, there is no assurance that any such plan or proposal would
materialize into a transaction or other material development with respect to the
Issuer.
Except as provided otherwise herein or in the Purchase Agreement (as
amended), none of the Reporting Persons, nor to the best of their knowledge, any
of the directors or executive officers of DIC, IDB Development and IDB Holding,
has any present plans or proposals which relate to or would result in any of the
actions described in subsections (a) through (j) of Item 4 of Schedule 13D.
Page 10 of 33 pages
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a), (b) Percentages are based on 16,464,964 Ordinary Shares outstanding as
of July 2, 2006 (excluding 15,799 Ordinary Shares owned by a wholly owned
subsidiary of the Issuer), as the Issuer advised the Reporting Persons.
As of July 3, 2006:
DIC directly owns 5,081,033 Ordinary Shares, and may be deemed to share the
power to vote and dispose of these Ordinary Shares, constituting approximately
30.9% of the Ordinary Shares outstanding. The 5,081,033 Ordinary Shares do not
include the Anfield Shares and up to 584,837 Ordinary Shares underlying the
Management Option, which DIC may be required to purchase pursuant to Anfield's
put option and the Management Option, respectively.
IDB Development directly owns 1,630,214 Ordinary Shares, and may be deemed
to share the power to vote and dispose of these Ordinary Shares, constituting
approximately 9.9% of the Ordinary Shares outstanding. IDB Development may also
be deemed to be the beneficial owner, and to share the power to vote and
dispose, of the 5,081,033 Ordinary Shares owned by DIC, and the 800 Ordinary
Shares held by a subsidiary of CIEH for its own account. As a result, IDB
Development may be deemed to be the beneficial owner, and to share the power to
vote and dispose, of a total of 6,712,047 Ordinary Shares in the aggregate,
constituting approximately 40.8% of the Ordinary Shares outstanding.
IDB Holding and the Reporting Persons who are natural persons may be deemed
to share the power to vote and dispose of the aggregate of 6,712,047 Ordinary
Shares beneficially owned by DIC and IDB Development, constituting approximately
40.8% of the Ordinary Shares then outstanding.
Rolando Eisen, an external director of both the Issuer and IDB Holding
elected in accordance with the Israeli Companies Law, beneficially owns 27,991
Ordinary Shares, constituting approximately 0.17% of the outstanding Ordinary
Shares. Mr. Eisen informed DIC that he intends to resign from the Issuer's Board
of Directors shortly, and to exercise his right to sell the Ordinary Shares
beneficially owned by him to DIC in accordance with the Management Option.
Information provided to the Reporting Persons indicates that the executive
officers and directors of DIC, IDB Development and IDB Holding did not
beneficially own as of July 3, 2006 any Ordinary Shares, except as set forth
above.
(c) The following sets forth the sales of Ordinary Shares made during the
last 60 days ending on July 3, 2006 by subsidiaries of IDB Development for their
own account, and by a company controlled by Ruth Manor. All these sales (a total
of 5,672 Ordinary Shares) were made on the Tel Aviv Stock Exchange.
By a subsidiary of CIEH for its own account:
Date of Number of Shares Price Per
Transaction Sold Share
----------- ---- -----
May 16, 2006 1,000 NIS 276.15
May 17, 2006 500 283.60
May 19, 2006 747 279.13
May 22, 2006 1,000 266.91
May 25, 2006 842 266.26
By Taavura Holdings Ltd., a subsidiary of IDB Development:
Date of Number of Shares Price Per
Transaction Sold Share
----------- ---- -----
May 31, 2006 412 NIS 260.16
June 4, 2006 19 260.03
June 20, 2006 18 240.50
34 240.30
A company controlled by Ruth Manor sold 1,100 Ordinary Shares on July 3,
2006 at a price of NIS 233.55 per share.
Except as described above in this statement, the Reporting Persons have not
effected any transactions in the Ordinary Shares in the past 60 days ending on
July 3, 2006.
Page 11 of 33 pages
Information provided to the Reporting Persons indicates that none of the
executive officers and directors of DIC, IDB Holding and IDB Development,
purchased or sold during the last 60 days ending on July 3, 2006, any Ordinary
Shares.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDING OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER.
None, except for the Amendment Agreement, Loan Agreement and Debenture
described in Item 4 above, which description is incorporated herein by
reference.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Schedules A, B and C: Name, citizenship, residence or business
address and present principal occupation of the
directors and executive officers of DIC, IDB
Development and IDB Holding.
Exhibit 1: Amendment Agreement, dated July 3, 2006
Exhibit 2: Loan Agreement, dated July 3, 2006
Exhibit 3: Debenture, dated July 3, 2006
Exhibit 4: Letter Agreement dated June 19, 2006 between IDB Development
and DIC authorizing DIC to file this Statement on Schedule 13D and
any amendments hereto on behalf of IDB Development.
Exhibit 5: Letter Agreement dated June 19, 2006 between IDB Holding and
DIC authorizing DIC to file this Statement on Schedule 13D and any
amendments hereto on behalf of IDB Holding.
Exhibit 6: Letter Agreement dated June 19, 2006 between Nochi Dankner and
DIC authorizing DIC to file this Statement on Schedule 13D and any
amendments hereto on behalf of Nochi Dankner.
Exhibit 7: Letter Agreement dated June 19, 2006 between Shelly Bergman and
DIC authorizing DIC to file this Statement on Schedule 13D and any
amendments hereto on behalf of Shelly Bergman.
Exhibit 8: Letter Agreement dated June 19, 2006 between Ruth Manor and DIC
authorizing DIC to file this Statement on Schedule 13D and any
amendments hereto on behalf of Ruth Manor.
Exhibit 9: Letter Agreement dated June 19, 2006 between Avraham Livnat and
DIC authorizing DIC to file this Statement on Schedule 13D and any
amendments hereto on behalf of Avraham Livnat.
SIGNATURES
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certifies that the information set forth in this
Amendment No. 2 is true, complete and correct.
Dated: July 9, 2006
DISCOUNT INVESTMENT CORPORATION LTD.
IDB DEVELOPMENT CORPORATION LTD.
IDB HOLDING CORPORATION LTD.
NOCHI DANKNER
SHELLY BERGMAN
RUTH MANOR
AVRAHAM LIVNAT
By: Discount Investment Corporation Ltd.
(signed)
By: _______________________________
Michel Dahan and Kurt Keren, authorized signatories of
Discount Investment Corporation Ltd., for itself and on
behalf of IDB Development Corporation Ltd., IDB Holding
Corporation Ltd., Nochi Dankner, Shelly Bergman, Ruth
Manor and Avraham Livnat pursuant to agreements annexed
as Exhibits 4 through 9 to this Amendment No. 2 of the
Statement.
Page 12 of 33 pages
Schedule A
Directors and Executive Officers
o f
DISCOUNT INVESTMENT CORPORATION LTD.
(as of July 3, 2006)
Citizenship is the same as country of address, unless otherwise noted.
Name & Address Position Current Principal Occupation
Nochi Dankner Chairman of the Chairman and Chief Executive Officer of IDB
3 Azrieli Center, The Triangular Tower, 44th Board of Directors Holding; Chairman of IDB Development, DIC and
floor, Tel-Aviv 67023, Israel Clal Industries and Investments Ltd.; Director of
companies.
Zehava Dankner Director Member of the executive committee of the
64 Pinkas Street, Tel Aviv 62157, Israel Beautiful Israel Council.
Zvi Livnat Director Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel Officer of Clal Industries and Investments Ltd.
Avi Fischer Director Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel Officer of Clal Industries and Investments Ltd.
Lior Hannes Director Senior Executive Vice President of IDB
3 Azrieli Center, The Triangular Tower, 44th Development; Chairman of Clal Tourism Ltd.
floor, Tel-Aviv 67023, Israel
Refael Bisker Director Chairman of Property and Building Corporation Ltd.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Jacob Schimmel Director Director of UKI Investments.
17 High field Gardens, London W11 9HD, United
Kingdom
Shaul Ben-Zeev Director Chief Executive Officer of Avraham Livnat Ltd.
Taavura Junction, Ramle 72102, Israel
Eliahu Cohen Director Chief Executive Officer of IDB Development.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Gideon Lahav Director Director of companies.
124 Ehad Ha-Am Street, Tel-Aviv 65208, Israel
Moshe Arad External Director Director of companies.
14 Shay Agnon Street, Jerusalem 92586, Israel
Gideon Dover External Director Chief Executive Officer and director of Dover
11 Hamaalot Street, Herzlia B 46583, Israel Medical and Scientific Equipment Ltd.
Page 13 of 33 pages
Isaac Manor (*) Director Chairman of companies in the motor vehicle sector
26 Hagderot Street, Savion 56526, Israel of the David Lubinski Ltd. group.
Dori Manor (*) Director Chief Executive Officer of companies in the motor
18 Hareches Street, Savion 56538, Israel vehicle sector of the David Lubinski Ltd. group.
Adiel Rosenfeld Director Representative in Israel of the Aktiva group.
42 Ha'Alon Street, Timrat 23840, Israel
Ami Erel President and Chief President and Chief Executive Officer of DIC.
3 Azrieli Center, The Triangular Tower, 44th Executive Officer
floor, Tel-Aviv 67023, Israel
Oren Lieder Senior Vice Senior Vice President and Chief Financial Officer
3 Azrieli Center, The Triangular Tower, 44th President and Chief of DIC.
floor, Tel-Aviv 67023, Israel Financial Officer
Raanan Cohen Vice President Vice President of DIC.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Ari Bronshtein Vice President Vice President of DIC.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Michel Dahan Vice President and Vice President and Comptroller of DIC.
3 Azrieli Center, The Triangular Tower, 44th Comptroller
floor, Tel-Aviv 67023, Israel
(*) Dual citizen of Israel and France
======================================================================
Schedule B
Directors and Executive Officers
of
IDB DEVELOPMENT CORPORATION LTD.
(as of July 3, 2006)
Citizenship is the same as country of address, unless otherwise noted.
Name & Address Position Current Principal Occupation
Nochi Dankner Chairman of the Chairman and Chief Executive Officer of IDB
3 Azrieli Center, The Triangular Tower, 44th Board of Directors Holding; Chairman of IDB Development, DIC and Clal
floor, Tel-Aviv 67023, Israel Industries and Investments Ltd.; Director of
companies.
Zehava Dankner Director Member of the executive committee of the Beautiful
64 Pinkas Street, Tel Aviv 62157, Israel Israel Council.
Avi Fischer Deputy Chairman of Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th the Board of Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel Directors Officer of Clal Industries and Investments Ltd.
Zvi Livnat Deputy Chairman of Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th the Board of Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel Directors Officer of Clal Industries and Investments Ltd.
Page 14 of 33 pages
Refael Bisker Director Chairman of Property and Building Corporation Ltd.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Jacob Schimmel Director Director of UKI Investments.
17 High field Gardens, London W11 9HD, United
Kingdom
Shay Livnat Director President of Zoe Holdings Ltd.
26 Shalva Street,
Herzlia Pituach 46705, Israel
Eliahu Cohen Director and Chief Chief Executive Officer of IDB Development.
3 Azrieli Center, The Triangular Tower 44th Executive Officer
floor, Tel-Aviv 67023, Israel
Isaac Manor (*) Director Chairman of companies in the motor vehicle sector
26 Hagderot Street, Savion 56526, Israel of the David Lubinski Ltd. group.
Dori Manor (*) Director Chief Executive Officer of companies in the motor
18 Hareches Street, Savion 56538, Israel vehicle sector of the David Lubinski Ltd. group.
Abraham Ben Joseph Director Director of companies.
87 Haim Levanon Street,
Tel-Aviv 69345, Israel
Amos Malka External Director Chairman of Albar Mimunit Services Ltd.
18 Nahal Soreq Street, Modi'in 71700, Israel
Rami (Avraham) Mardor External Director Director of companies.
33 Haoranim Street,
Kfar Shmariyahu 46910, Israel
Irit Izakson Director Director of companies.
15 Great Matityahou Cohen Street, Tel-Aviv
62268, Israel
Lior Hannes Senior Executive Senior Executive Vice President of IDB
3 Azrieli Center, The Triangular Tower, 44th Vice President Development; Chairman of Clal Tourism Ltd.
floor, Tel-Aviv 67023, Israel
Dr. Eyal Solganik Executive Vice Executive Vice President and Chief Financial
3 Azrieli Center, The Triangular Tower, 44th President and Chief Officer of IDB Development; Chief Financial
floor, Tel-Aviv 67023, Israel Financial Officer Officer of IDB Holding.
Ari Raved Vice President Vice President of IDB Development.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Haim Gavrieli Vice President Vice President of IDB Development.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Haim Tabouch Vice President and Vice President and Comptroller of IDB Development;
3 Azrieli Center, The Triangular Tower, 44th Comptroller Comptroller of IDB Holding.
floor, Tel-Aviv 67023, Israel
Ruti Sapan Vice President, Vice President, Management Resources of IDB
3 Azrieli Center, The Triangular Tower, 44th Management Resources Development.
floor, Tel-Aviv 67023, Israel
(*) Dual citizen of Israel and France.
Page 15 of 33 pages
Schedule C
Directors and Executive Officers
of
IDB HOLDING CORPORATION LTD.
(as of July 3, 2006)
Citizenship is the same as country of address, unless otherwise noted.
Name & Address Position Current Principal Occupation
Nochi Dankner Chairman of the Chairman and Chief Executive Officer of IDB
3 Azrieli Center, The Triangular Tower, 44th Board of Directors Holding; Chairman of IDB Development, DIC and
floor, Tel-Aviv 67023, Israel and Chief Executive Clal Industries and Investments Ltd.; Director of
Officer companies.
Isaac Manor (*) Deputy Chairman of Chairman of companies in the motor vehicle sector
26 Hagderot Street, Savion 56526, Israel the Board of of the David Lubinski Ltd. group.
Directors
Arie Mientkavich Vice Chairman of Deputy Chairman of Gazit-Globe Ltd.; Director of
14 Betzalel Street, the Board of Gazit-Globe Israel (Development) Ltd.
Jerusalem 94591, Israel Directors
Zehava Dankner Director Member of the executive committee of the
64 Pinkas Street, Tel Aviv 62157, Israel Beautiful Israel Council.
Lior Hannes Director Senior Executive Vice President of IDB
3 Azrieli Center, The Triangular Tower, 44th Development; Chairman of Clal Tourism Ltd.
floor, Tel-Aviv 67023, Israel
Refael Bisker Director Chairman of Property and Building Corporation Ltd.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Jacob Schimmel Director Director of UKI Investments.
17 High field Gardens, London W11 9HD, United
Kingdom
Shaul Ben-Zeev Director Chief Executive Officer of Avraham Livnat Ltd.
Taavura Junction, Ramle 72102, Israel
Eliahu Cohen Director Chief Executive Officer of IDB Development.
3 Azrieli Center, The Triangular Tower, 44th
floor, Tel-Aviv 67023, Israel
Dori Manor (*) Director Chief Executive Officer of companies in the motor
18 Hareches Street, Savion 56538, Israel vehicle sector of the David Lubinski Ltd. group.
Meir Rosenne Director Attorney.
8 Oppenheimer Street, Ramat Aviv,
Tel Aviv 69395, Israel
Shmuel Lachman External Director Information technology consultant
9A Khilat Jatomir Street,
Tel Aviv 69405, Israel
Rolando Eisen External Director Director of companies.
2 "A" Geiger Street, Naveh Avivim, Tel Aviv
69341, Israel
Page 16 of 33 pages
Zvi Livnat Director and Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th Executive Vice Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel President Officer of Clal Industries and Investments Ltd.
Avi Fischer Executive Vice Executive Vice President of IDB Holding; Deputy
3 Azrieli Center, The Triangular Tower, 45th President Chairman of IDB Development; Co-Chief Executive
floor, Tel-Aviv 67023, Israel Officer of Clal Industries and Investments Ltd.
Dr. Eyal Solganik Chief Financial Chief Financial Officer of IDB Holding; Executive
3 Azrieli Center, The Triangular Tower, 44th Officer Vice President and Chief Financial Officer of IDB
floor, Tel-Aviv 67023, Israel Development.
Haim Tabouch Comptroller Comptroller of IDB Holding; Vice President and
3 Azrieli Center, The Triangular Tower, 44th Comptroller of IDB Development.
floor, Tel-Aviv 67023, Israel
(*) Dual citizen of Israel and France.
======================================================================
Exhibit 1
AMENDMENT AGREEMENT
This Amendment Agreement is made this 3rd day of July, 2006 among:
1) Discount Investment Corporation Limited (the "PURCHASER") (a company
incorporated under the laws of the State of Israel);
2) Anfield Limited ("ANFIELD") (a company incorporated under the laws of the
State of Israel); and
3) (a) Charles Rosner Bronfman Family Trust;
(b) Claridge Israel LLC;
(c) Esarbee Investments Limited;
(d) Charles R. Bronfman Trust;
(e) 87215 Canada Limited (being the entity related to Anfield Limited in
the Share Purchase Agreement referred to below);
(f) CBT Holdings LLC.
In this Amendment Agreement, Charles Rosner Bronfman Family Trust, Claridge
Israel LLC, Esarbee Investments Limited, Charles R. Bronfman Trust, CBT
Holdings LLC and 87215 Canada Limited are referred to as the "INITIAL
SELLERS" and together with Anfield as "THE SELLERS".
RECITALS
A. This Amendment Agreement is supplemental to the Share Purchase Agreement
dated 1st May 2006 among the Purchaser, and the parties listed therein as
"the Sellers" ("THE SHARE PURCHASE AGREEMENT").
A copy of the Share Purchase Agreement is attached to this Amendment
Agreement.
Capitalized terms in the Amendment Agreement shall have the same meaning as
in the Share Purchase Agreement, unless otherwise expressly stated herein.
Page 17 of 33 pages
B. Pursuant to the terms of the Share Purchase Agreement, the Purchaser has
agreed to purchase and the Sellers have agreed to sell shares of the
Company in accordance with the terms set out in the Share Purchase
Agreement.
C. The parties hereto have agreed to amend the provisions of the Share
Purchase Agreement so as to exclude therefrom 672,174 Ordinary Shares of
the Company owned by Anfield (the "ANFIELD SHARES"), constituting 4.082% of
the issued and outstanding share capital of the Company.
D. In lieu of purchasing the Anfield Shares at the Closing of the Share
Purchase Agreement (the "CLOSING"), the Purchaser wishes to grant Anfield
an option to sell the Anfield Shares and Anfield is interested in receiving
an option to sell the Anfield Shares to the Purchaser, all subject to and
in accordance with the provisions of this Amendment Agreement.
E. At the Closing, the Purchaser shall grant a loan (the "LOAN") to Anfield in
accordance with the terms of the loan agreement entered into between the
Purchaser and Anfield on the date hereof (the "LOAN AGREEMENT"), and
Anfield shall use the proceeds of the Loan, in part, to secure the release
of all charges and other security interests that exist over the Anfield
Shares as at the date of the Closing.
THEREFORE, the Purchaser and Anfield have agreed as follows:
1. REVISED CLOSING
1.1 At the Closing of the Share Purchase Agreement, the Purchaser shall
purchase from the Initial Sellers a total of 5,081,033 Ordinary Shares
of the Company (as set out in SCHEDULE 1 to this Amendment Agreement)
for a total purchase price of US$ 393,780,057 (three hundred ninety
three million seven hundred eighty thousand and fifty seven United
States Dollars) (subject to any adjustment required in accordance with
Section 3.3 of the Share Purchase Agreement).
1.2 Notwithstanding anything to the contrary contained in the Share
Purchase Agreement, the Anfield Shares shall not be deemed to fall
within the definition of the "Shares" in the Share Purchase Agreement,
and at the Closing of the Share Purchase Agreement the Purchaser shall
be required to purchase and the Initial Sellers shall be required to
sell only the shares being sold by the Initial Sellers, without the
Anfield Shares. There shall be no obligation on the part of the
Purchaser to purchase or on the part of Anfield to sell the Anfield
Shares, other than upon exercise of the Put Option (as defined below),
as described below. References to the Sellers in Section 8.3 of the
Share Purchase Agreement shall refer only to the Initial Sellers at
the Closing.
1.3 For the avoidance of doubt, the Deposit which has been or shall have
been deposited by the Purchaser pursuant to the terms of the Share
Purchase Agreement shall be attributed entirely to the Purchase Price
to be paid by the Purchaser at Closing, and no part of the Deposit
shall be attributed to the amount to be paid by the Purchaser to
Anfield in the event of the exercise by Anfield of the Put Option.
1.4 The grant of the Loan by DIC to Anfield pursuant to the Loan Agreement
shall be one of the actions to take place at the Closing, for the
purposes of Section 8.2 of the Share Purchase Agreement.
1.5 At the Closing, in place of the letter referred to in Section 8.2.1
(a) of the Share Purchase Agreement, the Sellers shall deliver to the
Purchaser a letter or letters from Bank Hapoalim confirming that it
holds the shares of Claridge Israel LLC, the Charles R. Bronfman
Trust, 87215 Canada Ltd and Esarbee Investments Ltd referred in
Schedule 1 to the Share Purchase Agreement, together with letters from
Bear Stearns confirming that Bear Sterns holds the shares of The
Charles Rosner Family Trust and CRBT Holdings LLC, referred to in
Schedule 1 of the Share Purchase Agreement.
2. ANFIELD PUT OPTION; ANFIELD CLOSING
2.1 The Purchaser hereby grants Anfield an option (the "PUT OPTION") to
sell the Anfield Shares to the Purchaser, free of all liens, charges,
encumbrances or any other third party rights, in consideration for the
Anfield Shares Purchase Price (as defined below). The Put Option shall
be exercisable by a written notice served by Anfield upon the
Purchaser during the period commencing on December 1, 2006 and ending
on December 24, 2006 (the "EXERCISE PERIOD"), in accordance with the
terms set forth herein and subject to the occurrence of the Closing
under the terms of the Share Purchase Agreement, as amended hereby.
For the avoidance of doubt, it is hereby clarified that in the event
that the Share Purchase Agreement shall be terminated for any reason
whatsoever, the Put Option granted hereunder shall be automatically
nullified and terminated and shall not have any force and effect.
Page 18 of 33 pages
2.2 Should Anfield exercise the Put Option, the closing of the purchase by
the Purchaser of the Anfield Shares shall take place on December 28,
2006 (the "ANFIELD CLOSING").
2.3 The warranties given by Anfield in Section 1 of the Share Purchase
Agreement, and by the Purchaser in Section 5 of the Share Purchase
Agreement (other than Section 5.7) shall apply to the Put Option and
the Anfield Shares, mutatis mutandis.
2.4 In the event that the Put Option is exercised, the "Threshold"
referred to in the Share Purchase Agreement shall apply to the
representations and warranties made by all of the Sellers in the Share
Purchase Agreement (including Anfield). If the Put Option is not
exercised, the Threshold shall apply in full to the Initial Sellers
only.
2.5 For greater certainty, the parties confirm that in the event of any
default or failure by Anfield or the Purchaser for whatever reason to
comply with the terms of the Loan Agreement or the terms of the Put
Option (as defined below) neither Anfield nor the Purchaser shall have
any recourse against the Initial Sellers in connection with the Loan,
the Put Option or in connection with the guaranty facility to be
provided by the Purchaser in favor of Anfield pursuant to the terms of
a Guaranty Facility Agreement to be entered between the Purchaser and
Anfield on or about the date hereof.
3. THE ANFIELD REVISED PURCHASE PRICE
3.1 In the event that Anfield exercises the Put Option, then at the
Anfield Closing the Purchaser shall pay to Anfield the amount of
approximately NIS 350.81 (three hundred and fifty and eighty one
hundredths New Israeli Shekels) per Ordinary Share for each of the
Anfield Shares (equivalent to approximately NIS 70.16, seventy and
sixteen hundredths New Israeli Shekels per ADR) linked to the CPI as
provided for hereunder, instead of the price specified in the Share
Purchase Agreement.
3.2 The total purchase price for the Anfield Shares is NIS 235,806,912
(two hundred thirty five million eight hundred and six thousand nine
hundred and twelve New Israeli Shekels) (the "ANFIELD SHARES PURCHASE
PRICE"). The Anfield Shares Purchase Price shall be linked to the
Israeli Consumer Price Index (including fruits and vegetables)
published by the General Bureau of Statistics (the "CPI") in the
following manner: the Anfield Shares Purchase Price shall be adjusted
by multiplying it by the last known CPI on the Anfield Closing
(namely, the CPI of November 2006, to be published on December 15,
2006) divided by the CPI published on June 15, 2006, for the month of
May 2006.
3.3 The Anfield Shares Purchase Price shall be reduced by the amount equal
to the aggregate cash dividend or distribution paid on the Anfield
Shares, or for which the cum-date falls between the date of the Share
Purchase Agreement and the Anfield Closing.
3.4 Anfield hereby expressly agrees that the Purchaser shall be entitled
to pay the Anfield Shares Purchase Price (as adjusted pursuant to
Section 3.3 above) by way of set off of the amount which Anfield owes
to the Purchaser under the terms of the Loan Agreement.
3.5 At the Anfield Closing:
3.5.1 Anfield shall provide customary certification from the Israeli
Revenue Authorities to the Purchaser that no Israeli tax or other
withholding is to be deducted from the Anfield Shares Purchase
Price.
3.5.2 Anfield shall deliver to the Purchaser a declaration that each
of the warranties that it has given under Section 1 of the Share
Purchase Agreement and under Section 4 hereof is correct as at
the date of the Anfield Closing (other than those warranties that
speak as of a particular date which will be correct as of such
date, and in all cases subject to such modifications as may be
appropriate subsequent to the date of the Share Purchase
Agreement, provided that any such modification, if material, has
been approved by the Purchaser), and that at the Anfield Closing,
Anfield is transferring the Anfield Shares to the Purchaser "Free
and Clear" (as that term is defined in the Share Purchase
Agreement).
3.5.3 The Security Trustee (as such term is defined in the Loan
Agreement) shall transfer the Anfield Shares to DIC and/or to any
other person or persons designated by DIC, and new certificates
representing the Anfield Shares shall be issued in the name of
DIC (and/or such designees).
Page 19 of 33 pages
3.6 At the Anfield Closing, the Purchaser shall deliver to Anfield a
declaration that the warranties that the Purchaser has given under
Section 5 of the Share Purchase Agreement and under Section 4 of this
Agreement are correct as at the date of the Anfield Closing (subject
to such modifications as may be appropriate, provided that any such
modifications, if material, have been approved by Anfield).
4. DECLARATIONS OF THE PARTIES
4.1 The provisions of Section 1.8 of the Share Purchase Agreement shall be
extended to cover also this Amendment Agreement as if express
reference to this Amendment Agreement was made in the said Section
1.8.
4.2 The Purchaser hereby represents to the Sellers that it has taken all
necessary action to authorize the signature, delivery and performance
of this Amendment Agreement and that the obligations on its part under
this Amendment Agreement are valid, binding and enforceable against it
in accordance with their terms.
5. MISCELLANEOUS
5.1 Save as expressly stated in this Amendment Agreement, the Share
Purchase Agreement shall remain unchanged, and all parties hereto
reaffirm the provisions of the Share Purchase Agreement (as amended
hereby) including, without limitations, the assignment rights granted
to the Purchaser under Section 14.7 of the Share Purchase Agreement.
5.2 The provisions of Section 12 (Governing Law), Section 13
(Jurisdiction) and Section 14 (Miscellaneous), (with Section 14.6
relating to the Purchaser, Anfield and the shares that are the subject
of the Put Option only; excluding Section 14.8; with Section 14.9
relating to the Purchaser and Anfield only; and excluding the second
sentence of Section 14.10) of the Share Purchase Agreement shall apply
to this Amendment Agreement, mutatis mutandis.
5.3 This Amendment Agreement may be executed in one of more counterparts,
each of which shall be deemed an original but all of which together
shall constitute one and the same document.
[Rest of the page intentionally left blank]
Signature Page of Amendment Agreement
IN WITNESS THEREOF: the parties hereto have executed this Amendment Agreement
the day and year first written above.
--------------------------------------- --------------------------------------
Discount Investment Corporation Limited Anfield Limited
By: By:
--------------------------------------- --------------------------------------
Charles Rosner Bronfman Family Trust Claridge Israel LLC
By: By:
--------------------------------------- --------------------------------------
Esarbee Investments Limited. Charles R. Bronfman Trust
By: By:
--------------------------------------- --------------------------------------
87215 Canada Limited CBT Holdings LLC
By: By:
Page 20 of 33 pages
AMENDMENT TO SHARE PURCHASE AGREEMENT
SCHEDULE 1
INITIAL SELLER NAME NO. OF KOOR SHARES
------------------- ------------------
Charles Rosner Bronfman Family Trust 120,046
CBT Holdings LLC 119,316
Claridge Israel LLC 2,375,835
Esarbee Investments Ltd. 2,271,167
Charles R. Bronfman Trust 104,669
87215 Canada Ltd 90,000
======================================================================
Exhibit 2
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "AGREEMENT") is made and entered into as of this 3rd
day of July, 2006, by and among:
Discount Investment Corp. Ltd. ("DIC"); and
Anfield Ltd. ("ANFIELD")
Each of DIC and Anfield shall hereinafter be referred to individually as a
"PARTY", and collectively as the "PARTIES".
WHEREAS DIC, Anfield and the entities listed in EXHIBIT A hereto (the
"INITIAL SELLERS") have entered into that certain Share
Purchase Agreement dated May 1, 2006 (the "SHARE PURCHASE
AGREEMENT"), providing for the purchase by DIC of an aggregate
of 5,753,207 ordinary shares of Koor Industries Ltd. (the
"COMPANY"); and
WHEREAS Anfield represents to DIC that as of the date hereof, Anfield
is the legal and beneficial owner of 672,174 ordinary shares
of the Company (the "ANFIELD SHARES"), constituting 4.082% of
the issued and outstanding share capital of the Company; and
WHEREAS the Parties entered into that certain Amendment Agreement,
dated this 3rd day of July, 2006, amending the Share Purchase
Agreement, (the "AMENDMENT"), in respect of the purchase by
DIC of the Anfield Shares, in accordance and subject to the
terms and conditions set forth in the Amendment; and
WHEREAS Anfield wishes to receive from DIC a loan, the details of
which are set forth herein, and DIC is willing to extend such
loan to Anfield, all pursuant to the terms and subject to the
conditions set forth herein.
WHEREAS Anfield wishes to apply a portion of the proceeds of the Loan
in order to repay outstanding indebtedness and to secure the
removal of any charge or other security interest over the
Anfield Shares immediately prior to the Closing of the Share
Purchase Agreement.
NOW THEREFORE, in consideration of the mutual and respective representations,
undertakings and covenants herein contained, the Parties hereby agree as
follows:
1. PREAMBLE; EXHIBITS AND HEADINGS
1.1 The preamble, the schedules and the exhibits attached hereto
constitute an integral part hereof.
1.2 The headings herein are inserted for convenience of reference only and
shall not limit or otherwise affect the interpretation of any of the
provisions hereof.
Page 21 of 33 pages
2. THE LOAN; DISCHARGE OF CERTAIN PLEDGES
2.1 Subject to and based on the representations, warranties and covenants
made by Anfield hereunder, DIC undertakes to lend to Anfield, and
Anfield hereby accepts, a loan in a total amount of NIS 231,295,073
(two hundred thirty one million two hundred ninety five thousand and
seventy three New Israeli Shekels), all in accordance and subject to
the terms and conditions set forth herein (the "LOAN" and the "LOAN
AMOUNT", respectively).
2.2 The Loan Amount shall be disbursed by DIC to Anfield on the day on
which the actual Closing (as such term is defined in Section 8.1 of
the Share Purchase Agreement) with respect to the Purchase by DIC of
the Shares owned by the Initial Sellers shall take place (the
"DISBURSEMENT DATE"), in accordance with the provisions of Section 2.3
below.
2.3 On the Disbursement Date, the following actions will take place, all
of which shall be deemed to have occurred simultaneously, and no
action shall be deemed to have been completed and no document shall be
deemed to have been delivered, until all actions are completed and all
documents are delivered:
2.3.1 Anfield shall deliver to DIC:
(a) A letter from Bank Hapoalim BM ("BANK HAPOALIM"),
substantially in the form attached hereto as SCHEDULE
2.3.1(A), confirming that Bank Hapoalim holds all the
Anfield Shares in an account or accounts in the name of
Anfield and that immediately upon receipt by it of a letter
of instructions from Anfield in accordance with the
provisions of Section 2.3.2 below, Bank Hapoalim shall
transfer the Anfield Shares to the Security Trustee (as
defined below).
(b) A letter from Bank Hapoalim, substantially in the form
attached hereto as SCHEDULE 2.3.1(B), confirming that it
releases all the pledges, liens and charges in its favor
over any of the Anfield Shares.
(c) A signed copy of the Anfield Debenture and the notice to be
provided to the Registrar of Companies in accordance with
the provisions of Section 6.2 hereof.
(d) A declaration from Anfield that each of the warranties that
it has given under Section 1 of the Share Purchase Agreement
is correct at the Disbursement Date.
2.3.2 Anfield shall transfer the Anfield Shares to G.L.E. Trust
Services Ltd. as security trustee (the "SECURITY TRUSTEE"), in
accordance with the provisions of the Anfield Debenture. For this
purpose, Anfield shall issue to Bank Hapoalim irrevocable and
unconditional letter of instructions instructing Bank Hapoalim to
transfer the Anfield Shares to the Security Trustee.
2.3.3 The Loan Amount shall be disbursed by DIC to Anfield in United
States Dollars being the equivalent of the Loan Amount calculated
according to the representative rate of exchange of the US Dollar
published by the Bank of Israel on June 30, 2006 (i.e, USD
52,093,485), by way of bank transfer to a bank account in the
name of Anfield at Bank Hapoalim, the details of which shall be
provided by Anfield to DIC at least 3 business days prior to the
Closing.
In this Agreement the term "business day" shall mean any day
other than a Friday, Saturday, Sunday or other day on which
commercial banks or banking institutions in Israel are authorized
or required by law to be closed for business.
2.4 (a) The Loan Amount shall bear interest at an annual rate of 4% (four
percent) and shall be linked (principal and interest) as set forth
below.
(b) Value Added Tax ("VAT") (if and to the extent payable) in respect
of the Loan shall be borne by DIC at its expense, and a valid VAT
invoice in respect of such VAT payment shall be delivered by DIC to
Anfield as required by law. If and to the extent that Anfield can
offset such VAT payment or reimbursement of such VAT payment can be
obtained by Anfield from the Israeli VAT authorities (the "REFUNDABLE
VAT"), Anfield shall, upon the date of the actual offset or
reimbursement, transfer and pay the Refundable VAT as additional
interest, plus VAT, to DIC.
(c) The Loan (principal and any accrued interest thereon) shall be
linked to the Israeli Consumer Price Index (including fruits and
vegetables) published by the General Bureau of Statistics (the "CPI")
in the following manner: the amount required to repay the Loan shall
be equal to the Loan Amount and any accrued interest thereon,
multiplied by the last known CPI on the date of repayment divided by
the CPI published on June 15, 2006, for the month of May 2006.
(d) In the event that the Loan (principal and any accrued interest
thereon together with linkage differentials), or any part thereof, is
not repaid in full when due, for any reason whatsoever, then, from the
Repayment Date, interest shall accrue on such unpaid amount (principal
and any accrued interest thereon together with linkage differentials)
until such balance is fully paid at the rate of 12% (twelve percent)
per annum, plus VAT, if applicable.
Page 22 of 33 pages
3. REPAYMENT OF THE LOAN
3.1 The Loan Amount and any accrued interest thereon, together with
linkage differentials, shall be due and payable on December 28,2006
(the "REPAYMENT DATE").
3.2 The Loan Amount and any accrued interest thereon, together with
linkage differentials, shall be repaid by Anfield in cash in New
Israeli Shekels.
3.3 It is hereby agreed and understood that the Loan (principal and any
interest accrued thereon, together with linkage differentials, may be
repaid in full by Anfield by way of set-off against the payment to
which Anfield shall be entitled under the terms of the Amendment upon
exercise of the Put Option (as defined in the Amendment).
3.4 In the event that Anfield shall have served notice exercising the Put
Option in accordance with the terms of the Amendment, the Loan shall
cease to bear interest from the Repayment Date, regardless of whether
or not the sale of the Anfield Shares upon exercise of the Put Option
shall have been completed (save where such non-completion is the
result of any breach of obligation on the part of Anfield).
3.5 Notwithstanding the aforesaid, and without derogating from any remedy
to which DIC may be entitled to under this Agreement and/or any other
agreement or instrument and/or any applicable law, the Loan Amount
together with any interest accrued thereon and linkage differentials
will immediately become due and payable in cash upon the occurrence of
any of the following events (and Anfield shall immediately notify DIC
of any such event) (each, an "EVENT OF DEFAULT"):
3.5.1 any breach by Anfield of any of its obligations or
representations under this Agreement or the Share Purchase
Agreement as amended by the Amendment, which breach is not cured
by Anfield within 30 (thirty) days of receiving written notice
thereof from DIC;
3.5.2 the commencement by Anfield of any liquidation proceedings or
the adoption of a winding up resolution by Anfield, or the
appointment of a receiver or trustee over the whole or any part
of the assets of Anfield, or the calling of a meeting of
creditors of Anfield for the purpose of entering into a scheme of
arrangement with them;
3.5.3 the commencement by third parties of any liquidation proceedings
against Anfield, which have not been terminated within 90
(ninety) days thereafter;
3.5.4 the levy of an attachment or the institution of execution
proceedings against all or a substantial part of all of the
assets of Anfield.
3.6 Without derogating from the aforesaid, any cash dividend or
distribution received by Anfield for the Anfield Shares during the
period commencing on the date hereof and ending on the Repayment Date
(the "TRANSITION PERIOD"), shall be immediately paid and transferred
by Anfield to DIC as payment on account of the balance of the Loan
(any such cash dividend or distribution received by Anfield prior to
the Disbursement Date, if any, shall be paid and transferred by
Anfield to DIC on the Disbursement Date).
3.7 In addition, should the Company declare any cash dividend or
distribution for which the cum-date falls during the Transition Period
and the payment date falls thereafter, then at the Repayment Date,
Anfield shall assign and transfer to DIC the right to receive such
cash dividend or distribution, against a corresponding reduction in
the balance of the Loan Amount.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF ANFIELD
4.1 Anfield hereby represents, warrants and covenants to DIC that:
4.1.1 It is a company duly incorporated and validly existing under the
laws of the State of Israel, with full corporate power and
authority to enter into and perform its obligations under this
Agreement.
4.1.2 The execution and delivery of this Agreement by it and the
consummation of the transactions contemplated hereby have been
duly and validly authorized by all necessary corporate action.
This Agreement has been duly and validly executed and delivered
by it and, assuming the due execution and delivery by the DIC,
constitutes a valid and binding obligation of it enforceable
against it in accordance with its terms.
Page 23 of 33 pages
4.1.3 No consent, approval, order, license, permit, action by, or
authorization of or designation, declaration, or filings with any
governmental and/or municipal authority is required that has not
been obtained by it in connection with the valid execution,
delivery and performance of this Agreement by it and all the
transactions contemplated hereby or ancillary hereto.
4.1.4 The execution, delivery and performance of this Agreement by it
and the prospective transactions contemplated hereby will not
result in any violation of and will not conflict with or result
in any breach of any of the terms and conditions of its
incorporation documents and/or any other material agreement or
instrument by which it is bound.
4.1.5 There are no actions, suits or proceedings at law or in equity
before any court, tribunal or governmental authority pending or
threatened against it, its subsidiaries or any of their
respective assets or revenues that are likely to adversely affect
in any material respect its business, assets or financial
condition or are likely to affect the validity or enforceability
of, or to adversely affect its ability to fulfill its obligations
under this Agreement.
4.2 Until final and full repayment of the Loan (principal and any interest
accrued thereon together with linkage differentials), Anfield shall
not, without DIC's prior written consent:
4.2.1 Cause or suffer to be made any sale, assignment, transfer, gift,
or any other disposition in any manner whatsoever, including any
conveyance, pledge, hypothecation, mortgage, lien, foreclosure,
or the creation of any encumbrance of whatever nature, of the
Anfield Shares or any part thereof.
4.2.2 Issue any debt or equity securities of any kind whatsoever, or
any rights with respect to any such securities.
4.2.3 Issue any shares of Anfield or other securities convertible into
shares of Anfield.
5. [RESERVED]
6. SECURITIES
6.1 To secure the full and prompt repayment of the Loan Amount and any
interest accrued thereon (together with linkage differentials) and the
performance by Anfield of all of its obligations hereunder, without
limitation in amount, Anfield hereby grants to DIC a first ranking
fixed charge on the Anfield Shares together with all proceeds and
substitutions thereof, all cash, stock and other moneys and property
paid thereon, all rights to subscribe for securities declared or
granted in connection therewith, and all other cash and non-cash
proceeds of the foregoing (for the avoidance of doubt, excluding the
Loan or any part thereof) (the "ANFIELD CHARGE").
6.2 Concurrently with, and as a condition precedent to the disbursement of
the Loan, DIC and Anfield shall sign the debenture attached as
SCHEDULE 6.2 hereto pertaining to the creation of the Anfield Charge
(the "ANFIELD DEBENTURE"), and Anfield will sign the requisite formal
notice to the Registrar of Companies notifying the Registrar of
Companies of the imposition of the Anfield Charge. Anfield hereby
undertakes to file such notice with the Registrar of Companies
together with a copy of the signed Anfield Debenture within three (3)
business days following the Disbursement Date.
6.3 In accordance with the terms of the Anfield Debenture, Anfield shall,
on the Disbursement Date, transfer the Anfield Shares to the Security
Trustee. Concurrently with the execution of this Agreement, the
Parties shall enter into the Letter of Instructions to the Security
Trustee attached hereto as EXHIBIT B.
Anfield hereby expressly agrees that in the event that DIC pays the
Anfield Shares Purchase Price (as that term is defined in the
Amendment) by way of set-off against the Loan Amount (as expressly
permitted under the terms of the Amendment), the Security Trustee
shall be authorised to transfer the Anfield Shares to DIC or any other
persons designated by DIC (provided that DIC shall have served written
notice of the set-off upon Anfield and the Security Trustee,
confirming that no further amounts are due from Anfield to DIC under
this Loan Agreement, other than any payment to which DIC may be
entitled to under Section 2.4(b) hereof, if at all).
In the event that the Security Trustee transfers the Anfield Shares to
DIC or any other persons designated by DIC on the date of the Anfield
Closing (as that term is defined in the Amendment), Anfield shall be
deemed to have repaid the Loan in full on the date of the Anfield
Closing, excluding any payment to which DIC may be entitled to under
Section 2.4(b) hereof, if at all.
6.4 Provided that the Anfield Charge granted hereunder is valid and there
is no other person having priority rights under any agreement and/or
any applicable law over the assets underlying the Anfield Charge, DIC
shall have no recourse against Anfield, its directors, officers or any
other person acting on its behalf in respect of the Loan or any part
thereof, and the sole remedy of DIC against Anfield (or its directors,
officers or any other person acting on its behalf) shall be to realise
its rights under the Anfield Debenture.
Page 24 of 33 pages
6.5 Anfield shall reimburse DIC on demand for any and all fees, costs and
expenses (including, without limitation, attorney's fees and
disbursements) assumed or incurred by DIC, in enforcing or attempting
to enforce any right or remedy under this Agreement.
7. MISCELLANEOUS
7.1 GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of Israel, without giving effect
to the rules regarding conflict of law, and the competent courts of
Tel Aviv-Jaffa shall have sole and exclusive jurisdiction over any
dispute between the Parties hereto.
7.2 ENTIRE AGREEMENT. This Agreement, including the preamble and exhibits
thereto, constitutes the entire understanding and agreement between
the Parties with regard to the subject matter hereof, and supersedes,
nullifies and terminates all prior agreements and representations
between the Parties with regard to such subject matter.
7.3 ASSIGNMENT OF RIGHTS. Neither Party shall assign any right or
obligation hereunder without the prior written consent of the other
Party, provided however, that the foregoing shall not apply to any
assignment by DIC to any assignee permitted under the provisions of
the Amendment (as such term is defined in the preamble hereto).
7.4 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power, or remedy accruing to any Party upon any breach or default
under this Agreement, shall be deemed a waiver of any other breach or
default therefore or thereafter occurring. Any waiver, consent or
approval of any kind on the part of any Party of any breach or default
under this Agreement, or any waiver on the part of any Party of any
provisions or conditions of this Agreement, must be in writing and
shall be effective only to the extent specifically set forth in such
writing.
7.5 EXPENSES. Each Party shall bear its respective costs and expenses
related to the execution of this Agreement.
7.6 AMENDMENTS. This Agreement may not be amended except by a written and
signed document executed by all Parties hereto.
7.7 SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable, such invalidity or unenforceability shall not affect
other provisions of this Agreement, and, to that extent, the
provisions of this Agreement are intended to be and shall be deemed
severable.
7.8 NOTICES. Any notice required or permitted by this Agreement will be in
writing and will be deemed given if personally delivered, sent by
prepaid registered mail, or sent by facsimile or similar
communication, and confirmed by such mail, postage prepaid, addressed
to the other Party at the address set out below or at such other
address for which such party gives notice hereunder. Notices will be
deemed given 1 (one) business day after personal delivery, 3 (three)
business days after deposit in the mail, or 1 (one) business day after
confirmation of transmission is obtained if sent by facsimile or
similar communication, as applicable.
DIC:
3 Azrieli Center
Tel Aviv 67023
Israel
Fax: 03-6075866
Attn.: the Comptroller
With a copy to:
Goldfarb, Levy, Eran Meiri & Co.
2 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-6089837
Attention: Adv. Oded Eran & Adv. Nechama Brin
Page 25 of 33 pages
Anfield:
4 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-696 6464
Attention: Alan Sacks
With a copy to:
Herzog, Fox & Neeman
4 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-6966464
Attention: Adv. Alan Sacks
[Signature Page Follows]
IN WITNESS WHEREOF, this Agreement has been executed by the parties hereto as of
the day and year first hereinabove written:
____________________________ ______________________
DISCOUNT INVESTMENT CORP. LTD. ANFIELD LTD.
By: _______________ By: _______________
Title: _______________ Title: _______________
======================================================================
EXHIBIT A - THE INITIAL SELLERS
1. Charles Rosner Bronfman Family Trust
2. Charles R. Bronfman Trust
3. CBT Holdings, LLC
4. Claridge Israel, LLC
5. Esarbee Investments Limited.
6. 87215 Canada Limited
======================================================================
Exhibit 3
DEBENTURE
THIS DEBENTURE (this "DEBENTURE") is made and entered into as of this 3rd day of
July, 2006, by and between Discount Investment Corp. Ltd., a company registered
under the laws of the State of Israel, Registration No. 52-002389-6 ("DIC") and
Anfield Ltd., a company registered under the laws of the State of Israel,
Registration No. 51-253873-7 ("ANFIELD").
Each of DIC and Anfield shall hereinafter be referred to individually as a
"Party", and collectively as the "Parties".
WHEREAS Anfield and DIC are parties to a Loan Agreement dated July
3rd, 2006, with respect to a certain borrowing of funds by
Anfield from DIC (the "LOAN AGREEMENT"); and
WHEREAS it is a condition precedent to the disbursement of the Loan
(as such term is defined in the Loan Agreement) that as
security for the full and prompt repayment of the Loan
(principal together with any interest accrued thereon and
linkage differentials) and the performance by Anfield of all
of its obligations under the Loan Agreement, the Parties shall
execute and deliver this Debenture.
Page 26 of 33 pages
NOW THEREFORE, in consideration of the mutual and respective representations,
undertakings and covenants herein contained, the Parties hereby agree as
follows:
1. DEFINITIONS
Capitalized terms or matters of construction shall be as set forth in the
Loan Agreement.
2. GRANT OF SECURITY INTEREST
2.1. To secure the full and prompt repayment of the Loan (principal
together with any interest accrued thereon and linkage differentials)
plus VAT (if applicable) (the "SECURED AMOUNT") and the performance by
Anfield of all of its obligations under the Loan Agreement, and
without any limitation in amount, Anfield hereby grants DIC a security
interest and a first ranking fixed charge (the "ANFIELD CHARGE") on
672,174 ordinary shares (the "ANFIELD SHARES") of Koor Industries
Ltd., deposited at Bank Hapoalim Ltd., account No. 325904 (at branch
No. 510) (or any other account), together with all proceeds and
substitutions thereof, all cash, stock and other moneys and property
paid thereon, all rights to subscribe for or otherwise receive
securities declared or granted in connection therewith, and all other
cash and non-cash proceeds of the foregoing.
2.2. On the Disbursement Date, Anfield shall transfer the Anfield Shares to
the Security Trustee (as such terms are defined in the Loan
Agreement). Concurrently with the execution of this Debenture, the
Parties shall enter into the Letter of Instructions to the Security
Trustee attached to the Loan Agreement as attachment C .
2.3. Anfield waives any right it may have of first requiring DIC or its
designee to proceed against or enforce any specific rights pursuant to
this Debenture and/or the Loan Agreement or any other rights or
security or claim payment from any person, before realizing the
Anfield Charge.
2.4. Without derogating from the generality of the aforesaid, concurrently
with, and as a condition precedent to the disbursement of the Loan,
Anfield shall sign the requisite formal notice to the Registrar of
Companies, in the form attached hereto as EXHIBIT A, notifying the
Registrar of Companies of the creation and perfection of the Anfield
Charge. Anfield hereby undertakes to file such notice with the
Registrar of Companies together with a copy of this Debenture within
three (3) business days following the date hereof.
2.5. Notwithstanding anything to the contrary contained herein, neither
Anfield nor any person having a right which may be affected by the
Anfield Charge created hereby or to be created by the realization
thereof, shall have any right under Section 13(b) of the Israeli
Pledges Law, 5727-1967.
3. COVENANTS OF ANFIELD
In addition to the representations and warranties set forth in the Loan
Agreement, Anfield hereby represents and warrants to, and covenants and
agrees with DIC that:
3.1. Anfield will defend, at its own cost and expense, its rights to the
Anfield Shares or the priority of the Anfield Charge against all
claims and demands of all persons at any time claiming any interest in
the Anfield Shares or any priority to the Anfield Charge.
3.2. Anfield will keep the Anfield Shares free from any claim, security
interest, lien, encumbrance or any other third party right other than
those granted to DIC hereunder and/or under the Loan Agreement.
3.3. Anfield will do or cause to be done all things necessary to maintain
the security interest granted herein as a duly perfected first ranking
lien on the Anfield Assets.
3.4. Anfield will make best efforts to enable the exercise of the security
interest granted hereunder, if required, including, without
limitation, with respect to any third party consents, and to
facilitate the realization of the Anfield Charge or the exercise of
any rights vested in DIC or its designees, including by executing any
transfer, conveyance, charge, assignment or assurance of the Anfield
Shares (whether to DIC or its designees or otherwise) and/or by making
any registration and giving any notice, order or direction.
3.5. Other than the Anfield Charge granted to DIC, the Anfield Shares (or
any part thereof) are not subject to any claim, security interest,
lien, encumbrance or any other third party rights of any kind or
nature whatsoever.
Page 27 of 33 pages
3.6. Until final and full repayment of the Loan (principal and any interest
accrued thereon together with linkage differentials), Anfield shall
not, without DIC's prior written consent:
3.6.1. Cause or suffer to be made any sale, assignment, transfer,
gift, or any other disposition in any manner whatsoever,
including any conveyance, pledge, hypothecation, mortgage, lien,
foreclosure, or the creation of any encumbrance of whatever
nature, of the Anfield Shares or any part thereof.
3.6.2. Issue any debt or equity securities of any kind whatsoever, or
any rights with respect to any such securities.
3.6.3. Issue any shares of Anfield or other securities convertible
into shares of Anfield.
4. EVENTS OF DEFAULT
4.1. Upon the occurrence of the following events, DIC shall have the right
to realize the security interests hereunder (each, an "EVENT OF
DEFAULT"):
4.1.1. Any breach by Anfield of any of its obligations, warranties or
representations under the Loan agreement or the Share Purchase
Agreement, or the Amendment (as such terms are defined in the
Loan Agreement), which breach is not cured by Anfield within 30
(thirty) days of receiving written notice thereof from DIC;
4.1.2. The commencement by Anfield of any liquidation proceedings or
the adoption of a winding up resolution by Anfield, or the
appointment of a receiver or trustee over the whole or any part
of the assets of Anfield, or the calling of a meeting of
creditors of Anfield for the purpose of entering into a scheme of
arrangement with them;
4.1.3. The commencement by third parties of any liquidation
proceedings against Anfield, which have not been terminated
within 90 (ninety) days thereafter;
4.1.4. the levy of an attachment or the institution of execution
proceedings against all or a substantial part of the assets of
Anfield.
4.2. At any time following the occurrence of any Event of Default, DIC may
exercise any right available to it under this Debenture and/or the
Loan Agreement, in order to collect the Secured Amount (or any part
thereof), and for such purpose, to initiate any legal proceedings
available to DIC, including without limitations, the realization of
the Anfield Charge and the appointment of a receiver to facilitate
such realization.
4.3. Anfield shall reimburse DIC on demand for any and all fees, costs and
expenses (including, without limitation, attorney's fees and
disbursements) assumed or incurred by DIC, in enforcing or attempting
to enforce any right or remedy under this Debenture and/or the Loan
Agreement.
5. CONTINUING AND RELEASE OF SECURITY INTEREST
5.1. This Debenture shall create a continuing security interest in the
Anfield Shares, and shall (i) remain in full force and effect until
full and final performance of all of Anfield's obligations in
accordance with this Debenture and/or the Loan Agreement; (ii) be
binding upon Anfield, its successors and permitted assigns; and (iii)
inure to the benefit of DIC and its respective successors and
permitted designees and assigns.
5.2. Immediately following the compliance of all of Anfield's obligations
in accordance with the Loan Agreement (including, for the avoidance of
doubt, by way of set-off upon exercise of the Put Option, as described
in Section 3.3 of the Loan Agreement), all of the security interest
granted hereunder and under the Loan agreement shall be released and
revoked.
6. BORROWER REMAINS LIABLE
Anything herein to the contrary notwithstanding: (a) Anfield shall remain
liable under any contracts and agreements related to or associated with the
Anfield Shares to the same extent as if this Debenture had not been
executed; and (b) DIC shall not have any obligation or liability under any
contracts and agreements related to or associated with the Anfield Shares
by reason of this Debenture, nor shall it be obligated to perform any of
the obligations or duties of Anfield thereunder or to take any action to
collect or enforce any claim for payment assigned hereunder.
Page 28 of 33 pages
7. MISCELLANEOUS
7.1. GOVERNING LAW. This Debenture shall be governed by and interpreted in
accordance with the laws of the State of Israel, without giving effect
to the rules regarding conflict of law, and the competent courts of
Tel Aviv-Jaffa shall have sole and exclusive jurisdiction over any
dispute between the Parties hereto.
7.2. ENTIRE AGREEMENT. This Debenture, including the preamble and exhibits
thereto, constitutes the entire understanding and agreement between
the Parties with regard to the subject matter hereof, and supersedes,
nullifies and terminates all prior agreements and representations
between the Parties with regard to such subject matter (excluding the
Loan Agreement).
7.3. ASSIGNMENT OF RIGHTS. Neither Party shall assign any right or
obligation hereunder without the prior written consent of the other
Party, provided however, that the foregoing shall not apply to any
assignment by DIC to any assignee permitted under the provisions of
the Amendment (as such term is defined in the Loan Agreement).
7.4. DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power, or remedy accruing to any Party upon any breach or default
under this Debenture, shall be deemed a waiver of any other breach or
default therefore or thereafter occurring. Any waiver, consent or
approval of any kind on the part of any Party of any breach or default
under this Debenture, or any waiver on the part of any Party of any
provisions or conditions of this Debenture, must be in writing and
shall be effective only to the extent specifically set forth in such
writing.
7.5. EXPENSES. Each Party shall bear its respective costs and expenses
related to the execution of this Debenture.
7.6. AMENDMENTS. This Debenture may not be amended except by a written and
signed document executed by all Parties hereto.
7.7. SEVERABILITY. If any provision of this Debenture is held invalid or
unenforceable, such invalidity or unenforceability shall not affect
other provisions of this Debenture, and, to that extent, the
provisions of this Debenture are intended to be and shall be deemed
severable.
7.8. NOTICES. Any notice required or permitted by this Debenture will be in
writing and will be deemed given if personally delivered, sent by
prepaid registered mail, or sent by facsimile or similar
communication, and confirmed by such mail, postage prepaid, addressed
to the other Party at the address set out below or at such other
address for which such party gives notice hereunder. Notices will be
deemed given 1 (one) business day after personal delivery, 3 (three)
business days after deposit in the mail, or 1 (one) business day after
confirmation of transmission is obtained if sent by facsimile or
similar communication, as applicable.
DIC:
3 Azrieli Center
Tel Aviv 67023
Israel
Fax: 03-6075866
Attn.: the Comptroller
With a copy to:
Goldfarb, Levy, Eran Meiri & Co.
2 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-6089910
Attn.: Oded Eran, Adv. & Nechama Brin, Adv.
Page 29 of 33 pages
Anfield:
4 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-6966464
With a copy to:
Herzog, Fox & Neeman
4 Weizmann Street
Tel Aviv 64239
Israel
Fax: 03-6966464
Attn.: Adv. Alan Sacks
[Signature Page Follows]
IN WITNESS WHEREOF, this Debenture has been executed by the Parties hereto as of
the day and year first hereinabove written:
____________________________ ______________________
DISCOUNT INVESTMENT CORP. LTD. ANFIELD LTD.
By: _______________ By: _______________
Title: _______________ Title: _______________
======================================================================
Exhibit 4
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("IDBH") may file as necessary on behalf of the undersigned
with the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and
any amendments thereto in respect of shares of Koor Industries Ltd. purchased,
owned or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
IDB Development Corporation Ltd.
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
======================================================================
Page 30 of 33 pages
Exhibit 5
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("DIC") may file as necessary on behalf of the undersigned with
the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and any
amendments thereto in respect of shares of Koor Industries Ltd. purchased, owned
or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
IDB Holding Corporation Ltd.
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
======================================================================
Exhibit 6
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("DIC") may file as necessary on behalf of the undersigned with
the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and any
amendments thereto in respect of shares of Koor Industries Ltd. purchased, owned
or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
Nochi Dankner
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
======================================================================
Page 31 of 33 pages
Exhibit 7
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("DIC") may file as necessary on behalf of the undersigned with
the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and any
amendments thereto in respect of shares of Koor Industries Ltd. purchased, owned
or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
Shelly Bergman
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
======================================================================
Exhibit 8
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("DIC") may file as necessary on behalf of the undersigned with
the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and any
amendments thereto in respect of shares of Koor Industries Ltd. purchased, owned
or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
Ruth Manor
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
======================================================================
Page 32 of 33 pages
Exhibit 9
June 19, 2006
Discount Investment Corporation Ltd.
The Triangular Tower, 44th Floor
3 Azrieli Center
Tel-Aviv, 67023
Israel
Gentlemen,
Pursuant to rule 13d-1(k)(1)(iii) promulgated under the Securities Exchange
Act of 1934, as amended, the undersigned hereby agrees that Discount Investment
Corporation Ltd. ("DIC") may file as necessary on behalf of the undersigned with
the Securities and Exchange Commission a Schedule 13D or a Schedule 13G and any
amendments thereto in respect of shares of Koor Industries Ltd. purchased, owned
or sold from time to time by the undersigned.
DIC is hereby authorized to file a copy of this letter as an exhibit to
said Schedule 13D or Schedule 13G or any amendments thereto.
Very truly yours,
(signed)
Avraham Livnat
A g r e e d:
(signed)
Discount Investment Corporation Ltd.
Page 33 of 33 pages