AGREEMENT
Made and entered into at Tel Aviv on the 30th day of December 1999
BETWEEN
XXXXX XXXXXXX (bearer of British Passport No. 000000000),
(Hereinafter: "Xxxxxxx")
of the first part;
AND
ARWOLL HOLDINGS LTD. (Pvte. Co. 51-260178-2),
(hereinafter: "Arwoll")
of the second part;
AND
ZIRA HOLDINGS LTD. (in formation)
represented by its founder - XXXX XXXXXXXXXX (bearer of
Belgium Passport No. EA 725317),
(hereinafter: "Zira")
of the third part;
AND
XXXX XXXXXXXXXX (hereinafter: "Rabinowicz")
of the fourth part;
WHEREAS: Xxxxxxx wishes to organize his holdings in the company Macpell
Industries Ltd. (hereinafter: "Macpell") (the holding is via Arwoll - a
company under his full control) within the framework of a group to be
called the Xxxxxxx Group (hereinafter: "the Xxxxxxx Group"); and
WHEREAS: Wofson is desirous that Rabinowicz, with whom he has for many years
been co-operating in the business of Macpell and of Tefron Ltd.
(hereinafter: "Tefron"), should (via Zira - a company in the process of
being formed which will be under the full control of Rabinowicz) join,
as a minority group, the Xxxxxxx Group, in which the majority will
continue to be held by Xxxxxxx (through arwoll); and
WHEREAS: In connection with the foregoing, Arwoll agrees to sell and transfer to
Zira, and Zira agrees to purchase and accept from Arwoll, portion of
the Macpell shares owned by Arwoll;
WHEREAS: The parties to the Agreement wish to specify herein the terms of sale
and purchase, as well as other matters;
NOW THEREFORE IT IS DECLARED, STIPULATED AND AGREED BY THE PARTIES TO THE
AGREEMENT AS FOLLOWS:
1. Preamble and interpretation
1.1. The preamble to the Agreement and the appendix attached hereto,
constitute integral parts hereof.
1.2. In this Agreement each of the following terms and expressions will have
the meaning set opposite each of them, as follows:
"The Agreement" - this agreement.
"Macpell" - Macpell Industries Ltd. (Publ. Co. No. 52-003752-4).
"The Shares Sold" - 3,893,086 shares of NIS 1 par value each in
Macpell.
"Tefron" - Tefron Ltd. (Publ. Co. No. 52-004340-7).
"The Bank" - Bank Hapoalim B.M.
"The Bank" - Bank Hapoalim B.M.
"The Contract" - a contract that was signed on 28th December 1999
between Arwoll and Avi Roimi (hereinafter: "Roimi"), in connection with
the acquisition of shares in Macpell.
"The Shareholders' Agreement" - an agreement signed on 28th December
1999 between Arwoll and Roimi in connection with the relationship which
would apply between them as shareholders in Macpell.
This document is attached as an appendix to the Agreement.
2. Representations and undertakings by Arwoll
Arwoll represents and undertakes to Zira that:
2.1. Arwoll is the owner of 8,195,971 shares in the Macpell, which
represent 52.67% of the issued and paid-up share capital of
Macpell.
2.2. A further 3,533,473 shares are still registered in the name of
Arwoll in the register of shareholders of Macpell.
These shares were sold by Arwoll to Roimi and/or to a
corporation under his control, pursuant to the Contract.
2.3. The Shares Sold and Aroll's rights therein are free and clear
of any pledge, emcumbrance, attachment, undertaking or any
other third party right (hereinafter: "Free and Clear"), apart
from a charge and a pledge in favour of the Bank, which agrees
to release the Shares Sold from the charge and the pledge in
order for same to be sold to Zira as Free and Clear.
2.4. The Shares Sold are fully paid-up and they are registered in
the register of shareholders of Macpell and with the Registrar
of Companies in the name of Arwoll.
2.5. The Shares Sold are transferable, are not blocked by the
provisions of any law or by virtue of provisions or
instructions of any competent body, and there is no
restriction to the sale and transfer thereof to Zira.
3. Representations by Zira
Zira's representations are made by its founder - Rabinowicz.
3.1. Rabinowicz declares that he is a director of Macpell and of
Tefron and is the chief executive officer of Tefron.
3.2. Rabinowicz declares that the affairs, business and the
commercial and legal situation of Macpell and of Tefron are
well-known to him.
3.3. Rabinowicz declares that by virtue of the foregoing in this
clause, Zira (in this name or in such name as may be approved
by the Registrar of Companies of this name is approved) agrees
to purchase the Shares Sold, at the price and on the
conditions specified below, without making the effecting of
the purchase contingent upon conducting due diligence
examinations, or subject to any condition precedent or other
restrictive condition.
4. Sale and Purchase of the shares
4.1. Arwoll undertakes to sell and transfer the Shares Sold to
Zira, and Zira undertakes to purchase the Shares Sold form
Arwoll and to accept delivery thereof.
4.2. In consideration for the Shares Sold Zira undertakes to pay
Arwoll an aggregate amount of $13,635,144 (thirteen million
six hundred and thirty-five thousand one hundred and
forty-four US dollars), on the basis of a price of $3.5024 per
share (which is also the price specified in the Contract).
The payment shall be effected in dollars and/or in the new
shekel equivalent thereof according to the representative rate
known at the time of payment.
4.3. The full amount of the consideration shall be paid by Zira to
Arwoll on Wednesday, 12th January 2000, at 10.00 a.m. at the
offices of the Bank, at 00 Xxxxxxxxxx Xxxxxxxxx, Xxx Xxxx
(hereinafter, "the Date of Execution").
4.4. Against receipt of the full amount of the consideration as
aforesaid to the credti of Arwoll's account, account no.
51661, branch 000 (Xxxx Xxxx branch) of the Bank, Arwoll will
deliver to Zira, on the Date of Execution, a suitable share
transfer deed singed by it, accompanied by share certificate
in respect of all the Shares Sold, in circumstances where the
Shares Sold are Free and Clear.
5. Financing of the transaction
5.1. The Bank has informed the parties, prior to the signing of the
Agreement, that it is prepared to place at Zira's disposal the
credit required for purposes of financing the amount of the
consideration, provided that one-third of the amount of the
credit is guaranteed by way of a guarantee by Arwoll, which
will be secured by a charge over some of Arwoll's shares in
Macpell (hereinafter: "the Guarantor").
5.2. Arwoll agrees to give the Guarantee to the Bank and to
encumber portion of its shares in Macpell as security for the
Guarantee.
5.3. As security for the Guarantee:
5.3.1. Zira will encumber the Shares Sold by way of a
second-ranking charge in favour of Arwoll.
5.3.2. In the scope of its membership of the Xxxxxxx Group,
Zira will give Arwoll an irrevocable power of
attorney to vote on its behalf and in its name on the
strength of the Shares Sold at general meetings of
Macpell, and Zira undertakes, so long as the
Guarantee is in force, not to vote itself and not to
give anyone else a right to vote on the strength of
the Shares Sold.
6. The Shareholder's Agreement
6.1. Zira declares that it is conversant with the Shareholders'
Agreement and is aware of the provisions thereof.
6.2. By virtue of the provisions of Clause 7.5 of the Shareholders'
Agreement, Zira hereby confirms, unreservedly and
unconditionally, its acquiescence to the provisions of the
Shareholders' Agreement as if it had been a party to that
agreement form the outset; Zira assumes a pro rata portion of
the rights and obligations pursuant to that agreement.
6.3. The last part of the preceding sub-clause with regard to the
rights is subject to the provisions of Clause 5.3.2 above with
respect to the voting rights on the strength of the Shares
Sold.
6.4. For the avoidance of doubt, Zira's rights to give instructions
for the appointment of directors in Macpell (Clause 4.5(b) of
the Shareholder's Agreement or in Tefron (Clause 4.8, ibid)
and Zira's rights to sell shares on the Stock Exchange without
restiction (Clause 7.6 ibid.) shall be portion of Arwoll's
rights (Xxxxxxx in those clauses).
7. Holding of shares in Macpell
After the transfer of the shares has been effected pursuant to this
Agreement and pursuant to the Contract, the state of holdings of shares
in Macpell will be as follows:
Arwoll - 4,302,885 shares = 27.65% of the issued and paid-up
capital
Roimi - 4,097,986 shares = 26.34% of the issued and paid-up
capital
Zira - 3,893,086 shares = 25.02% of the issued and paid-up
capital
Totalling - 12,293,957 shares = 79.00%
8. Option to purchase shares in Tefron
8.1. Tabriz Anstalt Ltd. N.V. (hereinafter: "Tabriz") has given
Xxxxxxx and Rabinowicz, and/or companies under their control,
an option (hereinafter: "the Option") to purchase from its
shares of Tefron, on the conditions and at the price as set
forth in the Option documents.
8.2. Xxxxxxx and Rabinowicz hereby agree that if they should
decide, either themselves and also/or through companies under
their control, to exercise the Option or portion thereof, the
division between them of which they will notify Tabriz, as
required under the conditions of the Option, will be 52.5% -
Xxxxxxx and 47.5% - Rabinowicz, until such time as is
otherwise agreed between them.
9. Taxes and expenses
9.1. Each party to the Agreement shall be liable for the taxes
imposed on it, if imposed, according to any law, in respect of
the transaction which is the subject of the Agreement.
9.2. Stamp duty in respect of the Agreement and/or in respect of
the transfer of the Shares Sold, if same applies, shall be
borne by Arwoll and By Zira in equal shares.
10. Amendments to the Agreement
There will be no validity to any alternation and/or amendment to the
Agreement unless this is done by way of a document in writing, to be
signed by all the relevant parties amongst the parties to the
Agreement.
11. Address
The addresses of the parties for purposes of this Agreement are:
11.1. Xxxxxxx and Arwoll - c/o Xxxxxx Xxxxxxxxxx, Adv.
00 Xxxxxxxxxx Xxxxxxxxx, Xxx Xxxx 00000
Tel. 00-0000000
Fax 00-0000000
11.2 Rabinowicz and Zira - c/o Tefron Ltd.
00 Xxxxx Xxxxxx, Xxxx Xxxx 00000
Tel. 00-0000000
Fax 00-0000000
IN WITNESS WHEREOF THE PARTIES HAVE HEREUNTO SIGNED:
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Xxxxx Xxxxxxx Arwoll Holdings Ltd.
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Xxxx Xxxxxxxxxx Zira Holdings Ltd.
(in formation)
