EXHIBIT 13
AMENDMENT 2 TO THE TRUST DEED OF AUGUST 18, 2009
DRAWN UP AND SIGNED IN TEL-AVIV ON OCTOBER 13, 2009
BETWEEN:
SCAILEX CORPORATION LTD.
Public company no. 00-000000-0
of 00 Xxx-Xxxxxx Xxxxx Xxxxxx, Xxxxxx-Xxxxx 00000 Israel
(hereinafter - "THE COMPANY")
OF THE FIRST PART;
AND:
XXX XXXX TRUST COMPANY LTD.
Private company no. 00-000000-0
of 00-00 Xxxxxxxx Xxxxx Xxxx, Xxx-Xxxx, Xxxxxx
(hereinafter - "THE TRUSTEE")
OF THE SECOND PART;
WHEREAS on September 6, 2009, the Company and the Trustee signed an
amendment ("AMENDMENT 1") to the Trust Deed of August 18, 2009,
which was signed between the Company and Clal Finance Trust 2007
Ltd. ("THE FIRST TRUST DEED") in relation to a shelf prospectus
published by the Company on August 21, 2009 ("THE SHELF
PROSPECTUS"), whereby the Company may offer, inter alia, Series 1
Bonds of the Company ("SERIES 1 BONDS");
AND WHEREAS On September 6, 2009, the Company published a shelf offering
report pursuant to the Shelf Prospectus, pursuant whereto the
Company published its initial offering of Series 1 Bonds ("THE
SHELF OFFERING REPORT");
AND WHEREAS due to an inadvertent clerical error, Amendment 1 and the First
Addendum to Amendment 1 (the Bond Certificate), prescribed, inter
alia, that the conversion rate of the Series 1 Bonds shall not be
adjusted following a distribution of dividends;
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AND WHEREAS the Company contacted the Trustee in order to correct the Trust
Deed so that the conversion rate shall be adjusted in the event
of a distribution of dividends, as specified in this Amendment
("AMENDMENT 2") hereunder;
AND WHEREAS the Trustee was convinced that the Amendment 2 does not prejudice
the holders of the Series 1 Bonds;
WHEREFORE, THE PARTIES HEREBY AGREE, STIPULATE AND DECLARE AS FOLLOWS:
1. CORRECTION TO CLAUSE 3.5 OF AMENDMENT 1:
Clause 3.5 of Amendment 1 shall be corrected so that, in lieu of the
referral to clause 2.16.3(c)(1) of the Shelf Prospectus, the referral shall
be to clause 2.16.3(c)(2) of the Shelf Prospectus. The version of the
clause subsequent to the correction shall be, therefore, as specified
hereunder:
"3.5 Series 1 Bonds are convertible, subject to adjustments as specified in
clauses 2.16.3(a), (b) and (c)(2) of the Shelf Prospectus."
2. CORRECTION TO CLAUSE 3 OF THE FIRST ADDENDUM TO AMENDMENT 1 - SERIES 1 BOND
CERTIFICATE
Clause 3 of the First Addendum to Amendment 1 - Series 1 Bond Certificate,
shall be corrected to that, in lieu of the referral to clause 2.16.3(c)(1)
of the Shelf Prospectus, the referral shall be to clause 2.16.3(c)(2) of
the Shelf Prospectus. The version of the clause subsequent to the
correction shall be, therefore, as specified hereunder:
"3. Series 1 Bonds are convertible, subject to adjustments as specified in
clauses 2.16.3(a), (b) and (c)(2) of the Shelf Prospectus."
3. GENERAL
3.1 Attached is the updated version of the Series 1 Bond Certificate,
which includes the aforesaid correction.
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3.2 Apart from that stated above, no change occurred in the rest of the
conditions of the First Trust Deed and Amendment 1, and the First
Trust Deed and Amendment 1 shall continue to apply between the parties
in relation to the Series 1 Bonds.
3.3 It is hereby clarified that the update of the Trust Deed, as specified
in this Amendment, applies solely in connection with the Series 1
Bonds, and it in no way applies the conditions specified in this
Amendment to other series of bonds that the Company has offered and/or
may offer pursuant to the Shelf Prospectus.
3.4 By signing this agreement, the Trustee authorizes each of the
authorized signatories of the Company to report on its behalf in the
Magna network about its engagement in this agreement and its signing
of it.
IN WITNESS WHEREOF, THE PARTIES HAVE HEREUNTO SIGNED:
Stamp + /s/ Yahel Shachar; /s/ Shachar Rachim
--------------------------------------------- ---------------------------
SCAILEX CORPORATION LTD. XXX XXXX TRUST COMPANY LTD.
ATTORNEY'S CONFIRMATION
I, the undersigned, Xxxxx Xxxx, the attorney of Scailex Corporation Ltd., hereby
confirm that this Addendum was duly signed by the authorized signatories of
Scailex Corporation Ltd., Messrs. Yahel Shachar and Shachar Rachim.
/s/ Xxxxx Xxxx
--------------
XXXXX XXXX, ADV.
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SCAILEX CORPORATION LTD.
FIRST ADDENDUM
CERTIFICATE OF SERIES 1 BONDS
Issued herewith is a Bond, which is payable in a single bullet payment in the
year 2024 (but may be redeemed early, as specified hereunder), which bears
annual, unlinked interest, as specified hereunder:
REGISTERED BONDS
Certificate number _______.
Annual interest rate: ___%.
Par value of this Bond: NIS ______.
The registered holder of this Bond: _________________.
THIS CERTIFICATE attests that Scailex Corporation Ltd. ("THE COMPANY") shall pay
100% of the par value of this Bond to whomever shall be the registered "holder"
(as this term is defined in the conditions in the overleaf) of the Bond on the
determinant date for that payment, all being subject to that specified in the
conditions in the overleaf and the Trust Deed dated August 18, 2009 and the
amendments thereto dated September 6, 2009 and October 13, 2009, between the
Company on the one hand and Xxx Xxxx Trust Company Ltd. and/or any party that
shall serve from time to time as a trustee of the holders of the bonds pursuant
to the Trust Deed ("THE TRUSTEE" and "THE TRUST DEED," respectively).
1. This Bond bears interest at the annual interest rate specified above, which
shall be paid at the appointed time, all as specified in the conditions in
the overleaf.
2. This Bond shall not be linked, all as specified in the conditions in the
overleaf.
3. The Series 1 Bonds shall be convertible into ordinary shares of NIS 0.12
par value each of the Company on any trading date as of the registration
date of the Series 1 Bonds for trading on the Tel-Aviv Stock Exchange and
until December 15, 2024, in such manner that, during the period from the
registration date for trading and until September 5, 2014, every NIS 80 par
value of Series 1 Bonds shall be convertible into one ordinary share of NIS
0.12 par value of the Company, and subsequently, as of September 6, 2014
and until December 15, 2024, every NIS 200 par value of Series 1 Bonds
shall be convertible into one ordinary share of NIS 0.12 par value of the
Company.
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4. The Series 1 Bonds are convertible subject to the adjustments as specified
in clauses 2.16.3 (a), (b) and (c)(2) of the Shelf Prospectus.
5. This Bond is being issued as part of Series 1 of Bonds, the conditions of
which are identical to the conditions of this Bond ("THE RELEVANT SERIES"),
being subject to the conditions in the overleaf and in the Trust Deed. It
is hereby clarified that the provisions of the Trust Deed shall constitute
an integral part of the provisions of this Bond, and shall be binding upon
the Company and upon the holders of the bonds included in the aforesaid
series.
6. The Bonds of the Relevant Series shall not be secured by sureties, any
liens or by any other way, all as specified in the Offering Report of the
Company dated September 6, 2009, under which Bonds of the Relevant Series
were offered for the first time to the public ("THE INITIAL OFFERING
REPORT"), and as specified hereunder in clause 4.5.
7. To the extent not prescribed otherwise in the Initial Offering Report of
the Bonds of the Relevant Series, the Company shall be allowed to pledge
all of its assets and/or a portion thereof, in any lien and in any other
manner, in favor of any party that it shall deem fit, without any
restriction, and at any ranking, including for the securing of any bonds
(or any series of bonds) or other liabilities, and without the need for the
consent of the Trustee and/or of the holders of the Bonds of any series.
Furthermore, the Company shall be allowed to sell, lease, deliver or
transfer by any other means, its property, in whole or in part, in any
manner, to the favor of any party that it shall deem fit, without the need
for any consent of the Trustee and/or the holders of the Bonds in any
series.
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8. All of the Bonds of the Relevant Series shall be PARI PASSU, INTER SE, in
relation to the Company's liabilities pursuant to the Bonds of this Series,
and without any preferential or preferred right of one over the other.
SIGNED BY THE COMPANY ON __________________
Stamp + /s/ Yahel Shachar; /s/ Shachar Rachim
---------------------------------------------
SCAILEX CORPORATION LTD.
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THE CONDITIONS RECORDED IN THE OVERLEAF
4. GENERAL
The following expressions shall have the following meanings in this Series
1 Bond, unless the context dictates otherwise:
"THE COMPANY" and/or
"THE ISSUER" Scailex Corporation Ltd.;
"THE TRUST DEED" or
"THE FIRST TRUST DEED" Trust deed signed between the Company and
Clal Finance Trust 2007 Ltd. on August
18, 2009, including the addenda thereto,
which constitute an integral part
thereof;
"THE PROSPECTUS" or
"THE SHELF PROSPECTUS" Shelf prospectus of the Company, which
was published, inter alia, in respect of
the Bonds;
"SHELF OFFERING REPORT" or
"OFFERING REPORT" Shelf offering to be published pursuant
to the Shelf Prospectus, in conformity
with the provisions of the Securities
Act, 5728 - 1968, in which Bonds of the
Relevant Series shall be offered, while
determining all of the special
particulars for that offering;
"REPORT OF THE INITIAL
OFFERING OF THE RELEVANT
SERIES" An offering report under which Bonds of
the Relevant Series shall be offered
for the first time;
"THE BONDS" or "THE BOND" Series 1 Bonds;
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"THE TRUSTEE" Xxx Xxxx Trust Company Ltd. and/or any
party that shall serve from time to time
as a trustee of the Bondholders pursuant
to this Deed;
"THE REGISTER FOR
THE RELEVANT SERIES" Register of the holders of the Bonds of
the same series, as stated in clause 25
of the Trust Deed;
"HOLDERS OF THE BONDS" and/or
"THE BONDHOLDERS"
and/or "THE HOLDERS" Any party holding the Bonds;
"SPECIAL RESOLUTION" Resolution passed during a general
assembly of Bondholders of the Relevant
Series, during which Holders of at least
fifty-five percent (55%) of the balance
of the par value of the Bonds in
circulation of that series are present,
either in person or by proxy, or during a
postponed assembly during which Holders
of at least ten percent (10%) of the said
balance are present, either in person or
by proxy, which was passed (whether
during the original assembly or during
the postponed assembly) by a majority of
at least seventy-five percent (75%) of
all votes of the voters, excluding
abstentions;
"THE BOND CERTIFICATE" Bond certificate of the Relevant Series,
the version of which appears in the First
Addendum to the Trust Deed;
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"THE LAW" or "THE
SECURITIES ACT" The Securities Act, 5728 - 1968, and the
regulations instituted pursuant thereto
from time to time;
"THE COMPANIES ACT" The Companies Act, 5759 - 1999;
"PRINCIPAL" The outstanding par value of the Bonds of
the Relevant Series;
"TRADING DAY" Any day on which transactions are carried
out on the Tel-Aviv Stock Exchange Ltd.;
"BUSINESS DAY" or
"BANKING BUSINESS DAY" Any day that the banks in Israel are open
for business;
"BUSINESS DAY ABROAD" Any day on which a quotation of base
interest is determined, relating to
foreign currency, which is published in
the Reuters information service, or any
other source of information that shall be
specified in the Initial Offering Report
of the Bonds of the Relevant Series;
"THE TASE" The Tel-Aviv Stock Exchange Ltd.;
"THE NOMINEE COMPANY" The Nominee Company of Israel Discount
Bank Ltd.;
"THE TASE CLEARING HOUSE" The clearing house of the Tel-Aviv Stock
Exchange Ltd.
2. This Bond is one of a Series of registered Series 1 Bonds at the inclusive
nominal sum of up to NIS 4,000,000,000 for each relevant series. The Bonds
in this Series shall be issued PARI PASSU, INTER SE, without any
preferential or preferred right of one over the other.
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3. This Bond is payable (Principal) in a number of payments, which shall be
paid on each of the dates as shall be specified in the Initial Offering
Report, under which the Bond shall be offered, but on not more than one
date per quarter. The absence of linkage and the type of interest on the
Principal of the Bond to be issued shall be specified in the Offering
Report under which the Bond shall be offered for the first time. The
interest rate on the Principal of the Bond shall be determined during a
tender, pursuant whereto its initial offering shall be conducted. The
interest on the Bond Principal shall be paid annually in two biannual
payments, all as shall be specified in the Offering Report under which the
Bond shall be offered for the first time. The dates and number of payments
of the Principal, the absence of linkage, the type of interest, the
interest rate or method for determining it, and the interest payment dates
of the Bond, as shall be specified in the Offering Report under which the
Bond shall be offered for the first time, shall be determined by the
Company prior to the initial offering of the Bond.
4. PAYMENT DATE OF THE BOND PRINCIPAL
The principal of the Bonds, which is not linked to the consumer price index
or to any other index or currency, shall be paid in a single bullet payment
on December 31, 2024.
4.1 FORCED EARLY REDEMPTION OF THE SERIES 1 BONDS
The Company shall be entitled to effect a full forced early redemption
of all of the Series 1 Bonds (hereinafter: "EARLY REDEMPTION OF SERIES
1"), according to the following mechanism:
4.1.1 The Company shall publish an Immediate Report by no later than
August 6, 2014, with a copy to the Trustee for the Series 1
Bonds, about the resolution to effect an Early Redemption of
Series 1 on September 7, 2014 (hereinafter: "THE EARLY REDEMPTION
DATE OF SERIES 1"). The Company shall also publish the accrued
interest up until the Early Redemption Date of Series 1 in the
Immediate Report as stated.
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4.1.2 On the Early Redemption Date of Series 1, the Company shall pay
the sum of the Bond principal, plus the accrued interest in
respect of the outstanding balance of the Series 1 Bonds up until
the Early Redemption Date of Series 1.
4.1.3 The Company shall transfer the funds necessary for the purpose
of the Early Redemption of Series 1 to the Nominee Company, this
in conformity with the bylaws of the TASE Clearing House.
4.2 VOLUNTARY REDEMPTION BY THE HOLDERS OF THE SERIES 1 BONDS
4.2.1 NOTICE OF VOLUNTARY REDEMPTION
If the Company shall not issue an Immediate Report regarding an
Early Redemption of Series 1 by August 6, 2014, as specified
above in clause 3.3, the Company shall publish on that same day,
i.e., on August 6, 2014, an Immediate Report and an advertisement
in two Hebrew-language daily newspapers circulated in Israel
about the entitlement of the holders of the Series 1 Bonds to
voluntarily redeem their bonds on September 7, 2014 (hereinafter:
"VOLUNTARY REDEMPTION OF SERIES 1").
During the period between August 21, 2014 and September 7, 2014,
a holder of Series 1 Bonds shall not be able to effect a
conversion into Company shares, in accordance with clause 4.4.1
above, and this shall also be stated in the above-mentioned
Immediate Report.
4.2.2 Every holder of Series 1 Bonds, who desires to effect a
Voluntary Redemption of Series 1, shall be entitled to do so by
written notice (hereinafter: "VOLUNTARY REDEMPTION NOTICE"),
which is to be delivered by the holder to the Company during the
period between the publication of the Immediate Report as stated
above in clause 3.4.1 and August 26, 2014, at the Company's
registered office or at any other location specified by the
Company in the Immediate Report and/or in the advertisement in
the two daily newspapers as stated above.
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4.2.3 The Voluntary Redemption Notice of a holder of Series 1 Bonds
through TASE members shall be delivered to the TASE member
through which it is holding the Bonds that it desires to redeem,
which shall be delivered by it to the Company during the period
between the publication date of the Immediate Report as stated
above in clause 4.2.1 and August 26, 2014.
4.2.4 Pursuant to the bylaws of the TASE clearing house, the following
provisions shall apply to the delivery of Voluntary Redemption
Notices of Series 1:
4.2.4.1 Written notice from the TASE member must be received at
the TASE Clearing House by six trading days prior to the
Voluntary Redemption date of Series 1, separately for each
secondary account, in which the TASE member shall specify
the quantity in respect whereof the Voluntary Early
Redemption of Series 1 is being requested, and shall attach
thereto a certificate of exemption from withholding tax at
source, if any.
An application for a Voluntary Redemption of Series 1, which
relates to a quantity of Series 1 Bonds that exceeds the
quantity registered to the credit of the TASE member in the
secondary account to which the application relates shall not
be effected at all and shall be returned to the sending TASE
member, specifying the reason for the return.
4.2.4.2 No later than the second trading day after the day on
which the TASE Clearing House received a notice as stated
above from the TASE member, as specified above in subclause
(1), the Clearing House shall deliver a notification to the
Nominee Company of Israel Discount Bank Ltd., which shall
specify the inclusive par value of the Series 1 Bonds in
respect whereof applications for Voluntary Early Redemption
were submitted, attaching the certificates of exemption from
withholding tax at source.
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4.2.4.3 No later than the second trading day after the day on
which the Clearing House delivered a notification to the
Nominee Company as specified above in subclause 4.2.4.2, the
Nominee Company shall deliver a notification to the Company,
which shall specify the inclusive par value of the Series 1
Bonds in respect whereof applications for Voluntary Early
Redemption of Series 1 were submitted, attaching the
certificates of exemption from withholding tax at source.
On the Voluntary Redemption Date of Series 1, the Company
shall redeem the Series 1 Bonds in respect whereof Voluntary
Redemption Notices were submitted, in such manner that the
holder of the said Series 1 Bonds shall be entitled to
receive from the Company the sum of NIS 1 in respect of each
NIS 1 of Bonds that shall be redeemed by the Company on the
said date, plus the accrued and as yet unpaid interest.
A Voluntary Redemption Notice of Series 1 submitted to the
Company or to the TASE members may not be cancelled or
changed.
4.2.5 The sum of the Voluntary Redemption of Series 1 shall be paid to
the holders of the Bonds by the Trustee, by way of the execution
of a bank transfer to the Nominee Company of Israel Discount Bank
Ltd., according to the particulars that the Company shall issue
to the Trustee as stated hereunder, out of the funds deposited in
the Escrow Account, according to the written instructions that
shall be received from the Company, which shall include the date
for transfer of the funds, the destination thereof, as well as
any other particular that shall be required in order to enable
the Trustee to carry out the transfer, attaching a calculation of
the sum that must be paid, as specified above in clause 4.2.4(3).
In the event that the balance of the funds in the Escrow Account
shall be less than the Obligatory Value of the Bonds, the Company
shall transfer to the Escrow Account the sum equivalent to the
difference between the Obligatory Value of the Bonds and the
funds in the Escrow Account at that time that the Trustee must
transfer as stated above in this subclause. The Trustee and the
Company shall transfer the funds required for the purpose of the
Voluntary Redemption of Series 1 to the Nominee Company of Israel
Discount Bank Ltd. in conformity with the bylaws of the TASE
Clearing House. The Company shall provide any assistance to the
Trustee that might be required in order to enable it to render
the payment in its entirety and on time, including the timely
transfer to the Trustee of details of the sums, the dates and any
other detail that is required in order to effect the Voluntary
Redemption of Series 1 as stated.
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4.3 FORCED EARLY REDEMPTION OF ALL OF THE BONDS
The Company undertakes that, in the event that the Partner Share
Acquisition Transaction shall not be consummated by the Deadline,
i.e., by March 31, 2010, it shall call the Series 1 Bonds for forced
early redemption, and the following provisions shall apply.
If the Company shall not publish an Immediate Report regarding the
consummation of the Partner Share Acquisition Transaction by the
Deadline, the Company shall effect a full forced early redemption of
all of the Series 1 Bonds (hereinafter: "EARLY REDEMPTION"), according
to the following mechanism:
4.3.1 On April 1, 2010, the Company shall publish an Immediate Report
that the Partner Share Acquisition Transaction was not
consummated, and about the effecting of an Early Redemption to
the Bondholders, with a copy to the Trustee, with the determinant
date for the implementation thereof to be specified in the
Immediate Report, which shall be no less than 30 days and no more
than 45 days prior to the implementation of the Early Redemption.
The date of the Early Redemption shall not occur during the
period between the determinant date for the payment of interest
in respect of the Bonds and the actual payment date of the
interest. The Company shall also report the interest that has
accrued up until the date of the Early Redemption in the
Immediate Report.
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4.3.2 On the date of the Early Redemption, the Company shall pay the
sum of the Principal of the Bonds, with the addition of the
interest that accrued in respect of the outstanding balance of
the Bonds up until the date of the Early Redemption (hereinafter:
"THE OBLIGATORY VALUE").
4.3.3 The sum of the Early Redemption shall be paid to the Bondholders
by the Trustee, by way of the execution of a bank transfer to the
Nominee Company of Israel Discount Bank Ltd., according to the
particulars that the Company shall issue to the Trustee as stated
hereunder, out of the funds deposited in the Escrow Account,
according to the written instructions that shall be received from
the Company, which shall include the date for transfer of the
funds, the destination thereof, as well as any other particular
that shall be required in order to enable the Trustee to carry
out the transfer, attaching a calculation of the sum that must be
paid, as specified above in clause 4.3.2. In the event that the
balance of the funds in the Escrow Account shall be less than the
Obligatory Value of the Bonds, the Company shall transfer to the
Escrow Account the sum equivalent to the difference between the
Obligatory Value of the Bonds of the Relevant Series and the
funds in the Escrow Account at that time. The Trustee and the
Company shall transfer the funds required for the purpose of the
forced Early Redemption to the Nominee Company in conformity with
the bylaws of the TASE Clearing House. The Company shall provide
any assistance to the Trustee that might be required in order to
enable it to render the payment in its entirety and on time,
including the timely transfer to the Trustee of details of the
sums, the dates and any other detail that is required in order to
effect the forced Early Redemption as stated.
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4.4 VOLUNTARY REDEMPTION
In the event that the Company shall consummate the Partner Share
Acquisition Transaction by the Deadline; i.e., by March 31, 2010,
without a rating for the Series 1 Bonds having been received by that
date, the Holders of the Series 1 Bonds shall be entitled to an Early
Redemption of the Bonds that they are holding (hereinafter: "VOLUNTARY
REDEMPTION"), according to the following mechanism:
4.4.1 VOLUNTARY REDEMPTION NOTICE
On April 1, 2010, the Company shall publish an Immediate Report
and an advertisement in two Hebrew-language daily newspapers
circulated in Israel regarding the entitlement of Holders of the
Series 1 Bonds to voluntarily redeem the Bonds on May 2, 2010.
4.4.2 It shall be possible to deliver an Early Redemption Notice as of
the date that the Company shall deliver a notice as stated
regarding the date for notifying of an Early Redemption, subject
to that stated hereunder. A Voluntary Redemption Notice of a
holder of Bonds that are registered under its name in the
Register of Bondholders of the Relevant Series, must be delivered
to the Company within the period from the publication date of the
Immediate Report as stated above in clause 4.4.1 and April 18,
2010, at its registered office or at any other location that the
Company shall so advise in the Immediate Report and/or in the
advertisement in the two daily newspapers as stated above.
4.4.3 A Voluntary Redemption Notice of a Holder of Bonds through TASE
members must be delivered to the TASE member through which the
Bondholder is holding the Bonds that it wishes to redeem by April
18, 2010.
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4.4.4 Pursuant to the bylaws of the TASE Clearing House, the following
provisions shall apply to the delivery of Voluntary Redemption
Notices:
4.4.4.1 Written notice from the TASE member must be received at
the TASE Clearing House by six trading days prior to the
Voluntary Redemption date, separately for each secondary
account, in which the TASE member shall specify the quantity
in respect whereof the Voluntary Early Redemption is being
requested, and shall attach thereto a certificate of
exemption from withholding tax at source, if any.
4.4.4.2 An application for a Voluntary Redemption, which relates
to a quantity of Bonds that exceeds the quantity registered
to the credit of the TASE member in the secondary account to
which the application relates, shall not be effected at all
and shall be returned to the sending TASE member, specifying
the reason for the return.
4.4.4.3 No later than the second trading day after the day on
which the TASE Clearing House received a notice as stated
above from the TASE member, as specified above in subclause
(a), the Clearing House shall deliver a notification to the
Nominee Company of Israel Discount Bank Ltd., which shall
specify the inclusive par value of the Bonds in respect
whereof applications for Voluntary Redemption were
submitted, attaching the certificates of exemption from
withholding tax at source.
4.4.4.4 No later than the second trading day after the day on
which the Clearing House delivered a notification to the
Nominee Company of Israel Discount Bank Ltd. as specified
above in subclause (b), the Nominee Company shall deliver a
notification to the Company, which shall specify the
inclusive par value of the Bonds in respect whereof
applications for Voluntary Redemption were submitted,
attaching the certificates of exemption from withholding tax
at source.
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4.4.4.5 On the Voluntary Redemption Date, the Company shall
redeem the Bonds in respect whereof Voluntary Redemption
Notices were submitted, in such manner that the Holder of
the said Bonds shall be entitled to receive from the Company
the sum of NIS 1 in respect of each NIS 1 of Bonds that
shall be redeemed by the Company on the said date, (plus the
accrued and as yet unpaid interest).
4.4.4.6 A Voluntary Redemption Notice submitted to the Company or
to the TASE members may not be cancelled or changed.
4.4.5 The sum of the Voluntary Redemption shall be paid to the
Bondholders by the Trustee, by way of the execution of a bank
transfer to the Nominee Company of Israel Discount Bank Ltd.,
according to the particulars that the Company shall issue to the
Trustee as stated hereunder, out of the funds deposited in the
Escrow Account, according to the written instructions to be
received from the Company, which shall include the date for
transfer of the funds, the destination thereof, as well as any
other particular that shall be required in order to enable the
Trustee to carry out the transfer, attaching a calculation of the
sum that must be paid, as specified above in clause 4.4.4(e). In
the event that the balance of the funds in the Escrow Account
shall be less than the Obligatory Value of the Bonds, the Company
shall transfer to the Escrow Account the sum equivalent to the
difference between the Obligatory Value of the Bonds of the
Relevant Series and the funds in the Escrow Account at that time.
The Trustee and the Company shall transfer the funds required for
the purpose of the Voluntary Redemption to the Nominee Company of
Israel Discount Bank Ltd. in conformity with the bylaws of the
TASE Clearing House. The Company shall provide any assistance to
the Trustee that might be required in order to enable it to
render the payment in its entirety and on time, including the
timely transfer to the Trustee of details of the sums, the dates
and any other detail that is required in order to effect the
Voluntary Redemption as stated.
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4.5 The total immediate net consideration (i.e., net of commissions) that
the Company shall receive in respect of the issuance of the Series 1
Bonds shall be deposited in an escrow account, which shall be opened
in one of the five major banks in Israel and shall not be transferred
to the Company for its use until the conditions for the Closing of the
Partner Share Acquisition Transaction as stated have been fulfilled,
according to the following mechanism:
4.5.1 The Trustee shall open a bank account under its name at one of
the five major banks in Israel, at its discretion, provided that
a bank as stated shall have a rating of at least (AA), to which
the issue coordinator shall transfer the total immediate net
proceeds that the Company shall receive in respect of the
issuance of the Series 1 Bonds, and this sum shall be invested in
shekel deposits or in shekel bonds issued by the State of Israel
or in short-term loans issued by the State of Israel, according
to the Company's instructions (hereinafter: "THE ESCROW ACCOUNT"
and "THE DEPOSIT," respectively). The Trustee shall have sole
signatory rights in the Escrow Account in relation to any
operation in this account, including with respect to the
withdrawal of monies from this account. Notwithstanding that
stated, it is clarified that the policy for investing the funds
in the Escrow Account for Series 1 is the sole responsibility of
the Company, and the Trustee for Series 1 shall not be
responsible for any loss or damage that might be caused as a
result of investment operations as stated that shall be carried
out according to the Company's instructions.
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4.5.2 The funds, the securities being deposited in the Escrow Account,
and all of the Company's rights in the Escrow Account shall be
pledged in favor of the Trustee for the Holders of the Series 1
Bonds under a first-ranking fixed lien, and, concurrent with the
transfer of the Deposit to the Escrow Account, the Company shall
issue the following documents to the Trustee:
4.5.2.1 an original lien registration certificate from the
Registrar of Companies on the funds, the securities being
deposited in the Escrow Account and all rights of the
Company in the Escrow Account in favor of the Trustee; all
documents submitted to the Registrar of Companies for the
purpose of registration of the lien, including the form
"Particulars of Mortgages and Liens," with the first page of
each document being stamped with the "received" stamp of the
Registrar of Companies; a summary of the particulars of the
Company's liens, subsequent to the registration of the lien,
which specifies the lien that was registered and every other
lien that the Company has; i.e., thus enabling the Trustee
to verify that no lien is registered with the Registrar of
Companies that contradicts the aforesaid lien. It is
clarified that the lien registration certificate as stated
shall be issued to the Trustee within 5 Business Days of the
signing date of the lien documents.
4.5.2.2 Confirmation from the bank acknowledging that the funds,
the securities being deposited in the Escrow Account and all
of the Company's rights in the Escrow Account are pledged in
favor of the Trustee, and that the bank shall not have any
rights of offset or lien in relation to the funds and
securities that are being held and that shall be held in the
Escrow Account.
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4.5.3 As long as the preconditions for the Closing of the Partner
Share Acquisition Transaction have not been fulfilled up until
the Deadline, the purpose of the Deposit is to guarantee the
repayment of the Principal of the Series 1 Bond to the
Bondholders, and this, in the event that the preconditions for
the Closing of the Partner Share Acquisition Transaction shall
not be fulfilled by the Deadline.
4.5.4 The Trustee shall operate the Deposit as follows: upon receiving
notification from the Company that all preconditions for the
Closing of the Partner Share Acquisition Transaction have been
fulfilled, then, subject to the signing of the lien document, as
specified hereunder in clause 3.5, the Trustee shall sign the
order to transfer the Deposit to the account specified by the
Company, inclusive of profits and after deducting tax and
expenses in respect of account management, the Trustee's fee, and
expenses incurred in accordance with the Trust Deed, to the
extent accumulated up until that time. To dispel any doubt, it is
clarified that, for the purpose of approving the transfer of the
Deposit to the Company, the Trustee is relying solely on the
Company's notification that all preconditions have been fulfilled
for the Closing of the Partner Share Acquisition Transaction by
the Deadline, and the Trustee is not required to verify whether
the preconditions indeed had actually been fulfilled. The Trustee
shall be present at the time of the Closing of the Partner Share
Acquisition Transaction in order to enable the performance of its
operations in conformity with the Trust Deed at that time. The
Company shall notify the Trustee three Business Days in advance
of the expected transfer date of the funds.
4.6 If all of the preconditions stated above in clause 4.3 shall be
fulfilled regarding the release of all of the funds from the Escrow
Account in respect of the Series of Bonds, and in the event of a
Voluntary Redemption as stated above in clause 4.4, in which only a
portion of the Bonds has been redeemed, and a balance remains in the
Escrow Account, the Bondholders are hereby instructing the Trustee, by
way of an irrevocable instruction, to transfer the entire balance of
funds of the Deposit that shall be in the Escrow Account to the
Company, and for this purpose, to sign all documents required for the
removal of the lien on the Escrow Account and for the transfer of the
funds of the Deposit to the Company. Shortly after the transfer of the
funds, the Trustee shall take action to close the Escrow Account.
21
4.7 To dispel any doubt, it is hereby clarified that the Trustee is under
no obligation to examine, and in fact, the Trustee did not examine,
the economic value of the collateral that was provided and/or that
shall be provided (if any) to guarantee the payments to the Holders of
the Series 1 Bonds. Upon engaging in the Trust Deed and consenting to
serve as the Trustee for the Holders of the Series 1 Bonds, the
Trustee is not expressing its opinion, whether explicitly or implied,
regarding the economic value of the collateral that was provided
and/or shall be provided (if any) by the Company. Furthermore, the
Trustee is not expressing its opinion regarding the Company's ability
to fulfill its undertakings towards the Holders of the Series 1 Bonds.
That stated shall in no way derogate from the Trustee's obligations by
law and/or pursuant to the Trust Deed, and shall in no way derogate
from the Trustee's duty (to the extent that such duty applies to the
Trustee pursuant to any law) to examine the impact of changes in the
Company as of the date of the Shelf Offering Report and thereafter, to
the extent that any such changes might adversely affect the Company's
ability to fulfill its undertakings towards the Holders of the Series
1 Bonds. That stated shall in no way derogate from the Trustee's
obligations by law and/or pursuant to the Trust Deed.
5. ABSENCE OF LINKAGE BASES ON THE BOND PRINCIPAL AND INTEREST
The Principal and Interest on the Bonds are not linked to the consumer
price index or to any other index or currency.
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6. THE INTEREST ON THE SERIES 1 BONDS
6.1 The registered Series 1 Bonds of NIS 1 par value each bear fixed
annual interest at the rate of 4% per annum..
6.2 The interest shall be paid in biannual payments, on the balance of the
outstanding Principal, on June 30 and on December 31 of each of the
years 2010 through2024, in respect of the six-month period ending on
the last day prior to every interest payment date. The first interest
payment on the Series 1 Bonds shall be paid on June 30, 2010 for the
period as of the day after the tender date pursuant to the Shelf
Offering Report and ending on June 29, 2010, with the interest being
calculated on the basis of 365 days per year, according to the number
of days in the said period. The subsequent interest payments shall be
calculated according to the annual interest rate divided by the number
of interest payments per year.
The Company shall publish the interest rate that shall be paid in the
first payment in the Immediate Report of the Results of the Issue
pursuant to the Shelf Offering Report.
6.3 The Company shall pay interest as stated to whoever shall be
registered in the Register as the owner of the Series A Bonds at the
end of March 19 and September 18 of each year, as the case may be,
just prior to the date of the interest payment.
6.4 The interest on the principal of the Bonds of the Relevant Series
shall be calculated as of the first day of the first interest period.
On that day, the Company shall file an Immediate Report specified the
interest rate to be paid in respect of the first interest period,
being calculated as state above.
6.5 The last payment of interest on the Principal of the Bonds of the
Relevant Series shall be paid, together with the last payment on
account of the Principal of the Bonds of the same series, this against
the delivery of the Bond Certificates of that series to the Company.
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If, by March 31, 2010, the Series 1 Bonds shall be rated for the first
time at a rating that is lower than (A-) or A3 (hereinafter: "THE
DECLINE"), then the annual interest rate that the Series of Bonds
shall bear shall increase at the rate of 0.3% in respect of each
rating step that is lower than an (A-) or A3 rating (hereinafter: "THE
AMENDED INTEREST RATE"), this as of the issue date of the Bonds. For
example: if the rating of the Series 1 Bonds shall be BBB+, then the
annual interest rate that Series 1 Bonds shall bear shall increase at
the rate of 0.3%. If the rating shall be lower by an additional step,
then the interest rate shall increase at the rate of 0.6%, and so
forth. The Company shall transfer an updated payment schedule to the
Trustee with the change in the interest rate in the event of a
Decline.
It is clarified that a rise in the interest rate as a result of a
Decline in rating as stated, shall be effected one time only during
the entire term of the Bonds; i.e., any decline in the rating after
the Decline shall not cause another change in the interest rate.
6.6 The Company shall publish an Immediate Report regarding the initial
rating assigned to the Bonds, and if the rating shall be lower than
(A-) or A3, then the Amended Interest Rate that shall be paid to the
Holders of the Series 1 Bonds shall also be specified in the Immediate
Report. If the announcement of the change in the rating of the Series
1 Bonds shall be published less than four (4) trading days prior to
the determinant date for the interest payment (hereinafter: "THE NEXT
INTEREST PAYMENT"), the payment of the additional interest resulting
from the Decline shall be postponed, and shall be paid on the date of
the subsequent interest payment (hereinafter: "THE SUBSEQUENT INTEREST
PAYMENT"). As of the payment of the first interest after the payment
of the Subsequent Interest Payment and thereafter, the interest rate
shall return to the Amended Interest Rate.
7. THE PAYMENTS OF PRINCIPAL AND INTEREST OF THE BONDS
7.1 The payments on account of the interest and/or the Principal of the
Bonds of the Relevant Series, which shall be offered pursuant to the
Shelf Prospectus, shall be paid to the persons whose names shall be
registered in the Register for that same series on the dates as shall
be specified in the Initial Offering Report of that series, in
conformity with the provisions of the TASE regulations as they shall
be at that time ("THE DETERMINANT DATE IN THE RELEVANT Series"),
except for the last payment of the Principal and interest, which shall
be rendered against the delivery of the Bond Certificates of that
series to the Company at the Company's registered office, or at any
other location that the Company shall so instruct, no later than five
(5) Business Days prior to the final payment date.
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It is hereby clarified that any party that is not registered in the
Register for the Relevant Series on the Determinant Date in the
Relevant Series shall not be entitled to a payment of interest in
respect of the interest period that began prior to that date.
7.2 In any instance whereby the payment due date on account of Principal
and/or interest shall fall on a day other than a Business Day, the
payment date shall be postponed until the first subsequent Business
Day, without any additional payment, and "the Determinant Date" for
the purpose of determining entitlement to redemption or to interest
shall not change as a result.
7.3 Any payment on account of Principal and/or interest, which shall be
paid in arrears that exceeds seven (7) Business Days after the payment
due date according to the Bond conditions as stated, for reasons
depending upon the Company, shall bear arrears interest (as this term
is defined hereunder) as of the payment due date until the actual
payment date. To the extent that there are a number of arrears in
payments as stated, the total number of days in arrears (cumulatively)
during the period that the Bond Series is in circulation, in respect
whereof the Company shall not pay arrears interest, shall not exceed
21 Business Days.
7.4 In this regard, the rate of the arrears interest means the maximum
interest rate that shall be in effect at that time at Bank Leumi
Le-Israel Ltd. in respect of debit balances in current loan accounts
or in current accounts in Israeli currency having no credit framework
in effect, whichever is higher, which shall be calculated according to
the number of days of the actual delay. In the event of arrears in
payment as state above, the Company shall announce the interest rate,
including the arrears interest as stated, in an Immediate Report two
(2) trading days prior to the actual payment date.
25
7.5 The payment to those entitled shall be rendered by way of checks or
bank transfer to the credit of the bank account of those persons whose
names shall be listed in the Register for the Relevant Series, and
which shall be specified in particulars to be timely delivered in
writing to the Company, according to that stated in clause 5.6
hereunder. If the Company shall be unable to pay any sum to those
entitled thereto, for a reason not dependent upon the Company, the
provisions of clause 12 of the Trust Deed shall apply.
7.6 A Holder of the Bonds of the Relevant Series shall notify the Company
of the bank account details for crediting payments to that Holder
according to the Bonds of that Series as stated above, or about any
change in the said account details or in its address, as the case may
be, by written notice sent by registered mail to the Company. The
Company shall be required to act according to the Holder's notice
regarding a change as stated, once fifteen (15) Business Days have
elapsed since the arrival of the Holder's notice to the Company.
7.7 If a Bondholder entitled to a payment as stated did not deliver
details about its bank account in timely fashion to the Company, any
payment on account of the Principal and the interest shall be rendered
by check, which shall be sent by registered mail to its last address
registered in the Register for the Relevant Series. The mailing of a
check to an entitled Bondholder by registered mail as stated shall be
deemed, for all intents and purposes, to be payment of the sum quoted
therein on the date of its dispatch at the post office, provided that,
upon proper presentation for collection, it shall be paid.
7.8 Any compulsory payment, to the extent required by law, shall be
deducted from any payment in respect of the Bonds of the Relevant
Series.
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8. SURETY
The Series 1 Bonds shall not be secured by any surety or lient, with the
exception of that stated above in clause 4.5.
9. CONVERSION RIGHT OF THE SERIES 1 BONDS ("THE CONVERTIBLE BONDS")
9.1 THE CONVERSION TERMS
9.1.1 On any trading day as of the date that each of the series of
Convertible Bonds are registered for the first time for trading
on the TASE and until a number of days prior to the end of the
period of the Bonds of that series, in accordance with the TASE
directives as they shall be on the date of the Initial Offering
Report of that series, and as shall be specified in the said
Offering Report ("THE CONVERSION PERIOD," and any trading day as
stated shall be called hereinafter: "THE CONVERSION DAY," and the
last day of the Conversion Period shall be called hereinafter:
"THE EXPIRATION OF THE CONVERSION PERIOD"), with the exception of
a number of days prior to the determinant date for a partial
redemption, in accordance with the TASE regulations and
directives as they shall be on the date of the said Offering
Report and until the execution date of the partial redemption,
the balance of the Principal of the Convertible Bonds of that
series that are in circulation at that time shall be convertible
into registered fully-paid up ordinary shares of NIS 0.12 par
value each of the Company ("THE CONVERTED SHARES") according to a
conversion rate that shall not diminish from the par value of
ordinary shares of the Company on the date of the said Offering
Report ("THE CONVERSION RATE"), subject to adjustments as
specified hereunder, and in the manner and under the conditions
as shall be specified in the said Offering Report.
9.1.2 Any holder of the Convertible Bonds of any series desiring to
convert the balance of the par value of the Principal of the
Convertible Bonds of that series that it is holding into
Converted Shares ("THE CONVERTER") shall submit a written
application, on a form to the determined by the Company, either
directly to the Company at its registered office (in the instance
whereby those Bonds are registered under the Converter's name in
the register of that series), or through the TASE member (in the
instance whereby those Bonds are being held by the Converter
through that TASE member) on the Conversion Days, and, in any
event, until the Expiration of the Conversion Period relative to
that series, and attaching the Certificates of the Convertible
Bonds relating to the application ("THE CONVERSION NOTICE").
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9.1.3 The conversion of the balance of the par value of the Principal
of a number of Convertible Bonds from the same series that are
registered under the name of the same Holder may be applied for
in a single Conversion Notice, and, in such instance, all of the
Certificates of the Convertible Bonds relating to that Conversion
Notice must be attached thereto.
9.1.4 In the event of conversion of the Convertible Bonds into shares
in accordance with this clause in relation to only a portion of
the total par value of the Convertible Bonds registered in a
single Bond Certificate, the Convertible Bond Certificates must
first be split into the number of Bond Certificates necessary for
that purpose so that the total of the sums of the par value of
the Bonds registered therein shall be equal to the total par
value of the Bond Certificate that shall be split as stated.
9.1.5 The Conversion Notice forms may be obtained at the registered
office of the Company and at any other location that the Company
shall so notify.
9.1.6 The Converter shall sign any document at any time that shall be
required by law and according to the Company's instructions for
the purpose of the allotment of the Converted Shares. The
conversion date shall be deemed the day on which the Company
receives a Conversion Notice directly from the Converter (in
respect of Bonds directly held) or the day on which the TASE
Clearing House receives a notice from the TASE member of
conversion of the Convertible Bonds (in respect of Bonds held
through the Nominee Company), which fulfills all conditions
specified above, as the case may be ("THE CONVERSION DATE").
28
9.1.7 If the Converter does not fulfill all conditions for conversion
of the Convertible Bonds in their entirety, the Conversion Notice
shall be deemed null and void, and the Certificates of the
Convertible Bonds that were attached to that Conversion Notice
shall be returned to the applicant.
9.1.8 A Conversion Notice submitted to the Company cannot be cancelled
or changed.
9.1.9 The Converter shall not be entitled to allot a portion of one
Converted Share; however, all fractions of Converted Shares that
shall be created at the time of conversion, if any, shall be sold
on the TASE by a trustee to be appointed for this purpose by the
Company, within thirty (30) days after these fractions
accumulated into whole shares at an acceptable quantity for sale
on the TASE, considering the costs involved therein, and the net
proceeds from the sale thereof shall be divided among those
entitled accordingly, within fifteen (15) days of the date of the
sale. A check shall not be sent to a single entitled Converter as
stated for a sum that is less than NIS 50; such sum may be
collected from the Company's offices during regular workdays and
office hours. An entitled Converter as stated, who shall not come
to the Company's offices to collect such sum within twelve (12)
months of the date of the sale, shall lose its right to this sum.
9.1.10 Converted Shares shall vest the owners thereof with all rights
to participate in all dividends and other distributions, with the
date that determines the right to receive them being the
Conversion Date or thereafter; Converted Shares shall have equal
rights, in all aspects, to the ordinary shares of NIS 0.12 par
value existing in the Company's share capital at that time.
29
9.1.11 The Convertible Bonds that were converted shall be removed from
circulation on their Conversion Date and shall be completely
nullified, retroactively to the Conversion Date, as of the
allotment date of the Converted Shares in respect thereof, and
shall not vest any right to any interest whatsoever after the
last interest payment date, when the determinant date in respect
thereof falls prior to the Conversion Date.
9.1.12 Any portion of the Convertible Bonds from any series that shall
not be converted by the Expiration of the Conversion Period
relative to that series shall no longer vest any right whatsoever
to the Bondholder to convert it into Converted Shares, and the
conversion right in respect thereof shall be null and void as of
that date.
9.2 CONVERSION TIMETABLES
By bylaws of the TASE Clearing House, as they shall be on the actual
Conversion Day, shall apply to conversions of the Convertible Bonds.
The Company shall allot Certificates in respect of the Converted
Shares that are due to each Converter within one trading day of the
Conversion Date, and, upon receiving clearance to register the
allotted Converted Shares for trading on the TASE, the Company shall
take action to register the Converted Shares for trading on the TASE
within three (3) days of the aforesaid date.
9.3 PROVISIONS PROTECTING HOLDERS OF CONVERTIBLE BONDS DURING THE
CONVERSION PERIOD
9.3.1 DISTRIBUTION OF BONUS SHARES
If the Company shall distribute bonus shares after the date of
the Initial Offering Report of any series of the Convertible
Bonds and until the Expiration of the Conversion Period relative
to that series, the rights of the holders of the Convertible
Bonds of that series shall be preserved, in the manner specified
hereunder:
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9.3.1.1 Subsequent to the date determining the entitlement to
participate in the said distribution, the number of
Converted Shares to which a holder of the Convertible Bonds
of that series shall be entitled upon the conversion thereof
shall increase, by adding the number of shares to which the
said holder would have been entitled as bonus shares had he
converted its Convertible Bonds immediately prior to the
said determinant date.
9.3.1.2 A holder of the Convertible Bonds shall not be entitled
to allot a portion of a bonus share according to that stated
above; however, all fractions of bonus shares that shall be
created at the time of the allotment and that shall
accumulate into whole shares shall be sold on the TASE by a
trustee to be appointed for this purpose by the Company,
within thirty (30) days of the said allotment date, and the
net proceeds (after deducting selling expenses and
compulsory payments and levies) shall be divided among those
entitled within fifteen (15) days of the date of the sale. A
check shall not be sent to a single entitled holder for a
sum that is less than NIS 50; such sum may be collected from
the Company's offices during regular workdays and office
hours. An entitled holder as stated, who shall not come to
the Company's offices to collect such sum within twelve (12)
months of the date of the sale, shall lose its right to this
sum.
9.3.1.3 Subject to that stated in the TASE regulations and
directives, the adjustment method may not be amended.
31
9.3.2 RIGHTS ISSUE
If, as of the date of the Initial Offering Report of any series
of the Convertible bonds and up until the Expiration of the
Conversion Period relative to that series, the Company shall
offer securities of any class by way of a rights issue to its
shareholders, the number of Converted Shares in respect of a
conversion of the Convertible Bonds of that series that have not
yet been converted into ordinary shares of the Company shall be
adjusted on the date determining the right to purchase the
securities to be offered during the rights issue, according to
the bonus component in the rights, as expressed in the ratio
between the Company's share rate on the TASE on the said
determinant date and the base rate "ex rights." Subject to that
stated in the TASE regulations and directives, the adjustment
method as specified above may not be amended.
9.3.3 ADJUSTMENT IN RESPECT OF A DIVIDEND DISTRIBUTION
If the Company shall distribute a dividend, as this term is
defined in the Companies Act ("THE DISTRIBUTION"), when the date
determining the entitlement thereto ("THE DETERMINANT DATE FOR
THE DISTRIBUTION") shall fall prior to the Expiration of the
Conversion Period, one of the provisions specified in subclauses
9.3.3.1 through 9.3.3.3 hereunder shall apply, all as shall be
specified by the Company in the Initial Offering Report of the
Relevant Series. The Company shall publish in a detailed manner
in the said Offering Report the adjustment method of the
Conversion Rate and/or the Conversion Ratio due to a
Distribution, if any, according to its choice of one of the
following alternatives:
9.3.3.1 The Conversion Rate and/or the Conversion Ratio shall not
be adjusted due to a Distribution by the Company.
9.3.3.2 As of the first day of trading of the Company's shares
after the Determinant Date for the Distribution (ex
dividend), the Conversion Rate of the Convertible Bonds of
the Relevant Series shall be equal to the previous
Conversion Rate as it shall be on the Determinant Date for
the Distribution, less the net sum of the Distribution in
respect of each Converted Share, but at a Conversion Rate
not less than the par value of the Company's shares at that
time (hereinafter: "THE ADJUSTED CONVERSION PRICE").
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"THE NET SUM OF THE DISTRIBUTION PER SHARE" in this regard
is the sum of the Distribution by the Company in respect of
each share, after the Company deducts the income tax from
individual residents of Israel who are not Material
Shareholders, as this term is defined in section 88 of the
Income Tax Ordinance [New Version], 5721 - 1961, in
conformance with the law.
9.3.3.3 As of the first day of trading of the Company's shares
after the Determinant Date for the Distribution (ex
dividend), the Conversion Ratio of the Convertible Bonds in
circulation shall be adjusted by multiplying it by the ratio
between the rate of the Company's share on the TASE, as
shall be set by the TASE as the adjusted rate for the
Distribution (ex-dividend rate) and the closing rate set on
the TASE for the Company's share on the Determinant Date for
the Distribution. The Company shall announce the Adjusted
Conversion Ratio, as stated, in an Immediate Report no later
than the day on which the Company's shares shall be traded
"ex dividend."
9.4 ADDITIONAL PROVISIONS PROTECTING THE HOLDERS OF THE CONVERTIBLE BONDS
DURING THE CONVERSION PERIOD
The following provisions shall apply as of the publication date of the
Offering Report relating to any series of the Convertible Bonds, and
for as long as all of the Convertible Bonds of that series have not
been converted, but, in any event, not after the Expiration of the
Conversion Period relative to that series:
33
9.4.1 The Company shall retain a sufficient quantity of ordinary
shares of NIS 0.12 par value each in its registered share capital
to guarantee the allotment of all shares that are likely to
derive from the conversion of all of the Convertible Bonds of
that series that are in circulation from time to time, and, if
necessary, shall cause the Company to increase its registered
share capital accordingly.
9.4.2 If the Company shall consolidate the ordinary shares of NIS 0.12
par value each in its issued share capital into shares of a
higher par value, or shall subdivide them into shares of a lesser
par value, then subsequent to such an action, the number of
Converted Shares that shall be allotted due to a conversion of
the Convertible Bonds of that series shall be decreased or
increased, as the case may be. In such instance, that stated
above in clause 9.1.9 shall apply, MUTATIS MUTANDIS.
9.4.3 Holders of the Convertible Bonds of that series may peruse a
copy of the Company's periodic reports and interim financial
statements at the Company's registered office during regular
office hours. At the written request of a holder of the
Convertible Bonds of that series, the Company shall mail a copy
of the aforesaid reports and statements to the bondholder.
9.4.4 Within ten (10) days of each adjustment of the Conversion Rate
or of the number of Converted Shares relative to that series of
Convertible Bonds, the Company shall publish an announcement in
two (2) widely-circulated daily newspapers published in Israel in
the Hebrew language regarding the right of the holders of the
Convertible Bonds of that series to convert them into shares, and
specifying the Conversion Period, the Conversion Rate and the
number of Converted Shares to which a holder of the Convertible
Bonds shall be entitled in respect of a conversion at that time -
all relative to the said series.
34
9.4.5 In addition to the aforesaid announcement, the Company shall
publish a notification in two (2) widely-circulated daily
newspapers published in Israel in the Hebrew language and shall
send a written notification to the bondholders registered in the
register for that series regarding the deadline for converting
the Convertible Bonds of that series, with a copy to the TASE and
to the Trustee of that series, no later than three (3) weeks and
no earlier than four (4) weeks prior to the Expiration of the
Conversion Period relative to that series. Such notification
shall specify the Conversion Rate, the number of Converted Shares
and the number of bonus shares to which a holder of the
Convertible Bonds shall be entitled at the time of conversion
within this timeframe - all relative to the said series.
9.4.6 The Company shall not distribute and shall not offer a dividend
in cash or bonus shares or an offer of rights to securities of
any class to the holders of the ordinary shares of NIS 0.12 par
value each, unless the determinant date relative to the right to
receive them shall be at least ten (10) trading days after the
publication of the Company's notification regarding the
Distribution or the offer of rights, as the case may be.
9.4.7 The Company shall refrain from any action, including a
Distribution of bonus shares, which is liable to lead to a
reduction of the Converted Share price under its par value.
9.4.8 In accordance with the TASE regulations and directives, as they
are on the date of the Trust Deed, the conditions of the
Convertible Bonds may not be amended in relation to any matter
pertaining to the Conversion Rate and the Conversion Days, but
the Company shall be allowed to amend the Conversion Period
and/or the Conversion Rate provided that it is being effected
within the scope of an arrangement or compromise ratified by a
court, in conformity with section 350 of the Companies Act.
Furthermore, in accordance with the said TASE regulations and
directives, the Company may amend the Conversion Rate within the
scope of a splitting proceeding of the Company or a merger
proceeding of the Company, provided that the amendment shall
solely include those adjustments required due to the said
proceeding.
35
In accordance with the said TASE regulations and directives, a
"splitting proceeding" in this context means - a proceeding
during which the Company shall transfer shares that it is holding
in another company to its shareholders, or a proceeding during
which the Company shall transfer assets and liabilities to a new
company founded for the purpose of the split, and the
shareholders of the new company shall also be the shareholders of
the company transferring the assets and liabilities, all provided
that the splitting proceeding is effected under equal conditions
for the shareholders of the Company. In accordance with the said
TASE regulations and directives, a "merger proceeding" in this
context means - a proceeding during which all of the Company's
shares shall be transferred to the ownership of a new company or
to the ownership of another registered company whose shares are
registered for trading on the TASE, or a proceeding during which
the Company shall transfer all of its assets and liabilities to
another company as stated, all provided that the securities of
the Company whose shares or assets shall be transferred as stated
shall be deregistered from trading on the TASE and the proceeding
shall be effected under equal conditions for the shareholders of
the Company.
Notwithstanding that stated above, in accordance with the said
TASE regulations and directives, the Company may amend the
Conversion Rate, provided that it is done within the scope of an
offering proceeding by way of rights in the Company or within the
scope of a proceeding of a Distribution of bonus shares in the
Company or within the scope of a proceeding of a Distribution of
a dividend in the Company and the amendment includes only those
adjustments required due to the said proceeding.
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9.5 VOLUNTARY LIQUIDATION
9.5.1 In the event that a resolution is passed to voluntarily
liquidate the Company, the Company shall issue written notice
thereof to all holders of the Convertible Bonds in circulation at
that time, which are registered in the register for the Relevant
Series of Convertible Bonds, and shall publish an announcement in
that regard in two (2) widely-circulated daily newspapers
published in Israel in the Hebrew language. Every holder of the
Convertible Bonds shall be entitled, at its discretion, to be
deemed as if it exercised its conversion right in respect thereof
prior to the passing of the resolution, this if the bondholder
shall notify the Company in writing of this desire within three
(3) months of the date of the Company's said notice.
9.5.2 In such instance, a holder of the Convertible Bonds shall be
entitled to participate in the distribution of the Company's
surplus assets upon liquidation (after the clearance of all of
its debts) among its shareholders, this at the sum that the
bondholder would have received upon liquidation of the Company
had it been a shareholder of the Company prior to the passing of
the liquidation resolution, due to the conversion of the
Convertible Bonds in its possession, in respect whereof it issued
a notice as stated to the Company, after deducting the sums of
interest paid in respect of those Convertible Bonds on the date
of the resolution or subsequently (excluding interest whose
payment due date falls prior to the date of the resolution, even
if paid on or after the resolution date); and the holder of the
Convertible Bonds shall not be entitled to any payment on account
thereof if the payment due date occurs after the resolution date.
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10. GENERAL PROVISIONS
10.1 Sums of the Principal and interest shall be paid to any Bondholder
without taking into consideration any equitable rights or any right of
offset or counterclaim that exists or that might exist between the
Company and the aforesaid Bondholder.
10.2 The Company shall not be obligated to record in the Register for the
Relevant Series any notice regarding a trust, lien and pledge of any
kind and type, or any equitable right or any other right relating to
the Bondholder's ownership of the Bond.
10.3 Any party becoming entitled to the Bond as a result of bankruptcy or
as a result of liquidation proceedings of the Bondholder, shall have
the right, as soon as it shall present the evidence that the Company
shall require from it, to be registered in the Register for the
Relevant Series as the Holder of the Bond.
11. REGISTER OF THE BONDHOLDERS
Regarding the keeping of a Register of Bondholders of the Relevant Series,
the provisions of clause 25 of the Trust Deed shall apply.
12. PREVENTION FROM PAYING, FOR A REASON NOT DEPENDENT UPON THE COMPANY
Regarding prevention from paying a Bondholder of a Relevant Series, for a
reason not dependent upon the Company, the provisions of clause 12 of the
Trust Deed shall apply.
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13. TRANSFER OF THE BONDS
The Bonds are transferable in relation to the entire par value thereof, and
even regarding a portion thereof, provided that it shall be in whole New
Shekels. Any transfer of the Bonds (excluding a transfer being carried out
by way of trading on the TASE) shall be effected according to a transfer
deed in the customary version, properly signed by the registered Holder or
its legal representatives and by the recipient of the transfer or its legal
representatives, which shall be delivered to the Company at its registered
office, attaching the Bond Certificates being transferred pursuant thereto,
and any other proof that shall be required by the Company for the sake of
proving the transferor's right to transfer them. If tax or any other
compulsory payment shall apply to a transfer deed for the Bonds, proof of
the payment thereof must be delivered to the Company to the Company's
satisfaction. The provisions of the Company's Articles of Association
applicable to transfers of fully paid-up shares and the assignment thereof
shall apply, MUTATIS MUTANDIS, as the case may be, on the mode of transfer
of the Bonds and the assignment thereof. In the event of a transfer of only
a portion of the par value of the Bonds registered in the Bond Certificate,
the Bond Certificates must be split, pursuant to the provisions of clause
14 hereunder, first into the number of Bond Certificates so required, in
such manner that the total sums of the par value registered therein shall
be equal to the sum of the par value of the Bonds registered in the said
Bond Certificate. After the fulfillment of all these conditions, the
transfer shall be recorded in the Register for the Relevant Series, and the
Company shall be allowed to demand that a note regarding the transfer as
stated shall be recorded on the Certificate of the Bonds being transferred,
which shall be delivered to the transferee, or that a new Bond Certificate
shall be issued to the transferee, and all of the conditions specified in
the Certificate of the Bonds being transferred shall apply to the
transferee, so that, every reference to the "holder" shall be deemed to
mean "the transferee" and the transferee shall be deemed the "holder" for
the purposes of the Trust Deed for the Relevant Series.
14. BOND CERTIFICATES AND SPLITTING THEREOF
One Certificate shall be issued in respect of the Bonds registered under
the name of a single Holder, or, at its request, a reasonable number of
Certificates shall be issued to it, provided that the total par value of
the Bonds registered in each Certificate as stated shall be in whole New
Shekels (the Certificates referred to in this clause shall be called
hereinafter: "THE CERTIFICATES").
All of the Bond Certificates may be split into Bond Certificates with the
total par value of the Bonds registered therein being equal to the total
par value of the Bonds registered in the Certificate being asked to be
split, provided that Certificates as stated shall not be issued other than
in a reasonable quantity. The split shall be effected against the delivery
of that Bond Certificate to the Company at its registered office for the
purpose of effecting the split. All expenses involved in the split,
including taxes and levies, if any, shall apply to the party requesting the
split.
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15. EARLY REDEMPTION.
Regarding early redemption of the Bonds, the provisions of clause 6 of the
Trust Deed and clause 6 above shall apply.
16. WAIVERS, COMPROMISES AND/OR CHANGES IN THE BOND CONDITIONS
In relation to the authority of the Company and/or the Trustee to effect a
waiver, compromise and changes in the conditions of the Bonds, the
provisions of clause 24 of the Trust Deed shall apply.
17. ASSEMBLIES OF BONDHOLDERS
The general assemblies of the Bondholders of the Relevant Series shall
convene and be conducted according to that stated in the Second Addendum to
the Trust Deed.
18. RECEIPTS AS PROOF
Without derogating from any other of these conditions, a receipt signed by
the Bondholder shall constitute proof of the full clearance of any payment
made by the Company in respect of the Bond.
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19. REPLACEMENT OF BOND CERTIFICATES
In the event that this Bond Certificate shall become worn, be lost or
destroyed, the Company shall issue a new Certificate in its place in
respect of this Bond and with the same conditions. Taxes and other levies,
as well as other expenses involved in the issuance of the new Certificate,
shall apply to the Bondholder requesting the said Certificate (including
expenses relating to proof of ownership of the Bonds, and relating to
indemnification and/or insurance coverage that the Company shall require,
if any, in relation thereto). In the event of wear and tear, the worn
Certificate shall be returned to the Company simultaneously and against the
issuance of the new Certificate.
20. APPLICABLE LAW AND JURISDICTION
The Courts in the city of Tel-Aviv - Jaffa shall have sole and exclusive
jurisdiction in any dispute concerning the Bonds, the Trust Deed and the
agreements by virtue whereof the Bonds were allotted, and solely the laws
of the State of Israel shall apply thereto.
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