STATE OF ISRAEL Underwriting Agreement
Exhibit 99.G
EXECUTION VERSION
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STATE OF ISRAEL
Xxxxxx Xxxxxxx & Co. Incorporated
Deutsche Bank Securities Inc.
As Representatives of the several Underwriters,
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Deutsche Bank Securities Inc.
As Representatives of the several Underwriters,
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs:
The Government of Israel on behalf of the State of Israel (“Israel”) proposes to sell
to the entities listed on Schedule I hereto (the “Underwriters”), for whom you (the
“Representatives”) are acting as representatives, $1,000,000,000 principal amount of its
5.50% Bonds due November 9, 2016 (the “Offered Securities”) pursuant to the provisions of a
Fiscal Agency Agreement dated as of March 13, 2000, as amended by Amendment No. 1 to Fiscal Agency
Agreement dated as of February 24, 2004 (the “Fiscal Agency Agreement”), between Israel and
Citibank, N.A., as fiscal agent (the “Fiscal Agent”).
The terms which follow, when used in this Agreement, shall have the meanings indicated:
“2004 Registration Statement” means the registration statement filed with the
Commission on February 12, 2004 (Registration Statement File No. 333-112271), which 2004
Registration Statement was declared effective by the Commission on February 18, 2004. In
the event any post-effective amendment to the 2004 Registration Statement becomes effective
prior to the Closing Date (as hereinafter defined), the term “2004 Registration Statement”
shall also mean such registration statement as so amended.
“Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
“Basic Prospectus” means the prospectus included in the 2004 Registration
Statement in the form filed with the Commission, which
prospectus, pursuant to Rule 429 of the Act, relates to the 2004 Registration
Statement, as such prospectus is amended or supplemented to the date of this Agreement, but
excluding any amendments or supplements related solely to an offering of a series of debt
securities other than the Offered Securities.
“Commission” means the Securities and Exchange Commission.
“Effective Date” shall mean each date that the Registration Statement and any
post-effective amendment or amendments thereto became or becomes effective.
“Execution Time” shall mean the date and time that this Agreement is executed
and delivered by the parties hereto.
“free writing prospectus” has the meaning set forth in Rule 405.
“issuer free writing prospectus” has the meaning set forth in Rule 433.
“preliminary prospectus” means any preliminary form of the Prospectus used in
connection with the offering of the Offered Securities that omits Rule 430A Information,
including, without limitation, the Basic Prospectus and any preliminary prospectus
supplement.
“Prospectus” means the Basic Prospectus together with the prospectus
supplement.
“prospectus supplement” means the final prospectus supplement filed with the
Commission pursuant to Rule 424, specifically relating to the Offered Securities.
“Registration Statement” shall mean the 2004 Registration Statement. Such
term shall include any Rule 430A Information deemed to be included in the Registration
Statement at the Effective Date as provided by Rule 430A.
“Release” means Release No. 33-6424 under the Act relating to delayed
offerings by foreign governments or political subdivisions thereof.
“Rule 164”, “Rule 405”, “Rule 415”, “Rule 424”,
“Rule 430A” and “Rule 433” refer to such rules under the Act as applicable
to registration statements subject to Schedule B under the Act in accordance with the
Release and, to the extent any such rule is not directly applicable, mean the provisions
thereunder as made applicable by the Release.
“Rule 430A Information” means information with respect to the Offered
Securities and the offering thereof permitted to be omitted from the Registration Statement
when it becomes effective pursuant to Rule 430A.
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“Time of Sale Prospectus” means the preliminary prospectus, the free writing
prospectuses, if any, and other information, in each case identified in Schedule II hereto.
As used herein, the terms “Registration Statement”, “Basic Prospectus”, “Prospectus”, “preliminary
prospectus” and “Time of Sale Prospectus” shall include in each case the material, if any,
incorporated by reference therein.
1. Representations and Warranties. Israel represents and warrants to, and agrees
with, each Underwriter as set forth in this Section 1.
(a) Israel meets the requirements for use of Schedule B under the Act, is a “seasoned
foreign government” within the meaning of the Release and has filed with the Commission the
Registration Statement, including a form of Basic Prospectus, for registration under the
Act of the offering and sale of the Offered Securities. Israel may have filed with the
Commission one or more amendments to the Registration Statement and may have used a
preliminary prospectus, each of which has previously been furnished to the Underwriters.
Such Registration Statement, as so amended, has become effective. Although the Basic
Prospectus may not include all the information with respect to the Offered Securities and
the offering thereof required by the Act and the rules thereunder to be included in the
Prospectus, the Basic Prospectus includes all such information required by the Act and the
rules thereunder as applicable pursuant to the Release to be included therein as of the
Effective Date. Israel will hereafter file with the Commission pursuant to the Release and
Rules 415 and 424(b)(2) or (5) either (x) a prospectus supplement to the Basic Prospectus
or (y) an amendment to such Registration Statement, including such prospectus supplement.
In the case of clause (x), Israel has included in such Registration Statement, as amended
as of the Effective Date of the 2004 Registration Statement, the information required for
such procedure pursuant to the Release. As filed, such prospectus supplement or such
amendment and prospectus supplement shall include all such required information with
respect to the Offered Securities and the offering thereof and, except to the extent the
Representatives shall agree in writing to any modification thereof, shall be in all
substantive respects in the form furnished to the Underwriters prior to the Execution Time
or, to the extent not completed at the Execution Time, shall be in such form with only such
specific additional information and other changes (beyond those contained in the Basic
Prospectus and any preliminary prospectus) as Israel has advised the Underwriters, prior to
the Execution Time, will be included or made therein and to which the Representatives shall
have agreed.
(b) On the Effective Date of any part of the Registration Statement, such part of the
Registration Statement did or will, on the date filed each preliminary prospectus did or
will, and, when the Prospectus is first filed (if required) in accordance with Rule 424(b)
and on the Closing Date (as defined below), the Prospectus (as supplemented in the case of
the Closing Date) will, comply in all material respects with the applicable requirements of
the Act, the rules thereunder and the Release; on the Effective Date of any part of the
Registration Statement,
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such part of the Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not misleading; the
Registration Statement as of the date hereof does not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; the Time of Sale Prospectus does not, and at
the time of each sale of the Offered Securities in connection with the offering and at the
Closing Date (as defined below), the Time of Sale Prospectus, as then amended or
supplemented by Israel, if applicable, will not, contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statement therein, in the light
of the circumstances under which they were made, not misleading; the Prospectus does not
contain and, as amended or supplemented, if applicable, at the Closing Date (as defined
below) will not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that Israel makes
no representations or warranties as to the information contained in or omitted from the
Registration Statement, the Time of Sale Prospectus or the Prospectus (or any supplement
thereto) in reliance upon and in conformity with information furnished in writing to Israel
by or on behalf of any Underwriter specifically for inclusion in the Registration
Statement, the Time of Sale Prospectus or the Prospectus (or any supplement thereto).
(c) Israel is not an “ineligible issuer” in connection with the offering pursuant to
Rules 164, 405 and 433. Any free writing prospectus that Israel is required to file
pursuant to Rule 433(d) has been, or will be, filed with the Commission in accordance with
the requirements of the Act. Each free writing prospectus that Israel has filed, or is
required to file, pursuant to Rule 433(d) or that was prepared by or on behalf of or used
or referred to by Israel complies or will comply in all material respects with the
requirements of the Act. Except for the free writing prospectuses, if any, identified in
Schedule II hereto, and electronic roadshows, each furnished to you before first use,
Israel has not prepared, used or referred to, and will not, without your prior consent,
prepare, use or refer to, any free writing prospectus.
(d) The issuance and sale of the Offered Securities have been duly authorized, and,
when duly executed, authenticated, issued and delivered as provided in the Fiscal Agency
Agreement and paid for in accordance with the terms hereof, will be duly and validly issued
and outstanding, and will constitute valid and binding obligations of Israel for the
payment and performance of which the full faith and credit of Israel will be pledged; the
Offered Securities will rank pari passu without any preference among
themselves; the payment obligations of Israel will at all times rank at least equally with
all other payment obligations of Israel relating to unsecured, unsubordinated “external
indebtedness” (as defined in the Offered Securities); and the Offered Securities, when
issued and delivered, will conform to the description thereof contained in the Prospectus.
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(e) Israel is a member of the International Monetary Fund and the International Bank
for Reconstruction and Development.
(f) Israel is not a party to any agreement with the United States of America relating
in any way to the immunity of Israel from jurisdiction of courts, suit, execution upon a
judgment, attachment prior to judgment or in aid of execution upon a judgment or any other
legal process. Israel is, under the law of Israel, subject to civil and commercial law
with respect to its obligations under this Agreement, the Fiscal Agency Agreement and the
Offered Securities and has agreed not to assert the defense of immunity, on the grounds of
sovereignty or otherwise, in respect of any suit, action or proceeding arising out of or
relating to claims under this Agreement, the Fiscal Agency Agreement or the Offered
Securities, except any such suit, action or proceeding instituted by a holder of the
Offered Securities (other than an Underwriter instituting such suit, action or proceeding
in its capacity as an Underwriter under this Agreement) arising out of or based on United
States federal or state securities laws.
2. Purchase and Sale. Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, Israel agrees to sell to each Underwriter, and
each Underwriter agrees, severally and not jointly, to purchase from Israel, at a purchase price of
99.238% of the principal amount thereof, plus accrued interest on the Offered Securities from
November 9, 2006 to the Closing Date, the principal amount of the Offered Securities set forth
opposite such Underwriter’s name in Schedule I hereto.
3. Delivery and Payment. Delivery of and payment for the Offered Securities shall be
made at 10:00 a.m., New York City time, on November 9, 2006, which date and time may be postponed
by agreement between the Representatives and Israel or as provided in Section 10 hereof (such date
and time of delivery and payment for the Offered Securities being herein called the “Closing
Date”). Delivery of the Offered Securities shall be made to the Underwriters through the
facilities of The Depository Trust Company for the respective accounts of the several Underwriters
against payment by the several Underwriters of the purchase price thereof to or upon the order of
Israel by certified or official bank check or checks drawn on or by a New York Clearing House bank
and payable in next day funds. Delivery of the Offered Securities shall be made at such location
as the Representatives shall reasonably designate at least one business day in advance of the
Closing Date, and payment for the Offered Securities shall be made at the offices of Cravath,
Swaine & Xxxxx LLP, Worldwide Plaza, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000. Certificates for
the Offered Securities shall be registered in such names and in such denominations as the
Representatives may request not less than two full business days in advance of the Closing Date.
Israel agrees to have the Offered Securities available for inspection, checking and packaging
by the Underwriters in New York, New York, not later than
1:00 p.m. on the business day prior to the Closing Date.
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4. Offering by Underwriters. It is understood that the several Underwriters propose
to offer the Offered Securities for sale to the public as set forth in the Prospectus. Each of the
Underwriters represents and warrants that it has complied with and will comply with all applicable
provisions of the Financial Services and Markets Xxx 0000 with respect to anything done by it in
relation to the Offered Securities in, from or otherwise involving the United Kingdom. Each
Underwriter severally covenants with Israel not to take any action that would result in Israel
being required to file with the Commission under Rule 433(d) a free writing prospectus prepared by
or on behalf of such Underwriter that otherwise would not be required to be filed by Israel, but
for the action of the Underwriter.
5. Agreements. Israel agrees with the several Underwriters that:
(a) Israel will use its best efforts to cause the Registration Statement, if not
effective at the Execution Time, and any amendment thereto, to become effective as soon as
reasonably practicable thereafter. Prior to the termination of the offering of the Offered
Securities, Israel will not file any amendment of the Registration Statement or supplement
(including the Prospectus or any preliminary prospectus) to the Basic Prospectus or the
Time of Sale Prospectus unless Israel has furnished the Underwriters a copy for their
review prior to filing and will not file any such proposed amendment or supplement to which
the Representatives reasonably object, unless Israel is otherwise advised by its U.S.
counsel that such filing is required under the Act. Subject to the foregoing sentence,
Israel will cause the Prospectus, properly completed, and any supplement thereto to be
filed with the Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed by such Rule and will provide evidence satisfactory to the
Underwriters of such timely filing. Israel will promptly advise the Underwriters (i) when
the Registration Statement, if not effective at the Execution Time, and any amendment
thereto, shall have become effective, (ii) when the Prospectus, and any supplement thereto,
shall have been filed with the Commission pursuant to Rule 424(b), (iii) when, prior to
termination of the offering of the Offered Securities, any amendment to the Registration
Statement shall have been filed or become effective, (iv) of any request by the Commission
for any amendment of the Registration Statement or supplement to the Prospectus or for any
additional information, (v) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the institution or threatening of any
proceeding for that purpose and (vi) of the receipt by Israel of any notification with
respect to the suspension of the qualification of the Offered Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose. Israel
will use its best efforts to prevent the issuance of any such stop order or the suspension
of any such qualification and, if issued or suspended, to obtain as soon as possible the
withdrawal thereof.
(b) Israel will furnish to the Underwriters a copy of each proposed free writing
prospectus to be prepared by or on behalf of, used by, or referred to by
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Israel and not to use or refer to any proposed free writing prospectus to which the
Representatives reasonably object.
(c) Israel will not take any action that would result in an Underwriter or Israel
being required to file with the Commission pursuant to Rule 433(d) a free writing
prospectus prepared by or on behalf of the Underwriter that the Underwriter otherwise would
not have been required to file thereunder.
(d) If the Time of Sale Prospectus is being used to solicit offers to buy the Offered
Securities at a time when the Prospectus is not yet available to prospective purchasers and
any event shall occur or condition exist as a result of which it is necessary to amend or
supplement the Time of Sale Prospectus in order to make the statements therein, in the
light of the circumstances, not misleading, or if any event shall occur or condition exist
as a result of which the Time of Sale Prospectus conflicts with the information contained
in the Registration Statement then on file, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply
with applicable law, Israel shall forthwith prepare, file with the Commission and furnish,
at its own expense, to the Underwriters and to any dealer upon request, either amendments
or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale
Prospectus as so amended or supplemented will not, in the light of the circumstances when
delivered to a prospective purchaser, be misleading or so that the Time of Sale Prospectus,
as amended or supplemented, will no longer conflict with the Registration Statement, or so
that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable
law.
(e) If, at any time when a prospectus relating to the Offered Securities is required
to be delivered under the Act, any event occurs as a result of which the Prospectus as then
supplemented would include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Prospectus to comply with the Act or the
respective rules thereunder, Israel promptly will (i) prepare and file with the Commission,
subject to the second sentence of paragraph (a) of this Section 5, an amendment or
supplement which will correct such statement or omission or effect such compliance and (ii)
supply any supplemented Prospectus to the Underwriters in such quantities as they may
reasonably request.
(f) Israel will endeavor to qualify the Offered Securities for offer and sale under
the securities or Blue Sky laws of such jurisdictions as the Underwriters shall reasonably
request and to pay all expenses (including reasonable fees and disbursements of counsel) in
connection with such qualification and in connection with the determination of the
eligibility of the Offered Securities for investment under the laws of such jurisdictions
as the Underwriters may reasonably
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designate; provided, however, that Israel shall not be obligated to
file any general or unlimited consent to service of process in any jurisdiction.
(g) Israel will make generally available to holders of the Offered Securities, as
soon as practicable, a statement in the English language of revenues and expenditures of
Israel covering the first full fiscal year of Israel beginning after the date of this
Agreement which will satisfy the provisions of Section 11(a) of the Act; it is understood
that this undertaking shall be deemed satisfied if Israel has filed its Annual Report on
Form 18-K for the year ended December 31, 2007.
(h) So long as any of the Offered Securities are outstanding, Israel will furnish to
the Underwriters copies of all reports and financial statements filed with the Commission
in connection with the Offered Securities.
(i) Until the business day following the Closing Date, Israel will not, without the
consent of the Representatives, offer or sell in the United States, or announce the
offering in the United States of, any securities other than normal course offers of State
of Israel Bonds sold through the Development Corporation for Israel.
(j) Israel will furnish to the Underwriters and counsel for the Underwriters, without
charge, copies of the Registration Statement (including exhibits thereto) and, so long as
delivery of a prospectus by an Underwriter or dealer may be required by the Act, as many
copies of any preliminary prospectus, the Time of Sale Prospectus and the Prospectus and
any supplement thereto as the Underwriters may reasonably request. Israel will pay the
expenses of printing or other production of all documents relating to the offering of
Offered Securities pursuant to this Agreement.
(k) Israel will use best efforts to cause the Offered Securities to be listed on the
Luxembourg Stock Exchange.
6. Expenses. Whether or not the transactions contemplated hereunder are consummated
or this Agreement is terminated, except as set forth in the next sentence, Israel will pay all
costs and expenses incident to the performance of the obligations of Israel hereunder, including,
without limiting the generality of the foregoing, (i) all costs and expenses incident to the filing
with the Commission of the Registration Statement (including all exhibits thereto), any preliminary
prospectus, the Prospectus and any amendments thereof or supplements thereto, (ii) any fees charged
by securities rating services for rating the Offered Securities, and (iii) all costs and expenses
of Israel’s Israeli, United States and any other outside counsel. Except as provided in Section 8
hereof, the Underwriters will pay (i) all their own costs and expenses and all costs and expenses
related to the Bloomberg roadshow, (ii) all costs and expenses incident to the printing and
distributing of any preliminary prospectus, the Time of Sale Prospectus, the Prospectus and any
amendments thereof or supplements thereto, (iii) all costs and expenses (including reasonable fees
of counsel to the Underwriters and their disbursements) incurred in connection with “Blue Sky”
qualifications, (iv) all costs and
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expenses related to the eligibility and acceptance of the Offered Securities for deposit with
The Depository Trust Company, (v) any costs and expenses, including fees of listing agents, in
connection with the listing of the Offered Securities on the Luxembourg Stock Exchange, (vi) any
fees of the Fiscal Agent, and (vii) all costs and expenses of the Underwriters’ Israeli, United
States and any other outside counsel.
7. Conditions to the Obligations of the Underwriters. The obligations of the
Underwriters to purchase the Offered Securities shall be subject to the accuracy in all material
respects of the representations and warranties on the part of Israel contained herein as of the
time of the execution of this Agreement and the Closing Date, to the accuracy in all material
respects of the statements of Israel made in any certificates pursuant to the provisions hereof, to
the performance by Israel of its obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become effective prior to the Execution
Time, unless the Representatives agree in writing to a later time, the Registration
Statement will become effective not later than (i) 6:00 p.m. New York City time, on the
date of determination of the public offering price, if such determination occurred at or
prior to 3:00 p.m. New York City time on such date or (ii) 12:00 noon on the business day
following the day on which the public offering price was determined, if such determination
occurred after 3:00 p.m. New York City time on such date; if filing of the Prospectus, or
any supplement thereto, is required pursuant to Rule 424(b), the Prospectus, and any such
supplement, shall have been filed in the manner and within the time period required by Rule
424(b) and in accordance with Section 5(a) of this Agreement; no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or threatened; and any request of the Commission
for additional information shall have been complied with to the satisfaction of the
Representatives.
(b) Israel shall have furnished to the Underwriters the written opinion, satisfactory
to the Representatives, of the Legal Advisor to the Ministry of Finance of the State of
Israel (the “Legal Advisor”) dated the Closing Date, to the effect that:
(i) the Offered Securities have been duly and validly authorized and executed
in accordance with the laws of Israel and, when duly authenticated in accordance
with the terms of the Fiscal Agency Agreement and delivered and paid for in
accordance with the terms of this Agreement, the Offered Securities will be valid
and binding obligations of Israel entitled to the benefits of the Fiscal Agency
Agreement;
(ii) the obligations of Israel under the Fiscal Agency Agreement, this
Agreement and the Offered Securities are and will be direct, general and
unconditional obligations of Israel, and are, under the laws of Israel, subject to
civil and commercial substantive and procedural law and to the procedural
requirements relating to enforcement and recognition of
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foreign judgments. The Offered Securities will rank pari
passu, without any preference among themselves; the payment obligations of
Israel will at all times rank at least equally with all other payment obligations
of Israel relating to unsecured and unsubordinated “external indebtedness” (as
defined in the Offered Securities) of Israel; the full faith and credit of Israel
has been pledged for the due and punctual payment of the principal of and interest
on the Offered Securities and for the performance of the obligations of Israel with
respect thereto;
(iii) Israel has the power and authority required for the execution and
delivery of this Agreement, the issuance of the Offered Securities and the
performance by Israel of its obligations thereunder and hereunder and under the
Fiscal Agency Agreement; and none of the execution or delivery by Israel of this
Agreement or the Offered Securities, the performance of its obligations hereunder
or thereunder or under the Fiscal Agency Agreement, or the fulfillment by Israel of
the terms hereof or thereof or under the Fiscal Agency Agreement requires, under
Israeli law, any publication, waiver, consent, filing, registration, authorization
or approval;
(iv) the Fiscal Agency Agreement has been duly authorized, executed and
delivered by Israel in accordance with the laws of Israel and is a valid and
binding agreement of Israel;
(v) this Agreement has been duly authorized, executed and delivered by Israel
in accordance with the laws of Israel;
(vi) all statements in the Registration Statement, the Time of Sale Prospectus
and the Prospectus with respect to or involving laws, statutes and regulations of
or pertaining to Israel are accurate in all material respects and fairly present
the information purported to be shown;
(vii) the provisions of this Agreement and the Offered Securities wherein
Israel consents to the jurisdiction of certain courts in the United States and
agrees not to assert the defense of immunity, on the grounds of sovereignty or
otherwise, are valid and binding; final judgment against Israel in any such suit,
action or proceeding brought, in accordance with such provisions, in the courts of
Israel or Federal or state courts in the City of New York would be conclusive and
binding upon Israel and may be enforced in the courts of Israel, without retrial or
reexamination but subject to the procedural requirements relating to enforcement
and recognition of foreign judgments;
(viii) under Israeli law in effect as of the date of such opinion, payments
made under the Offered Securities will be exempt from Israeli taxation, and there
are no transfer, stamp or similar taxes under the laws of Israel payable in
connection with the issuance, transfer and sale of the Offered Securities or the
execution and delivery of this Agreement;
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(ix) the choice of New York law to govern the validity, construction and
performance of this Agreement, the Offered Securities and the Fiscal Agency
Agreement would be upheld by an Israeli court as a valid and effective choice of
law under the laws of Israel;
(x) none of the execution or delivery by Israel of this Agreement or the
Offered Securities, the performance by Israel of its obligations hereunder or
thereunder or under the Fiscal Agency Agreement, or the fulfillment by Israel of
the respective terms hereof or thereof or of the Fiscal Agency Agreement, will
violate any provision of the laws of Israel or, to the best knowledge of the Legal
Advisor, violate any order, rule or regulations of any Israeli Court, regulatory
body, or administrative body or governmental body;
(xi) none of the execution or delivery by Israel of this Agreement or the
Offered Securities, the performance by Israel of its obligations hereunder or
thereunder or under the Fiscal Agency Agreement, or the fulfillment of the
respective terms hereof or thereof or of the Fiscal Agency Agreement by Israel,
will, to the best knowledge of the Legal Advisor after due inquiry, violate, or
result in a breach of, the terms of, or cause a default under, any note, note
agreement, bank loan, or any other agreement or instrument for money borrowed to
which Israel is a party;
(xii) there is no action, suit, or proceeding pending, or to the knowledge of
the Legal Advisor, threatened against or affecting Israel, before any court or
administrative agency in Israel, challenging the validity or enforceability of this
Agreement, the Fiscal Agency Agreement, or the Offered Securities or the
transactions contemplated hereby or thereby;
(xiii) the Registration Statement, as amended, any preliminary prospectus
supplement, and the Prospectus, and their filing with the Commission, have been
duly authorized by and on behalf of Israel and the Registration Statement has been
duly executed on behalf of Israel;
(xiv) the Legal Advisor shall further confirm that appropriate officials in
the Ministry of Finance have been apprised of the disclosure standards applicable
to the offering described in this Agreement and have reviewed the Time of Sale
Prospectus and the Prospectus. Based on such review, the results of which have
been discussed with the Legal Advisor, the Legal Advisor shall confirm that,
although the Legal Advisor shall not have made an independent investigation or
verification of the correctness and completeness of the information included in the
Time of Sale Prospectus or the Prospectus, nothing has come to the Legal Advisor’s
attention that would lead the Legal Advisor to believe that (except as to the
financial and statistical data contained therein as to which the Legal Advisor need
not express any belief) (a) any part of the Registration
Statement, when such part became effective, contained any untrue statement of
a material
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fact or omitted to state a material fact required to be stated therein
or necessary to make statements therein not misleading, (b) the Registration
Statement or the Prospectus, on the date of this Agreement, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, (c) the
Time of Sale Prospectus as of the date of this Agreement or, as amended or
supplemented, if applicable, as of the Closing Date contains any untrue statement
of a material fact or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made,
not misleading or (d) the Prospectus, as amended or supplemented, as applicable, as
of the Closing Date contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; and
(xv) the appointment of the Authorized Agent in Section 13 below and any
waiver in that section by Israel in respect thereto are legal, valid and binding in
accordance with their respective terms under the laws of Israel.
In rendering such opinion, the Legal Advisor may rely without independent
investigation on the opinion pursuant to paragraph (c) below as to matters of New
York and United States Federal law and such opinion shall be subject to any
limitations and exceptions contained in the opinion so relied upon. References to
the Prospectus in this paragraph (b) include any supplements thereto at the
Closing Date.
(c) The Underwriters shall have received on and as of the Closing Date an opinion,
satisfactory to the Representatives, of Xxxxxx & Xxxxxx LLP, special United States counsel
to Israel, to the effect that:
(i) the Offered Securities, when duly authorized, executed, authenticated and
issued in accordance with the terms of the Fiscal Agency Agreement and delivered
and paid for in accordance with the terms of this Agreement, will be valid and
binding obligations of Israel entitled to the benefits of the Fiscal Agency
Agreement;
(ii) the Fiscal Agency Agreement constitutes a valid and legally binding
agreement of Israel, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles;
(iii) no consent, approval, authorization, order, registration, clearance,
qualification or filing (each, a “Governmental Authorization”)
of or with any United States Federal or state government, administrative
agency, commission or other body is required for the issue and sale of the Offered
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Securities or the
consummation by Israel of the transactions contemplated by this Agreement or the
Fiscal Agency Agreement, except such as have been obtained under the Act and such
Governmental Authorizations as may be required under state securities or Blue Sky
laws in connection with
the purchase and distribution of the Offered Securities by the Underwriters;
(iv) the statements in the Registration Statement, the Time of Sale Prospectus
and the Prospectus under the captions “Debt Securities”, “Collective Action
Securities” and “Description of the Bonds” insofar as they purport to constitute a
summary of certain provisions of the Offered Securities and the Fiscal Agency
Agreement provide a fair summary of such provisions;
(v) the statements in the Registration Statement and the Prospectus under the
caption “Taxation”, insofar as they purport to constitute a summary of the material
United States Federal income and estate tax consequences of the purchase, ownership
and disposition of the Offered Securities, provide a fair summary of such
consequences;
(vi) Israel has validly submitted, under the laws of the State of New York and
the Federal laws of the United States, to the jurisdiction of the State and Federal
courts in the Borough of Manhattan in the City of New York, in any suit, action or
proceeding arising out of or based on this Agreement, the Fiscal Agency Agreement
or the Offered Securities, except any such suit, action or proceeding instituted by
a holder of the Offered Securities (other than an Underwriter instituting such
suit, action or proceeding in its capacity as an Underwriter under this Agreement)
arising out of or based on United States Federal or state securities laws;
(vii) the documents expressly incorporated by reference in the Time of Sale
Prospectus and the Prospectus as amended or supplemented (other than the financial
statements and related schedules therein, as to which such counsel need express no
opinion), when they became effective or were filed with the Commission, as the case
may be, appear on their face to comply as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder;
(viii) the agreement of Israel contained in this Agreement, the Offered
Securities and the Fiscal Agency Agreement that each will be governed and construed
in accordance with the laws of the State of New York, except with respect to its
authorization and execution by and on behalf of Israel, is valid and binding;
(ix) the Offered Securities are exempt from the provisions of the Trust
Indenture Act of 1939, as amended, under Section 304(a)(6) of said Act,
13
and no
indenture in respect of the Offered Securities need be qualified under said Act;
and
(x) the Registration Statement has become effective under the Act as of the
date and time specified in such opinion, and, to the knowledge of such counsel, no
stop order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose are pending before or threatened by the
Commission.
In giving such opinion, Xxxxxx & Xxxxxx LLP may (i) assume that the Fiscal Agency
Agreement, the Offered Securities and this Agreement have been duly authorized, executed
and delivered by the appropriate party or parties thereto and that each such party has
adequate power and authority to enter therein and (ii) rely without independent
investigation on the opinion delivered pursuant to paragraph (b) above as to matters
governed by the laws of Israel and such opinion shall be subject to any limitations and
exceptions contained in the opinion delivered pursuant to paragraph (b) above.
In addition, Xxxxxx & Xxxxxx LLP shall have furnished the Underwriters with a letter,
dated the Closing Date, confirming that as United States counsel to Israel, such counsel
reviewed the Registration Statement, the Time of Sale Prospectus and the Prospectus as then
amended or supplemented, participated in discussions with your representatives and those of
Israel and its Israeli counsel, and advised Israel as to the requirements of the Securities
Act and the applicable rules and regulations thereunder; on the basis of the information
that such counsel gained in the course of the performance of such services, considered in
the light of their understanding of the applicable law and the experience they have gained
through their practice under the Securities Act, such counsel will confirm to you that, in
their opinion, the Registration Statement and the Prospectus as then amended or
supplemented, as of the Effective Date of the 2004 Registration Statement and as of the
latest Effective Date of any part of the Registration Statement, appeared on their face to
be appropriately responsive in all material respects to the requirements of the Securities
Act and the applicable rules and regulations of the Commission thereunder; nothing that
came to such counsel’s attention in the course of the limited procedures described in such
letter has caused such counsel to believe that any part of the Registration Statement, when
such part became effective, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the statements
therein not misleading; nothing that came to such counsel’s attention in the course of such
limited procedures described in such letter has caused such counsel to believe that the
Registration Statement or the Prospectus on the date of this Agreement contained any untrue
statement of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading; nothing that has come
to such counsel’s attention in the course of the limited procedures described in such
letter has caused such counsel to believe that the Time of Sale Prospectus as of the date
of this Agreement or as amended or supplemented, if applicable, as of the Closing
14
Date
contains any untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and nothing that has
come to such counsel’s attention in the course of the limited procedures described in
such letter has caused such counsel to believe that the Prospectus (as then amended or
supplemented) as of the Closing Date contains any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. Such counsel
may state that the limitations inherent in the independent verification of factual matters
and the character of determinations involved in the registration process are such that they
do not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement, the Time of Sale Prospectus or the
Prospectus except for those made under the captions “Debt Securities”, “Collective Action
Securities” and “Description of the Bonds” in the Time of Sale Prospectus or the Prospectus
as then amended and supplemented insofar as they purport to summarize certain provisions of
documents therein described; that such counsel do not express any opinion or believe as to
(1) the financial statements and related schedules or other financial data or (2)
statistical information and data contained in the Registration Statement or the Prospectus
as then amended or supplemented, or as to matters of the laws of Israel; and that their
letter is furnished as United States counsel for Israel to you and is solely for your
benefit.
(d) The Underwriters shall have received from Cravath, Swaine & Xxxxx LLP, counsel for
the Underwriters, such opinion and letter, dated the Closing Date, with respect to the
issuance and sale of the Offered Securities, the Fiscal Agency Agreement, the Registration
Statement, the Time of Sale Prospectus, the Prospectus (together with any supplement
thereto) and other related matters as the Representatives may reasonably require, and
Israel shall have furnished to such counsel such documents as they request for the purpose
of enabling them to pass upon such matters. In giving such opinion, Cravath, Swaine &
Xxxxx LLP may rely without independent investigation on the opinion delivered pursuant to
paragraph 7(b) above as to the matters governed by the laws of Israel and such opinion
shall be subject to any limitations and exceptions contained in the opinion delivered
pursuant to paragraph (b) above.
(e) Israel shall have furnished to the Underwriters a certificate of Israel, signed by
either (i) the Director General and the Accountant General of the Ministry of Finance or
(ii) the Consul and Chief Fiscal Officer for the Western Hemisphere and the Deputy Chief
Fiscal Officer for the Western Hemisphere of the Ministry of Finance, dated the Closing
Date, to the effect that the signer of such certificate has carefully examined the
Registration Statement, the Time of Sale Prospectus, the Prospectus, any supplement to the
Prospectus and this Agreement and that:
(i) the representations and warranties of Israel in this Agreement are true
and correct in all material respects on and as of the Closing Date with
15
the same
effect as if made on the Closing Date and Israel has complied in all material
respects with all the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been instituted or, to
Israel’s knowledge, threatened; and
(iii) there has been no material adverse change or any development involving a
prospective material adverse change in the condition (financial, economic or
political) of Israel from that set forth in the Time of Sale Prospectus and the
Prospectus (exclusive of any supplement thereto dated after the Execution Time)
that was not disclosed to the Underwriters prior to the Execution Time.
(f) Subsequent to the Execution Time or, if earlier, the dates as of which information
is given in the Registration Statement (exclusive of any amendment thereof dated after the
Execution Time), the Time of Sale Prospectus and the Prospectus (exclusive of any
supplement thereto dated after the Execution Time), there shall not have been any change or
any development involving a prospective change in the condition (financial, economic or
political) of Israel from that set forth in the Registration Statement that, in the
judgment of the Representatives, is material and adverse and makes it impractical or
inadvisable to proceed with the offering or delivery of the Offered Securities as
contemplated by the Registration Statement, the Time of Sale Prospectus and the Prospectus
(in each case exclusive of any amendment or supplement thereto dated after the Execution
Time).
(g) Subsequent to the Execution Time, there shall not have been any decrease in the
rating of any of Israel’s debt securities by Standard and Poor’s Corporation or Xxxxx’x
Investors Service, Inc. or any written notice given of any intended or potential change in
any such rating that is not an upward change.
(h) Subsequent to the Execution Time, no proceeding shall be pending or threatened to
restrain or enjoin the issuance, sale or delivery of the Offered Securities or in any
manner to question the laws, proceedings, directives, resolutions, approvals, consents or
orders under which the Offered Securities are to be issued or to question the validity of
the Offered Securities, and none of such laws, proceedings, directives, resolutions,
approvals, consents or orders shall have been repealed, revoked or rescinded in whole or in
part.
(i) Subsequent to the Execution Time, Israel shall not have ceased to be a member of
the International Monetary Fund and the International Bank for Reconstruction and
Development.
(j) Prior to the Closing Date, Israel shall have furnished to the Underwriters such
further information, certificates, opinions and other documents as the Representatives may
reasonably request.
16
If any of the conditions specified in this Section 7 shall not have been fulfilled in all
material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in
all material respects reasonably satisfactory in form and substance to the Representatives and
to counsel for the Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be canceled at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancelation shall be given to Israel in writing or by telephone or telegraph confirmed in
writing.
The documents required to be delivered by this Section 7 shall be delivered at the office of
Cravath, Swaine & Xxxxx LLP, counsel for the Underwriters, at Worldwide Plaza, 000 Xxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx, 00000, at the Closing Date.
8. Reimbursement of Underwriters’ Expenses. If the sale of the Offered Securities
provided for herein is not consummated because any condition to the obligations of the Underwriters
set forth in Section 7 hereof is not satisfied, because of any termination pursuant to Section 11
hereof or because of any refusal, inability or failure on the part of Israel to perform any
agreement herein or comply with any provision hereof other than by reason of a default by any of
the Underwriters, Israel will reimburse the Underwriters severally upon demand for all reasonable
out-of-pocket expenses (including reasonable fees and disbursements of counsel) that shall have
been incurred by them in connection with the proposed purchase and sale of the Offered Securities.
9. Indemnification and Contribution. (a) Israel agrees to indemnify and hold
harmless each Underwriter, the directors, officers, employees and agents of each Underwriter and
each person who controls any Underwriter within the meaning of either Section 15 of the Act or
Section 20 of the Securities Exchange Act of 1934 (the “Exchange Act”) against any and all
losses, claims, damages or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement for the registration of the Offered
Securities as originally filed or in any amendment thereof, any preliminary prospectus, the Time of
Sale Prospectus, any issuer free writing prospectus or the Prospectus, or in any amendment thereof
or supplement thereto, or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the statements therein
not misleading or, in the case of any preliminary prospectus, the Time of Sale Prospectus, any
issuer free writing prospectus or the Prospectus, in light of the circumstances under which they
were made, not misleading, and agrees to reimburse each such indemnified party, as incurred, for
any legal or other expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that Israel will not be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged untrue statement or
omission
17
or alleged omission made therein in reliance upon and in conformity with written
information furnished to Israel by or on behalf of any Underwriter specifically for inclusion
therein. This indemnity agreement will be in addition to any liability which
Israel may otherwise have. Israel further agrees to indemnify and hold harmless each
Underwriter against any requirement under the laws of Israel to pay any stamp or similar taxes in
connection with the issuance of the Offered Securities to such Underwriter by Israel.
(b) Each Underwriter severally agrees to indemnify and hold harmless Israel, to the same
extent as the foregoing indemnity from Israel to each Underwriter, but only with reference to
written information relating to such Underwriter furnished in writing to Israel by or on behalf of
such Underwriter specifically for inclusion in the documents referred to in such foregoing
indemnity. This indemnity agreement will be in addition to any liability which any Underwriter may
otherwise have. Israel acknowledges that each Underwriter’s name, solely with respect to such
Underwriter, on the cover page of the prospectus supplement and each Underwriter’s name, address
and principal amount of bonds purchased, solely with respect to such Underwriter, the second, third
and fourth sentences of the second paragraph, the third paragraph and the seventh paragraph under
the heading “Underwriting” in the prospectus supplement constitute the only information furnished
in writing by or on behalf of the several Underwriters for inclusion in the documents referred to
in such foregoing indemnity, and the Underwriters confirm that such statements are correct.
(c) Promptly after receipt by an indemnified party under this Section 9 of notice of the
commencement of any action, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 9, notify the indemnifying party in writing
of the commencement thereof; but the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the indemnifying party
of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party
from any obligations to any indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party
in any action for which indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel retained by the
indemnified party or parties except as set forth below); provided, however, that
such counsel shall be reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party’s election to appoint counsel to represent the indemnified party in an action,
the indemnified party shall have the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs and expenses of such separate
counsel, if (i) the use of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded that there may be
legal defenses available to it and/or other indemnified parties which are different from or
additional to
18
those available to the indemnifying party, (iii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of the institution of such action or
(iv) the indemnifying party shall authorize the indemnified party to employ separate counsel
at the expense of the indemnifying party. It is understood that the indemnifying party shall not,
in connection with any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees and expenses of more than one separate firm (in addition to local counsel) for
all such indemnified parties and that such fees and expenses shall be reimbursed as they are
incurred. An indemnifying party will not, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or potential parties to
such claim or action) unless such settlement, compromise or consent includes an unconditional
release of each indemnified party from all liability arising out of such claim, action, suit or
proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 9 is
unavailable or insufficient (unless such indemnity is unavailable or insufficient by operation of
the provisos set forth therein) to hold harmless an indemnified party for any reason, Israel and
the Underwriters agree to contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively, “Losses”) to which Israel and one or more of the
Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits
received by Israel and by the Underwriters from the offering of the Offered Securities;
provided, however, that in no case shall any Underwriter (except as may be provided
in any agreement among the Underwriters relating to the offering of the Offered Securities) be
responsible for any amount in excess of the underwriting discount or commission applicable to the
Offered Securities purchased by such Underwriter hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, Israel and the Underwriters shall
contribute in such proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of Israel and of the Underwriters in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable considerations. Benefits
received by Israel shall be deemed to be equal to the total net proceeds from the offering (before
deducting expenses), and benefits received by the Underwriters shall be deemed to be equal to the
total underwriting discounts and commissions, in each case as set forth on the cover page of the
Prospectus. Relative fault shall be determined by reference to whether any alleged untrue
statement or omission relates to information provided by Israel or the Underwriters. Israel and
the Underwriters agree that it would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 9, each person who controls an Underwriter within the meaning of
either the Act or the Exchange Act
19
and each director, officer, employee and agent of an Underwriter
shall have the same rights to contribution as such Underwriter, and each official of Israel who
shall have
signed the Registration Statement shall have the same rights to contribution as Israel,
subject in each case to the applicable terms and conditions of this paragraph (d).
10. Default by an Underwriter. If any one or more Underwriters shall fail or refuse
to purchase and pay for any of the Offered Securities agreed to be purchased by such Underwriter or
Underwriters hereunder and such failure to purchase and pay shall constitute a default in the
performance of its or their obligations under this Agreement, the remaining Underwriters shall be
obligated severally to take up and pay for (in the respective proportions which the principal
amount of Offered Securities set forth opposite their names in Schedule I hereto bears to the
aggregate principal amount of Offered Securities set forth opposite the names of all the remaining
Underwriters) the Offered Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase; provided, however, that the remaining nondefaulting
Underwriters shall not be obligated to purchase any of the Offered Securities if the aggregate
principal amount of Offered Securities which the defaulting Underwriter or Underwriters agreed but
failed to purchase exceeds 9.09% of the aggregate principal amount of Offered Securities and any
remaining nondefaulting Underwriter shall not be obligated to purchase more than 110% of the
principal amount of Offered Securities set forth opposite its name in Schedule I hereto. If the
foregoing maximums are exceeded, the remaining Underwriters, or other underwriters acceptable to
the nondefaulting Underwriters, shall have the right to purchase all, but shall not be under any
obligation to purchase any, of the Offered Securities, and if such nondefaulting Underwriters, or
other underwriters acceptable to the nondefaulting Underwriters, do not purchase all the Offered
Securities, this Agreement will terminate without liability to any nondefaulting Underwriter or
Israel. In the event of a default by any Underwriter as set forth in this Section 10, the Closing
Date shall be postponed for such period, not exceeding seven days, as the Underwriters shall
determine in order that the required changes in the Registration Statement and the Prospectus or in
any other documents or arrangements may be effected. As used in this Agreement, the term
“Underwriter” includes, for all purposes of this Agreement unless the context requires otherwise,
any underwriter, other than the Underwriters, who purchases Offered Securities which a defaulting
Underwriter agreed but failed to purchase. Nothing contained in this Agreement shall relieve any
defaulting Underwriter of its liability, if any, to Israel and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
11. Termination. This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to Israel prior to delivery of and payment for
the Offered Securities, if prior to such time (i) trading in securities generally on the New York
Stock Exchange shall have been suspended or limited or minimum prices shall have been established
on such Exchange or settlement of securities trading generally shall have been materially
disrupted, (ii) a banking moratorium shall have been declared either by Federal or New York State
authorities or Israeli authorities or (iii) there shall have occurred (x) any outbreak or
escalation of hostilities in which the United States or Israel is involved or declaration by the
United States or Israel of a national emergency or war or other calamity or crisis or (y) a
material adverse change in
20
the general economic, political or financial conditions in Israel or the
United States the effect of which on financial markets is such as to make it, in the judgment of
the
Representatives, impracticable or inadvisable to proceed with the offering or delivery of the
Offered Securities as contemplated by the Prospectus.
12. Representations and Indemnities To Survive. The respective agreements,
representations, warranties, indemnities and other statements of Israel and of the Underwriters set
forth in or made in writing pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or Israel or any of the
officers, directors or controlling persons referred to in Section 9 hereof, and will survive
delivery of and payment for the Offered Securities. The provisions of Sections 8 and 9 hereof
shall survive the termination or cancelation of this Agreement.
13. Submission to Jurisdiction; Agent for Service of Process. Israel and the
Underwriters agree that the Federal courts of the United States sitting in the Southern District of
New York, the courts of the State of New York sitting in the City of New York and the courts of
Israel shall have exclusive jurisdiction in respect of any legal action or proceeding brought
against Israel and arising out of or relating to this Agreement. In respect of any such proceeding
which may be brought hereunder, Israel irrevocably submits to the jurisdiction of the Federal
courts of the United States in the Southern District of New York, the courts of the State of New
York sitting in the City of New York and the courts of Israel and waives any right of objection to
the laying of venue in any such court, including, without limitation, any objection on the basis of
inconvenient forum. Israel irrevocably agrees to be bound by any final judgment rendered thereby
in connection with this Agreement from which no appeal has been taken or is available.
Israel hereby appoints the Consul and Chief Fiscal Officer for the Western Hemisphere of the
Ministry of Finance of the Government of Israel, whose office address is presently at 000 Xxxxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, as its authorized agent (“Authorized Agent”) to
receive on its behalf service of process in any proceeding which may be brought under the
immediately preceding paragraph of this Section 13 in a Federal court of the United States in the
Southern District of New York or in a New York State court in the City of New York. Israel may
nominate a substitute or replacement for its Authorized Agent in the State of New York by giving
notice thereof to you, but such appointment shall not be effective until the successor to the
Authorized Agent accepts appointment as such. Israel agrees that it will at all times maintain an
Authorized Agent to receive such service, as above provided. The failure of the Authorized Agent
to give Israel notice of the service of any process shall not affect the validity of any proceeding
based on that process or any judgment obtained pursuant to it. Israel will take any and all
action, including the filing of any and all documents and instruments, that may be necessary to
continue such appointment or appointments in full force and effect as aforesaid. Service of
process upon the Authorized Agent at the address indicated in this Section 13, or at such other
address in the Borough of Manhattan in the City of New York, as may be the office of the Authorized
Agent at the time of such service, and written notice of such service to Israel (mailed or
delivered to Israel at the address set
21
forth in Section 14) hereof
shall be deemed, in every respect, effective service of process upon Israel.
In respect of any proceeding which may be brought under this Agreement, Israel irrevocably
agrees not to assert the defense of immunity, on the grounds of sovereignty or otherwise, from
jurisdiction, execution or attachment in aid of execution, personally and in respect of any of its
property.
Neither the submission to jurisdiction, the appointment of the Authorized Agent or the
agreements with respect to immunity in this Section 13 shall be interpreted to include actions
brought under the United States Federal securities laws or any State securities laws (other than
any legal action or proceeding instituted by an Underwriter in its capacity as an Underwriter under
this Agreement).
Notices. All communications hereunder will be in writing and effective only on receipt,
and, if sent to the Underwriters, will be mailed or delivered to Xxxxxx Xxxxxxx & Co. Incorporated,
0000 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000, Attention: Investment Banking Department; or, if
sent to Israel, will be mailed or delivered to it at:
Government of Israel
Ministry of Finance
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Consul and Chief Fiscal Officer
Ministry of Finance
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Consul and Chief Fiscal Officer
with a copy to:
Government of Israel
Ministry of Finance
0 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
ISRAEL
Attn: Accountant General
Ministry of Finance
0 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
ISRAEL
Attn: Accountant General
14. English Documents. All documents to be delivered under this Agreement by Israel
shall be in the English language or accompanied by a certified English translation.
15. Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers and directors and controlling
persons referred to in Section 9 hereof, and no other person will have any right or obligation
hereunder. No purchaser of any Offered Securities from any Underwriter shall be deemed to be a
successor or assign merely by reason of such purchase.
22
16. Applicable Law. This Agreement will be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflicts of law principles of such
State, except with respect to its authorization and execution by and on behalf of Israel, which
shall be governed by the law of Israel.
17. Counterparts. This Agreement may be signed in two or more counterparts, which
together shall constitute one and the same instrument.
18. No Fiduciary Duty. Israel acknowledges that in connection with the offering of
the Offered Securities: (i) the Underwriters have acted at arms length, are not agents of, and owe
no fiduciary duties to, Israel or any other person, (ii) the Underwriters owe Israel only those
duties and obligations set forth in this Agreement and prior written agreement (to the extent not
superseded by this Agreement), if any, and (iii) the Underwriters may have interests that differ
from those of Israel. Israel waives to the full extent permitted by applicable law any claims it
may have against the Underwriters arising from an alleged breach of fiduciary duty in connection
with the offering of the Offered Securities.
23
If the foregoing is in accordance with your understanding of our agreement, please sign and
return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall
represent a binding agreement among Israel and the several Underwriters.
Very truly yours, THE GOVERNMENT OF ISRAEL, ON BEHALF OF STATE OF ISRAEL |
||||
By: | /s/ Yaron Zelekha | |||
Name: | Xx. Xxxxx Zelekha, C.P.A. | |||
Title: | Accountant General | |||
By: | /s/ Xxxxx Xxxxxxxxx | |||
Name: | Xxxxx Xxxxxxxxx | |||
Title: | Senior Deputy Accountant General | |||
By: | /s/ Xxx Xxxxxxxxx | |||
Name: | Xxx Xxxxxxxxx | |||
Title: | Consul and Chief Fiscal Officer of the Ministry of Finance for the Western Hemisphere |
The foregoing Agreement is hereby confirmed and accepted as of the date first above written. | ||||||
By: | Deutsche Bank Securities Inc. | |||||
By: | /s/ Xxxxxxx X. Xxxxxxxx | |||||
Name: | Xxxxxxx X. Xxxxxxxx | |||||
Title: | Director/Debt Syndicate | |||||
Deutsche Bank Securities Inc. | ||||||
By: | /s/ Xxxxxxxxx Xxxxxx | |||||
Name: | Xxxxxxxxx Xxxxxx | |||||
Title: | Director | |||||
Deutsche Bank Securities Inc. | ||||||
Bank Coverage & Syndicate | ||||||
By: | Xxxxxx Xxxxxxx & Co. Incorporated | |||||
By: | /s/ Xxxxxxx Xxxxx | |||||
Name: | Xxxxxxx Xxxxx | |||||
Title: | Executive Director | |||||
For themselves and the other Several Underwriters named in Schedule I to the foregoing Agreement. |
SCHEDULE I
Principal Amount of | ||||
Offered Securities | ||||
Underwriters | to be Purchased | |||
Deutsche Bank Securities Inc.
|
$ | 460,000,000 | ||
Xxxxxx Xxxxxxx & Co. Incorporated
|
460,000,000 | |||
Xxxxxxx, Sachs & Co.
|
20,000,000 | |||
Citibank Global Markets Inc.
|
20,000,000 | |||
Xxxxxx Brothers Inc.
|
20,000,000 | |||
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
|
20,000,000 | |||
Total: |
$ | 1,000,000,000 | ||
SCHEDULE II
1. Prospectus dated February 18, 2004.
2. Preliminary Prospectus Supplement dated November 1, 2006 relating to the Offered Securities.
3. Final Term Sheet dated November 2, 2006, a copy of which is included as Annex A hereto.
ANNEX A to
SCHEDULE II
SCHEDULE II
Filed pursuant to Rule 433
November 2, 2006
November 2, 2006
Relating to
Pricing Prospectus Supplement dated November 1, 2006 to
Registration Statement Xx. 000-000000
Pricing Prospectus Supplement dated November 1, 2006 to
Registration Statement Xx. 000-000000
![(STATE OF ISRAEL LOGO)](https://www.sec.gov/Archives/edgar/data/52749/000095012306014203/y27292a1y2729203.gif)
XXXXX XX XXXXXX
5.50 % Bonds due 2016
Issuer: |
State of Israel | |
Principal Amount: |
US $1,000,000,000 | |
Maturity date: |
11/09/2016 | |
Trade date: |
11/02/2006 | |
Original Issue Date (Settlement): |
11/09/2006 | |
Issue price (Price to Public): |
99.378% | |
Underwriters’ Commission: |
0.14% | |
Net Proceeds to Issuer: |
99.238% | |
Coupon: |
5.50% | |
Yield to Maturity: |
5.582% | |
Spread to Treasury: |
+98 basis points (0.98%) | |
Benchmark Treasury: |
4.875% to August 15, 2016 | |
Benchmark Yield: |
4.602% | |
Interest Payment Period: |
Semi-annually | |
Interest Payment Dates: |
Each May 9th and November 9th, commencing May 9, 2007 | |
Interest Payment Record Dates: |
Each April 24 and October 25 | |
Denominations: |
$2,000 and multiples of $1,000 above that amount | |
Business Day: |
New York | |
CUSIP: |
00000XX00 | |
ISIN: |
US 46513EE325 | |
Ratings: |
A2/A-/A- | |
Joint Bookrunners: |
Deutsche Bank Securities Inc. (46%) and Xxxxxx Xxxxxxx & Co. Incorporated (46%) | |
Co-Managers: |
Citigroup Global Markets Inc. (2%); Xxxxxxx, Sachs & Co. (2%); Xxxxxx Brothers Inc. (2%); Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (2%) |
The issuer has filed a registration statement (including a prospectus) with the U.S. Securities
and Exchange Commission (“SEC”) for the offering to which this communication relates. Before you
invest, you should read the prospectus in that registration statement and other documents the
issuer has filed with the SEC for more complete information about the issuer and this offering.
You may get these documents for free by visiting XXXXX on the SEC website at xxx.xxx.xxx.
Alternatively, the issuer, any underwriter or any dealer participating in the offering
will arrange to send you the prospectus if you request it by calling Deutsche Bank Securities, Inc.
toll-free at 1-800-503-4611 or Xxxxxx Xxxxxxx & Co. Incorporated toll-free at 0-000-000-0000.
Prospectus Dated February 18, 2004
Prospectus Supplement Dated November 1, 2006
Prospectus Supplement Dated November 1, 2006