Exhibit C
SHAREHOLDERS AGREEMENT
BETWEEN
KOOR INDUSTRIES LTD.,
FEDERMANN ENTERPRISES LTD.
AND
HERIS AKTIENGESELLSCHAFT
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[TRANSLATED FROM THE HEBREW ORIGINAL]
SHAREHOLDERS AGREEMENT
----------------------
Made in Tel Aviv this 27th day of December 2004
BETWEEN
Koor Industries Ltd.
whose address for the purpose of this Agreement
is 14 Hamalacha Street, Afek Industrial Park, Rosh
Ha'ayin 48091
("Koor")
of the one part
---------------
AND
1. Federmann Enterprises Ltd.
("Federmann Enterprises")
2. Heris Aktiengesellschaft
("Heris")
whose address solely for the purpose of this Agreement is
00 Xxxxxxxx Xxxxxx, Xxx Xxxx
(Federmann Enterprises and Heris are hereinafter
jointly and severally referred to as "Federmann")
of the other part
-----------------
(hereinafter the "Parties")
WHEREAS on the date of signing this Agreement Federmann is the holder
of 19,915,448 Ordinary Shares of 1 NIS par value each of
Elbit Systems Ltd, a public company whose Shares are traded
on the Tel Aviv Stock Exchange and on Nasdaq in the United
States (hereinafter the "Company"), of which Federmann
Enterprises is owner of 16,078,990 Ordinary Shares of 1 NIS
par value each of the Company and Heris is the owner of
3,836,458 Ordinary Shares of 1 NIS par value each of the
Company (those specific Shares and bonus Shares that are in
future issued in respect of them, if at all, excluding the
Koor Shares, as defined below, are hereinafter the "Federmann
Shares");
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AND WHEREAS in accordance with a Share Transfer Deed between Federmann
Enterprises and Koor, together with the appendices thereto,
of which this Agreement constitutes Appendix 10.7 (herein
the "Deed of Sale"), Federmann Enterprises and Koor have
agreed upon the sale of 4,000,000 (four million) Ordinary
Shares of 1 NIS par value each of the Company from Federmann
Enterprises to Koor, subject to various conditions precedent
and in two stages, in the first stage 2,160,000 (two million
one hundred and sixty thousand) Ordinary Shares of 1 NIS par
value each of the Company being sold to Koor, and in the
second stage an additional 1,840,000 (one million eight
hundred and forty thousand) Ordinary Shares of the Company
being sold to Koor, all subject to and in accordance with
the provisions of the Deed of Sale (the specific Shares that
are to be transferred to Koor from Federmann Enterprises
pursuant to the Deed of Sale and bonus Shares issued in
respect of them, if at all, are herein referred to as the
"Koor Shares");
AND WHEREAS the Parties wish to set forth their relationship with respect
to their holdings of the Company's Shares.
NOW THEREFORE THE PARTIES HEREBY WARRANT, PROVIDE AND AGREE BETWEEN THEM AS
FOLLOWS:
1. Preamble and Interpretation
---------------------------
1.1 The preamble and appendices hereto constitute an integral
part hereof and are as binding as the other terms hereof.
1.2 The Clause headings herein are solely for the sake of
convenience and are not to be applied in the interpretation
hereof.
2. Definitions
-----------
In this Agreement the following terms shall have the meanings ascribed
to them, unless expressly stated otherwise:
2.1 "Heris" means Heris Aktiengesellschaft (Company No.
56-002196-6);
2.2 "Independent Director" means a director who meets all the
independence criteria in accordance with the Foreign Law;
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2.3 "Stock Exchange" means the Tel Aviv Stock Exchange Ltd. or
the Nasdaq National Market or any other stock exchange on
which the Company's Shares are listed for trade;
2.4 "External Director" means as defined in the Companies Law;
2.5 "Foreign Law" means the law applicable in the United States
regarding securities, including the provisions of the
Sarbanes Oxley Act and the rules and regulations that have
been and are in future issued by virtue thereof, and
including the rules of the Nasdaq National Market;
2.6 "Agreement" means this Agreement together with the appendices
hereto;
2.7 "Company" means Elbit Systems Ltd. (Public Company No.
520043027);
2.8 "First Minimum Quantity" means 3,050,000 (three million fifty
thousand) Ordinary Shares, together with all bonus Shares
that are issued in respect of them, if any, and together with
all the Shares that are issued to Koor by virtue of rights
that are vested in Koor solely in respect of the Koor Shares
in the context of a rights offering of the Company to its
shareholders, if any, all from the time of signing this
Agreement;
2.9 "Second Minimum Quantity" means 2,050,000 (two million fifty
thousand) Ordinary Shares, together with all bonus Shares
that are issued in respect of them, if any, and together with
all the Shares that are issued to Koor by virtue of rights
that are vested in Koor solely in respect of the Koor Shares
in the context of a rights offering of the Company to its
shareholders, if any, all from the time of signing this
Agreement;
2.10 "Transfer" means a sale, gift, realization of a lien (but not
the creation of a lien), loan and any other transfer
whatsoever of a Share and/or any right vested in the Share's
owner and/or holder, whether or not for consideration and
whether voluntary or involuntary;
2.11 "Companies Law" means the [Israeli] Companies Law, 5759-1999;
2.12 "First Minimum Percentage" means 6.45% of the Company's
issued share capital at the time of computation;
2.13 "Second Minimum Percentage" means 4.32% of the Company's
issued share capital at the time of computation;
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2.14 "Business Day" means a day on which the two major banks in
Israel are open for business, other than Fridays and holiday
eves, which shall not be treated as a Business Day;
2.15 "Koor" means Koor Industries Ltd. (Public Company No.
520014143);
2.16 "First Closing Date" means as defined in the Deed of Sale;
2.17 "Second Closing Date" means as defined in the Deed of Sale;
2.18 "Stock Exchange Sale" means a sale in the context of trading
on the Stock Exchange or a sale in a transaction outside the
Stock Exchange by means of a distributor to buyers whose
identity is unknown to the seller or a sale to trust funds in
Israel or abroad or to provident funds or to provident fund
management companies;
2.19 "Koor Shares" means as stated in the preamble hereto;
2.20 "Federmann Shares" means as stated in the preamble hereto;
2.21 "Ordinary Shares", "Shares" or the "Company's Shares" means
Ordinary Shares of 1 NIS par value each in the Company;
2.22 "Federmann Enterprises" means Federmann Enterprises Ltd.
(Private Company No. 512278391);
2.23 "Officer" means as defined in the Companies Law;
2.24 "Free and Clear" means free and clear of any charge, pledge,
attachment, levy, debt, lien, claim, right of pre-emption,
right of refusal, option, lock-up arrangement or any further
or other third party right whatsoever, other than
restrictions in respect of the Transfer and/or negotiability
of Shares that are imposed pursuant to the Foreign Law
(Shares which are not registered under U.S. securities laws);
2.25 "Federmann" means as stated in the preamble hereto;
2.26 "Acquisition" means acquisition, purchase, receipt of a gift
and any receipt of a Transfer, in any way whatsoever, of a
Share and/or right vested in the owner and/or holder of the
Share, whether or not for consideration;
2.27 "Deed of Sale" means as stated in the preamble hereto;
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2.28 "Direct Control" means Control deriving from holding Shares
alone and not together with others;
2.29 "Control" means as the term is defined in the [Israel]
Securities Law, 5728-1968;
2.30 "Qualification Conditions" means all the requirements in
accordance with applicable law and pursuant to the Company's
documents of incorporation for a person to serve as a
director of the Company, including security clearance as
required in Israel for the purpose of such service, but
excluding the conditions for an Independent Director.
3. The Parties' Warranties
-----------------------
3.1 Federmann hereby warrants that Federmann Enterprises is a
limited company, duly registered in Israel and that Heris is
a foreign company, duly registered in Liechtenstein.
3.2 Koor hereby warrants that it is a limited company, duly
registered in Israel.
3.3 Each of the Parties warrants that it is empowered to enter
into this Agreement and perform all its obligations pursuant
hereto and that its signatories hereto are duly empowered to
obligate it.
3.4 Each of the Parties hereto warrants and undertakes that there
is no legal impediment and/or no impediment pursuant to its
incorporation documents and/or applicable law and/or any
order or direction of a court and/or any contract,
understanding or agreement to which it is a party, to its
entering into this Agreement and performing all its
obligations pursuant hereto.
3.5 Except as set out in this Agreement, each of the Parties
hereby warrants that it is in possession of all the approvals
and consents necessary for the purpose of signing and
performing this Agreement.
3.6 Each of the Parties further warrants that it is not a party
to any agreement, arrangement or obligation that is contrary
to and/or impairs its ability to perform all its obligations
pursuant hereto.
4. Voting Agreement - Board of Directors
-------------------------------------
4.1 From the Second Closing Date until such time as Koor's
holdings of the Koor Shares fall below the First Minimum
Percentage or until such time as Koor's holdings of the Koor
Shares fall below the First Minimum Quantity, whichever is
earlier, Federmann shall vote by
virtue of all its holdings
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in the Company's Shares in favor of the election to the
Company's Board of Directors of such number of candidates as
are nominated to office by Koor, which is the greater of:
(1) two directors; or
(2) a number of directors equal to 20% of the number of
the Company's directors, including External
Directors and including the directors who are
elected as aforesaid in accordance with Koor's
nomination, rounded up to the nearest whole number.
It is hereby agreed that if it is required in accordance with
the Foreign Law that a majority of the Company's directors
are Independent Directors, Koor undertakes that at least one
half of the directors who are elected to office in accordance
with its nomination as aforesaid, that number being rounded
up to the nearest whole number, will fulfil the conditions
required in respect of Independent Directors.
4.2 After the Second Closing Date, from such time as Koor's
holdings of the Koor Shares fall below the First Minimum
Percentage or from such time as Koor's holdings of the Koor
Shares fall below the First Minimum Quantity, whichever is
earlier, until such time as Koor's holdings of the Koor
Shares fall below the Second Minimum Percentage or until such
time as Koor's holdings of the Koor Shares fall below the
Second Minimum Quantity, whichever is earlier, Federmann
shall vote by virtue of all its holdings in the Company's
Shares in favor of the election of one director who has been
nominated by Koor, provided that the candidate fulfils all
the Qualification Conditions.
4.3 From the First Closing Date until:
(i) the Second Closing Date; or
(ii) to the extent that the Second Closing Date does not
occur, until such time as Koor's holdings of the
Koor Shares fall below the Second Minimum Percentage
or until such time as Koor's holdings of the Koor
Shares fall below the Second Minimum Quantity,
whichever is earlier;
Federmann shall vote by virtue of all its holdings in the
Company's Shares in favor of the election of one director who
has been nominated by Koor, provided that the candidate
fulfils all the Qualification Conditions.
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4.4 From the First Closing Date, so long as Federmann holds 20%
or more of the Company's issued share capital and so long
as Koor holds the Company's Shares, Koor shall vote by
virtue of all its holdings in the Company's Shares:
4.4.1 In favor of the election of all the directors of the
Company whose candidacy for office has been
nominated by Federmann, except for the directors for
whose election Federmann has undertaken to vote as
provided in Clauses 4.1 or 4.2 or 4.3, as the case
may be, except for a candidate who does not fulfil
the Qualification Conditions.
4.4.2 Without derogating from the generality of Clause
4.4.1 above, in favor of the appointment of all the
external directors whose candidacy is nominated by
Federmann.
4.4.3 In favor of the appointment of the chairperson of
the board of directors who has been nominated for
office by Federmann, provided that if at the time of
the General Meeting at which the appointment of the
chairperson of the Company's board of directors is
raised for discussion and vote, Koor is entitled to
the restricted right described in Clause 6.3 below,
then at the time of the General Meeting there shall
serve one of the directors who has been elected to
office in accordance with Koor's nomination as
provided in Clause 4.1 above, who is nominated by
Koor as Vice chairperson of the Company's board of
directors.
4.5 In Clauses 4.6 to 4.8 below, "Proposing Party" means the
Party on whose nomination, as provided in Clauses 4.1 or 4.2
or 4.3 or 4.4 above, a particular candidate has been
appointed as a director of the Company.
4.6 If a Proposing Party wishes to replace or terminate the
office of a director elected in accordance with its
nomination, the Parties shall act, to the extent necessary,
to hold a General Meeting of the Company and vote in favor of
a proposal to remove said director from office and in favor
of the appointment of another director in his place whose
candidacy is nominated by the Proposing Party and who fulfils
all the Qualification Conditions.
4.7 The Parties shall vote against a proposal to remove from
office a director whose candidacy was nominated by Koor or
Federmann, unless the Proposing Party otherwise instructs in
writing and in advance.
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4.8 If the post of a director is vacated for any reason, the
Parties shall act, to the extent necessary, to hold a General
Meeting of the Company and vote for the appointment as a
director of such candidate as nominated by the Proposing
Party in place of the director whose post has become vacant,
provided that such candidate meets all the Qualification
Conditions.
4.9 Before holding any General Meeting of the Company, on the
agenda of which is the appointment of directors, notice shall
be given by the Company or by Federmann to Koor in connection
with holding the General Meeting and, in accordance with
applicable law and the Company's incorporation documents,
each Party shall give the Company three Business Days' prior
written notice, with a copy to the other, of the candidates
nominated by it for the office of a director in the Company,
as provided in this Clause 4 above.
4.10 Should Koor's holdings of the Koor Shares fall below the
First Minimum Percentage or should Koor's holdings of the
Koor Shares fall below the First Minimum Quantity, whichever
is earlier, Koor shall use its best efforts, subject to
applicable law, in order to procure that all the directors
who have been appointed to office on Koor's nomination as
provided in Clause 4.1 above, other than one director, will
immediately resign from their office as directors of the
Company.
4.11 Should Koor's holdings of the Koor Shares fall below the
Second Minimum Percentage or should Koor's holdings of the
Koor Shares fall below the Second Minimum Quantity, whichever
is earlier, Koor shall use its best efforts, subject to
applicable law, to procure that the director appointed to
office on its nomination, as provided in Clauses 4.2 and/or
4.3 above, shall immediately resign from his office as a
director.
5. General Voting Agreement
------------------------
5.1 From the First Closing Date and subject to the provisions of
Clause 4 above, Koor undertakes to vote by virtue of all its
holdings in the Company's Shares, on every matter and
proposed resolution that is put to the Company's General
Meeting for decision and/or for a resolution of the Company's
shareholders in any manner whatsoever, in accordance with
written instructions that are given to it by Federmann at
least seven Business Days in advance before the time of the
relevant General Meeting or the time of passing the relevant
resolution, as the case may be.
Solely for the purpose of this Clause 5.1, Koor shall not be
deemed holder of the Company's Shares that are exclusively
owned by related
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private companies that are not companies under Koor's Control
and by related public companies of Koor. At Federmann's
request and subject to applicable law, Koor shall make a
recommendation to those companies to vote in accordance with
such instructions as have been given to Koor by Federmann as
aforesaid.
5.2 The provisions of Clause 5.1 above shall not apply:
(i) as regards approval by the Company's General Meeting
of transactions that are to be approved by reason of
the fact that Federmann, Federmann's controlling
shareholders or the officers of any of them have a
personal interest in them; and
(ii) in connection with a proposal to alter the Company's
Articles of Association that is such as to affect
Koor's rights in accordance with the Company's
Articles of Association in a manner that is
prejudicial to Koor in comparison with Federmann.
5.3 For the performance of the provisions of Clauses 4 and 5
above, the Parties undertake to attend every General Meeting
of the Company and do all acts necessary, at the times
prescribed therefor, so that their voting in the General
Meeting by virtue of all their holdings in the Company will
be valid and effective in accordance with applicable law and
pursuant to the Company's incorporation documents.
6. Other Non-Transferable Rights
-----------------------------
6.1 Koor undertakes to give Federmann written notice immediately
after it learns that members of Xxxxxxx Xxxxxxxx'x family
and/or trusts for the benefit of Xxxxxxx Xxxxxxxx'x family
have ceased being Koor's controlling shareholders.
Federmann may, in its discretion, give written notice to Koor
within 90 days of the date on which it receives Koor's
written notice as aforesaid that it has decided to bring to
an end the additional non-transferable rights set out in
Clause 6.3 below (the date on which Federmann's written
notice is received by Koor being referred to below in this
Clause as the "Termination Date").
6.2 The provisions of Clauses 6.3 to 6.8 below shall only apply
in the period between the Second Closing Date and the earlier
of the following two dates:
6.2.1 such time as the number of the Koor Shares that are
exclusively owned by Koor falls below the First
Minimum
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Percentage or such time as the number of the Koor
Shares that are exclusively owned by Koor falls
below the First Minimum Quantity, whichever is
earlier. For the avoidance of doubt, Shares owned by
a person or entity that is not Koor shall not be
deemed as Shares that are exclusively owned by Koor,
even if Koor is deemed to hold them by virtue of
Clause 17.6 below; or
6.2.2 the Termination Date, as defined in Clause 6.1
above.
6.3 The Parties shall act, subject to applicable law, for the
appointment of one of the directors who have been elected to
office on the nomination of Koor as provided in Clause 4.1
above, who shall be nominated by Koor, as Vice Chairperson of
the Company's Board of Directors.
6.4 The Parties shall act, subject to applicable law, so that on
every one of the Company's Board of Directors' committees
there shall be a member one of the directors elected for
office on Koor's nomination as provided in Clause 4.1 above,
who shall be nominated by Koor.
6.5 The Parties shall act, subject to applicable law, so that
there shall be established in the Company a board of
directors' committee for strategic planning, its members
being: one of the directors elected for office on Koor's
nomination as provided in Clause 4.1 above, who shall be
nominated by Koor, at least one of the external directors and
such other directors as determined by the Company's board of
directors (hereinafter the "Strategic Planning Committee").
The function of the Strategic Planning Committee shall be to
assist and make recommendations to the Company's board of
directors on the strategic planning of the Company's business
activity.
6.6 When the tenure of Xx Xxxxxx Xxxxxxxx (hereinafter "Xx.
Xxxxxxxx") as President and CEO of the Company comes to an
end, the Parties shall act, subject to the provisions of
applicable law, so that the Company's board of directors
establishes a special search committee, the composition of
which shall include the Chairperson of the board of
directors, the Vice Chairperson of the board of directors, a
director elected to office on the nomination of Federmann as
provided in Clause 4.4.1 above and a director elected to
office on the nomination of Koor, as provided in Clause 4.1
above (hereinafter the "Search Committee"). The Search
Committee shall act for 30 days in an attempt to identify a
candidate for the post of the Company's CEO, who is agreed by
all the members of the Committee and it shall make a
recommendation to the Company's board of directors to elect
that candidate to the post of the Company's CEO. In any
event, even if the Search Committee has been unable to locate
a candidate agreed by all
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the members of the Search Committee within 30 days as
aforesaid, the Company's CEO shall be elected by the
Company's board of directors.
For the avoidance of doubt, it is clarified that the
Company's President and CEO is currently Xx Xxxxxxxx, and
that the Company's board of directors may extend Xx
Xxxxxxxx'x tenure as it deems fit, and that the Search
Committee mentioned above shall not be established for that
purpose.
6.7 To the extent requested to do so by Koor, Federmann shall
vote in the Company's General Meeting by virtue of all its
holdings in the Company in order to pass a resolution of the
Company approving the Company's entering into a Registration
Rights Agreement with Koor, which will vest Koor, so long as
it holds 5% or more of the Company's issued share capital,
with one demand right on the same conditions, mutatis
mutandis, ("Registration Right") as those detailed in the
Registration Rights Agreement dated 5 July 2000 among the
Company, Elron Electronic Industries Ltd. and Federmann (the
"Registration Rights Agreement"). Federmann hereby undertakes
that to the extent that pursuant to the Registration Rights
Agreement it is vested with more than one demand right and to
the extent that the Company so requires for the purpose of
granting the Registration Right to Koor, Federmann shall,
without any consideration or compensation, relinquish one
demand right that is vested in it pursuant to the
Registration Rights Agreement.
6.8 Should officers or controlling shareholders of Federmann
serve as directors of any subsidiary of the Company, the
Parties shall act, subject to applicable law, so that the
Company also appoints as a director of that subsidiary one of
the directors of the Company who has been appointed to office
on Koor's nomination as provided in Clause 4 above. The
foregoing shall not apply if there is any legal restriction
to the appointment of more than one director, who is a
director of the Company, to the subsidiary's board of
directors as aforesaid.
7. For the avoidance of doubt, it is clarified that the rights granted to
Koor pursuant to Clause 6 above, in all its sub-clauses, are personal
(non-transferable) rights that are not attached to the Koor Shares
that are held by Koor. Said rights are not assignable and/or
transferable to any third party, either together with a Transfer of
all or any of the Koor Shares in the Company or otherwise.
8. Restrictions on Transfer of Shares
----------------------------------
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8.1 From the First Closing Date, Koor shall not Transfer all or
any of the Koor Shares, including in the event of a forced
sale due to receivership, execution proceedings or winding-up
proceedings, except subject to and in accordance with the
provisions of Clauses 10, 11 and 12 below.
8.2 From the First Closing Date, Federmann shall not Transfer all
or any of the Federmann Shares, including in the event of a
forced sale due to receivership, execution proceedings or
winding-up proceedings, except subject to and in accordance
with the provisions of Clauses 9 and 12 below.
9. Koor's Tag-Along Right on a Sale of the Federmann Shares
--------------------------------------------------------
9.1 Should Federmann wish to Transfer any of the Federmann Shares
that constitute more than half the Federmann Shares that are
held by Federmann for the time being to a third party (in
this Clause 9 the "Third Party"), Federmann shall provide
Koor written notice detailing the number of Shares that it
intends to Transfer to the Third Party (in this Clause "the
Offered Shares"), the identity of the Third Party, the
identity of all the Third Party's ultimate interested parties
or, to the extent that the Third Party wishes to receive a
Transfer of the Offered Shares indirectly through a trustee
and/or another person and/or another entity in any manner
whatsoever, the identity of every such trustee and other
person and entity as aforesaid and the identity of the third
party beneficiary and all its ultimate interested parties,
the number of Shares that are held by Federmann at the time
of giving the notice, all to the level of detail for which
the Company and/or the Third Party would be obligated, in
accordance with Israeli securities laws, for reporting the
identity of the said entities and persons, were the Third
Party an interested party in the Company, and the
consideration that the Third Party has undertaken to pay
Federmann for the Offered Shares, the payment terms and all
the other material conditions of the transaction, including
the transaction's conditions precedent (hereinafter in this
Clause the "Sale Notice").
9.2 By the end of a period of 7 Business Days starting on the
date of Koor's receipt of the Sale Notice (hereinafter the
"Tag-Along Notice Period"), Koor may provide Federmann
written notice that it wishes to sell to the Third Party the
Koor Shares that it holds at that time or a portion thereof
together with the Offered Shares and at the price and on the
payment terms and other conditions specified in the Sale
Notice (in this Clause 9 the "Tag-Along Notice"). In the
Tag-Along Notice, which will be provided during the Tag-Along
Notice Period, Koor shall specify the quantity of Shares,
solely out of the Koor Shares, that Koor wishes to sell the
Third Party as aforesaid.
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9.3 Should Koor provide a Tag-Along Notice during the Tag-Along
Notice Period, Federmann shall be entitled to Transfer its
Shares to the Third Party, provided that the Third Party also
purchases from Koor, at the price and on the payment terms
and other conditions specified in the Sale Notice, and at the
same time, the Koor Shares specified by Koor in the Tag-Along
Notice. If the number of Offered Shares, together with the
number of the Koor Shares specified in the Tag-Along Notice,
exceeds the quantity of Shares that the Third Party is
willing to purchase, the quantity of Shares that is purchased
by the Third Party shall be apportioned pro rata between
Federmann and Koor in the ratio between the number of the
Federmann Shares that are held by Federmann prior to
completing the Share Transfer to the Third Party and the
number of the Koor Shares that are held by Koor prior to
completing the Share Transfer to the Third Party.
9.4 Should Koor not provide a Tag-Along Notice during the
Tag-Along Notice Period, Federmann may Transfer the Offered
Shares to the Third Party for consideration and on payment
terms and other conditions no better to Federmann than those
detailed in the Sale Notice, provided that an Agreement for
the Transfer of the Offered Shares is signed by Federmann and
the Third Party within 30 Business Days of the end of the
Tag-Along Notice Period and the Transfer of the Offered
Shares pursuant thereto is completed within 180 days of the
end of the Tag-Along Notice Period, all subject to the
provisions of Clauses 12.1 to 12.3 below.
9.5 For the avoidance of doubt, to the extent that a transaction
for the Transfer to the Third Party of the Offered Shares is
not signed by the expiration of 30 Business Days from the end
of the Tag-Along Notice Period or the transaction for the
Transfer of the Offered Shares is not completed within 180
days of the end of the Tag-Along Notice Period, Federmann may
only Transfer the Offered Shares after again providing a
Tag-Along Notice to Koor as provided above in this Clause 9.
9.6 For the purpose of the foregoing provisions of Clause 9,
there shall be deemed as a single Transfer (1) a number of
transactions for the Transfer of Shares that are effected
with a single Third Party during a six-month period and for
such purpose a "Transaction for the Transfer of Shares"
includes the grant, Transfer or sale of any option or right
to acquire or receive Shares; and the "Single Third Party"
includes any related company (as defined in the Securities
Law, 5728-1968) of the Third Party and any interested party
(as defined in the Securities Law, 5728-1968) in any of them
and includes anyone acting with the Third Party, in
cooperation under an agreement, whether written or oral, and
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also (2) a transaction for the Transfer of Shares (as defined
above) in the scope of which there are Transferred in any
manner whatsoever - including as a result of a Transfer of
Control in Heris from Federmann Enterprises to a Third Party
or Third Parties and/or in other subsidiaries of Federmann
from Federmann to any Third Party or Third Parties and/or a
Transfer of actual economic control of the Federmann Shares
that are owned by Heris and/or other subsidiaries of
Federmann from Federmann to any Third Party or Third Parties
- Shares of Federmann, from Federmann to any Third Party or
Third Parties, in a percentage of more than 50% of the
Federmann Shares that are then held by Federmann.
9.7 For the avoidance of doubt, the foregoing shall not preclude
Federmann from entering into an agreement to Transfer the
Offered Shares to the Third Party before giving the Sale
Notice, provided that such does not preclude Koor from
tagging along in the sale of the Offered Shares to the Third
Party in accordance with the provisions of this Clause 9.
9.8 Without derogating from and in addition to the provisions of
Clause 9.6, the provisions of Clauses 9.1 to 9.7 above shall
not apply, and Koor shall not have a Tag-Along Right, in
respect of a Transfer of any of the Federmann Shares from
Federmann Enterprises to Heris and vice versa. Nevertheless,
if Federmann Enterprises sells Control of Heris and at the
time of the sale Heris holds more than 50% of the Federmann
Shares, Federmann shall xxxxx Xxxx the Tag-Along Right as
provided in Clauses 9.1 to 9.7 above, mutatis mutandis. To
the extent that at the time of the Transfer of Control of
Heris, Heris holds other assets, in addition to the Federmann
Shares, the value of the Federmann Shares that are held by
Heris at that time shall be determined by an appraiser agreed
between the Parties, and in the absence of such agreement,
then by the chairperson of the accounting firm of Somekh
Xxxxxxx (KPMG), who may also appoint himself.
9.9 It is agreed that the foregoing provisions of Clauses 9.1 to
9.8 shall not apply and Koor's Tag-Along Right shall expire
from such time as Koor's holdings of the Koor Shares fall
below the Second Minimum Percentage or from such time as
Koor's holdings fall below the Second Minimum Quantity,
whichever is earlier.
10. Non-Transfer of Shares by Koor
------------------------------
Koor shall not Transfer the Koor Shares or any of them during the
period commencing on the date of signing this Agreement and ending at
the later of the following two dates:
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10.1 on the expiration of 12 months after the First Closing Date;
or
10.2 if the performance of Stage 'B' of the Transaction pursuant
to the Deed of Sale is completed - the expiration of nine
months after the Second Closing Date;
(hereinafter the "Prohibited Sales Period").
11. Federmann's Right of First Refusal
----------------------------------
11.1 Subject to the provisions of Clause 10 above and Clause 12
below, if Koor wishes to Transfer any of the Koor Shares to a
Third Party, it may only do so if it first enters into an
agreement with a specific Third Party for the Transfer of
those Shares, the agreement being subject to the Right of
First Refusal vested in Federmann pursuant to this Agreement,
and subject to the following provisions.
Koor shall provide Federmann written notice within 2 Business
Days of entering the agreement with the Third Party, in which
it shall notify Federmann that it has entered into a binding
agreement for the Transfer of Shares from the Koor Shares to
a Third Party (in this Clause 11 the "Third Party"), subject
to the Right of First Refusal vested in Federmann pursuant to
this Clause 11, and in the notice it shall detail the number
of Shares that it has undertaken to Transfer to the Third
Party (in this Clause the "Offered Shares"), the identify of
the Third Party and the identity of all the Third Party's
ultimate interested parties or to the extent that the Third
Party wishes to receive a Transfer of the Offered Shares
indirectly through a trustee and/or other person and/or
entity in any manner, then the identity of every such trustee
and other person and entity as aforesaid, the identity of the
Third Party beneficiary and of all its ultimate interested
parties, the number of the Shares held by the Third Party on
the date of providing the notice, all to the same level of
detail for which the Company and/or the Third Party would be
obligated, in accordance with Israeli securities laws, for
reporting the identity of the said entities and persons, were
the Third Party an interested party in the Company, and the
consideration that the Third Party has undertaken to pay to
Koor for the Offered Shares (which shall only be cash
consideration), the payment terms and all the other material
conditions of the transaction, including all the conditions
precedent of the transaction (hereinafter in this Clause the
"Sales Notice").
11.2 Until the end of a period of 21 Business Days commencing on
the date of Federmann's receipt of the Sales Notice
(hereinafter in this Clause 11 the "Acceptance Notice
Period"), Federmann may give Koor written notice that it has
decided to purchase the Offered Shares for
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the consideration and on the payment terms and other
conditions detailed in the Sales Notice (hereinafter the
"Acceptance Notice").
11.3 In the event of Acceptance Notice being provided, Koor shall
Transfer to Federmann and Federmann shall take a Transfer
from Koor of all the Offered Shares, Free and Clear, for the
consideration and on the terms and conditions detailed in the
Sale Notice, within 7 Business Days of the date on which all
the approvals and permits necessary for such transaction as
aforesaid in accordance with applicable law are obtained and
in any event not later than the expiration of 60 days from
the date the Acceptance Notice is provided (hereinafter the
"Completion Period"). The Parties shall cooperate in order to
obtain all the approvals and permits necessary for the
transaction as aforesaid as soon as possible.
11.4 Should Federmann not provide Koor an Acceptance Notice in
writing by the end of the Acceptance Notice Period or should
Federmann provide an Acceptance Notice but the transaction
mentioned in Clause 11.3 above not be completed by the end of
the Completion Period other than due to a breach of this
Agreement by Koor, Koor may Transfer the Offered Shares to
the Third Party for the consideration and on the payment
terms and other conditions detailed in the Sales Notice,
provided that the transaction for the sale to the Third Party
of the Offered Shares is completed by the expiration of 120
days from the end of the Acceptance Notice Period or from the
end of the Completion Period, as the case may be (hereinafter
the "Maximum Sales Period"), all subject to the provisions of
Clauses 12.1 to 12.3 below.
11.5 For the avoidance of doubt, should the transaction for the
sale of the Offered Shares to the Third Party not be
completed by the end of the Maximum Sales Period, Koor may
only Transfer the Offered Shares after again providing a
Right of First Refusal to Federmann as provided above in this
Clause 11.
11.6 From the end of the Prohibited Sales Period, the provisions
of Clauses 11.1 to 11.5 above shall not apply with respect to
a Stock Exchange sale of the Koor Shares by Koor in aggregate
quantities not exceeding in any 12-month period 2% of the
Company's issued share capital.
11.7 Notwithstanding the provision of Clause 11.6 above, Koor may
not Transfer, pursuant to Clause 11.6 above, in the
aggregate, more than 950,000 of the Koor Shares that are held
by it:
11.7.1 unless Federmann Transfers any of the Federmann
Shares, except on a Transfer subject to Koor's
Tag-Along Right
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pursuant to Clause 9 above, and except for a
Transfer to a person or entity, the Shares held by
which are deemed as held by Federmann in accordance
with the provisions of Clause 17.6 below; or
11.7.2 unless the quantity of the Federmann Shares together
with the Koor Shares falls below 45% of the
Company's issued share capital, other than as a
result of a breach of this Agreement by Koor.
12. Transfer of Shares and Obligations Pursuant to the Agreement
------------------------------------------------------------
Without derogating from the other provisions of this Agreement,
including Clause 7 above, it is agreed that on any Transfer of the
Federmann Shares by Federmann that is subject to Koor's Tag-Along
Right under Clause 9 above, and on any Transfer of the Koor Shares by
Koor that is subject to Federmann's Right of First Refusal under
Clause 11 above (hereinafter in this Clause 12 the "Shares Being
Transferred", and Koor and Federmann being respectively the
"Transferor Party"), the following provisions shall apply:
12.1 If the Transferor Party wishes to Transfer all the Federmann
Shares or all the Koor Shares, as the case may be, the
Transferor Party may not do so and such a Transfer shall be
ineffective unless the Transferor Party Transfers and assigns
to the transferee the Shares Being Transferred (in this
Clause 12 the "Purchaser"), together with the Transfer of the
Shares Being Transferred, all the rights and obligations of
the Transferor Party pursuant to this Agreement, and the
Purchaser and the Transferor Party so confirm in writing to
the other Party as provided in Clause 12.3 below. On
completion of the assignment and Transfer of all the
Transferor Party's rights and obligations as aforesaid, the
Transferor Party shall cease being a Party to this Agreement
and shall be succeeded by the Purchaser.
12.2 If the Transferor Party wishes to Transfer only a portion of
the Federmann Shares or only a portion of the Koor Shares, as
the case may be, then the Transferor Party may not do so and
such a Transfer shall be ineffective, unless, together with
the Transfer of the Shares being Transferred, the Purchaser
assumes all the obligations of the Transferor Party jointly
and severally with the Transferor Party and confirms said
obligation in writing to the other Party as provided in
Clause 12.3 below. For the avoidance of doubt, it is
clarified that the Transferor shall continue to be entitled
as against the other Party to all the rights vested in the
Federmann Shares or the Koor Shares, as the case may be, that
are held by it.
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12.3 In the event that Koor is the Transferor Party, Koor shall
provide Federmann, together with the Sales Notice as
mentioned in Clause 11.1 above, the written confirmation of
Koor and the Purchaser as provided in Clause 12.1 above or
the written confirmation of the Purchaser as provided in
Clause 12.2 above, as the case may be, duly signed by the
Purchaser and/or Koor, as the case may be.
In the event that Federmann is the Transferor Party,
Federmann shall provide Koor, within 2 Business Days of
signing an agreement with the Purchaser for the Transfer of
the Offered Shares, as provided in Clause 9.4 or Clause 9.7
above, the written confirmation of the Purchaser, as provided
in Clause 12.1 above or the written confirmation of Federmann
and the Purchaser, as provided in Clause 12.2 above, as the
case may be, duly signed by the Purchaser and/or Federmann,
as the case may be.
12.4 In addition to the foregoing, even in a case or cases in
which Federmann Transfers any of the Federmann Shares that
are held by it, the Transfer of which is not subject to
Koor's Tag-Along Right pursuant to Clause 9 above, Federmann
may, if it so desires, assign and Transfer its obligations
pursuant to this Agreement or any of them so that the
transferee of the Shares and Federmann shall be jointly and
severally liable to Koor for all the obligations pursuant to
this Agreement or a portion of them, in such proportion as
determined between Federmann and the transferee of the
Shares. For the avoidance of doubt, Federmann may exercise
its right to assign and Transfer all or any of its
obligations as provided in this Clause 12.4 together with a
Transfer of any of the Federmann Shares, once or several
times, in its discretion.
13. Limitation on Restrictions and Rights
-------------------------------------
The limitations imposed with respect to a Share Transfer and the
rights vested in the Parties in connection with a Share Transfer
pursuant to Clauses 9 to 12 above only apply to the Federmann Shares
and the Koor Shares, and those limitations and rights shall not apply
with respect to other Shares in the Company that may be held by
Federmann or Koor, as the case may be.
14. Tag-Along Right to Purchase
---------------------------
Should a Party to this Agreement (in this Clause 14 the "Purchasing
Party") directly or indirectly, including through subsidiaries and/or
any trustee, acquire Shares of the Company for total consideration in
excess of US$ 25 million (in this Clause 14 the "Purchased Shares")
from a Single Third Party, as defined in Clause 9.6 above (in this
Clause 14 the "Seller"), whether or not on the Stock Exchange (in this
Clause 14 the "Purchase Transaction"), the other
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Party to the Agreement (in this Clause 14 the "Other Party") shall
have a right to tag along on such Acquisition as aforesaid, on the
terms of the Purchase Transaction, and to acquire a portion of the
securities that are being purchased (in this Clause 14 the "Purchase
Tag-Along Right") in accordance with the provisions set out below:
14.1 The Purchasing Party shall provide the other Party written
notice within 3 Business Days of the completion of the
Purchase Transaction, detailing the terms of the Purchase
Transaction that it has made, including the quantity of
additional Shares, the price (which shall only be cash
consideration), the payment terms, the Seller's identity and
every other material condition (in this Clause 14 the
"Seller's Notice").
14.2 Within 14 Business Days of receiving the Purchaser's notice,
the Other Party shall give the Purchasing Party written
notice if it is tagging along in the Purchase Transaction and
of the quantity of Shares, out of the additional Shares, that
it wishes to purchase, not exceeding such quantity the ratio
between which it and the rest of the additional Shares is
equal to the ratio:
(i) if Koor is the Other Party - between the Koor Shares
that are held by Koor on the date the Purchaser's
notice is given and the Federmann Shares that are
held by Federmann on the date the Purchaser's notice
is given;
(ii) if Federmann is the Other Party - between the
Federmann Shares that are held by Federmann on the
date the Purchaser's notice is given and the Koor
Shares that are held by Koor on the date the
Purchaser's notice is given.
14.3 Should the Other Party give the Purchasing Party Tag-Along
notice at such time as mentioned in Clause 14.2 above, the
Purchasing Party shall Transfer to the Other Party Shares of
the Company in the quantity specified in the Tag-Along
notice, Free and Clear, for the consideration and on the
terms detailed in the Purchaser's notice, all within 7
Business Days of the date of giving the Tag-Along notice.
15. Term of the Agreement and Effect of the Agreement
-------------------------------------------------
15.1 This Agreement shall take effect on the First Closing Date.
Should Stage 'A' of the Transaction (as the term is defined
in the Deed of
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Sale) not be performed and completed by the end of 3 Business
Days after the Stage 'A' Completion Deadline (as defined in
the Deed of Sale), then this Agreement shall be null and void
and ineffective, without either of the Parties having any
claim, complaint or demand against the other.
15.2 This Agreement shall be in effect until the end of a period
of 15 years from the date on which it enters into effect as
provided in Clause 15.1 above or until such time as
Federmann's holdings of the Federmann Shares together with
Koor's holdings of the Koor Shares fall below 25% of the
Company's issued share capital, whichever is the earlier.
15.3 For the avoidance of doubt, it is clarified that this
Agreement shall not come to an end if Koor or Federmann
ceases to hold Koor Shares or the Federmann Shares, as the
case may be, if together with a Transfer of the remainder of
the Federmann Shares or the Koor Shares, as the case may be,
the Transferor Party (as defined in Clause 12 above)
Transferred and assigned all its rights and obligations
pursuant to this Agreement to the Purchaser (as defined in
Clause 12 above), and the provisions of this Agreement shall
continue to apply and obligate the Purchaser and the Other
Party.
16. Koor's Withdrawal from the Controlling Interest
-----------------------------------------------
16.1 Koor may at any time from October 1, 2008, provide written
notice to Federmann in which it shall inform Federmann of
Koor's desire to bring to an end its rights and obligations
pursuant to Clauses 4, 6 (if Koor is entitled to rights
pursuant to Clause 6 at that time), 7, 8, 9, 10, 11 (except
for Clauses 11.6 and 11.7), 12, 13 and 14 of this Agreement
(hereinafter in this Clause 16 the "Revoked Clauses"), and on
the expiration of 6 months from the date on which Federmann
is given Koor's written notice as aforesaid (hereinafter in
this Clause 16 the "Expiration Date"), all the Parties'
rights and obligations pursuant to the Revoked Clauses shall
expire so that the sole rights and obligations that will
continue to obligate and entitle the Parties pursuant to this
Agreement shall be the rights and obligations in Clause 5
above and this Clause 16, all without prejudice to either of
the Party's rights to any relief in respect of a breach of
any of the provisions of the Revoked Clauses that occurred
prior to the Expiration Date.
16.2 Should such notice be given by Koor and to the extent that
Federmann so wishes, the Parties shall discuss the
possibility of Koor's Shares that are held by Koor at that
time being acquired by Federmann, alone or together with
others, without the provisions of this Clause being such as
to obligate either of the Parties to enter into such a
purchase
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agreement or to permit Koor to Transfer the Koor Shares
otherwise than in accordance with the provisions of Clauses
16.3 and 16.4 below.
16.3 As from the Expiration Date, Koor may Transfer all or any of
the Koor Shares that are held by it in any way, either by a
Stock Exchange sale or otherwise, including a distribution in
kind to its shareholders, subject nevertheless to Federmann's
Right of First Offer as provided in Clause 16.4 below or in
accordance with the provisions of Clauses 11.6 and 11.7
above.
16.4 Federmann's Right of First Offer
--------------------------------
16.4.1 As of the Expiration Date, Koor may not Transfer any
of the Koor Shares unless it first gives Federmann
written notice detailing the quantity of the Koor
Shares that it wishes to transfer (hereinafter the
"Offered Shares").
16.4.2 Federmann may, but is not required to, within 14
Business Days of receiving Koor's notice as
aforesaid (hereinafter in this Clause 16.4 the
"Offer Period"), provide Koor written notice
(hereinafter in this Clause 16.4 "Federmann's
Notice"), informing Koor that it wishes to purchase
from Koor the Offered Shares or the portion of them
as specified by Federmann in Federmann's Notice
(hereinafter in this Clause 16. the "Shares for
Purchase") and the price per Share that it is
willing to pay for those Shares (hereinafter in this
Clause 16.4 the "Price Offered").
16.4.3 Within 7 Business Days of Koor's receiving
Federmann's Notice, Koor shall provide Federmann
written notice (hereinafter in this Clause 16.4 the
"Koor's Notice") if it agrees or if it does not
agree to Transfer to Federmann the Shares for
Purchase at the Price Offered. Should Koor inform
Federmann in Koor's Notice that it agrees to
Transfer to Federmann the Shares for Purchase at the
Price Offered, Koor shall Transfer to Federmann and
Federmann shall accept from Koor a Transfer of the
Shares for Purchase, and Federmann shall pay Koor
the Price Offered, all by the expiration of 21
Business Days from the date Koor's Notice is
received by Federmann (hereinafter in this Clause
16.4 the "Completion Period").
16.4.4 Should Koor inform Federmann in Koor's Notice that
it does not agree to Transfer to Federmann the
Shares for Purchase at the Price Offered, Koor may
Transfer the Shares for
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Purchase to a Third Party or Third Parties, but only
at a price greater than the Price Offered on the
same or more favorable payment terms to Koor than
those specified in Clause 16.4.3 above, without any
further obligation of Koor, all within 90 Business
Days of the date Koor's Notice is given. For the
avoidance of doubt, to the extent that the Shares
for Purchase have not been Transferred by Koor to a
Third Party as aforesaid within 90 Business Days of
the date of Koor's notice being provided, Koor may
only Transfer the Shares for Purchase after again
providing Federmann the Right of First Offer as
provided in this Clause 16.4.
16.4.5 Should Federmann not provide Federmann's Notice
within the 14 Business Days mentioned in Clause
16.4.2 above or should Federmann state in
Federmann's Notice that it wishes to acquire only
some of the Offered Shares or if the Transfer of the
Shares for Purchase has not been completed by the
end of the Completion Period, otherwise than due to
a breach of contract by Koor, Koor may, within 90
Business Days of the date on which Koor's Notice was
provided as provided in Clause 16.4.3 above or from
the end of the Completion Period, as the case may
be, sell the Offered Shares (if Federmann's Notice
has not been provided as aforesaid) or that portion
of them that are not included in the Shares for
Purchase (if Federmann's Notice is provided with
respect to only a portion of the offered Shares).
16.4.6 For the purpose of Clauses 16.4.3 and 16.4.5 above,
a Transfer of Shares by means of their distribution
as a dividend in kind by Koor to its shareholders
shall be deemed as a Transfer of Shares that is made
on the date determining the rights to receive the
dividend in kind by Koor's shareholders, and such
Transfer as aforesaid shall be deemed as though made
at the average closing price of the Company's shares
on the Tel Aviv Stock Exchange in the 12 trading
days before and in the 12 trading days after the
date of giving Koor's written notice as provided in
Clause 16.4.1 above.
17. Miscellaneous
-------------
17.1 This Agreement may be signed in several separate copies and
each copy signed by one of the Parties shall be treated as an
original and all together they shall be treated as a single,
complete document.
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17.2 No conduct by either of the Parties shall be deemed a waiver
of any of its rights pursuant to this Agreement or by law or
as its waiver of or acquiescence to in any breach or
non-performance of any condition, unless the waiver,
acquiescence, postponement, modification, cancellation or
addendum has been done expressly and in writing.
17.3 This Agreement contains, embodies, merges and expresses all
the terms and conditions agreed between the Parties on the
matters mentioned herein. Any promises, guarantees,
agreements, whether written or oral, undertakings or
representations on the matters mentioned in this Agreement
that were given or made by the Parties prior to the making of
this Agreement that have not found specific expression herein
shall not be deemed to augment, derogate from or modify the
rights and obligations provided in this Agreement or deriving
herefrom, and the Parties shall not be bound by them from the
date of this Agreement (hereinafter "Revocation of the
Obligations Preceding Signature"). It is hereby expressly
agreed that the Revocation of the Obligations Preceding
Signature shall be effective even in the event that this
Agreement is revoked or rescinded for any reason. The
foregoing shall not be such as to impair the effect of the
Parties' rights and obligations pursuant to the Sale [sic]
Agreement.
17.4 For the avoidance of doubt, the provisions of the
Shareholders Agreement between Koor and the Company,
including wording that is different from the wording of this
Agreement, shall not in any manner be applied in the
interpretation of this Agreement. Without prejudice to the
generality of the foregoing, the exchanges of documents
between the Parties prior to the signature of this Agreement,
including the drafts exchanged between them, shall have no
significance in the interpretation of this Agreement.
17.5 Except as otherwise provided in this Agreement, the Parties'
rights and obligations pursuant to this Agreement are not
assignable and/or transferable. The provisions of this Clause
are not such as to affect Federmann's right to exercise its
right of first refusal as provided in Clause 11 above by
means of any third party and/or third parties.
17.6 In this Agreement any person or entity shall be deemed as
holding all the Shares held by it, directly or indirectly
and, without prejudice to the generality of the foregoing,
all the Shares held, directly or indirectly, by any related
entity and by any member of his family, as they are defined
in the Securities Law, 5728-1968; and also all the Shares
that are held by any person and/or entity that is construed
in accordance with the provisions of the Securities Law,
5728-1968 as holding Shares of the Company together with that
person or entity and also all the Shares held through a
trustee and/or registration company,
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and also all the Shares that are held by another shareholder
of the Company who is jointly and severally liable with a
Party to this Agreement for the obligations pursuant to this
Agreement. Nevertheless, a Party to this Agreement shall not,
for the purpose of this Agreement, be treated as holding
Shares that are held by the other Party to this Agreement.
17.7 This Agreement shall be governed by the laws of the State of
Israel, without taking into account its choice of law rules.
Exclusive jurisdiction on all matters relating to this
Agreement or deriving herefrom is vested in the competent
courts in the City of Tel Aviv-Jaffa and in them alone.
17.8 Each of the Parties to this Agreement shall bear the legal
expenses that it is charged in respect of this Agreement.
17.9 An obligation to vote by virtue of all of a Party's Shares in
the Company in connection with any resolution in any way also
includes the obligation to participate in the vote by virtue
of all those Shares, and not to vote for any further or other
proposed resolution that is such as to contradict, cancel or
diminish said resolution.
17.10 Without being such as to impose any further limitations on
the Transfer of Shares other than that expressly provided in
this Agreement, each of the Parties undertakes to act in good
faith towards the other and not, by act or omission, to cause
the frustration of this Agreement's provisions or any of them
and/or to make them unrealizable.
17.11 The Parties hereto may extend any time specified in this
Agreement, either once or several times, by written notice
signed by two officers of each Party to this Agreement,
without any further approval being necessary.
18. Notices
18.1 The Parties' addresses for the purpose of this Agreement are
as set out in the heading hereto or any other address in
Israel of which one Party gives the other written notice.
18.2 Any notice pursuant to this Agreement shall be in writing and
be sent by registered mail or personal delivery by messenger
to the address of the relevant Party, as mentioned in Clause
18.1 above, and that address shall in all respects in
connection with this Agreement also be the address of that
Party for the service of court process.
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18.3 Notice that is sent shall be treated as having reached the
addressee and come to its knowledge within five Business Days
if sent by registered mail or, if delivered in person by
messenger by 17:00 hours on any Business Day, it shall be
treated as received on the Business Day after delivery.
IN WITNESS WHEREOF THE PARTIES HAVE EXECUTED THIS AGREEMENT:
(signed) (signed)
-------------------------- --------------------------
Koor Industries Ltd. Federmann Enterprises Ltd.
(signed)
--------------------------
Heris Aktiengesellschaft
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