SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
For the Month of August 2003
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ELSCINT LIMITED
(Translation of Registrant's Name into English)
13 Mozes Street, Tel Aviv 67442, Israel
(Address of Principal Corporate Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F:
|X| Form 20-F |_| Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934:
|_| Yes |X| No
Attached hereto as Exhibit 1 and incorporated by reference herein is
the Registrant's notice of annual general meeting and proxy statement,
distributed to the Registrant's shareholders on or about August 5, 2003.
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ELSCINT LIMITED
(Registrant)
By: /s/ Uri Levin
----------------------------------
Name: Uri Levin
Title: Chief Financial Officer
Dated: August 5, 2003.
EXHIBIT INDEX
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EXHIBIT NO. DESCRIPTION
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1. Notice of annual general meeting and proxy statement.
EXHIBIT 1
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ELSCINT LIMITED
13 MOZES STREET
TEL-AVIV 67442, ISRAEL
TEL: (972-3) 608-6001
Dear Shareholder,
You are cordially invited to attend the Annual General Meeting of
Shareholders of Elscint Limited (the "Company") to be held at 11:00 a.m., Israel
time, on Thursday, August 28, 2003, at the Company's offices at 13 Mozes Street,
Tel-Aviv 67442, Israel.
The purposes of the meeting are set forth in the accompanying Notice of
Meeting and Proxy Statement.
For the reasons set forth in the accompanying Proxy Statement, the
Company's board of directors recommends that you vote "FOR" proposals 1 through
8, as specified on the enclosed form of proxy.
We look forward to greeting personally those shareholders who are able
to be present at the meeting. However, whether or not you plan to attend the
meeting, it is important that your shares be represented. Accordingly, you are
kindly requested to sign, date and mail the enclosed proxy in the envelope
provided at your earliest convenience so that it will be received not later than
48 hours before the meeting.
Thank you for your continued cooperation.
Very truly yours,
ABRAHAM (RAMI) GOREN
EXECUTIVE CHAIRMAN OF THE BOARD OF DIRECTORS
Tel-Aviv, Israel
August 5, 2003
ELSCINT LIMITED
13 MOZES STREET
TEL-AVIV 67442, ISRAEL
TEL: (972-3) 608-6001
NOTICE OF ANNUAL GENERAL MEETING
OF SHAREHOLDERS
Notice is hereby given that an Annual General Meeting of Shareholders
(the "Meeting") of Elscint Limited (the "Company") will be held at 11:00 a.m.,
Israel time, on Thursday, August 28, 2003, at the Company's offices at 13 Mozes
Street, Tel-Aviv 67442, Israel for the following purposes:
1. To re-elect the Company's current six (6) directors to the Company's
board of directors ("Board of Directors");
2. To re-elect the current two (2) external directors serving on the
Board of Directors for an additional 3-year term commencing on October
2, 2003;
3. To approve the appointment of the Company's auditors for the fiscal
year ended December 31, 2003 and to authorize the Board of Directors
to determine the auditors' remuneration to be fixed in accordance with
the volume and nature of their services to the Company for the year
ended December 31, 2003;
4. To approve the compensation to be paid to current and future members
of the Company's audit committee (the "Audit Committee"), in an amount
equal to 120% of the compensation presently paid to the current
members of the Audit Committee, in accordance with the Israeli
Companies Regulations (Principles Regarding Compensation and Expenses
for External Directors), 2000;
5. To approve the compensation to be paid to the Company's current and
future directors who do not hold any other office with the Company,
any subsidiary thereof or any company affiliated with Europe-Israel
(M.M.S.) Ltd., the indirect controlling shareholder of the Company, to
be in accordance with the maximum amount permitted under the scale of
remuneration established by the Israeli Ministry of Justice and
adopted pursuant to the Israeli Companies Law, 1999;
6. To approve the grant of an annual bonus to the Executive Chairman of
the Board of Directors for the fiscal year ended December 31, 2002;
7. To approve the grant of an annual bonus to the Company's President and
director for the fiscal year ended December 31, 2002; and
8. To approve an amendment to the employment terms of the Company's
President and director.
In addition, the shareholders will be requested to consider at the
Meeting the report of the Board of Directors and the financial statements of the
Company for the fiscal year ended December 31, 2002.
Finally, the shareholders may consider and act upon such other business
as may properly come before the Meeting and any adjournment thereof.
Shareholders of record at the close of business on August 4, 2003 are
entitled to notice of, and to vote at, the Meeting and any adjournment thereof.
Shareholders who are unable to attend the Meeting in person are requested to
complete, date and sign the enclosed form of proxy and return it promptly in the
pre-addressed envelope provided. Shareholders who attend the Meeting may revoke
their proxies in writing and vote their shares in person at the Meeting.
Joint holders of shares should note that, pursuant to the articles of
association of the Company, the vote of the senior of joint holders of any share
who tenders a vote, whether in person or by proxy, will be accepted to the
exclusion of the vote(s) of the other registered holder(s) of the shares, and
for this purpose seniority will be determined by the order in which the names
appear in the Company's Register of Shareholders.
By Order of the Board of Directors,
MARC LAVINE
CORPORATE SECRETARY
Tel-Aviv, Israel
August 5, 2003
ELSCINT LIMITED
13 MOZES STREET
TEL-AVIV 67442, ISRAEL
TEL: (972-3) 608-6001
PROXY STATEMENT
This Proxy Statement is being furnished to the holders of Ordinary
Shares, New Israeli Shekels 0.05 nominal value (the "Shares"), of Elscint
Limited (the "Company") in connection with the solicitation of proxies by the
management and board of directors (the "Board of Directors") of the Company for
use at the Annual General Meeting of Shareholders (the "Meeting") to be held at
11:00 a.m., Israel time, on Thursday, August 28, 2003, at the Company's offices
at 13 Mozes Street, Tel-Aviv 67442, Israel, and at any adjournment thereof,
pursuant to the accompanying Notice of Meeting.
At the Meeting, the shareholders will be asked to consider and vote on
the following matters:
1. To re-elect the Company's current six (6) directors to the
Company's Board of Directors;
2. To re-elect the current two (2) external directors serving on the
Board of Directors for an additional 3-year term commencing on
October 2, 2003;
3. To approve the appointment of the Company's auditors for the
fiscal year ended December 31, 2003 and to authorize the Board of
Directors to determine the auditors' remuneration to be fixed in
accordance with the volume and nature of their services to the
Company for the year ended December 31, 2003;
4. To approve the compensation to be paid to current and future
members of the Company's audit committee (the "Audit Committee"),
in an amount equal to 120% of the compensation presently paid to
the current members of the Audit Committee, in accordance with
the Israeli Companies Regulations (Principles Regarding
Compensation and Expenses for External Directors), 2000;
5. To approve the compensation to be paid to the Company's current
and future directors who do not hold any other office with the
Company, any subsidiary thereof or any company affiliated with
Europe-Israel (M.M.S.) Ltd., the indirect controlling shareholder
of the Company ("Europe-Israel"), to be in accordance with the
maximum amount permitted under the scale of remuneration
established by the Israeli Ministry of Justice and adopted
pursuant to the Israeli Companies Law, 1999;
6. To approve the grant of an annual bonus to the Executive Chairman
of the Board of Directors for the fiscal year ended December 31,
2002;
7. To approve the grant of an annual bonus to the Company's
President and director for the fiscal year ended December 31,
2002; and
8. To approve an amendment to the employment terms of the Company's
President and director.
In addition, the shareholders will be requested to consider at the
Meeting the report of the Board of Directors and the financial statements of the
Company for the fiscal year ended December 31, 2002.
Finally, the shareholders may consider and act upon such other business
as may properly come before the Meeting and any adjournment thereof.
The approval of each of Proposals 1 and 3 through 8 requires the
affirmative vote of at least a majority of the votes of shareholders present and
voting at the Meeting in person or by proxy.
The approval of proposal 2 requires the affirmative vote of at least a
majority of the votes of shareholders present at the Meeting in person or by
proxy that are voted for such proposal, provided that (i) such majority vote at
the Meeting shall include at least one third (1/3) of the total votes of
non-controlling shareholders present at the Meeting in person or by proxy; votes
abstaining shall not be taken into account in counting the above-referenced
shareholders' votes, or (ii) the total number of votes of the shareholders
mentioned in clause (i) above that are voted against such proposal does not
exceed one percent (1%) of the total voting rights of the Company.
Each Share is entitled to one vote upon each matter to be voted on at
the Meeting. No less than two (2) shareholders, present in person or by proxy,
and holding or representing, in the aggregate, not less than fifty-one percent
(51%) of the issued and outstanding Shares, will constitute a quorum at the
Meeting. If within a half hour after the time appointed for the holding of the
Meeting no quorum is present, the Meeting will stand adjourned to the same day
in the following week, at the same time and place, or to such other day, time
and place as shall be determined by the Board of Directors by notice to the
shareholders, and at such adjourned meeting, the business for which the Meeting
was called will be transacted if at least two (2) shareholders present in person
or by proxy, and representing, in the aggregate, not less than 26% of the issued
and outstanding Shares, are present or represented.
A proxy for use at the Meeting and a return envelope for the proxy are
enclosed. Unless otherwise indicated on a proxy, shares represented by executed
and unrevoked proxies will be voted at the Meeting "FOR" all of the proposals
set forth above. If a shareholder instructs in a proxy to abstain from voting on
the proposal, the Shares represented by such proxy will be deemed not to have
been cast for the purpose of the particular proposal and, accordingly, such
Shares will not be counted in calculating the percentage of affirmative votes
required for approval of such proposal. Shareholders may revoke their proxy at
any time before the effective
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exercise thereof by returning a later-dated proxy or by voting their shares in
person at the Meeting.
Management and the Board of Directors are soliciting proxies for use at
the Meeting. Proxies will be mailed to shareholders on or about August 5, 2003
and will be solicited primarily by mail; however, additional solicitations may
be made by telephone, facsimile or other means of contact by certain officers,
employees or agents of the Company, none of whom will receive additional
compensation therefor. The entire expense of solicitation, including the cost of
preparing, assembling and mailing the proxy materials, will be borne by the
Company. The Company will also reimburse the reasonable expenses of brokerage
firms and others for forwarding materials to beneficial owners of Shares.
OUTSTANDING SHARES AND VOTING RIGHTS
The Company had 17,424,643 Shares (1) outstanding as of July 30, 2003.
Each Share is entitled to one vote upon each proposal to be presented at the
Meeting.
BENEFICIAL OWNERSHIP OF SECURITIES BY CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth, as of July 30, 2003, the number of
Shares owned by (i) all shareholders known to the Company to own 5% or more of
the Shares and (ii) all current directors and officers of the Company as a
group:
- ------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS NUMBER OF PERCENT OF SHARES
SHARES BENEFICIALLY OWNED BENEFICIALLY OWNED
- ------------------------------------------------------------------------------------------------------------
Elbit Medical Holdings Ltd. (2)
13 Mozes Street
Tel Aviv, Israel 10,269,784 58.94%
- ------------------------------------------------------------------------------------------------------------
Fidelity Management & Research Co. (3)
82 Devonshire Street
Boston, MA 02109-3614 1,430,800 8.21%
- ------------------------
(1) Such number (i) excludes 68,500 Shares held by a trustee in favor of
the Company pursuant to the Company's employees and officers incentive
plan, and (ii) includes 437,417 Shares issued pursuant to the Company's
employees and officers incentive plan, which Shares have not vested and
with respect to which there are no voting rights as of the date hereof.
(2) Elbit Medical Holdings Ltd. is a wholly-owned subsidiary of Elbit
Medical Imaging Ltd. ("EMI"), an Israeli public company whose shares
are listed on the Nasdaq National Market and on the Tel Aviv Stock
Exchange ("TASE"). As of July 30, 2003, Europe-Israel, an Israeli
company whose shares are listed on the TASE, held approximately 56.76%
of the issued and outstanding share capital of EMI (approximately
55.93% on a fully diluted basis.) As of July 30, 2003, Control Centers
Ltd., a privately held Israeli company ("Control Centers"), held
approximately 80.17% of the issued and outstanding shares of
Europe-Israel. Control Centers is engaged, through its direct holdings
in Europe-Israel and through Europe-Israel's direct and indirect wholly
and partially owned subsidiaries and affiliates, in the following core
businesses: real estate investment, development and operation of
shopping and entertainment centers, the hi-tech industry and hotel
ownership and management. Control Centers also holds direct interests
in property development projects in Israel.
(3) The amount and nature of beneficial ownership of these Shares is based
solely on information provided to the Company by Fidelity Management
and Research Co. and is accurate as of May 31, 2003.
-3-
- ------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS NUMBER OF PERCENT OF SHARES
SHARES BENEFICIALLY OWNED BENEFICIALLY OWNED
- ------------------------------------------------------------------------------------------------------------
Leumi Pia Trust Company Management Co. Ltd. (4)
31-33 Montefiore Street
Tel Aviv, Israel 1,090,000 6.2%
- ------------------------------------------------------------------------------------------------------------
All directors and officers of the Company as a group (10
persons) (5) 167,499 *
- ------------------------------------------------------------------------------------------------------------
- ------------------------
* Less than 1%.
PROPOSAL NO. 1
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ELECTION OF DIRECTORS
At the Meeting, six (6) persons are to be elected as directors of the
Company. The nominees, if elected, together with the two (2) serving external
directors, will constitute the entire Board of Directors. Each of the elected
directors will hold office until the next Annual General Meeting and until his
or her successor shall have duly taken office, unless any office is earlier
vacated under any relevant provisions of the articles of association of the
Company or applicable laws or regulations. Unless otherwise instructed, all
proxies will be voted FOR election of the six (6) nominees listed below as
directors of the Company.
The nominees listed below have indicated to the Company their
availability for election. In the event that any of the nominees should not
continue to be available for election, the persons appointed as proxies may
exercise their discretion to vote for a substitute nominee.
In the event that any of the nominees is not able to serve as a
director, under the articles of association of the Company the Board of
Directors will be entitled to fill such vacancy until the next Annual General
Meeting of Shareholders. The Company is not aware of any reason why any of the
nominees, if elected, would be unable to serve as a director.
The Board of Directors elected Mr. Shmuel Peretz as a director of the
Company on March 30, 2003 in accordance with the Company's articles of
association. Mr. Peretz is nominated for re-election, as are the other directors
currently serving on the Board of Directors.
The table below sets forth the names of the nominees for election to
the Board of Directors and the serving external directors, the years in which
they first became directors of the Company, their present principal occupation
or employment and their beneficial ownership of Shares as of July 30, 2003:
- ------------------------
(4) The amount and nature of beneficial ownership of these Shares is based
solely on information provided to the Company by Leumi Pia Trust
Company Management Co. and is accurate as of June 30, 2003.
(5) Represents Shares granted under the Company's directors and officers
incentive plan, with respect to which the beneficial ownership and
voting rights have vested as of the date hereof. The Company's
directors and officers were granted an additional 235,001 Shares under
the Company's employees and officers incentive plan, the beneficial
ownership and voting rights of which have not yet vested, and will not
vest within 60 days after the date hereof.
-4-
===================================== ================= ====================================== ======================
YEAR FIRST BENEFICIAL
BECAME PRINCIPAL OCCUPATION OWNERSHIP
NOMINEES DIRECTOR OR EMPLOYMENT OF SHARES*
===================================== ================= ====================================== ======================
Abraham (Rami) Goren (6) 1999 Executive Chairman of the Board of
Directors 30,000
- ------------------------------------- ----------------- -------------------------------------- ----------------------
Rachel Lavine 1999 President of the Company and Vice
President of Europe-Israel 33,333
- ------------------------------------- ----------------- -------------------------------------- ----------------------
Shimon Yitzhaki 1999 President of EMI and Vice President
of Europe-Israel 16,666
- ------------------------------------- ----------------- -------------------------------------- ----------------------
Joel Schwartz 1999 Senior partner in a private law firm 12,500
- ------------------------------------- ----------------- -------------------------------------- ----------------------
Shlomo Ben Eliyahu 2002 Consultant ---
- ------------------------------------- ----------------- -------------------------------------- ----------------------
Shmuel Peretz (7) 2003 President of the Israel Aircraft ---
Industries' European Division
===================================== ================= ====================================== ======================
===================================== ================= ====================================== ======================
YEAR FIRST BENEFICIAL
BECAME PRINCIPAL OCCUPATION OWNERSHIP
NOMINEES DIRECTOR OR EMPLOYMENT OF SHARES*
===================================== ================= ====================================== ======================
Moshe Lion (6) (7) 2000 Senior partner of an accounting firm
in Israel and Chairman of the
Provident Fund Investment Committee
of Bank Tefahot 12,500
- ------------------------------------ ------------------ -------------------------------------- ----------------------
Benny Gal (6) (7) 2000 Controlling shareholder and manager
of Gal-BSD Advertising Ltd. 12,500
==================================== ================== ====================================== ======================
* The beneficial ownership column represents Shares granted under the
Company's employees and officers incentive plan, with respect to which the
beneficial ownership and voting rights have vested as of the date hereof.
The Company's directors were granted an additional 197,501 Shares under the
Company's employees and officers incentive plan, the beneficial ownership
and voting rights of which have not yet vested, and will not vest within 60
days after the date hereof.
ABRAHAM (RAMI) GOREN was appointed as Executive Chairman of the Board
of Directors as of July 1, 1999. Formerly, Mr. Goren had been a partner in the
law firm of Prof. Joseph Gross, Hodak, Greenberg & Co. (now known as the law
firm of Gross, Kleinhendler, Hodak, Halevy, Greenberg & Co.), a leading Israeli
securities and corporate law firm. Prior thereto, Mr. Goren was an associate in
the law firm of Weil, Gotshal & Manges in New York City from September 1989
until August 1992. From 1999 until 2003, Mr. Goren served as the Executive
- ----------------------------------------
(6) Member of the Donation Committee.
(7) Member of the Audit Committee.
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Chairman of the board of directors of Nessuah Zannex Ltd., a TASE listed full
service investment house. Mr. Goren also serves as a director of various private
companies in Israel and abroad. Mr. Goren received his LL.B. degree from Bar
Ilan University in 1986 and an LL.M. degree from New York University in 1989.
Mr. Goren was admitted to the Israeli Bar in 1987 and to the New York State Bar
in 1990.
RACHEL LAVINE was appointed President and a member of the Board of
Directors in May 1999. Since March 1998, she has also served as Vice President
of Europe-Israel, and from 1994 to 1998 Ms. Lavine served as Chief Financial
Officer of Control Centers. Ms. Lavine holds a Bachelor of Arts degree in
Accounting from the College for Management in Tel Aviv, and is a certified
public accountant. Ms. Lavine is married to Marc Lavine, the Company's General
Counsel and Corporate Secretary.
SHIMON YITZHAKI was appointed a member of the Board of Directors in May
1999. In May 1999 he was also appointed President of EMI. Since March 1998, Mr.
Yitzhaki has served as the Vice President of Europe-Israel, and, since the
mid-1980's, as Vice President of Control Centers. Mr. Yitzhaki holds a Bachelor
of Arts degree in Accounting from Bar Ilan University, and is a certified public
accountant.
JOEL SCHWARTZ was appointed a member of the Board of Directors in
August 1999. Mr. Schwartz is the senior partner in the law firm of J. Schwartz &
Co. in Tel Aviv, Israel specializing in commercial law, principally in the areas
of aviation and real estate. Mr. Schwartz holds an LL.B. degree from Tel Aviv
University.
SHLOMO BEN ELIYAHU was appointed a member of the Board of Directors in
March 2002. Mr. Ben Eliyahu works independently in providing legal and financial
counseling to the Office of the Israeli Prime Minister and large private
institutions. During 2001, Mr. Ben Eliyahu served as a director of the Israeli
Land Authority and from 1999 to 2001, Mr. Ben Eliyahu was the Director General
of the Israeli Ministry of Housing and Construction. Prior thereto, Mr. Ben
Eliyahu served as a director of the Israeli Ports and Railways Authority and as
a publicly nominated director of a construction company. Mr. Ben Eliyahu was
also a member of the Israeli Land Council, the Governmental Directors General
Council and the chairman of the Israeli Contractors Council. Mr. Ben Eliyahu
holds an LL.B. degree from Bar Ilan University.
SHMUEL PERETZ was appointed a member of the Board of Directors in March
2003. Mr. Peretz serves since 1997 as the president of the Israel Aircraft
Industries' European Division. Between 1991 and 1996 Mr. Peretz served as Vice
President (Finance) of the Israel Aircraft Industries. Between 1980 and 2002 Mr.
Peretz served as a director of Elta Ltd., Magal Ltd., Medisel Technologies Inc.,
SpaceCom Ltd., and Belgium Advanced Technologies (a Belgium company). Mr. Peretz
holds a B.A. degree in Economics and Political Science from the Hebrew
University in Jerusalem, as well as an MBA from the New York Institution of
Technology.
ALTERNATE DIRECTORS
Subject to the Companies Law, the articles of association of the
Company provide that any director may appoint, by written notice to the Company,
another person (who is neither a member of the Board of Directors nor an
alternate director) to serve as an alternate director at any meeting of the
Board of Directors at which the appointing director is not present, and may
remove such alternate director. Pursuant to the articles of association of the
Company, any
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alternate director may exercise all powers and privileges of the director who
appointed him at any meeting, which he attends in place of such appointing
director. According to the articles of association of the Company, alternate
directors are not entitled to receive any remuneration from the Company. The
appointment of an alternate director does not in itself diminish the
responsibility of the appointing director as a director.
The articles of association of the Company also provide that the Board
of Directors may delegate its powers (subject to limitations under the Companies
Law) to one or more committees of the Board of Directors, as it deems
appropriate.
The Company's current external directors, Messrs. Moshe Lion and Benny
Gal, will continue to serve as external directors until the expiration of their
three-year term on October 1, 2003 (in accordance with applicable law). The
Company and the Board of Directors are proposing to re-appoint Messrs. Lion and
Gal as the Company's external directors for an additional three-year term,
commencing on October 2, 2003 (see Proposal No. 2 below).
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It is proposed that the following resolution be adopted at the Meeting:
- --------------------------------------------------------------------------------
"RESOLVED, THAT THE ELECTION OF MESSRS. GOREN, YITZHAKI, SCHWARTZ, BEN-ELIYAHU
AND PERETZ AND MS. LAVINE AS DIRECTORS OF THE COMPANY, AS PRESENTED TO THE
COMPANY'S SHAREHOLDERS, BE, AND SAME HEREBY IS, APPROVED."
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
PROPOSAL NO. 2
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RE-ELECTION OF EXTERNAL DIRECTORS
Since the service of the current external directors will expire on
October 1, 2003 (in accordance with applicable Israeli law), it is proposed to
re-appoint them for an additional three-year term, commencing on October 2,
2003.
Moshe Lion was appointed a member of the Board of Directors in October
2000. Mr. Lion is a senior partner of an accounting firm in Israel and chairman
of Israel Railways and the Provident Fund Investment Committee of Bank Tefahot,
an Israeli bank. From December 1997 to July 1999, Mr. Lion was the Director
General of the Israeli Prime Minister's Office and an economic advisor to the
Israeli Prime Minister. From January 1997 to November 1997 he served as the Head
of the Bureau of the Israeli Prime Minister's Office and as an economic advisor
to the Israeli Prime Minister. Mr. Lion holds a Bachelor of Arts degree in
accounting and economics and a Masters Degree in Law (LL.M.) from Bar Ilan
University.
Benny Gal was appointed a member of the Board of Directors in October
2000. Mr. Gal is the owner and manager of Gal-BSD Advertising Ltd., a firm
engaged in the advertising field. Mr. Gal holds a Business Management degree
from the College for Management in Tel Aviv and is a graduate of the Marketing
and Advertising School of the Advertisers Association in Israel. Mr. Gal is also
a graduate of the Corporation Senior Directors training course of the Business
Management Faculty in Tel-Aviv University.
Each of the nominees for external directors declared to the Company
that he fulfills and complies with the qualifications for his appointment as an
external director, in accordance with the Companies Law.
It is proposed that the following resolution be adopted at the Meeting:
- --------------------------------------------------------------------------------
"RESOLVED, THAT THE RE-APPOINTMENT OF MESSRS. LION AND GAL AS EXTERNAL DIRECTORS
OF THE COMPANY FOR A THREE-YEAR TERM, COMMENCING ON OCTOBER 2, 2003, AS
PRESENTED TO THE COMPANY'S SHAREHOLDERS, BE, AND THE SAME HEREBY IS, APPROVED."
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
-8-
PROPOSAL NO. 3
- --------------
APPROVAL OF APPOINTMENT OF THE COMPANY'S AUDITORS FOR THE
FISCAL YEAR ENDED DECEMBER 31, 2003 AND AUTHORIZATION OF THE
BOARD OF DIRECTORS TO DETERMINE THE AUDITORS' REMUNERATION
The Board of Directors has elected Somekh Chaikin and Co., a member of
KPMG International, the current auditors of the Company, as the Company's
auditors for the fiscal year ended December 31, 2003. Such auditors have been
the Company's auditors since 1972, and have no relationship with the Company or
with any affiliate of the Company, except as auditors.
It is proposed that the following resolution be adopted at the Meeting:
- --------------------------------------------------------------------------------
"RESOLVED, that the appointment of Somekh Chaikin and Co. as the Company's
auditors for the fiscal year ended December 31, 2003, and the determination by
the Board of Directors of the remuneration of said auditors in accordance with
the volume and nature of their services to the Company, as presented to the
Company's shareholders, be, and same hereby are, approved."
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
PROPOSAL NO. 4
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APPROVAL OF THE COMPENSATION TO BE PAID TO CURRENT AND FUTURE
MEMBERS OF THE AUDIT COMMITTEE IN AN AMOUNT EQUAL TO 120% OF
THE AMOUNT PRESENTLY PAID TO THE CURRENT MEMBERS OF THE AUDIT COMMITTEE
The Israeli Companies Regulations (Relieves for Public Companies whose
Shares are Registered for Trade on an Exchange Outside Israel), 2000 increased
in April 2003 the maximum compensation which may be paid to a company's external
director, in the event the laws of a foreign country (such as the United States)
applicable to such company impose additional obligations and requirements
stemming from his/her position as an external director or an independent
director.
In light of the additional obligations imposed by applicable U.S. law
and following the approval of the Audit Committee and Board of Directors, it is
proposed that the compensation to be paid to the current and future members of
the Audit Committee will be in an amount equal to 120% of the amount presently
paid to the current members of the Audit Committee. Such compensation will be
linked to the Israeli Consumer Price Index, all in accordance with the Israeli
Companies Regulations (Principles Regarding Compensation and Expenses for
External Directors), 2000 (the "Compensation Regulations").
Since under the Compensation Regulations, the compensation paid to an
external director cannot be changed during his/her term of service as an
external director, the aforementioned amendment to the compensation of the
members of the Audit Committee (which include the two external directors of the
Company) shall apply to the Company's current external directors only during
their second term (if they are elected by the Company's shareholders at the
Meeting), commencing on October 2, 2003.
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It is proposed that the following resolution be adopted at the Meeting:
- --------------------------------------------------------------------------------
"RESOLVED, that the compensation paid to current and future members of the Audit
Committee in an amount equal to 120% of the amount presently paid to the current
members of the Audit Committee, in accordance with the Israeli Companies
Regulations (Principles Regarding Compensation and Expenses for External
Directors), 2000, which compensation shall apply to the Company's external
directors commencing with their term of service beginning on October 2, 2003 and
which compensation has been approved by the Audit Committee and Board of
Directors, and as presented to the Company's shareholders, be, and the same
hereby is, approved."
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
PROPOSAL NO. 5
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APPROVAL OF THE COMPENSATION TO BE PAID TO THE COMPANY'S CURRENT AND FUTURE
DIRECTORS WHO DO NOT HOLD ANY OTHER OFFICE WITH THE COMPANY, ANY SUBSIDIARY
THEREOF OR ANY COMPANY AFFILIATED WITH EUROPE-ISRAEL, TO BE IN ACCORDANCE WITH
THE MAXIMUM AMOUNT PERMITTED UNDER APPLICABLE ISRAELI LAW AND REGULATIONS
Following the approval of the Audit Committee and Board of Directors,
it is proposed to approve that the compensation to be paid to current and future
members of the Board of Directors who do not hold any other office with the
Company, any subsidiary thereof or any company affiliated with Europe-Israel, be
in accordance with the maximum amount permitted under the scale of remuneration
established by the Israeli Ministry of Justice and adopted pursuant to the
Companies Law.
This resolution shall not apply to current and future members of the
Audit Committee, with respect to whom the Company and the Board of Directors are
proposing to approve an increase in compensation separately (see Proposal No. 4
above).
It is proposed that the following resolution be adopted at the Meeting:
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"RESOLVED, that the compensation to be paid to current and future directors of
the Company who do not hold any other office with the Company, any subsidiary
thereof or any company affiliated with Europe-Israel be in accordance with the
maximum amount permitted under the scale of remuneration established by the
Israeli Ministry of Justice and adopted pursuant to the Companies Law, which
compensation has been approved by the Audit Committee and Board of Directors,
and as presented to the Company's shareholders, be, and the same hereby is,
approved."
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
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PROPOSAL NO. 6
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APPROVAL OF THE GRANT OF AN ANNUAL BONUS TO THE EXECUTIVE
CHAIRMAN OF THE BOARD OF DIRECTORS FOR THE FISCAL YEAR
ENDED DECEMBER 31, 2002
Following the approval by the Audit Committee and the Board of
Directors, it is recommended to grant to Mr. Abraham (Rami) Goren, the Executive
Chairman of the Board of Directors, an annual bonus of $50,000 for the fiscal
year ended December 31, 2002.
The Board of Directors proposes that the following resolution be
adopted at the Meeting:
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"RESOLVED, that the annual bonus of the Executive Chairman of the Board of
Directors for the fiscal year ended December 31, 2002, as presented to the
Company's shareholders, be, and same hereby is, approved."
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
PROPOSAL NO. 7
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APPROVAL OF THE GRANT OF AN ANNUAL BONUS TO THE COMPANY'S
PRESIDENT AND DIRECTOR FOR THE FISCAL YEAR
ENDED DECEMBER 31, 2002
Following the approval by the Audit Committee and the Board of
Directors, it is recommended to grant to Ms. Rachel Lavine, the Company's
President and director, an annual bonus of $100,000 for the fiscal year ended
December 31, 2002.
The Board of Directors proposes that the following resolution be
adopted at the Meeting:
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"RESOLVED, that the annual bonus of the Company's President and director for the
fiscal year ended December 31, 2002, as presented to the Company's shareholders,
be, and same hereby is, approved."
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
PROPOSAL NO. 8
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APPROVAL OF AN AMENDMENT TO THE EMPLOYMENT TERMS
OF THE COMPANY'S PRESIDENT AND DIRECTOR
Following the approval of the Audit Committee and Board of Directors,
it is proposed to amend Ms. Lavine's employment terms, by increasing Ms.
Lavine's annual employment cost to the Company to $390,000 plus reimbursement of
expenses. Ms. Lavine may devote up to 10% of her time to other positions in the
Control Centers Group. This amendment, if adopted by the Company's shareholders,
shall be effective as of September 1, 2003.
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"RESOLVED, that the amendment to the employment terms of the Company's President
and director by increasing Ms. Lavine's annual employment cost to the Company to
$390,000, plus reimbursement of expenses, effective as of September 1, 2003, as
presented to the Company's shareholders, be, and same hereby is, approved."
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THIS PROPOSED
RESOLUTION.
In addition to the foregoing proposals, the shareholders will be
requested to consider at the Meeting the report of the Board of Directors and
the financial statements of the Company for the fiscal year ended December 31,
2002.
OTHER BUSINESS
The Board of Directors knows of no other matter to come before the
Meeting. However, if any matters requiring a vote of the shareholders arise, it
is the intention of the persons named in the enclosed form of proxy to vote such
proxy in accordance with their best judgment, including any matters or motions
dealing with the conduct of the Meeting.
The prompt return of your proxy will be appreciated and helpful in
obtaining the necessary vote. Therefore, whether or not your expect to attend
the Meeting, please sign the form of proxy provided herewith and return it in
the enclosed envelope so that it is received by the Company not later than 48
hours before the Meeting.
By Order of the Board of Directors,
ABRAHAM (RAMI) GOREN
EXECUTIVE CHAIRMAN OF THE BOARD OF DIRECTORS
RACHEL LAVINE
PRESIDENT
August 5, 2003
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