EXHIBIT 3.2
THE COMPANIES LAW, 5759 - 1999
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A COMPANY LIMITED BY SHARES
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AMENDED AND RESTATED
ARTICLES OF ASSOCIATION
OF
MIND C.T.I. LTD.
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GENERAL PROVISIONS
1. Object and Purpose of the Company
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The object and purpose of the Company shall be as set forth in the
Company's Memorandum of Association, as the same shall be amended from time to
time in accordance with applicable law.
2. Limitation of Liability
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The liability of the shareholders is limited to the payment of the nominal
value of the shares in the Company allotted to them and which remains unpaid,
and only to that amount. If the Company's share capital shall include at any
time shares without a nominal value, the shareholders' liability in respect of
such shares shall be limited to the payment of up to NIS 0.01 for each such
share allotted to them and which remains unpaid, and only to that amount.
3. Interpretation
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(a) Unless the subject or the context otherwise requires: words and
expressions defined in the Companies Law, 5759-1999 (the "Companies Law"), and
in those sections of the Companies Ordinance [New Version], 5743-1983 that are
still in force (with respect to such sections), in force on the date when these
Articles or any amendment thereto, as the case may be, first became effective
shall have the same meanings herein; words and expressions importing the
singular shall include the plural and vice versa; words and expressions
importing the masculine gender shall include the feminine gender; and words and
expressions importing persons shall include bodies corporate.
(b) The captions in these Articles are for convenience only and shall not
be deemed a part hereof or affect the construction of any provision hereof.
SHARE CAPITAL
4. Share Capital
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(a) The share capital of the Company shall be eight hundred eighty thousand
New Israeli Shekels (NIS 880,000) divided into eighty-eight million (88,000,000)
ordinary shares of a nominal value of one Agora (NIS 0.01) each, of which eighty
million (80,000,000) initially shall be designated "Ordinary Shares" and eight
million (8,000,000) initially shall be shall be designated "Non-Voting Ordinary
Shares."
(b) Rights of Ordinary Shares. The Ordinary Shares confer upon the holders
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thereof all rights accruing to a shareholder of the Company, as provided in
these Articles, including, inter alia, the right to receive notices of, and to
attend, meetings of the shareholders; for each share held - the right to one
vote at all shareholders' meetings for all purposes, and to share equally, on a
per share basis, in such dividends as may be declared by the Board of Directors
in accordance with the terms of these Articles and the Companies Law, and upon
liquidation or dissolution - in the assets of the Company legally available for
distribution to shareholders after payment of all debts and other liabilities of
the Company, in accordance with the terms of these Articles and applicable law.
All Ordinary Shares rank pari passu in all respects with each other.
(c) Rights of Non-Voting Ordinary Shares. The Non-Voting Ordinary Shares
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shall have rights equal to the Ordinary Shares, except that the holders of the
Non-Voting Ordinary Shares shall not be entitled to receive notices of, and to
attend, shareholder meetings of the shareholders and shall not be entitled to
any voting rights at meetings of the shareholders, except as provided by
applicable law. If the Company shall subdivide (by share split, bonus shares or
otherwise) or combine (by reverse share split or otherwise) the Ordinary Shares,
the Non-Voting Ordinary Shares shall be subdivided or combined, as the case may
be, to the same extent.
(d) Conversion Right of the Non-Voting Ordinary Shares. At the option of
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the holder of any Non-Voting Ordinary Shares, any Non-Voting Ordinary Shares
held by such holder may be converted into an equal number of fully-paid and non-
assessable Ordinary Shares, except to the extent that, after giving effect to
the conversion of all the Non-Voting Ordinary Shares proposed by a holder to be
so converted, such holder and its affiliates would own ten percent (10%) or more
of the outstanding voting shares of the Company. The term "affiliate" when used
in respect to any person shall mean a person controlled by, controlling or under
common control with, such person.
(e) Exercise of Conversion Right. To exercise its conversion right, a
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holder of Non-Voting Ordinary Shares shall surrender the certificate or
certificates representing the shares being converted to the Company at its
principal office, and shall give written notice to the Company at that office
that such holder elects to convert such shares. Such notice shall also state
the name or names (with address or addresses) in which the certificate or
certificates for Ordinary Shares shall be issued. The certificate or
certificates for Non-Voting Ordinary Shares surrendered for conversion shall be
accompanied by proper assignment thereof to the Company or in blank. The date
when such written notice is received by the Company, together with the
certificate or certificates representing the Non-Voting Ordinary
Shares being converted, shall be the "Conversion Date." As promptly as
practicable after the Conversion Date, the Company shall issue and shall deliver
to the holder of the Non-Voting Ordinary Shares being converted, or on its
written order, such certificate or certificates as it may request for the number
of Ordinary Shares into which such Non-Voting Ordinary Shares shall have been
converted in accordance with the provisions of this Article 4. Such conversion
shall be deemed to have been effected immediately prior to the close of business
on the Conversion Date, and at such time the rights of the holder as holder of
the converted Non-Voting Ordinary Shares shall cease and the person or persons
in whose name or names any certificate or certificates for Ordinary Shares shall
be issuable upon such conversion shall be deemed to have become the holder or
holders of record of the Ordinary Shares represented thereby. For the avoidance
of doubt, upon conversion of any Non-Voting Ordinary Shares into Ordinary Shares
pursuant to this Article 4, such Non-Voting Ordinary Shares in the Company's
registered share capital shall be deemed to have been converted into an
equivalent number of Ordinary Shares without the issuance by the Company of
Ordinary Shares.
(f) Automatic Conversion of Non-Voting Ordinary Shares. Upon transfer of
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any Non-Voting Ordinary Shares to a non-affiliate, such Non-Voting Ordinary
Shares shall automatically be converted into an equal number of fully-paid and
non-assessable Ordinary Shares, except to the extent that, after giving effect
to the conversion of all the Ordinary Shares so transferred, the transferee and
its affiliates would own ten percent (10%) or more of the outstanding voting
shares of the Company.
(g) Procedure upon Automatic Conversion. As promptly as practicable
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following such transfer, the certificate or certificates representing such
shares shall be surrendered to the Company at its principal office, along with
notice of the transfer of such shares. Such notice shall also state the name or
names (with address or addresses) in which the certificate or certificates for
Ordinary Shares shall be issued. The certificate or certificates for Non-Voting
Ordinary Shares surrendered for conversion shall be accompanied by proper
assignment thereof reflecting such transfer. The date of such transfer shall be
the "Conversion Date." As promptly as practicable after receipt of such notice
of transfer, the Company shall issue and shall deliver to the transferee, or on
its written order, such certificate or certificates as it may request for the
number of Ordinary Shares into which such Non-Voting Ordinary Shares shall have
been converted in accordance with the provisions of this Article 4. Such
conversion shall be deemed to have been effected immediately prior to the close
of business on the Conversion Date, and at such time the rights of the holder as
holder of the converted Non-Voting Ordinary Shares shall cease and the person or
persons in whose name or names any certificate or certificates for Ordinary
Shares shall be issuable upon such conversion shall be deemed to have become the
holder or holders of record of the Ordinary Shares represented thereby. For the
avoidance of doubt, upon conversion of any Non-Voting Ordinary Shares into
Ordinary Shares pursuant to this Article 4, such Non-Voting Ordinary Shares in
the Company's registered share capital shall be deemed to have been converted
into an equivalent number of Ordinary Shares without the issuance by the Company
of Ordinary Shares.
5. Increase of Share Capital
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(a) The Company may, from time to time, by resolution of the shareholders
("Shareholders Resolution"), whether or not all the shares then authorized have
been issued,
and whether or not all the shares theretofore issued have been called up for
payment, increase its share capital by the creation of new shares. Any such
increase shall be in such amount and shall be divided into shares of such
nominal amounts, and such shares shall confer such rights and preferences, and
shall be subject to such restrictions, as such resolution shall provide.
(b) Except to the extent otherwise provided in such resolution, such new
shares shall be subject to all the provisions applicable to the shares of the
original capital.
6. Special Rights; Modifications of Rights
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(a) Without prejudice to any special rights previously conferred upon the
holders of existing shares in the Company, the Company may, from time to time,
by Shareholders Resolution, provide for shares with such preferred or deferred
rights or rights of redemption or other special rights and/or such restrictions,
whether in regard to dividends, voting, repayment of share capital or otherwise,
as may be stipulated in such resolution.
(b) (i) If at any time the share capital is divided into different
classes of shares, the rights attached to any class, unless otherwise provided
by these Articles, may be modified or abrogated by the Company, by Shareholders
Resolution, subject to the sanction of a resolution passed by the holders of a
majority of the shares of such class by written consent or at a separate General
Meeting of the holders of the shares of such class.
(ii) The provisions of these Articles relating to General Meetings
shall, mutatis mutandis, apply to any separate General Meeting of the holders of
the shares of a particular class.
(iii) Unless otherwise provided by these Articles, the enlargement of
an existing class of shares, or the issuance of additional shares thereof, shall
not be deemed, for purposes of this Article 6(b), to modify or abrogate the
rights attached to the previously issued shares of such class or of any other
class.
7. Consolidation, Subdivision, Cancellation and Reduction of Share Capital
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(a) The Company may, from time to time, by Shareholders Resolution
(subject, however, to the provisions of Article 6(b) hereof and to applicable
law):
(i) consolidate and divide all or any of its issued or unissued share
capital into shares of larger nominal value than its existing shares,
(ii) subdivide its shares (issued or unissued) or any of them, into
shares of smaller nominal value than is fixed by these Articles of Association
(subject, however, to the provisions of the Companies Law), and the Shareholders
Resolution whereby any share is subdivided may determine that, as among the
holders of the shares resulting from such subdivision, one or more of the shares
may, as compared with the others, have any such preferred or deferred rights or
rights of redemption or other special rights, or be subject to any such
restrictions, as the Company has power to attach to unissued or new shares.
(iii) cancel any shares which, at the date of the adoption of such
resolution, have not been taken or agreed to be taken by any person, and
diminish the amount of its share capital by the amount of the shares so
canceled, or
(iv) reduce its share capital in any manner, and with and subject to
any incident authorized, and consent required, by law.
(b) With respect to any consolidation of issued shares into shares of
larger nominal value, and with respect to any other action which may result in
fractional shares, the Board of Directors may settle any difficulty which may
arise with regard thereto, as it deems fit, including, inter alia, resort to one
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or more of the following actions:
(i) determine, as to the holder of shares so consolidated, which
issued shares shall be consolidated into each share of larger nominal value;
(ii) allot, in contemplation of or subsequent to such consolidation or
other action, such shares or fractional shares sufficient to preclude or remove
fractional share holdings;
(iii) redeem, in the case of redeemable preference shares, and
subject to applicable law, such shares or fractional shares sufficient to
preclude or remove fractional share holdings;
(iv) cause the transfer of fractional shares by certain shareholders
of the Company to other shareholders thereof so as to most expediently preclude
or remove any fractional shareholdings, and cause the transferees to pay the
transferors the fair value of fractional shares so transferred, and the Board of
Directors is hereby authorized to act as agent for the transferors and
transferees with power of substitution for purposes of implementing the
provisions of this sub-Article 7(b)(iv).
SHARES
8. Issuance of Share Certificates; Replacement of Lost Certificates
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(a) Share certificates shall be issued under the seal or stamp of the
Company and shall bear the signatures of the Company's chief executive officer
and chief financial officer, or of any other person or persons authorized
thereto by the Board of Directors.
(b) Each shareholder shall be entitled to one numbered certificate for all
the shares of any class registered in his name, and if reasonably requested by
such shareholder, to several certificates, each for one or more of such shares.
(c) A share certificate registered in the names of two or more persons
shall be delivered to the person first named in the Registrar of Shareholders in
respect of such co-ownership.
(d) If a share certificate is defaced, lost or destroyed, it may be
replaced, upon payment of such fee, and upon the furnishing of such evidence of
ownership and such indemnity, as the Board of Directors may think fit.
(e) The Company may issue bearer shares.
9. Registered Holder
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Except as otherwise provided in these Articles, the Company shall be
entitled to treat the registered holder of any share as the absolute owner
thereof, and, accordingly, shall not, except as ordered by a court of competent
jurisdiction, or as required by statute, be bound to recognize any equitable or
other claim to, or interest in such share on the part of any other person.
10. Allotment of Shares
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The unissued shares from time to time shall be under the control of the
Board of Directors, who shall have the power to allot shares or otherwise
dispose of them to such persons, on such terms and conditions (including inter
alia terms relating to calls as set forth in Article 12(f) hereof), and either
at par or at a premium, or, subject to the provisions of the Companies Law, at a
discount, and at such times, as the Board of Directors may think fit, and the
power to give to any person the option to acquire from the Company any shares,
either at par or at a premium, or, subject as aforesaid, at a discount, during
such time and for such consideration as the Board of Directors may think fit.
11. Payment in Installments
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If by the terms of allotment of any share, the whole or any part of the
price thereof shall be payable in installments, every such installment shall,
when due, be paid to the Company by the then registered holder(s) of the share
of the person(s) entitled thereto.
12. Calls on Shares
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(a) The Board of Directors may, from time to time, make such calls as it
may think fit upon shareholders in respect of any sum unpaid in respect of
shares held by such shareholders which is not, by the terms of allotment thereof
or otherwise, payable at a fixed time, and each shareholder shall pay the amount
of every call so made upon him (and of each installment thereof if the same is
payable in installments), to the person(s) and at the time(s) and place(s)
designated by the Board of Directors, as any such time(s) may be thereafter
extended and/or such person(s) or place(s) changed. Unless otherwise stipulated
in the resolution of the Board of Directors (and in the notice hereafter
referred to), each payment in response to a call shall be deemed to constitute a
pro rata payment on account of all shares in respect of which such call was
made.
(b) Notice of any call shall be given in writing to the shareholder(s) in
question not less than fourteen (14) days prior to the time of payment,
specifying the time and place of payment, and designating the person to whom
such payment shall be made, provided,
however, that before the time for any such payment, the Board of Directors may,
by notice in writing to such shareholder(s), revoke such call in whole or in
part, extend such time, or alter such person and/or place. In the event of a
call payable in installments, only one notice thereof need be given.
(c) If, by the terms of allotment of any share or otherwise, any amount is
made payable at any fixed time, every such amount shall be payable at such time
as if it were a call duly made by the Board of Directors and of which due notice
had been given, and all the provisions herein contained with respect to such
calls shall apply to each such amount.
(d) The joint holders of a share shall be jointly and severally liable to
pay all calls in respect thereof and all interest payable thereon.
(e) Any amount unpaid in respect of a call shall bear interest from the
date on which it is payable until actual payment thereof, at such rate (not
exceeding the then prevailing debitory rate charged by leading commercial banks
in Israel), and at such time(s) as the Board of Directors may prescribe.
(f) Upon the allotment of shares, the Board of Directors may provide for
differences among the allottees of such shares as to the amount of calls and/or
the times of payment thereof.
13. Prepayment
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With the approval of the Board of Directors, any shareholder may pay to the
Company any amount not yet payable in respect of his shares, and the Board of
Directors may approve the payment of interest on any such amount until the same
would be payable if it had not been paid in advance, at such rate and time(s) as
may be approved by the Board of Directors. The Board of Directors may at any
time cause the Company to repay all or any part of the money so advanced,
without premium or penalty. Nothing in this Article 13 shall derogate from the
right of the Board of Directors to make any call before or after receipt by the
Company of any such advance.
14. Forfeiture and Surrender
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(a) If any shareholder fails to pay any amount payable in respect of a
call, or interest thereon as provided for herein, on or before the day fixed for
payment of the same, the Company, by resolution of the Board of Directors, may
at any time thereafter, so long as the said amount or interest remains unpaid,
forfeit all or any of the shares in respect of which said call had been made.
Any expense incurred by the Company in attempting to collect any such amount or
interest, including, inter alia, attorneys' fees and costs of suit, shall be
added to, and shall, for all purposes (including the accrual of interest
thereon), constitute a part of the amount payable to the Company in respect of
such call.
(b) Upon the adoption of a resolution of forfeiture, the Board of Directors
shall cause notice thereof to be given to such shareholder, which notice shall
state that, in the event of the failure to pay the entire amount so payable
within a period stipulated in the notice
(which period shall not be less than fourteen (14) days and which may be
extended by the Board of Directors), such shares shall be ipso facto forfeited,
provided, however, that, prior to the expiration of such period, the Board of
Directors may nullify such resolution of forfeiture, but no such nullification
shall estop the Board of Directors from adopting a further resolution of
forfeiture in respect of the non-payment of the same amount.
(c) Whenever shares are forfeited as herein provided, all dividends
theretofore declared in respect thereof and not actually paid shall be deemed to
have been forfeited at the same time.
(d) The Company, by resolution of the Board of Directors, may accept the
voluntary surrender of any share.
(e) Any share forfeited or surrendered as provided herein shall become the
property of the Company, and the same, subject to the provisions of these
Articles, may be sold, re-allotted or otherwise disposed of as the Board of
Directors thinks fit.
(f) Any shareholder whose shares have been forfeited or surrendered shall
cease to be a shareholder in respect of the forfeited or surrendered shares, but
shall, notwithstanding, be liable to pay, and shall forthwith pay, to the
Company, all calls, interest and expenses owing upon or in respect of such
shares at the time of forfeiture or surrender, together with interest thereon
from the time of forfeiture or surrender until actual payment, at the rate
prescribed in Article 12(e) above, and the Board of Directors, in its
discretion, may enforce the payment of such moneys, or any part thereof, but
shall not be under any obligation to do so. In the event of such forfeiture or
surrender, the Company, by resolution of the Board of Directors, may accelerate
the date(s) of payment of any or all amounts then owing by the shareholder in
question (but not yet due) in respect of all shares owned by such shareholder,
solely or jointly with another, and in respect of any other matter or
transaction whatsoever.
(g) The Board of Directors may at any time, before any share so forfeited
or surrendered shall have been sold, re-allotted or otherwise disposed of,
nullify the forfeiture or surrender on such conditions as it thinks fit, but no
such nullification shall estop the Board of Directors from re-exercising its
powers of forfeiture pursuant to this Article 14.
15. Lien
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(a) Except to the extent the same may be waived or subordinated in writing,
the Company shall have a first and paramount lien upon all the shares registered
in the name of each shareholder (without regard to any equitable or other claim
or interest in such shares on the part of any other person), and upon the
proceeds of the sale thereof, for his debts, liabilities and engagements arising
from any cause whatsoever, solely or jointly with another, to or with the
Company, whether the period for the payment, fulfillment or discharge thereof
shall have actually arrived or not. Such lien shall extend to all dividends
from time to time declared in respect of such share. Unless otherwise provided,
the registration by the Company of a transfer of shares shall be deemed to be a
waiver on the part of the Company of the lien (if any) existing on such shares
immediately prior to such transfer.
(b) The Board of Directors may cause the Company to sell any shares subject
to such lien when any such debt, liability or engagement has matured, in such
manner as the Board of Directors may think fit, but no such sale shall be made
unless such debt, liability or engagement has not been satisfied within seven
(7) days after written notice of the intention to sell shall have been served on
such shareholder, his executors or administrators.
(c) The net proceeds of any such sale, after payment of the costs thereof,
shall be applied in or toward satisfaction of the debts, liabilities or
engagements of such shareholder (whether or not the same have matured), or any
specific part of the same (as the Company may determine), and the residue (if
any) shall be paid to the shareholder, his executors, administrators or assigns.
16. Sale after Forfeiture or Surrender or in Enforcement of Lien
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Upon any sale of shares after forfeiture or surrender or for enforcing a
lien, the Board of Directors may appoint some person to execute an instrument of
transfer of the shares so sold and cause the purchaser's name to be entered in
the Register of Shareholders in respect of such shares, and the purchaser shall
not be bound to see to the regularity of the proceedings, or to the application
of the purchase money, and after his name has been entered in the Register of
Shareholders in respect of such shares, the validity of the sale shall not be
impeached by any person, and the remedy of any person aggrieved by the sale
shall be in damages only and against the Company exclusively.
17. Redeemable Shares
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The Company may, subject to applicable law, issue redeemable shares and
redeem the same.
18. [reserved]
TRANSFER OF SHARES
19. Effectiveness and Registration
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(a) No transfer of shares shall be registered unless a proper instrument of
transfer (in form and substance satisfactory to the Board of Directors) has been
submitted to the Company or its agent, together with any share certificate(s)
and such other evidence of title as the Board of Directors may reasonably
require. Until the transferee has been registered in the Register of
Shareholders in respect of the shares so transferred, the Company may continue
to regard the transferor as the owner thereof. The Board of Directors, may,
from time to time, prescribe a fee for the registration of a transfer.
(b) The Board of Directors may, in its discretion and to the extent that it
deems necessary, close the Register of Shareholders for the registration of
transfer of shares for such periods as may be determined by the Board of
Directors, and no transfers of shares shall be registered during any period in
which the Register of Shareholders is so closed.
20. Record Date for General Meetings
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Notwithstanding any provision to the contrary in these Articles, for the
determination of the shareholders entitled to receive notice of and to
participate in and vote at a General Meeting, or to express consent to or
dissent from any corporate action in writing, or to receive payment of any
dividend or other distribution or allotment of any rights or to exercise any
rights in respect of shares of the Company, the Board of Directors may fix, in
advance, a record date, which, subject to applicable law, shall not be earlier
than ninety (90) days prior to the General Meeting or other action, as the case
may be. No persons other than holders of record of shares as of such record
date shall be entitled to notice of and to participate in and vote at such
General Meeting, or to exercise such other right or receive such other benefit,
as the case may be. A determination of shareholders of record with respect to a
General Meeting shall apply to any adjournment of such meeting, provided that
the Board of Directors may fix a new record date for an adjourned meeting.
TRANSMISSION OF SHARES
21. Decedents' Shares
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(a) In case of a share registered in the names of two or more holders, the
Company may recognize the survivor(s) as the sole owner(s) thereof unless and
until the provisions of Article 21(b) have been effectively invoked.
(b) Any person becoming entitled to a share in consequence of the death of
any person, upon producing evidence of the grant of probate or letters of
administration or declaration of succession (or such other evidence as the Board
of Directors may reasonably deem sufficient that he sustains the character in
respect of which he proposes to act under this Article or of his title), shall
be registered as a shareholder in respect of such share, or may, subject to the
regulations as to transfer herein contained, transfer such share.
22. Receivers and Liquidators
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(a) The Company may recognize the receiver or liquidator of any corporate
shareholder in winding-up or dissolution, or the receiver or trustee in
bankruptcy of any shareholder, as being entitled to the shares registered in the
name of such shareholder.
(b) The receiver or liquidator of a corporate shareholder in winding-up or
dissolution, or the receiver or trustee in bankruptcy of any shareholder, upon
producing such evidence as the Board of Directors may deem sufficient that he
sustains the character in respect of which he proposes to act under this Article
or of his title, shall with the consent of the Board of Directors (which the
Board of Directors may grant or refuse in its absolute discretion), be
registered as a shareholder in respect of such shares, or may, subject to the
regulations as to transfer herein contained, transfer such shares.
GENERAL MEETINGS
23. Annual General Meeting
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An Annual General Meeting shall be held once in every calendar year at such
time (within a period of not more than fifteen (15) months after the last
preceding Annual General Meeting) and at such place either within or without the
State of Israel as may be determined by the Board of Directors.
24. Extraordinary General Meetings
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All General Meetings other than Annual General Meetings shall be called
"Extraordinary General Meetings." The Board of Directors may, whenever it
thinks fit, convene an Extraordinary General Meeting at such time and place,
within or without the State of Israel, as may be determined by the Board of
Directors, and shall be obliged to do so upon a requisition in writing in
accordance with Sections 63(b)(1) or (2) of the Companies Law.
25. Notice of General Meetings
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The Company is not required to give notice under Section 69(b) of the
Companies Law.
PROCEEDINGS AT GENERAL MEETINGS
26. Quorum
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(a) Two or more shareholders (not in default in payment of any sum referred
to in Article 32(a) hereof), present in person or by proxy and holding shares
conferring in the aggregate at least twenty-five percent (25%) of the voting
power of the Company (subject to rules and regulations, if any, applicable to
the Company), shall constitute a quorum at General Meetings. No business shall
be transacted at a General Meeting, or at any adjournment thereof, unless the
requisite quorum is present when the meeting proceeds to business.
(b) If within an hour from the time appointed for the meeting a quorum is
not present, the meeting, if convened upon requisition under Sections 63(b)(1)
or (2), 64 or 65 of the Companies Law, shall be dissolved, but in any other case
it shall stand adjourned to the same day in the next week, at the same time and
place, or to such day and at such time and place as the Chairman may determine
with the consent of the holders of a majority of the voting power represented at
the meeting in person or by proxy and voting on the question of adjournment. No
business shall be transacted at any adjourned meeting except business which
might lawfully have been transacted at the meeting as originally called. At
such adjourned meeting, any two (2) shareholders (not in default as aforesaid)
present in person or by proxy, shall constitute a quorum (subject to rules and
regulations, if any, applicable to the Company).
(c) The Board of Directors may determine, in its discretion, the matters
that may be voted upon at the meeting by proxy in addition to the matters listed
in Section 87(a) to the Companies Law.
27. Chairman
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The Chairman, if any, of the Board of Directors shall preside as Chairman
at every General Meeting of the Company. If there is no such Chairman, or if at
any meeting he is not present within fifteen (15) minutes after the time fixed
for holding the meeting or is unwilling to act as Chairman, the shareholders
present shall choose someone of their number to be Chairman. The office of
Chairman shall not, by itself, entitle the holder thereof to vote at any General
Meeting nor shall it entitle such holder to a second or casting vote (without
derogating, however, from the rights of such Chairman to vote as a shareholder
or proxy of a shareholder if, in fact, he is also a shareholder or such proxy).
28. Adoption of Resolutions at General Meetings
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(a) Unless other provided herein, a Shareholders Resolution shall be deemed
adopted if approved by the holders of a majority of the voting power represented
at the meeting in person or by proxy and voting thereon.
(b) A Shareholders Resolution approving a merger (as defined in the
Companies Law) of the Company shall be deemed adopted if approved by the holders
of a majority of the voting power represented at the meeting in person or by
proxy and voting thereon.
(c) Every question submitted to a General Meeting shall be decided by a
show of hands, but if a written ballot is demanded by any shareholder present in
person or by proxy and entitled to vote at the meeting, the same shall be
decided by such ballot. A written ballot may be demanded before the proposed
resolution is voted upon or immediately after the declaration by the Chairman of
the results of the vote by a show of hands. If a vote by written ballot is
taken after such declaration, the results of the vote by a show of hands shall
be of no effect, and the proposed resolution shall be decided by such written
ballot. The demand for a written ballot may be withdrawn at any time before the
same is conducted, in which event another shareholder may then demand such
written ballot. The demand for a written ballot shall not prevent the
continuance of the meeting for the transaction of business other than the
question on which the written ballot has been demanded.
(d) A declaration by the Chairman of the meeting that a resolution has been
carried unanimously, or carried by a particular majority, or lost, and an entry
to that effect in the minute book of the Company, shall be conclusive evidence
of the fact without proof of the number or proportion of the votes recorded in
favor of or against such resolution.
29. Resolutions in Writing
----------------------
A resolution in writing signed by all shareholders of the Company then
entitled to attend and vote at General Meetings or to which all such
shareholders have given their written consent (by letter, facsimile
[telecopier], telegram, telex or otherwise), or their oral consent
by telephone (provided that a written summary thereof has been approved and
signed by the Chairman of the Board of Directors of the Company) shall be deemed
to have been unanimously adopted by a General Meeting duly convened and held.
30. Power to Adjourn
----------------
(a) The Chairman of a General Meeting at which a quorum is present may,
with the consent of the holders of a majority of the voting power represented in
person or by proxy and voting on the question of adjournment (and shall if so
directed by the meeting), adjourn the meeting from time to time and from place
to place, but no business shall be transacted at any adjourned meeting except
business which might lawfully have been transacted at the meeting as originally
called.
(b) It shall not be necessary to give any notice of an adjournment, whether
pursuant to Article 26(b) or Article 30(a), unless the meeting is adjourned for
thirty (30) days or more in which event notice thereof shall be given in the
manner required for the meeting as originally called.
31. Voting Power
------------
Subject to the provisions of Article 32(a) and subject to any provision
hereof conferring special rights as to voting, or restricting the right to vote,
every shareholder shall have one vote for each share held by him of record, on
every resolution, without regard to whether the vote hereon is conducted by a
show of hands, by written ballot or by any other means.
32. Voting Rights
-------------
(a) No shareholder shall be entitled to vote at any General Meeting (or be
counted as a part of the quorum thereat), unless all calls and other sums then
payable by him in respect of his shares in the Company have been paid, but this
Article shall not apply to separate General Meetings of the holders of a
particular class of shares pursuant to Article 6(b).
(b) A company or other corporate body being a shareholder of the Company
may, by resolution of its directors or any other managing body thereof,
authorize any person to be its representative at any meeting of the Company.
Any person so authorized shall be entitled to exercise on behalf of such
shareholder all the power which the latter could have exercised if it were an
individual shareholder. Upon the request of the Chairman of the meeting,
written evidence of such authorization (in form acceptable to the Chairman)
shall be delivered to him prior to the conclusion of the meeting.
(c) Any shareholder entitled to vote may vote either personally or by proxy
(who need not be a shareholder of the Company), or, if the shareholder is a
company or other corporate body, by a representative authorized pursuant to
Article 32(b).
(d) If two or more persons are registered as joint holders of any share,
the vote of the senior who tenders a vote, in person or by proxy, shall be
accepted to the exclusion of the vote(s) of the other joint holder(s); and for
this purpose seniority shall be determined by the order in which the names stand
in the Register of Shareholders.
PROXIES
33. Instrument of Appointment
-------------------------
(a) The instrument appointing a proxy shall be in writing and shall be
substantially in the following form:
"I _____________________ of __________________________________
(Name of Shareholder) (Address of Shareholder)
being a shareholder of ___________________________ hereby appoint
(Name of the Company)
________________________of _____________________________
(Name of Proxy) (Address of Proxy)
as my proxy to vote for me and on my behalf at the General Meeting of the
Company to be held on the _____ day of ___________, 19__ and at any
adjournment(s) thereof.
Signed this ______ day of ____________, 19__.
_________________________
(Signature of Appointer)"
or in any usual or common form or in such other form as may be approved by the
Board of Directors. It shall be duly signed by the appointer or his duly
authorized attorney or, if such appointer is a company or other corporate body,
under its common seal or stamp or the hand of its duly authorized agent(s) or
attorney(s). Upon the request of the Company, written evidence of such
authorization (in form acceptable to the Company) shall be delivered to the
Company prior to the conclusion of the meeting.
(b) The instrument appointing a proxy (and the power of attorney or other
authority, if any, under which such instrument has been signed) shall either be
delivered to the Company (at its Registered Office, or at its principal place of
business or at the offices of its registrar and/or transfer agent or at such
place as the Board of Directors may specify) not less than seventy two (72)
hours (or such shorter period as determined by the Board of Directors) before
the time fixed for the meeting at which the person named in the instrument
proposes to vote.
(c) For as long as any of the Company's securities are publicly traded on a
U.S. market or exchange, all proxy solicitations by persons other than the Board
of Directors shall be undertaken pursuant to the U.S. Proxy Rules, whether or
not applicable to the Company under U.S. law.
34. Effect of Death of Appointor or Revocation of Appointment
---------------------------------------------------------
A vote cast pursuant to an instrument appointing a proxy shall be valid
notwithstanding the previous death of the appointing shareholder (or of his
attorney-in-fact, if any, who signed such instrument), or the revocation of the
appointment or the transfer of the share in respect of which the vote is cast,
provided no written intimation of such death, revocation or transfer shall have
been received by the Company or by the Chairman of the meeting before such vote
is cast and provided, further, that the appointing shareholder, if present in
person at said meeting, may revoke the appointment by means of a writing, oral
notification to the Chairman, or otherwise.
BOARD OF DIRECTORS
35. Powers of Board of Directors
----------------------------
(a) In General
----------
The management of the business of the Company shall be vested in the
Board of Directors, which may exercise all such powers and do all such acts and
things as the Company is authorized to exercise and do, and are not hereby or by
law required to be exercised or done by the Company in General Meeting. The
authority conferred on the Board of Directors by this Article 35 shall be
subject to the provisions of the Companies Law, of these Articles and any
regulation or resolution consistent with these Articles adopted from time to
time by the Company in General Meeting, provided, however, that no such
regulation or resolution shall invalidate any prior act done by or pursuant to a
decision of the Board of Directors which would have been valid if such
regulation or resolution had not been adopted.
(b) Borrowing Power
---------------
The Board of Directors may from time to time, in its discretion, cause
the Company to borrow or secure the payment of any sum or sums of money for the
purposes of the Company, and may secure or provide for the repayment of such sum
or sums in such manner, at such times and upon such terms and conditions in all
respects as it thinks fit, and, in particular, by the issuance of bonds,
perpetual or redeemable debentures, debenture stock, or any mortgages, charges,
or other securities on the undertaking or the whole or any part of the property
of the Company, both present and future, including its uncalled or called but
unpaid capital for the time being.
(c) Reserves
--------
The Board of Directors may, from time to time, set aside any amount(s)
out of the profits of the Company as a reserve or reserves for any purpose(s)
which the Board of Directors, in its absolute discretion, shall think fit, and
may invest any sum so set aside in any manner and from time to time deal with
and vary such investments, and dispose of all or any part thereof, and employ
any such reserve or any part thereof in the business of the Company without
being bound to keep the same separate from other assets of the Company, and may
subdivide or redesignate any reserve or cancel the same or apply the funds
therein for another purpose, all as the Board of Directors may from time to time
think fit.
(d) Protective Measures
-------------------
The Board of Directors may, at any time in its sole discretion, adopt
protective measures to prevent or delay a coercive takeover of the Company,
including without limitation the adoption of a "Shareholder Rights Plan."
36. Exercise of Powers of Directors
-------------------------------
(a) A meeting of the Board of Directors at which a quorum is present
(whether in person, by conference call or by any other device allowing the
participating Directors to hear each other simultaneously) shall be competent to
exercise all the authorities, powers and discretions vested in or exercisable by
the Board of Directors,
(b) A resolution proposed at any meeting of the Board of Directors shall be
deemed adopted if approved by a majority of the Directors present when such
resolution is put to a vote and voting thereon.
(c) A resolution in writing signed by all Directors then in office and
lawfully entitled to vote thereon (as conclusively determined by the Chairman of
the Audit Committee or, in the absence of such determination, by the Chairman of
the Board of Directors) or to which all such Directors have given their consent
(by letter, telegram, telex, facsimile, telecopier or otherwise), or their oral
consent by telephone (provided that a written summary thereof has been approved
and signed by the Chairman of the Board of Directors of the Company) shall be
deemed to have been unanimously adopted by a meeting of the Board of Directors
duly convened and held.
37. Delegation of Powers
--------------------
(a) The Board of Directors may, subject to the provisions of the Companies
Law, delegate any or all of its powers to committees, each consisting of two or
more persons (all of whose members must be Directors), and it may from time to
time revoke such delegation or alter the composition of any such committee. Any
Committee so formed (in these Articles referred to as a "Committee of the Board
of Directors"), shall, in the exercise of the powers so delegated, conform to
any regulations imposed on it by the Board of Directors. The meetings and
proceedings of any such Committee of the Board of Directors shall, mutatis
mutandis, be governed by the provisions herein contained for regulating the
meetings of the
Board of Directors, so far as not superseded by any regulations adopted by the
Board of Directors under this Article. Unless otherwise expressly provided by
the Board of Directors in delegating powers to a Committee of the Board of
Directors, such Committee shall not be empowered to further delegate such
powers.
(b) Without derogating from the provisions of Article 50, the Board of
Directors may, subject to the provisions of the Companies Law, from time to time
appoint a Secretary to the Company, as well as officers, agents, employees and
independent contractors, as the Board of Directors may think fit, and may
terminate the service of any such person. The Board of Directors may, subject
to the provisions of the Companies Law, determine the powers and duties, as well
as the salaries and emoluments, of all such persons, and may require security in
such cases and in such amounts as it thinks fit.
(c) The Board of Directors may from time to time, by power of attorney or
otherwise, appoint any person, company, firm or body of persons to be the
attorney or attorneys of the Company at law or in fact for such purpose(s) and
with such powers, authorities and discretions, and for such period and subject
to such conditions, as it thinks fit, and any such power of attorney or other
appointment may contain such provisions for the protection and convenience of
persons dealing with any such attorney as the Board of Directors may think fit,
and may also authorize any such attorney to delegate all or any of the powers,
authorities and discretions vested in him.
38. Number of Directors
-------------------
Until otherwise determined by Shareholders Resolution of the Company, the
Board of Directors shall consist of not less than three (3) nor more than nine
(9) Directors, at least two (2) of which shall be External Directors in
accordance with the Companies Law (the "External Directors").
39. Election and Removal of Directors
---------------------------------
(a) The Board of Directors of the Company shall be divided into three (3)
classes of Directors, designated as Class I, Class II, and Class III, which
shall be differentiated by the dates of commencement and expiration of the terms
of office of their respective Directors. The number of Directors in each class
shall be divided equally, so far as practicable, among the classes. The initial
terms of office of the Directors of the respective classes shall be as follows:
(1st) Class I Directors shall serve until the Annual General Meeting to be
convened in 2001;
(2nd) Class II Directors shall serve until the Annual General Meeting to be
convened in 2002; and
(3rd) Class III Directors shall serve until the Annual General Meeting to be
convened in 2003,
until their respective successors shall be duly elected. At each Annual General
Meeting, beginning with the Annual General Meeting to be convened in 2001, the
Directors elected or re-elected to the class whose term expires at such meeting
shall serve until the Annual General Meeting to be convened in the third year
following such election or re-election.
(b) Directors shall be elected at General Meetings by the vote of the
holders of a majority of the voting power represented at such meeting in person
or by proxy and voting on the election of directors.
(c) Notwithstanding anything to the contrary in these Articles of
Association, the affirmative vote of at least 75% of the shares present, in
person or by proxy, and voting on the matter shall be required to amend or
repeal this Article 39 or to remove any Director prior to the expiration of his
or her term.
(d) Notwithstanding anything to the contrary in this Article 39, the
provisions of this Article 39 shall not apply to the Company's External
Directors, who shall not be members of any class and shall serve pursuant to the
provisions of the Companies Law.
40. Qualification of Directors
--------------------------
No person shall be disqualified to serve as a Director by reason of his not
holding shares in the Company or by reason of his having served as a Director in
the past.
41. Continuing Directors in the Event of Vacancies
----------------------------------------------
In the event of one or more vacancies in any class of Directors, the
continuing Directors may continue to act in every matter and may temporarily
fill any such vacancy in such class, provided, however, that if the continuing
Directors number less than a majority of the number provided for pursuant to
Article 38 hereof, they may only act in an emergency, and may call a General
Meeting of the Company for the purpose of electing Directors to fill any or all
vacancies, so that at least a majority of the number of Directors provided for
pursuant to Article 38 hereof are in office as a result of said meeting.
42. Vacation of Office
------------------
(a) The office of a Director shall be vacated, ipso facto, upon his death,
or if he be found lunatic or become of unsound mind, or if he become bankrupt,
or, if the Director is a company, upon its winding-up.
(b) The office of a Director shall be vacated by his written resignation.
Such resignation shall become effective on the date fixed therein, or upon the
delivery thereof to the Company, whichever is later.
43. Remuneration of Directors
-------------------------
No Director shall be paid any remuneration by the Company for his services
as Director except as may be approved by a Shareholders Resolution, except for
reimbursement of expenses incurred in connection with fulfilling his duties as a
Director.
44. Conflict of Interests
---------------------
Subject to the provisions of the Companies Law, the Company may enter into
any contract or otherwise transact any business with any Director in which
contract or business such Director has a personal interest, directly or
indirectly; and may enter into any contract of otherwise transact any business
with any third party in which contract or business a Director has a personal
interest, directly or indirectly. Any Director who has such a personal interest
shall notify the other Directors with respect thereto prior to any discussion or
vote on the matter by the Board of Directors.
45. [reserved]
PROCEEDINGS OF THE BOARD OF DIRECTORS
46. Meetings
--------
The Board of Directors may meet and adjourn its meetings and otherwise
regulate such meetings and proceedings as the Board of Directors think fit.
Notice of the meetings of the Board of Directors shall be sent to each Director
at the last address that the Director provided to the Company.
47. Quorum
------
Until otherwise unanimously decided by the Board of Directors, a quorum at
a meeting of the Board of Directors shall be constituted by the presence of a
majority of the Directors then in office who are lawfully entitled to
participate in the meeting (as conclusively determined by the Chairman of the
Audit Committee and in the absence of such determination - by the Chairman of
the Board of Directors), but shall not be less than two.
48. Chairman of the Board of Directors
----------------------------------
The Board of Directors may from time to time elect one of its members to be
the Chairman of the Board of Directors, remove such Chairman from office and
appoint another in its place. The Chairman of the Board of Directors shall
preside at every meeting of the Board of Directors, but if there is no such
Chairman, or if at any meeting he is not present within fifteen (15) minutes of
the time fixed for the meeting, or if he is unwilling to take the chair, the
Directors present shall choose one of their number to be the chairman of such
meeting. The Chairman shall not have a casting vote.
49. Validity of Acts Despite Defects
--------------------------------
Subject to the provisions of the Companies Law, all acts done bona fide at
any meeting of the Board of Directors, or of a Committee of the Board of
Directors, or by any person(s) acting as Director(s), shall, notwithstanding
that it may afterwards be discovered that there was some defect in the
appointment of the participants in such meetings or any of them or any person(s)
acting as aforesaid, or that they or any of them were disqualified, be as valid
as if there were no such defect or disqualification.
GENERAL MANAGER
50. General Manager
---------------
The Board of Directors may from time to time appoint one or more persons,
whether or not Directors, as General Manager(s) of the Company and may confer
upon such person(s), and from time to time modify or revoke, such title(s)
(including Managing Director, Director General or any similar or dissimilar
title) and such duties and authorities of the Board of Directors as the Board of
Directors may deem fit, subject to such limitations and restrictions as the
Board of Directors may from time to time prescribe. Such appointment(s) may be
either for a fixed term or without any limitation of time, and the Board of
Directors may from time to time (subject to the provisions of the Companies Law
and of any contract between any such person and the Company) fix his or their
salaries and emoluments, remove or dismiss him or them from office and appoint
another or others in his or their place or places.
MINUTES
51. Minutes
-------
(a) Minutes of each General Meeting and of each meeting of the Board of
Directors shall be recorded and duly entered in books provided for that purpose.
Such minutes shall, in all events, set forth the names of the persons present at
the meeting and all resolutions adopted thereat.
(b) Any minutes as aforesaid, if purporting to be signed by the chairman of
the meeting or by the chairman of the next succeeding meeting, shall constitute
prima facia evidence of the matters recorded therein.
DIVIDENDS
52. Declaration and Payment of Dividends
------------------------------------
The Board of Directors may from time to time declare, and cause the Company
to pay, such dividend as may appear to the Board of Directors to be justified.
The Board of Directors shall determine the time for payment of such dividends,
and the record date for determining the shareholders entitled thereto.
53. [reserved]
54. Amount Payable by Way of Dividends
----------------------------------
Subject to the rights of the holders of shares with special rights as to
dividends and without derogating from the provisions of Article 35(d) above, any
dividend paid by the Company shall be allocated among the shareholders entitled
thereto in proportion to their respective holdings of the shares in respect of
which such dividend is being paid.
55. Interest
--------
No dividend shall carry interest as against the Company.
56. Payment in Specie
-----------------
Upon the declaration of the Board of Directors, a dividend may be paid,
wholly or partly, by the distribution of specific assets of the Company or by
distribution of paid up shares, debentures or debenture stock of the Company or
of any other companies, or in any one or more of such ways.
57. Capitalization of Profits, Reserves etc.
----------------------------------------
Upon the resolution of the Board of Directors, the Company -
(a) may cause any moneys, investments, or other assets forming part of the
undivided profits of the Company, standing to the credit of a reserve fund, or
to the credit of a reserve fund for the redemption of capital, or in the hands
of the Company and available for dividends, or representing premiums received on
the issuance of shares and standing to the credit of the share premium account,
to be capitalized and distributed among such of the shareholders as would be
entitled to receive the same if distributed by way of dividend and in the same
proportion, on the footing that they become entitled thereto as capital, or may
cause any part of such capitalized fund to be applied on behalf of such
shareholders in paying up in full, either at par or at such premium as the
resolution may provide, any unissued shares or debentures or debenture stock of
the Company which shall be distributed accordingly, in payment, in full or in
part, of the uncalled liability on any issued shares or debentures or debenture
stock; and
(b) may cause such distribution or payment to be accepted by such
shareholders in full satisfaction of their interest in the said capitalized sum.
58. Implementation of Powers under Articles 56 and 57
-------------------------------------------------
For the purpose of giving full effect to any resolution under Articles 56
or 57, and without derogating from the provisions of Article 7(b) hereof, and
subject to applicable law, the Board of Directors may settle any difficulty
which may arise in regard to the distribution as it thinks expedient, and, in
particular, may issue fractional certificates, and may fix the value for
distribution of any specific assets, and may determine that cash payments shall
be made to any shareholders upon the footing of the value so fixed, or that
fractions of less value than the nominal value of one share may be disregarded
in order to adjust the rights of all parties, and may vest any such cash,
shares, debentures, debenture stock or specific assets in trustees upon such
trusts for the persons entitled to the dividend or capitalized fund as may seem
expedient to the Board of Directors.
59. Deductions from Dividends
-------------------------
The Board of Directors may deduct from any dividend or other moneys payable
to any shareholder in respect of a share any and all sums of money then payable
by him to the Company on account of calls or otherwise in respect of shares of
the Company and/or on account of any other matter of transaction whatsoever.
60. Retention of Dividends
----------------------
(a) The Board of Directors may retain any dividend or other moneys payable
or property distributable in respect of a share on which the Company has a lien,
and may apply the same in or toward satisfaction of the debts, liabilities, or
engagements in respect of which the lien exists.
(b) The Board of Directors may retain any dividend or other moneys payable
or property distributable in respect of a share in respect of which any person
is, under Articles 21 or 22, entitled to become a shareholder, or which any
person is, under said Articles, entitled to transfer, until such person shall
become a shareholder in respect of such share or shall transfer the same.
61. Unclaimed Dividends
-------------------
All unclaimed dividends or other moneys payable in respect of a share may
be invested or otherwise made use of by the Board of Directors for the benefit
of the Company until claimed. The payment by the Directors of any unclaimed
dividend or such other moneys into a separate account shall not constitute the
Company a trustee in respect thereof, and any dividend unclaimed after a period
of seven (7) years from the date of declaration of such dividend, and any such
other moneys unclaimed after a like period from the date the same were payable,
shall be forfeited and shall revert to the Company, provided, however, that the
Board of Directors may, at its discretion, cause the Company to pay any such
dividend or
such other moneys, or any part thereof, to a person who would have been entitled
thereto had the same not reverted to the Company.
62. Mechanics of Payment
--------------------
Any dividend or other moneys payable in cash in respect of a share may be
paid by check or warrant sent through the post to, or left at, the registered
address of the person entitled thereto or by transfer to a bank account
specified by such person (or, if two or more persons are registered as joint
holders of such share or are entitled jointly thereto in consequence of the
death or bankruptcy of the holder or otherwise, to any one of such persons or to
his bank account), or to such person and at such address as the person entitled
thereto may by writing direct. Every such check or warrant shall be made
payable to the order of the person to whom it is sent, or to such person as the
person entitled thereto as aforesaid may direct, and payment of the check or
warrant by the banker upon whom it is drawn shall be a good discharge to the
Company. Every such check or warrant shall be sent at the risk of the person
entitled to the money represented thereby.
63. Receipt from a Joint Holder
---------------------------
If two or more persons are registered as joint holders of any share, or are
entitled jointly thereto in consequence of the death or bankruptcy of the holder
or otherwise, any one of them may give effectual receipts for any dividend or
other moneys payable or property distributable in respect of such share.
ACCOUNTS
64. Books of Account
----------------
The Board of Directors shall cause accurate books of account to be kept in
accordance with the provisions of the Companies Law and of any other applicable
law. Such books of account shall be kept at the Registered Office of the
Company, or at such other place or places as the Board of Directors may think
fit, and they shall always be open to inspection by all Directors. No
shareholder, not being a Director, shall have any right to inspect any account
or book or other similar document of the Company, except as conferred by law or
authorized by the Board of Directors or by a Shareholders Resolution.
65. Audit
-----
At least once in every fiscal year the accounts of the Company shall be
audited and the correctness of the profit and loss account and balance sheet
certified by one or more duly qualified auditors.
66. Auditors
--------
The appointment, authorities, rights and duties of the auditor(s) of the
Company, shall be regulated by applicable law. The Audit Committee of the
Company shall have the authority to fix, in its discretion, the remuneration of
the auditor(s) for the auditing services.
BRANCH REGISTERS
67. Branch Registers
----------------
Subject to and in accordance with the provisions of the Companies Law and
to all orders and regulations issued thereunder, the Company may cause branch
registers to be kept in any place outside Israel as the Board of Directors may
think fit, and, subject to all applicable requirements of law, the Board of
Directors may from time to time adopt such rules and procedures as it may think
fit in connection with the keeping of such branch registers.
RIGHTS OF SIGNATURE, STAMP AND SEAL
68. Rights of Signature, Stamp and Seal
-----------------------------------
(a) The Board of Directors shall be entitled to authorize any person or
persons (who need not be Directors) to act and sign on behalf of the Company,
and the acts and signature of such person(s) on behalf of the Company shall bind
the Company insofar as such person(s) acted and signed within the scope of his
or their authority.
(b) The Company shall have at least one official stamp.
(c) The Board of Directors may provide for a seal. If the Board of
Directors so provides, it shall also provide for the safe custody thereof. Such
seal shall not be used except by the authority of the Board of Directors and in
the presence of the person(s) authorized to sign on behalf of the Company, who
shall sign every instrument to which such seal is affixed.
NOTICES
69. Notices
-------
(a) Any written notice or other document may be served by the Company upon
any shareholder either personally or by sending it by prepaid mail addressed to
such shareholder at his address as described in the Register of Shareholders or
such other address as he may have designated in writing for the receipt of
notices and other documents. Any written notice or other document may be served
by any shareholder upon the Company by tendering the same in person to the
Secretary or the General Manager of the Company at the principal office of the
Company or by sending it by prepaid registered mail (airmail if posted
outside Israel) to the Company at its Registered Address. Any such notice or
other document shall be deemed to have been served (i) in the case of mailing,
two (2) business days after it has been posted (seven (7) business days if sent
internationally), or when actually received by the addressee if sooner than two
(2) days or seven (7) days, as the case may be, after it has been posted; (ii)
in the case of overnight air courier, on the third (3rd) business day following
the day sent, with receipt confirmed by the courier, or when actually received
by the addressee if sooner than three (3) business days after it has been sent;
(iii) in the case of personal delivery, on the date such notice was actually
tendered in person to such shareholder (or to the Secretary or the General
Manager); (iv) in the case of facsimile transmission, on the date on which the
sender receives automatic electronic confirmation by the recipient's facsimile
machine that such notice was received by the addressee. The mailing date or
publication date and the date of the meeting shall be counted as part of the
days comprising any notice period. Notice may be sent by cablegram, telex,
telecopier (facsimile) or other electronic means and confirmed by registered
mail as aforesaid. If a notice is, in fact, received by the addressee, it shall
be deemed to have been duly served, when received, notwithstanding that it was
defectively addressed or failed, in some respect, to comply with the provisions
of this Article 69(a).
(b) All notices to be given to the shareholders shall, with respect to any
share to which persons are jointly entitled, be given to whichever of such
persons is named first in the Register of Shareholders, and any notice so given
shall be sufficient notice to the holders of such share.
(c) Any shareholder whose address is not described in the Register of
Shareholders, and who shall not have designated in writing an address for the
receipt of notices, shall not be entitled to receive any notice from the
Company.
(d) Notwithstanding anything to the contrary herein: notice by the Company
of a General Meeting which is published in two daily newspapers in Israel, if at
all, shall be deemed to have been duly given on the date of such publication to
any shareholder whose address as registered in the Register of Shareholders (or
as designated in writing for the receipt of notices and other documents) is
located in the State of Israel, and notice by the Company of a General Meeting
which is published in one daily newspaper in New York, New York, U.S.A. or in
one international wire service shall be deemed to have been duly given on the
date of such publication to any shareholder whose address as registered in the
Register of Shareholders (or as designated in writing for the receipt of notices
and other documents) is located outside Israel.
INSURANCE AND INDEMNITY
70. Exculpation, Indemnity and Insurance
------------------------------------
(a) For purposes of these Articles, the term "Office Holder" shall mean
every Director and every officer of the Company, including, without limitation,
each of the persons defined as "Nosei Misra" in the Companies Law.
(b) Subject to the provisions of the Companies Law, the Company may
prospectively exculpate an Office Holder from all or some of the Office Holder's
responsibility for damage resulting from the Office Holder's breach of the
Office Holder's duty of care to the Company.
(c) Subject to the provisions of the Companies Law, the Company may
indemnify an Office Holder in respect of an obligation or expense specified
below imposed on the Office Holder in respect of an act performed in his
capacity as an Office Holder, as follows:
(i) a financial obligation imposed on him in favor of another person
by a court judgment, including a compromise judgment or an arbitrator's award
approved by court;
(ii) reasonable litigation expenses, including attorneys' fees,
expended by an Office Holder or charged to the Office Holder by a court, in a
proceeding instituted against the Office Holder by the Company or on its behalf
or by another person, or in a criminal charge from which the Office Holder was
acquitted, or in a criminal proceeding in which the Office Holder was convicted
of an offense that does not require proof of criminal intent.
The Company may undertake to indemnify an Office Holder as aforesaid, (aa)
prospectively, provided that the undertaking is limited to categories of events
which in the opinion of the Board of Directors can be foreseen when the
undertaking to indemnify is given, and to an amount set by the Board of
Directors as reasonable under the circumstances and (bb) retroactively.
(d) Subject to the provisions of the Companies Law, the Company may enter
into a contract for the insurance of all or part of the liability of any Office
Holder imposed on the Office Holder in respect of an act performed in his
capacity as an Office Holder, in respect of each of the following:
(i) a breach of his duty of care to the Company or to another person;
(ii) a breach of his duty of loyalty to the Company, provided that the
Office Holder acted in good faith and had reasonable cause to assume that such
act would not prejudice the interests of the Company;
(iii) a financial obligation imposed on him in favor of another
person.
(e) The provisions of Articles 70(a), 70(b) and 70(c) above are not
intended, and shall not be interpreted, to restrict the Company in any manner in
respect of the procurement of insurance and/or in respect of indemnification (i)
in connection with any person who is not an Office Holder, including, without
limitation, any employee, agent, consultant or contractor of the Company who is
not an Office Holder, and/or (ii) in connection with any Office Holder to the
extent that such insurance and/or indemnification is not specifically prohibited
under law; provided that the procurement of any such insurance and/or the
provision of any such indemnification shall be approved by the Audit Committee
of the Company.
WINDING UP
71. Winding Up
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If the Company be wound up, then, subject to applicable law and to the
rights of the holders of shares with special rights upon winding up, the assets
of the Company available for distribution among the shareholders shall be
distributed to them in proportion to the nominal value of their respective
holdings of the shares in respect of which such distribution is being made.
* * * * *