EXHIBIT 4.15
[UNOFFICIAL TRANSLATION]
AGREEMENT
Drawn up and signed in 5(th) day of July , 2006
BETWEEN: MACPELL INDUSTRIES LTD.
Public company no. 52 - 003752 - 4
of 28 Hida Street, Bnei Brak
(hereinafter: the "LESSOR")
AND: TEFRON LTD.
Public company no. 52 - 004340- 7
of 94 Em Hamoshavot Street, Petach Tikva
(hereinafter: the "LESSEE")
And HI-TEX, founded by Tefron Ltd.
Private company no. 51 - 248981 - 6
of 94 Em Hamoshavot Street, Petach Tikva
(hereinafter: "HI-TEX")
WHEREAS: The Lessee is leasing from the Lessor an industrial
structure of approximately 7,710 sq.m. in the Teradion
Industrial Zone (hereinafter: the "HEADQUARTER BUILDING"),
pursuant to an agreement dated August 16, 1995, and pursuant
to the Appendix of Changes to this agreement of May 2001,
between the Lessee and New Net Assets (1994) Ltd.
(hereinafter: "NEW NET") which was merged into the Lessor,
as approved in the merger certificate of the Registrar of
Companies dated February 15, 2006 (hereinafter: the
"AGREEMENT OF 1995"), pursuant to which the lease term ends
in 2006;
AND WHEREAS: The Lessee is leasing from the Lessor an industrial
structure of approximately 6,040 sq.m., out of a structure
in an area of approximately 6,580 sq.m., which is situated
near to the Headquarter Building, in the Teradion Industrial
Zone (hereinafter: the "FINISHED PRODUCTS BUILDING"),
pursuant to an agreement dated December 10, 1999, and
pursuant to the Appendix of Changes to this agreement of May
2001, between the Lessee and New Net (hereinafter: the
"AGREEMENT OF 1999"), pursuant to which the lease term ends
on July 31, 2012;
AND WHEREAS: HI-TEX, which is a wholly owned subsidiary of the Lessee, is
leasing from the Lessor two additional structures which are
situated near to the Headquarter Building, one (hereinafter:
"HI-TEX BUILDING 1") pursuant to an agreement dated August
12, 1997, as amended from time to time between the Lessee
and New Net, when the rights and obligations of the Lessee
pursuant thereto were assigned to HI-TEX (hereinafter: the
"AGREEMENT OF 1997") and the other, (hereinafter: "HI-TEX
BUILDING 2") pursuant to an agreement dated December 21,
1998, as amended from time to time between HI-TEX and New
Net (hereinafter: the "AGREEMENT OF 1998").
AND WHEREAS: The parties have agreed to the amendment of the Agreement of
1995, the Agreement of 1997, the Agreement of 1998 and the
Agreement of 1999, in the manner set forth below;
THE FOLLOWING HAS THEREFORE BEEN DECLARED, STIPULATED AND AGREED BETWEEN THE
PARTIES:
1. The Preamble to this Agreement forms an integral part hereof.
2. On August 10, 2006 (hereinafter: the "Date of Vacation of the Finished
Products Building") the lease term of the Finished Products Building shall
end, and on the said date, the Lessee shall vacate the Finished Products
Building and shall return it to the Lessor. Notwithstanding the foregoing
in section 3 below, until the Date of Vacation of the Finished Products
Building, all of the provisions of the Agreement of 1999 shall apply
between the parties in connection with the rental of the Finished Products
Building until the Date of Vacation of the Finished Products Building,
including the provisions relating to the manner of the return of the
Finished Products Building to the Lessor, all subject to a change in the
Date of Vacation of the Finished Products Building, as stated above and
subject to the following changes only:
a. Notwithstanding that stated in the Agreement of 1999, in respect of
the period from April 16, 2006 to the Date of Vacation of the Finished
Products Building, the rent in respect of the Finished Products
Building shall be in the amount, in New Israel Shekels, which is equal
to 2.7 US dollars per sq.m., according to the representative rate of
exchange of the dollar that is known on the date of payment. For the
avoidance of doubt, and notwithstanding that stated in section 7.1 of
the Agreement of 1999, the said rent is fixed and is not linked. In
addition, the rent in respect of the period until the Date of Vacation
of the Finished Products Building shall be paid in full by the Lessee
to the Lessor not later than at the expiration of 30 days from the
date of the taking of effect of this Agreement, as stated in section
11 below.
b. Without derogating from the other undertakings of the Lessee pursuant
to the Agreement of 1999, and pursuant to any law, and in light of the
fact that HI-TEX is leasing the HI-TEX Building 2, which is near to
the Finished Products Building and which is connected to the Finished
Products Building, it is hereby stressed and clarified that the Lessee
and HI-TEX shall take all the reasonable measures as required so that
from the Date of Vacation of the Finished Products Building, there
shall be no disturbance (by act or omission) on the part of the Lessee
or HI-TEX, or any entity on their behalf, to the use by the Lessor or
any entity on its behalf (including a new tenant) of the Finished
Products Building (and of the parking spaces adjacent thereto) and in
connection therewith, the Lessee and HI-TEX undertake, jointly and
severally, without derogating from the generality of the foregoing,
the following:
(1) Until the connection in an independent manner of the Finished
Products Building to the electricity grid of the Israel Electric
Corporation (which, if and when it is implemented, shall be
implemented by the Lessor or the entity to which the Lessor shall
lease the Finished Products Building) - to continue to enable the
full supply of electricity to the Finished Products Building
through the infrastructure and electrical systems which are
situated in the HI-TEX Building 2 (in the same manner in which
the electricity is supplied to the Finished Products Building as
at the date of the signing of this Agreement), provided that the
Lessee and HI-TEX shall not be responsible for the quality of the
electricity which is supplied, for failures in the supply
thereof, for any reason which does not derive from gross
negligence of any of them, for the infrastructure and electrical
systems which are situated in the Finished Products Building, for
the infrastructure and electrical systems which are situated in
the HI-TEX Building 2, and for the infrastructure and electrical
systems which conduct the electricity from the HI-TEX Building 2
to the Finished Products Building (all provided that the level of
the handling of the infrastructure and the systems which are in
the HI-TEX Building 2 and which are being used for the purpose of
the transfer of the electricity to the Finished Products
Building, shall be similar to the level of the handling of the
infrastructure and the systems which are in the HI-TEX Building 2
and which are being used by the Lessee and HI-TEX). For the
avoidance of doubt, it is hereby clarified that the payments in
respect of the consumption of the electricity shall apply to the
Lessor (or any entity on its behalf, such as a new tenant),
commencing from the Date of Vacation of the Finished Products
Building, and for this purpose, the Lessor shall procure the
installation of a separate electricity meter for the Finished
Products Building (the installation of the said meter shall be at
the Lessor's expense; the Lessee and HI-TEX shall cooperate with
the Lessor in connection with the installation of the said meter,
including in all matters pertaining to the application to the
Israel Electric Corporation, provided that the Lessee and HI-TEX
shall not bear any payment in respect of the installation of the
said meter). In the event that the Lessor or the entity which
leased the Finished Products Building from the Lessor shall not
pay the electricity bill in respect of the consumption in the
Finished Products Building, the Lessee shall be entitled to
offset the amount that was not paid from the rent due to the
Lessor.
(2) To prevent any disturbance (on behalf of the Lessee, HI-TEX, or
any entity on their behalf, including service providers,
suppliers, contractors and other third parties which come into
contact with the Lessee or with HI-TEX) to the access of the
Lessor (or any entity on its behalf) or of any third party
(including a new tenant or any entity on its behalf) to the
loading and unloading area of the Finished Products Building and
to any other area of the Finished Products Building, and to take
all the reasonable measures as required (at the expense of the
Lessee and HI-TEX) in order to remove any such disturbance.
c. Without derogating from the other undertakings of the Lessor pursuant
to the Agreement of 1999 and pursuant to any law, it is hereby
emphasized and clarified that the Lessor (whether itself or through
corporations in its control) shall take all the reasonable measures as
required so as not to impair the use by the Lessee, HI-TEX or any
entity on their behalf of the Headquarter Building and of the nearby
structures which the Lessee and HI-TEX are leasing from the Lessor
(including the loading and unloading area and any other area of the
said structures and the parking spaces adjacent thereto), without any
disturbance (by act or omission) on the part of the Lessor or
corporations in its control. The Lessor undertakes that in any lease
agreement or grant of right of use with regard to the Finished
Products Building, it shall include a section in which the lessee or
recipient of the right undertakes not to disturb (by act or omission)
the use by the Lessee, HI-TEX or any entity on their behalf, of the
nearby building, of the Headquarter Building and of any other nearby
building which is being leased or shall be leased to the Lessee or to
HI-TEX by the Lessor (including the loading and unloading area and any
other area of the said structures and the parking spaces adjacent
thereto).
d. The parties declare that they are aware that pursuant to approval
received by the Lessor from the Investment Center, the Lessor is
required to continue to lease the Finished Products Building to the
Lessee until August 31, 2007 (in this sub-section - hereinafter: the
"Date of the Expiration of the Undertaking"). The parties shall apply,
jointly, to the Investment Center and they shall use their best
endeavors to receive the approval of the Investment Center for the
termination of the lease of the Finished Products Building on the Date
of the Vacation of the Finished Products Building, in consideration of
the Lessor's undertaking to lease the Headquarter Building to the
Lessee until the Date of the Expiration of the Undertaking.
e. The Lessor shall bear the cost of the Lessee's relocation from the
Finished Products Building to another structure, against invoices
which shall be presented by the Lessee to the Lessor in respect of the
costs of the said relocation, which is estimated in a total amount of
approximately 85,000 dollars.
3. The Lessee shall continue to lease the Headquarter Building, in such manner
that until April 15, 2006, all of the provisions of the Agreement of 1995
in respect of the rental of the Headquarter Building shall continue to
apply, and in the period commencing from April 16, 2006 (hereinafter: the
"Effective Date for Changes") until July 31, 2012 (hereinafter: the
"Updated Date for the Termination of the Lease of the Headquarter
Building"), the Agreement of 1999 shall apply, including all the provisions
thereof, to the rental of the Headquarter Building, subject to that stated
in this Agreement (all of the changes which are set forth below are solely
in respect of the period after the Effective Date for Changes):
a. The "Leased Premises" or the "Structure" - insofar as mentioned in the
Agreement of 1999 shall be the "Leased Premises" as construed in the
Agreement of 1995.
b. The base rent (as defined in section 7.1 of the Agreement of 1999)
with regard to the 6,040 sq.m. of the Headquarter Building, in respect
of the period commencing on the Effective Date for Changes and ending
on the Updated Date for the Termination of the Lease of the
Headquarter Building, shall be as set forth in the Agreement of 1999.
As of April 16, 2006, taking into consideration the amendment stated
in section 6 below, the rent pursuant to the Agreement of 1999 is 4.62
dollars per sq.m.
c. The base rent (as defined in section 7.1 of the Agreement of 1999)
with regard to the additional 1,670 sq.m. of the Headquarter Building
(which constitute the difference in area between the Headquarter
Building and the area of the Finished Products Building) in respect of
the period commencing on the Effective Date for Changes and ending on
the Updated Date for the Termination of the Lease of the Headquarter
Building, shall be in the monthly amount of 2.7 US dollars per sq.m.
This rent shall be paid every three months in advance, by bank
transfer, as the Lessor shall instruct the Lessee. With regard to this
rent only (but not with regard to the rent specified in sub-section
(b) above), the rent adjustment, in real terms, which is specified in
the last sentence of section 7.1 of the Agreement of 1999 shall not
apply, in respect of the period commencing on the Effective Date for
Changes and ending on the Updated Date for the Termination of the
Lease of the Headquarter Building.
d. For the avoidance of doubt, it is hereby clarified that the Agreement
of 1995 shall not apply to the Headquarter Building, commencing on the
Effective Date for Changes.
e. All of the securities that were provided pursuant to the Agreement of
1999 shall also be used to secure the undertakings of the Lessee with
regard to the Headquarter Building as stated in this section, pursuant
to the original terms according to which they were given in the
Agreement of 1999 (in addition to the fact that they shall continue to
be used to secure the undertakings of the Lessee with regard to the
Finished Products Building, including pursuant to section 2 above).
4. Notwithstanding that stated in the first paragraph of section 7.1 in the
Agreement of 1998, in effect commencing from April 16, 2006, the base rent
pursuant to the said agreement, taking into consideration the amendment
stated in section 6 below, shall be in the amount of 5.51 US dollars per
sq.m. per month (instead of 4.65 dollars as set forth in the
above-mentioned paragraph in the Agreement of 1998), which reflects a
discount of 4%, after the addition of all the linkages and adjustments that
were made by this date.
5. In the sixth paragraph of section 7.1 in the Agreement of 1997, in the
Agreement of 1998 and in the Agreement of 1999 (rent adjustment
mechanisms), the figure of 5% shall be replaced by 3% (three percent). It
is clarified that this amendment shall apply to the adjustments which shall
be made commencing from April 16, 2006, and shall not affect previous
adjustments to the rent which have already been made or which were due to
be made (pursuant to the terms of the relevant agreements) by April 16,
2006. For the avoidance of doubt, it is hereby clarified that all of the
provisions of the Agreement of 1997 and all of the provisions of the
Agreement of 1998 shall continue to apply between the parties, subject to
the changes in this Agreement only.
6.
a. The fifth paragraph of section 7.1 in the Agreement of 1997, in the
Agreement of 1998 and in the Agreement of 1999 (the paragraph
regarding the linkage mechanisms of the rent, which commences with the
words "The base rent shall be linked" and ends with the words "as
compared with the base index") shall be replaced with the text set
forth below, in effect in respect of the period commencing on April 1,
2006, only:
"The base rent shall be linked so that each of the payments of the
rent which is due from the Lessee to the Lessor shall be linked to the
American index, in such a manner that if the last index published
prior to the date of the actual remittance of any payment
(hereinafter: the "New Index") shall be higher than the index known on
April 16, 2006 (the index in respect of the month of March 2006, i.e.
199.8) (hereinafter: the "Base Index"), then the Lessee shall be
required to make the payment which shall be increased by the rate at
which the New Index has increased as compared with the Base Index."
b. In the third paragraph of section 7.1 in the Agreement of 1997, in the
Agreement of 1998 and in the Agreement of 1999, the definition of the
term "the Israeli index" shall be omitted, and the definition of the
term "dollar" shall be replaced with the following definition: "US
Dollar. And it is clarified that the rent pursuant to this section
shall be paid in Dollars and not in New Israel Shekels."
c. It is clarified that the Base Rent pursuant to the Agreement of 1997,
as of April 16, 2006, taking into consideration that stated above, is
5.52 dollars per sq.m.
7. This Agreement amends the provisions of the Agreement of 1995, the
Agreement of 1997, the Agreement of 1998 and the Agreement of 1999, and in
any event of an inconsistency between any of the above-mentioned previous
agreements and this Agreement, the provisions of this Agreement shall
prevail.
8. Upon their signing of this Agreement, the Lessee and HI-TEX give notice
that they have no claim and/or demand and/or lawsuit and/or right of any
kind or nature (hereinafter: "Claim") against the Lessor and/or New Net
and/or the officers thereof and/or the directors thereof and/or the
employees thereof and/or the shareholders thereof and/or the
representatives thereof and/or the insurers thereof and/or anything in
connection therewith, in all matters pertaining to the making, manners of
approval and validity of the lease agreements which are the subject of this
Agreement, or any one of them, and insofar as they have or had (or any of
them has or had) a Claim, then they hereby retract and waive the Claim in a
final and absolute manner.
Upon its signing of this Agreement, the Lessor gives notice that it has no
claim and/or demand and/or lawsuit and/or right of any kind or nature
(hereinafter: "Claim") against the Lessee and/or HI-TEX and/or the officers
thereof and/or the directors thereof and/or the employees thereof and/or
the shareholders thereof and/or the representatives thereof and/or the
insurers thereof and/or anything in connection therewith, in all matters
pertaining to the making, manners of approval and validity of the lease
agreements which are the subject of this Agreement, or any one of them, and
insofar as it has or had (or New Net, which is stepping into the shoes
thereof, has or had) a Claim, then it hereby retracts and waives the Claim
in a final and absolute manner.
In addition to the foregoing, the Lessee and HI-TEX declare that as of the
date of the signing of this Agreement, they are not aware of any Claim or
demand against the Lessor and/or New Net in connection with the contents
and the manner of implementation of the lease agreements which are the
subject of this Agreement, or any one of them.
9. The Lessee hereby declares that this Agreement is subject to the approval
of the Audit Committee, the Board of Directors and the General Meeting of
the Lessee. The Lessee hereby declares to the Lessor that its engagement in
this Agreement has been approved by the Audit Committee and the Board of
Directors of the Lessee, and that pursuant to any law and pursuant to the
documents of incorporation and the resolutions of the Lessee, its
engagement in this Agreement does not require the approval of other organs
of the Lessee, with the exception of the General Meeting, and that there is
no legal or other impediment to its engagement in this Agreement and to the
implementation of all of its undertakings pursuant hereto, subject to the
receipt of the approval of the General Meeting of the Lessee. HI-TEX hereby
declares that its engagement in this Agreement has been approved by its
Board of Directors and General Meeting, and that pursuant to any law and
pursuant to the documents of incorporation and the resolutions of HI-TEX,
its engagement in this Agreement does not require the approval of other
organs of HI-TEX, and that there is no legal or other impediment to its
engagement in this Agreement and to the implementation of all of its
undertakings pursuant hereto, subject to the receipt of the approval of the
General Meeting of the Lessee.
10. The Lessor hereby declares to the Lessee that its engagement in this
Agreement has been approved by its Audit Committee and Board of Directors,
and that pursuant to any law and pursuant to the documents of incorporation
and the resolutions of the Lessor, its engagement in this Agreement does
not require the approval of other organs of the Lessor, and that there is
no legal or other impediment to its engagement in this Agreement and to the
implementation of all of its undertakings pursuant hereto, subject to the
receipt of the approval of the General Meeting of the Lessor.
11. This Agreement shall take effect upon receipt of the later of the
following: (a) the approval of the General Meeting of the Lessee as stated
in section 9 above; (b) the approval of the General Meeting of the Lessor
as stated in section 10 above; and (c) the approval of the Investment
Center as stated in section 2(d). Should any of the approvals stated in
paragraphs (a) or (b) above not be received within 90 days from the date of
the signing of this Agreement, this Agreement shall be VOID AB INITIO.
Should the approval stated in paragraph (c) above not be received within 90
days from the date of the signing of this Agreement, the parties shall
conduct BONA FIDE negotiations in order to identify an alternative, agreed
solution in connection with the terms of the said paragraph (c). Should
such an agreed solution not be reached within 60 days, this Agreement shall
be VOID AB INITIO.
12. The parties agree that the courts in the Tel Aviv District shall have the
exclusive jurisdiction in all of the disputes between them arising from the
implementation, breach or interpretation of this contract.
IN WITNESS WHEREOF THE PARTIES HERETO HAVE HEREUNTO SET THEIR HANDS:
/s/ Yos Shiran /s/ Shmuel Nir
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/s/ Asaf Alperovitz /s/ Eli Azrieli
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LESSEE LESSOR
/s/ Yos Shiran
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/s/ Asaf Alperovitz
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HI-TEX