EXHIBIT 10.14
SHAREHOLDERS AGREEMENT
Made and entered into on May 21, 1996
Between
GAZIT INC. ["GAZIT"]
And
DANBAR RESOURCES AND DEVELOPMENT LTD. ["DANBAR RESOURCES"]
1. GENERAL
1.1 Gazit and Danbar Resources hold, themselves and/or through companies
under their control, shares and warrants of Equity One Inc. ["EQUITY"]
and shares of companies which hold shares and warrants of Equity,
including shares of Magan - Gas and Petroleum Resources Ltd.
1.2 Gazit and Danbar Resources have reached agreement regarding the
invoking of arrangements pursuant to which Gazit and Danbar Resources
will jointly control Magan and Equity, in equal shares. For this
purpose the arrangements set forth below have been prescribed.
2. DEFINITIONS AND INTERPRETATION
2.1 In this Agreement the following expressions will have the meanings set
opposite them, if such meaning reconciles with the content and context:
2.1.1 "DANBAR GROUP" - Danbar Resources and its subsidiaries or
companies under its control.
2.1.2 "GAZIT GROUP" - Gazit and its subsidiaries or companies
under its control.
2.1.3 "JOINT COMPANIES" - Private companies which hold shares
and/or warrants of Equity [including
Equity], in which the Danbar Group and
the Gazit Group hold their issued
capital; private companies in which the
Danbar Group holds the issued capital
thereof but in which the Gazit Group
has been granted an option to purchase
of the shares thereof, and also private
companies the issued capital of which is
held by the Gazit Group, but the Danbar
Group has been granted an option to
purchase some of the shares therein.
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2.1.4 "EQUITY - Equity One Inc.
2.1.5 "MAGAN" - Magan - Gas and Petroleum Resources
Ltd.
2.1.6 "THE TRUSTEE" - A trustee agreed upon between the
parties.
2.1.7 "DANBAR'S - ▇▇▇ ▇▇▇▇▇▇ or any other person in
REPRESENTATIVE" regard to whom Danbar Resources
gives written notice to the Trustee.
2.1.8 "GAZIT'S - ▇▇▇▇ ▇▇▇▇▇▇▇ or any other person in
REPRESENTATIVE" regard to whom Gazit gives written
notice to the Trustee.
2.1.9 "THE POWER OF - A power of attorney which Danbar
ATTORNEY" Group and the Gazit Group have
granted to Magan in connection with
the appointment of directors in Equity.
A copy of the power of attorney is
attached to this Contract as APPENDIX
A.
2.1.10 The division of the Agreement into clauses and the insertion
of headings to the clauses have been done as place-finders
and for the sake of convenience only, and no use shall be
made thereof for purposes of interpretation.
3. VOTING AT GENERAL MEETINGS AND APPOINTMENT OF DIRECTORS
3.1 The parties undertake to act in such a manner that the board of
directors of Equity will be comprised of nine members, of whom four
members will be appointed on the recommendation of Danbar Resources;
four members who will be appointed on the recommendation of Gazit; and
one member who will be appointed on the joint recommendation of Danbar
Resources and Gazit. The appointment of directors shall be effected in
accordance with the principles set forth above and in the manner
described in Clause 4.1.1 below. The provisions of this Clause 3.1 and
the provisions of Clause 4.1.1 below shall only apply when the
validity of the Power of Attorney expires.
3.2 The parties undertake to act in a manner that on the board of
directors of each of the Joint Companies, excluding Equity, the number
of directors who will be appointed on the recommendation of Danbar
Resources will be the same as the number of directors who will be
appointed on the recommendation of Gazit. The appointment of directors
will be effected in accordance with the principles set forth above and
in the manner stipulated in Clause 4.1.2 below.
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3.3 If for any reason the term of office of any of the directors presently
serving on the board of directors of Magan, whose names are set forth
in APPENDIX B to this Contract, should be terminated for any reason,
Gazit will be entitled to order the appointment of another director in
place of the director whose term of office has been terminated. In
such event Gazit and Danbar Resources will vote all their shares in
Magan in favor of the appointment of such candidate as Gazit directs
as aforesaid. Any substitute director who may be appointed as
aforesaid shall be deemed to have been included from the outset in
Appendix B to this Contract, so that if his term in office is for any
reason terminated, Gazit will have the right to appoint another person
in his place, in accordance with the provision of this clause.
3.4 The parties will act to coordinate their attitudes with regard to
voting their shares on any matter put to the vote at general meetings
of shareholders of each of the Joint Companies and of Magan [except in
connection with matters regulated pursuant to Clauses 3.1 to 3.3
above]. The voting of the parties shares will be effected in
accordance with the attitude of the parties jointly, in accordance
with the matters set forth in Clause 4.1.5 below.
This Clause 3.4 will also apply to the parties in connection with
their shares in Equity also if and when Equity becomes a public
company, until such time as the parties have otherwise agreed in
writing.
4. TRANSFER OF SHARES INTO TRUST: BLOCKING OF SHARES
On the Determining Date, the Danbar Resources Group and the Gazit Group
will each transfer to the Trustee ordinary shares of NIS 1 par value of
Magan, out of the Magan shares owned by them, which represent 12.55% of the
issued capital of Magan on a full dilution, and in a manner whereby in
aggregate ordinary shares of NIS 1 par value representing 25.1% of the
issued capital of Magan, on a full dilution, will be transferred to the
Trustee. In addition the parties will act in such manner that on the
aforesaid date all the shares of the Danbar Group and all the shares of the
Gazit Group in the remaining Joint Companies will be transferred to the
Trustee [shares to be held by the Trustee in accordance with the provisions
of this clause will henceforth be referred to as - "THE BLOCKED SHARES"].
In every instance that Magan issues additional securities, so that the
percentage which the blocked Magan shares represents constitutes less than
25% of the issued share capital of Magan on a full dilution, the parties
will, in equal proportions, lodge additional shares with the Trustee,
within 30 days from the date on which Magan issues such securities, so that
after the lodgment of the additional shares the blocked Magan shares will
represent 25.1% of the issued capital of the Company on a full dilution.
Danbar Resources, in its own name and on behalf of the remaining companies
which constitute the Danbar Group, and Gazit in its own name and on behalf
of all the remaining companies which constitute the Gazit Group, hereby
give the Trustee irrevocable instructions to act in connection with the
Blocked Shares as follows:
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4.1 In every case a general meeting of shareholders is held in any of the
Joint Companies, the Trustee shall vote the Blocked Shares as follows:
4.1.1 Should a general meeting of shareholders be held in Equity
for the appointment of directors in Equity, the Trustee will
vote all the blocked Equity shares in favor of the
appointment of up to four directors who are recommended by
Danbar's representative, and up to four directors who are
recommended by Gazit's representative. In addition, the
Trustee shall vote in favor of the appointment of an
additional director who is recommended in writing by
Danbar's representative and Gazit's representative jointly.
The provisions of this Clause 4.1.1 will apply only after
the validity of the Power of Attorney expires.
4.1.2 If a general meeting of shareholders is held in any of the
Joint Companies, excluding Equity, for purposes of
appointing directors, the Trustee shall vote all the Blocked
Shares of the relevant company in favor of the appointment
of representatives recommended by Danbar's representative
and representatives recommended by Gazit's representative,
so that all the directors in such company will be appointed
in accordance with a recommendation of the aforesaid
representatives and in a manner whereby the number of
directors to be appointed pursuant to a recommendation by
Danbar's representatives will be equal to the number of
directors to be appointed pursuant to a recommendation of
Gazit's representative.
4.1.3 If by the time a general meeting of any of the Joint
Companies is convened the Trustee has not received a
recommendation from a representative of one of the parties
for the appointment of directors, or if a representative of
one of the parties should recommend a smaller number of
directors than the number of directors he is entitled to
recommend, this shall in no way prejudice the right of the
other party's representative to recommend the appointment of
all the directors he is entitled to recommend in accordance
with the provisions of this Clause 4.1
4.1.4 Should a general meeting of the shareholders of Magan be
held for purposes of appointing directors in Magan, the
Trustee shall vote all the blocked Magan shares in the
manner described in Clause 3.3 above.
4.1.5 At any general meeting of one of the joint companies and
Magan, the Trustee shall vote in any matter [except in
connection with the appointment of directors], in such way
as the representatives of Danbar and of Gazit shall jointly
instruct him in writing. Should the Trustee not receive
instructions in writing in connection with the manner in
which he votes, signed by representatives of Danbar and
Gazit, prior to the convening of a general meeting of any of
the Joint Companies, the
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Trustee shall vote at such meeting against the passing of
any resolution put to the vote.
4.1.6 The Danbar Resources Group and the Gazit Group shall
themselves vote their shares in any of the Joint Companies
and in Magan which have not been lodged in trust in
accordance with the provisions of this Agreement. If there
are such shares then at any general meeting of each of the
Joint Companies and Magan, in a manner as Danbar Resources
and Gazit shall instruct the Trustee to act in accordance
with the matters above.
4.2 The Trustee shall not sell the Blocked Shares, in whole or in part, at
any time, unless he receives approval for doing so from Danbar
Resources and Gazit jointly and in writing. The Trustee shall allow
the parties to cause a pledge of the shares lodged by them in trust,
in favor of a financial institution or trust company for purposes of
securing a series/several series of debentures, provided that in the
terms and condition of the pledge of such shares the financial
institution or the trust company in favor of whom the shares are
pledged will undertake that in any event that the pledge should be
realized in respect of the shares, the financial institution or the
trust company will make an offer to the other party to purchase from
it the pledged shares at the lower of the following prices: the price
on the Stock Exchange [if the shares of such company are traded on the
Stock Exchange] or at a price which reflects the equity capital of the
relevant company, whichever is the lower.
4.3 Any dividend which is transferred to the Trustee in respect of the
Blocked Shares shall be transferred by him, immediately upon receipt
thereof, to the owner of the shares who lodged with him the shares in
respect of which the dividend was received.
4.4 If bonus shares should be distributed in respect of any of the Blocked
Shares, the Trustee shall also hold the bonus shares in trust for the
owner of the shares who deposited with him Blocked Shares in respect
of which the bonus shares were received. All the provisions of this
clause will apply respectively also to the bonus shares which are
distributed as aforesaid.
4.5 The Trustee shall not exercise any rights offered to him in connection
with the Blocked Shares, unless he receives a written instruction to
do so, both from Danbar Resources and from Gazit. In the event that
both Danbar Resources and Gazit should instruct the Trustee to
exercise rights, but in a number which is not equal, the Trustee shall
exercise the rights as if both parties had given the Trustee an
instruction to exercise rights in the number mentioned in the notice
of the party who gave an instruction to exercise rights in the smaller
number. The shares which will be received from the exercise of rights
as aforesaid shall also be lodged with the Trustee and the provisions
of this Clause 4 shall apply to them.
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5. COORDINATION IN REGARD TO BUYING AND SELLING OF SECURITIES
5.1 The parties shall coordinate between them any operation in connection
with the securities of Magan and of Equity. A party wishing to buy or
sell shares shall offer the other party to participate in an equal
proportion in the purchase or sale of the shares. A party will be
entitled to buy or sell shares as aforesaid even if the other party
does not accept the offer to participate in the purchase or sale of
the shares as aforesaid.
5.2 Notwithstanding the contents of Clause 5.1 above, until such time as
the total quantity of Equity shares to be sold by the parties jointly
reaches 800,000 shares, the Gazit Group will be obliged to make
whomever Danbar Resources may direct a party to transaction for the
sale of Equity shares, only in respect of one share to be sold by
whomsoever Danbar Resources may direct as against every 2 shares the
Gazit Group may sell. The Danbar Group will be obliged to offer
whomsoever Gazit may direct to participate in such transactions in a
manner whereby whomever Gazit may direct may sell 2 shares against
each share the Danbar Group may sell.
5.3 Should Gazit exchange Equity shares in its ownership for shares of
Magan which are allotted to it under a private placement by Magan, the
provisions of Clause 5.2 above will apply, mutatis mutandis, to the
Magan shares in a quantity which is equal to the quantity allotted
within the scope of the private placement. In such case the quantity
of Equity shares mentioned in Clause 5.2 above will be reduced by the
number equivalent to the quantity of Equity shares transferred to
Magan by Gazit.
5.4 It is clarified that for purposes of sales subject to Clause 5.1 to
5.3 above, if one of the parties should purchase Magan shares or
Equity shares in a transaction in which the other party does not wish
to participate, this will not have the effect of altering the ratios
for the sale of shares in later transactions, and the ratio will
remain 1:1, or 1:2, as the case may be.
5.5 For purposes of this Clause 5 - shares shall include convertible
securities or securities exercisable for shares.
6. GRANT OF POWER OF ATTORNEY BY ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ hereby grants the Trustee an irrevocable power of attorney to
vote his shares in Equity in his name and ▇▇▇▇▇ at general meetings of
shareholders of Equity. The Trustee shall vote the aforesaid shares in
accordance with the provisions of Clauses 4.1.1 and 4.1.5 above. The
aforesaid undertaking shall apply, so long as ▇▇▇▇ ▇▇▇▇▇▇▇ holds such
shares, to all ▇▇▇▇ ▇▇▇▇▇▇▇'▇ shares in Equity, as applicable from time to
time.
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7. PROHIBITION ON HOLDING OF SHARES
Each of the parties undertakes not to hold shares or other rights in any
corporation whatsoever which will hold Equity shares on its behalf,
directly or indirectly, except with the written consent of the other party.
Should a party hold shares or rights of such corporation, following the
receipt of consent from the other party in accordance with the matters set
forth above, such party shall cause the corporation in question [excluding
Magan] to transfer a power of attorney to the Trustee, pursuant to which
the Trustee will be entitled to vote all shares of such corporation at a
meeting of shareholders of Equity. The Trustee shall vote all the shares of
such corporation in accordance with the matters set forth in Clauses 4.1.1
and 4.1.5 above.
8. ADDITIONAL OPERATIONS
The parties will take and will cause companies under their control to take
all the steps required for purposes of the implementation and execution of
this Agreement.
9. COMING INTO FORCE OF THE AGREEMENT
This Agreement will come into force only if and when the Investment
Contract signed on May 21, 1996 between ▇▇▇▇▇, ▇▇▇ Overseas Ltd., Gazit
Holdings Inc., Equity and a company in the course of formation which is due
to be founded by Danbar Resources and Gazit, comes into force.
The validity of this Agreement is also conditional upon the due approval of
the Agreement by a general meeting of shareholders of Gazit Inc.
IN WITNESS WHEREOF THE PARTIES HAVE HEREUNTO SIGNED:
(-) (-)
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Danbar Resources Gazit Inc.
and Development Ltd.
I agree to the contents of Clause 6 above:
(-)
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▇▇▇▇ ▇▇▇▇▇▇▇
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