RNS Number : 3177L
Bank Hapoalim B.M.
08 January 2009
Bank Hapoalim B.M. (the "Company" or the "Bank)
An immediate report pursuant to the Securities (Transaction Between a Company and a Controlling Party Thereof) Regulations, 5761-2001
and the Securities (Periodic and Immediate Reports) Regulations, 5730-1970, concerning the convening of a Special General Meeting of the
shareholders of the Company ("the Meeting"), which is to be held on Thursday, 5th February, 2009, at 10:00 a.m., at Levinstein Tower , 23
Menahem Begin Road, 3rd Floor, Room 313, in Tel Aviv, for the adoption of the resolutions on the agenda, as specified below:
* On the Agenda of the Special General Meeting:
1. Election of Mr. Imri Tov as an external director of the Bank, in accordance with the provisions of the Companies Law, 5759-1999
(hereinafter - "the Companies Law").
The appointment of the candidate for the office of external director under the Companies Law, Mr. Imri Tov, is subject to approval by
the Bank of Israel.
2. The Bank's engagement, according to which the Bank will provide a prior undertaking to indemnity directors of the Bank is as
follows:
Mr. Imri Tov, whose appointment is subject to the approval of the General Meeting as set forth in Item 1 on the aforesaid agenda, Mrs.
Iris Dror, who was appointed as a director of the Bank on 16th November, 2008, for the whole period of her office commencing from the date
of her appointment as aforesaid (the controlling party of the Bank is liable to be considered as having a personal interest in the provision
of indemnity for Mrs. Iris Dror) as well as all the directors, including the external directors, who may hold office at the Bank from time
to time in the future. The letters of indemnity for all of the aforesaid directors shall be in the form attached as Annex A of the immediate
report. This form is identical to the letters of indemnity issued in the past to all of the directors presently in office at the Bank as
approved by the competent organs of the Bank, including the General Meeting.
The engagement to provide indemnity for all of the directors (except for Mrs. Iris Dror) requires approval by a simple majority of the
General Meeting, whereas providing the indemnity for Mrs. Iris Dror requires approval by a special majority, by reason of the controlling
party of the Bank being liable to be considered as having a personal interest in the approval, and accordingly will be brought for approval
of the Meeting by way of separate resolution, as will be set forth below.
3. Liability insurance for the directors and office holders of the Bank:
3.1 Ratification of the terms of the directors' and office holders' liability insurance, for all of the directors and office holders
in office at the Bank, including the external directors and including Mr. Imri Tov (whose appointment as an external director is subject to
the approval of the General Meeting as provided in Item 1 on the agenda of the Meeting) and also including the director Mrs. Iris Dror,
commencing from the date of her appointment to the Board of Directors on 16th November, 2008. The aforesaid insurance was renewed on 1st
June, 2008 and will expire on 31st May, 2009 (hereinafter: "the Existing Policy"). The terms of the Existing Policy conform to the approval
given in the past by the General Meeting. According to the Existing Policy, the total amount covered is 260 million Dollars and the total
premium is about 2,030 thousand Dollars. Further particulars of the Existing Policy are set forth in Item 3 of the detailed proposed
resolutions to be presented to the Meeting.
3.2 Approval that the insurance granted to the directors and the office holders in office at the Bank according to the Existing
Policy will also secure all of the directors and office holders who may be in office at the Bank from time to time in the future.
3.3 After the expiry of the Existing Policy the Bank will purchase a policy or policies for insuring directors' and office holders'
liability, which will grant coverage to all of the directors (including the external directors) and to all of the office holders who may
hold office at the Bank from time to time at the time of purchase and/or at any time thereafter. The purchase of the policy, or the
policies, as aforesaid, may be effected by way of renewal and/or extending the validity of the Existing Policy and/or any other policies
which may be issued in the future and/or purchasing additional and/or other policies; and all of the foregoing in such a manner that the
insurance coverage which shall be granted to the directors and the office holders of the Bank in office at any time shall not be less than
the insurance coverage under the Existing Policy and subject to the following cumulative conditions: (1) The insurance coverage under the
aforesaid policy or policies are for such period or periods which in total will not exceed five years from the expiry of the Existing Policy, namely until 31st May, 2014; and (2) The overall coverage
which shall be in force at any time under the aforesaid policy or policies will not exceed 400 million Dollars, per claim and in total, and
the annual premium will not exceed 5 million Dollars.
3.4 The resolutions set forth in Clauses 3.1, 3.2 and 3.3 shall be brought for approval en bloc consisting of one resolution
requiring approval by a simple majority, except for the resolutions set forth in Clauses 3.1 and 3.3, in so far as they pertain to the
provision of the insurance coverage for the director Mrs. Iris Dror, which requires approval by a special majority, by reason of the
controlling party of the Bank being liable to be considered as having personal interest in the approval, and accordingly will be brought for
approval of the Meeting by way of a separate resolution, as will be set forth below.
B. Controlling Parties With a Personal Interest in the Engagements on the Agenda and the Nature of Their Interest:
Arison Holdings (1998) Ltd., the controlling party of the Company ("Arison Holdings"), is liable to be considered as having a personal
interest in the engagements being brought for approval under Clauses 2 and 3 (in relation to the letter of indemnity to be provided to Mrs.
Iris Dror and in relation to the engagement to grant a liability insurance policy to the director Mrs. Iris Dror), for the following
reasons:
In relation to the engagement set forth in Item 2 on the agenda of the Meeting, the provision of the letter of indemnity to Mrs. Iris
Dror will be brought in a separate resolution, as it is liable to be considered, for the sake of prudence, as an exceptional transaction of
the Bank with another person and in which the controlling party of the Bank has a personal interest, for the following reason: According to
the letters of indemnity issued by Arison Holdings to Mrs. Iris Dror, Arison Holdings undertook, inter alia, to indemnify her for any
damages which she may incur by virtue of her being an office holder of Arison Holdings and/or of any company controlled (according to the
definition of the term "control" in the Securities Law, 5728-1968), directly or indirectly, by Arison Holdings. According to the aforesaid
letter of indemnity issued by Arison Holdings, in the event that the aforesaid office holder actually receives any payments on the strength
of any insurance policy or other indemnity agreement, Arison Holdings will not be duty bound to indemnify as aforesaid, except for damages for which no indemnification was received as aforesaid.
In view of the foregoing, the provision of a letter of indemnity by the Bank (and likewise taking out insurance as provided in Item 3 on the
agenda of the Meeting) to the aforesaid office holder, is liable to reduce the indemnification which Arison Holdings may be required to
indemnify the aforesaid office holder, and accordingly, for the sake of prudence, it is liable to have a personal interest in the
engagement.
In relation to the engagement to grant insurance to the director Mrs. Iris Dror which is set forth in Item 3 on the agenda of the
Meeting, this engagement, for the sake of prudence, is liable to be considered as an exceptional transaction of the Company with another
person and in which the controlling party of the Company has a personal interest, since Mrs. Iris Dror, by virtue of her being an office
holder of Arison Holdings and/or of any company controlled by Arison Holdings as clarified above, is insured under the policy and for the
same reason as aforesaid in relation to the personal interest in receiving a letter of indemnity. Taking out insurance which also covers the
aforesaid office holder, is liable to reduce the amounts of indemnification which Arison Holdings is liable to be required to pay on the
strength of the letter of indemnity issued by it, as aforesaid.
C. Names of the Directors who Have a Personal Interest in the Engagements on the Agenda Being Brought for Approval as a Transaction of
Controlling Parties and the Nature of Their Interest:
In relation to the engagement concerning the liability insurance for directors and office holders (Item 3 on the agenda of the Meeting),
all of the directors have a personal interest since they too will be entitled to insurance. In relation to the engagement concerning the
indemnity (Item 2 on the agenda of the Meeting), all of the directors have a personal interest since they too have received the same letters
of indemnity.
D. The Majority Required for Approving the Resolutions
The majority required for approving the resolution set forth in Item 1 on the agenda of the Meeting for the appointment of the external
director Mr. Imri Tov, is a simple majority of the votes of the shareholders participating in the poll (not including those abstaining), on
condition that one of the following is met: (1) The count of the votes of the majority includes at least one third of the votes of the
shareholders who are not the controlling parties of the Company or whoever on their behalf, who participate in the poll; when counting all
of the votes of the aforesaid shareholders, the votes of those abstaining shall not be taken into account; or - (2) The total number of the
votes of those voting against among the shareholders mentioned in sub-clause (1) above does not exceed one per cent. of all the voting
rights in the Company.
The majority required for approving the resolution on the subjects set forth in Items 2 and 3 (including all sub-paragraphs thereof) on
the agenda of the Meeting (except for the granting of a letter of indemnity to Mrs. Iris Dror as set forth in Item 2 on the agenda of the
Meeting and except for the engagement to confer liability insurance upon the director Mrs. Iris Dror as set forth in Items 3.1 and 3.3 on
the agenda of the Meeting), is a simple majority of the votes of the shareholders participating in the poll (not including those
abstaining).
The majority required for approving the resolutions on the subjects set forth in Item 2 on the agenda of the Meeting in relation to
granting a letter of indemnity to Mrs. Iris Dror and in Items 3.1 and 3.3 on the agenda of the Meeting in relation to the engagement to
grant liability insurance to the director Mrs. Iris Dror is a simple majority of the votes of the shareholders participating in the poll,
(not including those abstaining), on condition that one of the following is met: (1) The count of the votes of the majority includes at
least one third of the votes of the shareholders who have no personal interest in the approval of the resolutions, who participate in the
poll; when counting all of the votes of all of the aforesaid shareholders, the votes of those abstaining shall not be taken into account; or
- (2) The total number of votes of those against among the shareholders mentioned in sub-clause (1) above does not exceed one per cent. of
all the voting rights in the Company.
E. Further Particulars
The date for determining the entitlement to participate and vote at the Meeting pursuant to Section 182 (b) of the Companies Law is
Thursday, 8th January, 2009 ("the Determination Date"). Any shareholder of the Company, who is entitled to participate and vote at the
Meeting, may appoint a proxy to vote in his name. The letter of appointment and the proxy (if any), pursuant to which the letter of
appointment was executed, shall be deposited at the Company's offices no less than forty-eight (48) hours prior to the time scheduled for
the Meeting to commence. In addition, a shareholder may vote at the Meeting (on matters permitted by law) by means of a poll card. Voting in
writing shall be done by means of Part Two of the poll card attached to the immediate report.
Please note that Section 34 (a1) of the Banking (Licensing) Law, 5741-1981, provides as follows: "No person shall agree with another
concerning their voting for the appointment of a director of a banking corporation or a bank holding corporation, unless in accordance with
a permit given by the Governor after consulting with the Licences Committee; this provision shall not apply to a holder of means of control
who has agreed with another, that the other shall vote in his name and on his behalf for the person whom the holder of the means of control
has instructed him to, and on condition that the other shall not vote in the name of and on behalf of more than one other holder".
Accordingly, with respect to the election of the director (a matter set forth in Item 1 on the agenda of the Meeting), a proxy who is also a
shareholder in the Bank may vote in the name and on behalf of only one more shareholder. With respect to the other items on the agenda,
there is nothing to prevent the proxy from representing more than one shareholder.
If, after half an hour has passed from the time that was scheduled for the Meeting, at least two (2) shareholders, who hold or represent
at least 25% of all the votes in the Company, are not present, in person or by proxy (a "Quorum"), then the Meeting shall be adjourned for
one week and shall be held on Thursday, 12th February, 2009, at 10:00 a.m. [at the same time] and at the same place. If at the adjourned
Meeting no Quorum is present after half an hour has passed from the time scheduled for the Meeting then the Meeting shall be held with any
number of participants.
The poll card which can be used for voting ("the Poll Card") and the position statements within their meaning as provided in Section 88
of the Companies Law, if there are any, can be reviewed on the Securities Authority's distribution site at http://www.magna.isa.gov.il ("the
Distribution Site") and on the website of the Tel Aviv Stock Exchange Ltd. at http://maya.tase.co.il . Voting in writing shall be done by
means of Part Two of the Polling Card, as displayed on the Distribution Site. Any shareholder may approach the Company directly and receive
from it the text of the Poll Card and the position statements. A member of the Stock Exchange shall send, free of charge, by electronic
mail, a link to the text of the Poll Card and the position statements on the Distribution Site to each shareholder who is not registered in
the Register of Shareholders and whose shares are registered with this member of the Stock Exchange, if the shareholder has notified that he
so wishes, provided that the notice was given with respect to a particular securities account and in good time prior to the Determination Date.
In accordance with the Companies (Proof of Ownership of a Share for the Purpose of Voting at a General Meeting) Regulations, 5760-2000,
a shareholder, in whose favour shares are registered with a member of the Stock Exchange, who wishes to vote at the Meeting, shall submit to
the Company confirmation by that member of the Stock Exchange concerning his ownership of the shares on the Determination Date, as required
under those Regulations. A shareholder, whose shares are registered with a member of Stock Exchange, is entitled to receive the confirmation
of ownership from the member of the Stock Exchange through whom he holds his shares, at the branch of the member of the Stock Exchange or by
mail to his address in return for payment of postage only, if he is so requests. Such a request shall be made in advance with reference to a
particular securities account.
The Poll Card and the documents that are required to be attached thereto as specified therein, shall be delivered to the Company's
offices (including by registered mail), together with a confirmation of ownership (and with respect to a registered shareholder - together
with a photocopy of the identity card, passport or certificate of incorporation, as the case may be), within seventy-two (72) hours prior to
the time scheduled for convening the Meeting, namely by Monday, 2nd February, 2009, at 10:00 a.m. For this purpose, the "Time of Delivery"
is when the Poll Card and the attached documents reached the Company's offices.
The last time for delivering position statements to the Company is no more than ten (10) days after the Determination Date, namely no
later than Sunday, 18th January, 2009, at 10:00 a.m.
The full text of the resolutions being presented for the approval of the General Meeting, the Bank's Memorandum and Articles of
Association and the text of the letter of indemnity are open for inspection at the office of the Secretary of the Bank, 63-65Yehuda Halevy
Street in Tel Aviv, during regular working hours, by prior arrangement.
Bank Hapoalim B.M.
Bank Hapoalim B.M.
31st December, 2008
To To
The Securities Authority The Tel Aviv Stock Exchange Ltd.
Via Magna Via Magna
Ladies and Gentlemen
Re: Bank Hapoalim B.M. ("the Company " or "the Bank") - Immediate Report Pursuant to the Securities (Transaction between a Company
and a Controlling Party Thereof) Regulations, 5761-2001 ("the Controlling Parties Regulations") and the Securities (Periodic and Immediate
Reports) Regulations, 5730-1970 ("the Reports Regulations")
Pursuant to the Controlling Parties Regulations and the Reports Regulations, an immediate report is filed herewith concerning the
summoning of a Special General Meeting of the Company's shareholders ("the Meeting"), which is to be held on Thursday, 5th February, 2009 at
10:00 a.m. at the Company's offices at Levinstein Tower, 23 Menahem Begin Road, Tel Aviv (3rd Floor, Room 313), for the adoption of the
resolutions on the agenda, as specified below.
* On the Agenda of the Special General Meeting
1. Election of an external director
Election of Mr. Imri Tov as an external director of the Bank, in accordance with the provisions of the Companies Law, 5759-1999
(hereinafter - "the Companies Law").
Particulars according to Regulation 26 of the Securities (Periodic and Immediate Reports) Regulations in relation to a director whose
appointment is brought for approval:
a. Name: Imri Tov;
b. Identity Card Number: 005018155;
c. Date of Birth: 24th November, 1939;
d. Address for service of legal process: 3 Adam Hacohen, Tel Aviv;
e. Nationality: Israeli;
f. Member of the Committees Listed Below of the Board of Directors: Yet to be determined;
g. Has accounting and financial expertise having regard to his education and his pursuits, as set forth below;
h. Is not an employee of the Bank, a subsidiary or connected company of the Bank or of an interested party in the Bank;
i. Will act as a director of Bank from the date of his appointment by the Meeting;
j. (1) His education: M.A. - Economics and Business Administration - the Hebrew University in Jerusalem; B.A. - Economics and Political
Sciences - the Hebrew University in Jerusalem;
(2) His pursuits during the last five years and a list of the corporations in which he served or serves as a director:
2000 - to the present day - member of the Board of Directors of M.T.A. Holdings Ltd;
2006 - to the present day - external director on the Board of Directors of Shufersal Ltd;
2006-2008 - director and member of the Investments Committee of the State Employed Doctors' Provident Fund;
2007 - to the present day - director on the Board of Directors of ICG, a company for green energy;
2007 - to the present day - external director on the Board of Directors of Amnat - Management and Systems Ltd.;
2008 - to the present day - external director on the Board of Directors of Granit Hacarmel Ltd.;
2000-2007 - fellow of the Centre for Strategic Studies, University of Tel Aviv;
2000-2006 - external director on the Board of Directors of Bank Hapoalim B.M.;
2000-2005 - director on the Board of Directors of Elisra Industries Ltd.;
k. Is not a member of the family of any other interested party in the Bank;
m. The Bank views the director as having accounting and financial expertise with respect to meeting the minimum number set by the Board
of Directors pursuant to Section 92(a) (12) of the Companies Law.
The appointment of the candidate for the office of external director under the Companies Law, Mr. Imri Tov, is subject to the approval
of the Bank of Israel.
The Required Majority: A simple majority of the votes of the shareholders participating in the poll (not including those abstaining), on
condition that one of the following is met: (1) The count of the votes of the majority includes at least one third of the votes of the
shareholders who are not the controlling parties of the Company or whoever on their behalf, who participate in the poll; when counting all
of the votes of the aforesaid shareholders, the votes of those abstaining shall not be taken into account; or - (2) The total number of the
votes of those voting against among the shareholders mentioned in sub-clause (1) above does not exceed one per cent. of all the voting
rights in the Bank.
2. Indemnity Undertaking
After having obtained therefor the approval of the Audit Committee on 29th December, 2008 and the Board of Directors of the Company on
30th December, 2008, it is proposed to approve the engagement of the Bank according to which it will give an undertaking in advance to
indemnify directors of the Bank, as set forth below:
Mr. Imri Tov, whose appointment is subject to the approval of the General Meeting as set forth in Item 1 on the agenda of the Meeting,
Mrs. Iris Dror, who was appointed as a director of the Bank on 16th November, 2008, for the whole period of her office commencing from the
date of her appointment as aforesaid (the controlling party of the Bank is liable to be considered as having a personal interest in the
provision of indemnity for Mrs. Iris Dror) as well as all the directors, including the external directors, who may hold office at the Bank
from time to time in the future. The letters of indemnity for all of the aforesaid directors shall be in the form attached as Annex A of the
immediate report. This form is identical to the letters of indemnity issued in the past to all of the directors presently in office at the
Bank as approved by the competent organs of the Bank, including the General Meeting.
The engagement to provide indemnity for all of the directors (except for Mrs. Iris Dror) requires approval by a simple majority of the
General Meeting, whereas providing the indemnity for Mrs. Iris Dror requires approval by a special majority, by reason of the controlling
party of the Bank being liable to be considered as having a personal interest in the approval, as will be explained below, and accordingly,
the indemnity undertaking, as aforesaid, will be presented for the approval of the Meeting in two separate resolutions: (a) indemnity for
the external director Mr. Imri Tov and for all of the directors of the Bank whoever they may be from time to time, and - (b) Indemnity for
Mrs. Iris Dror.
The provision of the letter of indemnity to Mrs. Iris Dror will be brought in a separate resolution, as it is liable to be considered,
for the sake of prudence, as an exceptional transaction of the Bank with another person and in which the controlling party of the Bank has a
personal interest, for the following reason: According to the letters of indemnity issued by Arison Holdings (1998) Ltd., the controlling
party of the Bank (hereinafter - "Arison Holdings") to Mrs. Iris Dror, Arison Holdings undertook, inter alia, to indemnify her for any
damages which she may incur by virtue of her being an office holder of Arison Holdings and/or of any company controlled (according to the
definition of the term "control" in the Securities Law, 5728-1968), directly or indirectly, by Arison Holdings. According to the aforesaid
letter of indemnity issued by Arison Holdings, in the event that the aforesaid office holder actually receives any payments on the strength
of any insurance policy or other indemnity agreement, Arison Holdings will not be duty bound to indemnify as aforesaid, except for damages for which no indemnification was received as
aforesaid. In view of the foregoing, the provision of a letter of indemnity by the Bank (and likewise taking out insurance as provided in
Item 3 on the agenda of the Meeting) to the aforesaid office holder, is liable to reduce the indemnification which Arison Holdings may be
required to indemnify the aforesaid office holder, and accordingly, for the sake of prudence, it is liable to have a personal interest in
the engagement.
The Required Majority: In relation to the provision of a letter of indemnity to the external director Mr. Irmi Tov and to all the
directors of the Bank and as they may be from time to time, is - a simple majority; in relation to Mrs. Iris Dror - it is - the majority
required for controlling party transactions.
3. Insurance
After having obtained therefor the approval of the Audit Committee on 29th December, 2008, it is proposed as follows:
3.1 To ratify the terms of the directors' and office holders' liability insurance to be granted to all of the directors and office
holders in office at the Bank, including the external directors and including Mr. Imri Tov (whose appointment as an external director is
subject to the approval of the General Meeting as provided in Item 1 on the agenda) and also including the director Mrs. Iris Dror,
commencing from the date of her appointment to the Board of Directors on 16th November, 2008. The aforesaid insurance was renewed on 1st
June, 2008 and will expire on 31st May, 2009 (hereinafter: "the Existing Policy"). The terms of the Existing Policy conform to the approval
given in the past by the General Meeting. According to the Existing Policy, the total amount covered is 260 million Dollars and the total
premium is about 2,030 thousand Dollars. Further particulars of the Existing Policy are set forth below:
Directors' and Office
Holders' Insurance Policy
Commencement Date of the Insurance 1.6.2008
Coverage Amount (in millions of Dollars) 260
Premium (in thousands of Dollars) 2,030
The Insurance Is Valid Until 31.5.2009
Deductible for a Director and Office Holders 0
Deductible for the Company (in thousands of
Dollars) except USA and Canada 200
Deductible for the Company in the USA and Canada
(in thousands of Dollars) 375
Deductible for an SEC claim lodged in the USA
or Canada in connection with the ADR Level 1
Program (in thousands of Dollars)
500
3.2 Approval that the insurance granted to the directors and the office holders in office at the Bank according to the Existing
Policy will also secure all of the directors and office holders who may be in office at the Bank from time to time in the future.
3.3 After the expiry of the Existing Policy the Bank will purchase a policy or policies for insuring directors' and office holders'
liability, which will grant coverage to all of the directors (including the external directors) and to all of the office holders who may
hold office at the Bank from time to time at the time of purchase and/or at any time thereafter. The purchase of the policy, or the
policies, as aforesaid, may be effected by way of renewal and/or extending the validity of the Existing Policy and/or any other policies
which may be issued in the future and/or purchasing additional and/or other policies; and all of the foregoing in such a manner that the
insurance coverage which shall be granted to the directors and the office holders of the Bank in office at any time shall not be less than
the insurance coverage under the Existing Policy and subject to the following cumulative conditions: (1) The insurance coverage under the
aforesaid policy or policies is for such period or periods which in total will not exceed five years from the expiry of the Existing Policy, namely until 31st May, 2014; and (2) The overall coverage which
shall be in force at any time under the aforesaid policy or policies shall not exceed 400 million Dollars, per claim and in total, and the
annual premium shall not exceed 5 million Dollars.
3.4 The resolutions set forth in Clauses 3.3.1, 3.3.2 and 3.3.3 shall be brought for approval en bloc consisting of one resolution
requiring approval by a simple majority, except on the subject of providing insurance coverage for the director Mrs. Iris Dror which will be
brought for approval by separate resolution which requires a special majority as set forth below.
The Required Majority: For the sake of prudence, the insurance, as aforesaid, is liable to be considered as an exceptional transaction
of the Bank with another person and in which the party in control of the Bank has a personal interest, since Mrs. Iris Dror, as an office
holder in the Arison group, is insured under the aforesaid insurance policy. In the past a letter of indemnity was issued to Mrs. Iris Dror
by Arison Holdings, and taking out insurance by the Bank is liable to reduce the amounts of indemnification which Arison Holdings may be
required to pay to Mrs. Iris Dror, as set forth above in relation to Item 3 on the agenda. Accordingly, and for the sake of prudence, the
majority required for this resolution is the majority required for controlling party transactions.
______________________________________________________________________ For the sake of convenience, all of the further
particulars required in accordance with the Controlling Parties Regulations in relation to the engagements mentioned in Items 2 and 3 on the
agenda of the Meeting are brought en bloc in Chapter B of the report.
______________________________________________________________________ B. Further Particulars in relation to the
Engagements Mentioned in Clauses 2 and 3 of Chapter A of the Report
1. As aforesaid, the Meeting's agenda will also include engagements which constitute engagements in which the controlling party of
the Company has a personal interest. These engagements are: (a) Indemnification for Mrs. Iris Dror; and (b) The engagement with respect to
the insurance policy (in this Chapter B, jointly - "the Engagements").
Following are further particulars required in connection with the Engagements, in accordance with the Controlling Parties Regulations.
2. Names of controlling parties of the Company who have a personal interest in the Engagements and the nature of their personal
interest, a statement of the rights conferring upon them control of the Company, and the holdings of material shareholders thereof
2.1 The controlling party of the Company, Arison Holdings (1998) Ltd. ("Arison Holdings"), has a personal interest in the said
Engagements as specified in Chapter A of the Report.
2.2 Eternity Holdings One Trust holds 23.07% of the shares of Arison Holdings, which holds 20.01% of the Bank's shares. In addition,
Eternity Holdings One Trust holds 23.07% of the shares of Arison Sustainability Ltd., which holds 100% of the shares of Arison Investments
Ltd., which holds 100% of the shares of Arzaf D Ltd., which holds 100% of the shares of Israel Salt Industries Ltd., which holds 5.75% of
the Bank's shares.
Eternity Four-A Trust holds 53.86% of the shares of Arison Holdings. Eternity Four-A Trust also holds 53.86% of the shares of Arison
Sustainability Ltd., which holds 100% of the shares of Arison Investments Ltd., which holds 100% of the shares of Arzaf D Ltd., which holds
100% of the shares of Israel Salt Industries Ltd., which holds 5.75% of the Bank's shares.
Ms. Shari Arison is the main beneficiary of Eternity Holdings One Trust and of Eternity Four-A Trust.
Nickel 97-A Trust holds 23.07% of the shares of Arison Holdings, which holds 20.01% of the Bank's shares.
Nickel 97-A Trust also holds 23.07% of the shares of Arison Sustainability Ltd., which holds 100% of the shares of Arison Investments
Ltd., which holds 100% of the shares of Arzaf D Ltd., which holds 100% of the shares of Israel Salt Industries Ltd., which holds 5.75% of
the Bank's shares. Mr. Micky Arison, Ms. Shari Arison's brother, is the main beneficiary of Nickel 97-A Trust.
3. Required approvals
The Engagements are subject to the approval of the Company's Audit Committee and Board of Directors and the approval of the Company's
Special General Meeting by the majority required for controlling parties transactions. The approval of the Audit Committee was obtained on
29th December, 2008 and the approval of the Board of Directors was obtained on 30th December, 2008.
4. A statement of engagements of the type of the Engagements on the agenda or engagements similar thereto between the Company and the
controlling party or in which the controlling party had personal interest, which were concluded in the last two years or which are still in
effect
4.1 With respect to the engagement pertaining to the indemnification - on 20th March, 2008 the General Meeting approved the Bank's
engagement, according to which the Bank shall provide a prior undertaking to indemnify the following directors: Oded Sarig, Mali Baron,
Leslie Littner, Ronen Israel and Yair Orgler, as well as the directors Mrs. Efrat Peled and Nir Zichlinskey, office holders of Arison
Holdings (1998) Ltd., the controlling party of the Company, in the form of the indemnity letter that is attached as Annex "A" hereto (the
"Indemnity Letter" and the "Indemnity Undertaking"). The form of the indemnity letter is in accordance with the form of the indemnity
letters that were provided in the past to the other directors who hold office in the Company, (including directors who are controlling
parties or with respect to whom the controlling parties have a personal interest in granting to them the Indemnity Letter), and which were
approved in the past by the competent organs of the Company, including the General Meeting, and including the adjustment of the undertaking of the Bank to indemnify office holders who are directors of the Bank
(including directors who are controlling parties of the Bank), to the provisions of the Companies Law - (after Amendment No.3), and which
was approved by the Meeting on 10th November, 2005.
For further details see the immediate report on convening an annual meeting which the Company released on 13th February, 2008 and the
immediate report on the results of the meeting which the Company released on 20th March, 2008.
4.2 With respect to the engagement pertaining to insurance - on 20th March, 2008 the General Meeting of the Company approved to take out
liability insurance for directors and office holders, including for the directors Messrs. Efrat Peled, Nir Zichlinskey, Irit Izakson, as to
whom the controlling party of Company, Arison Holdings, has a personal interest in granting the insurance to those directors.
The General Meeting of 20th March, 2008 approved the terms of the liability insurance for directors and office holders, which was
renewed on 1st June 2007 until 31st May, 2008 ("the Existing Policy"). The General Meeting also approved the purchase of additional
insurance policy/ies for insuring directors' and office holders' liability after the expiry of the Existing Policy, which are to be
purchased including by way of further extensions or renewal of the Existing Policy and/or by means of purchasing another policy, with an
insurance coverage of not less than the existing one and on the cumulative terms set forth in the immediate report which was released by the
Company on 13th February, 2008.
For further particulars regarding the granting of liability insurance to directors and to office holders of the Bank see the immediate
report on convening an annual meeting which the Company released on 13th February, 2008 and the immediate report on the results of the
meeting which the Company released on 20th March, 2008.
5. The names of the directors who participated in the approval of the Engagements
5.1 The discussion by the Company's Board of Directors which took place on 30th December, 2008 for the approval of the Engagements
regarding the indemnity and the insurance, was attended by: Dan Dankner, Efrat Peled, Yair Orgler (an external director in accordance with
the Proper Conduct of Banking Business Directive of the Bank of Israel - 301 (hereinafter - "Directive 301"), Irit Izakson, Mali Baron (an
external director in accordance with Directive 301), Pnina Dvorin, Nira Dror (external director), Nir Zichlinskey, Ronen Israel (external
director in accordance with Directive 301), Leslie Littner (external director in accordance with Directive 301), Jay Pomrenze, Moshe Koren
and Oded Sarig (external director in accordance with Directive 301).
5.2 The discussion by the Company's Audit Committee which took place on 29th December, 2008 for the approval of the Engagements
regarding the engagement pertaining to the indemnity and the insurance, was attended by: Nira Dror (external director), Yair Orgler
(external director in accordance with Directive 301), and Leslie Littner (external director in accordance with Directive 301).
6. The names of the directors who have a personal interest in the Engagements and the nature of their interest
With respect to the engagement regarding the granting of liability insurance to directors and office holders - all of the directors have
a personal interest in relation to the insurance since they too will be and are entitled to the insurance. With respect to the engagement
regarding the indemnity, all of the directors in office at the Bank have a personal interest since they too will be and are entitled to
receive indemnification in accordance with the Indemnity Letters.
7. The Audit Committee's and Board of Directors' reasons for approving the Engagements
With respect to the insurance, the Audit Committee and the Board of Directors noted in their reasons that providing insurance to office
holders is usual, and that the insurance coverage that will be given to Mrs. Iris Dror is identical to the insurance coverage that will be
given by the Bank to the other directors of the Company. With respect to the indemnity, the Audit Committee and the Board of Directors noted
in their reasons that giving indemnity to office holders is usual, and that the indemnity that will be given to Mrs. Iris Dror is identical
to the indemnity that was given in the past to the other directors holding office in the Company, including to directors as whom the
controlling party has a personal interest in granting to them an Indemnity Letter, as aforesaid herein, and as was given and may be given by
the Bank to all of the directors in office at the Bank at any time, as aforesaid herein.
8. The manner in which the consideration was determined
The consideration for the insurance policy was determined in negotiations between the Bank and the insurance company.
9. The authority of the Securities Authority
In accordance with the Controlling Parties Regulations, within twenty- one days from the date of filing of this Immediate Report, the
Securities Authority (the "ISA") or an employee authorized by it in that regard is authorized to order the Company to give, within the time
to be determined therefor, an explanation, specification, information and documents in connection with any engagement, and to order the
Company to amend the Report in such manner and at such time as it shall determine. In the event that an instruction to amend the Report as
aforesaid shall have been given, the ISA is entitled to order an adjournment of the Meeting as set forth in the Controlling Parties
Regulations. The Company will file an amendment according to such instruction in the manner set forth in the Controlling Parties
Regulations, and all unless the ISA shall have ordered otherwise. If an instruction shall have been given regarding an adjournment for
convening the General Meeting, the Company shall let it be known in an immediate report that such instruction has been given.
C. The Required Majority, Entitlement to Vote and Further Particulars:
1. The date for determining the entitlement to participate and vote at the Meeting pursuant to Section 182 (b) of the Companies Law
is Thursday, 8th January, 2009 ("the Determination Date"). Any shareholder of the Company, who is entitled to participate and vote at the
Meeting, may appoint a proxy to vote in his name. The letter of appointment and the proxy (if any), pursuant to which the letter of
appointment was executed, shall be deposited at the Company's offices no less than forty-eight (48) hours prior to the time scheduled for
the Meeting to commence. In addition, a shareholder may vote at the Meeting (on matters permitted by law) by means of a poll card. Voting in
writing shall be done by means of Part Two of the poll card attached to this report.
Please note that Section 34 (a1) of the Banking (Licensing) Law, 5741-1981, provides as follows: "No person shall agree with another
concerning their voting for the appointment of a director of a banking corporation or a bank holding corporation, unless in accordance with
a permit given by the Governor after consulting with the Licences Committee; this provision shall not apply to a holder of means of control
who has agreed with another, that the other shall vote in his name and on his behalf for the person whom the holder of the means of control
has instructed him to, and on condition that the other shall not vote in the name of and on behalf of more than one other holder".
Accordingly, with respect to the election of the directors (Item No. 2 on the agenda of the General Meeting), a proxy who is also a
shareholder in the Bank may vote in the name and on behalf of only one more shareholder. With respect to the other items on the agenda,
there is nothing to prevent the proxy from representing more than one shareholder.
2. If, after half an hour has passed from the time that was scheduled for the Meeting, at least two (2) shareholders, who hold or
represent at least 25% of all the votes in the Company, are not present, in person or by proxy (a "Quorum"), then the Meeting shall be
adjourned for one week and shall be held on Thursday, 12th February, 2009, at 10:00 a.m. at the same time and at the same place. If at the
adjourned Meeting no Quorum is present after half an hour has passed from the time scheduled for the Meeting then the Meeting shall be held
with any number of participants.
3. The poll card which can be used for voting ("the Poll Card") and the position statements within their meaning as provided in
Section 88 of the Companies Law, if there are any, can be reviewed on the Securities Authority's distribution site at
http://www.magna.isa.gov.il ("the Distribution Site") and on the website of the Tel Aviv Stock Exchange Ltd. at http://maya.tase.co.il .
4. Voting in writing shall be done by means of Part Two of the Poll Card, as displayed on the Distribution Site. Any shareholder may
approach the Company directly and receive from it the text of the Poll Card and the position statements. A member of the Stock Exchange
shall send, free of charge, by electronic mail, a link to the text of the Poll Card and the position statements on the Distribution Site to
each shareholder who is not registered in the Register of Shareholders and whose shares are registered with this member of the Stock
Exchange, if the shareholder has notified that he so wishes, provided that the notice was given with respect to a particular securities
account and in good time prior to the Determination Date.
In accordance with the Companies (Proof of Ownership of a Share for the Purpose of Voting at General Meeting) Regulations, 5760-2000, a
shareholder, in whose favour shares are registered with a member of the Stock Exchange, who wishes to vote at the Meeting, shall submit to
the Company confirmation by that member of the Stock Exchange concerning his ownership of the shares on the Determination Date, as required
under those Regulations. A shareholder, whose shares are registered with a member of Stock Exchange, is entitled to receive the confirmation
of ownership from the member of the Stock Exchange through whom he holds his shares, at the branch of the member of the Stock Exchange or by
mail to his address in return for payment of postage only, if he is so requests. Such a request shall be made in advance with reference to a
particular securities account.
The Poll Card and the documents that are required to be attached thereto as specified therein, shall be delivered to the Company's
offices (including by registered mail), together with a confirmation of ownership (and with respect to a registered shareholder - together
with a photocopy of the identity card, passport or certificate of incorporation, as the case may be), within seventy-two (72) hours prior to
the time scheduled for convening the Meeting, namely by Monday, 2nd February, 2009, at 10:00 a.m. For this purpose, the "Time of Delivery"
is when the Poll Card and the attached documents reached the Company's offices.
The last time for delivering position statements to the Company is no more than ten (10) days after the Determination Date, namely no
later than Sunday, 18th January, 2009, at 10:00 a.m.
5. The full text of the resolutions being presented for the approval of the General Meeting, the Bank's Memorandum and Articles of
Association and the text of the Indemnity Letter are open for inspection at the office of the Secretary of the Bank, 63-65Yehuda Halevy
Street in Tel Aviv, during regular working hours, by prior arrangement by phoning 03-5673800, commencing from the date of publication of the
notice regarding the convening of the Special General Meeting in the daily newspapers as required by law.
6. The representative of the Company for dealing with this immediate report is Adv. Ilan Mazur, the Chief Legal Advisor of the Bank,
of 63-65Yehuda Halevy St., in Tel-Aviv, Telephone (03) 567 3225, Facsimile (03) 567 3343.
Bank Hapoalim B.M.
The Names of the Signatories and Their Titles:
Ilan Mazur, Adv., Chief Legal Adviser
Yoram Weissbrem, Secretary of the Bank
cc: Bank of Israel - 20 Yavneh St., Tel-Aviv
Registrar of Companies - 97 Jaffa Road, Jerusalem
Annex "A"
Date: ______________
To:
_____________
Dear Sir/Madam,
Letter of Indemnification
The Bank hereby irrevocably undertakes:
1. To indemnify you for any liability or expense as specified in Sections 2.1 and 2.2 below, which shall be imposed on you and/or
which you will bear, due to acts performed by you in your capacity as an officer of the Bank (including acts preceding the date of this
letter of indemnification), which are directly or indirect associated with one or more of the types of events or any part thereof or
anything related thereto, as specified in Schedule A hereto, which constitutes an integral part hereof (the "Schedule"), provided that the
amount of the indemnification by virtue of this letter of indemnification shall not exceed the amount specified in Sections 4.1 and 4.2
below.
2. The indemnification undertaking as stated in Section 1 above, shall apply due to any liability or expense which is lawfully
indemnifiable, as follows:
2.1 Any monetary liability imposed on you in favor of another person pursuant to a judgment, including a judgment issued in a
settlement or an arbitration award that was approved by the court.
2.2 Reasonable litigation expenses, including attorney's fees, which you incurred or which were charged to you by a court, in a
proceeding initiated against you by the Bank or on its behalf or by another person, or in a criminal indictment from which you will be
acquitted or a criminal indictment in which you will be convicted of a criminal offense requiring no proof of general intent.
2.3 Reasonable litigation expenses, including attorney's fees, incurred by you due to an investigation or a proceeding conducted
against you by an authority authorized to conduct the investigation or the proceeding, and which ended without the filing of an indictment
against you and without a monetary liability being imposed on you as an alternative to a criminal proceeding, or having ended without the
filing of an indictment against you but with the imposition of a monetary liability as an alternative to a criminal proceeding, in an
offense requiring no proof of general intent.
"A proceeding ending without the filing of an indictment in a matter in which a criminal investigation was launched", means the closing
of the case pursuant to Section 62 of the Criminal Procedure Law [Consolidated Version], 5742-1982 (in this subsection - the Criminal
Procedure Law), or a stay of proceedings by the Attorney General pursuant to Section 231 of the Criminal Procedure Law;
"Monetary liability as an alternative to a criminal proceeding" - A monetary liability imposed by law as an alternative to a criminal
proceeding, including an administrative fine pursuant to the Administrative Offenses Law, 5746-1985, a fine for an offense determined as an
infraction pursuant to the provisions of the Criminal Procedure Law, a monetary penalty or a fine.
3. It is clarified that the provisions of Section 1 shall apply also due to a liability or expense as specified in Sections 2.1, 2.2
and 2.3 above, which shall have been imposed on you due to act performed by you by virtue of:
3.1 Your holding office on behalf of the Bank in an authorized organ in any corporation other than the Bank (the "Other
Corporation").
3.2 Your appointment on behalf of the Bank to any position in the Other Corporation.
3.3 For the avoidance of doubt, it is hereby clarified that for purposes of this Section 3, holding office and/or an appointment on
behalf of the Bank shall mean holding office and/or an appointment as aforesaid pursuant to the decision of the Bank's management and/or the
Bank's Board of Directors.
4. 4.1 The amount of the indemnification which the Bank shall pay pursuant to this letter due to any certain event (in addition to
amounts which shall be received from an insurance company, if any, in the context of insurance purchased by the Bank and/or amounts to be
received, if any, in the context of indemnification from any person other than the Bank), to all of the Bank's officers, in the aggregate,
pursuant to this letter of indemnification, due to one or more of the types of events specified in the Schedule, shall not exceed 25%
(twenty five percent) of the Bank's equity according to its latest financial statements published before the date of actual indemnification
(the "Maximum Indemnification Amount").
4.2 Within the framework of the Maximum Indemnification Amount and subject to the provisions of this letter, you shall be entitled to
full payment of any and all liabilities and litigation expenses as stated in Section 2 above, which shall be imposed on you and/or which you
will bear as provided in this letter.
4.3 If and insofar as the sum total of all indemnification amounts which the Bank will be required to pay due to a certain event,
shall exceed the Maximum Indemnification Amount or the balance of the Maximum Indemnification Amount yet unpaid by the Bank (as being at
that time), the Maximum Indemnification Amount or, as the case may be, the balance thereof, shall be divided among the officers who will be
entitled to indemnification, such that the indemnification amount which each one of the officers shall actually receive will be calculated
according to the ratio between the amount of indemnification which would be due to each one of the officers but for the Maximum
Indemnification Amount restriction, and the amount of indemnification which would be due to all of the said officers, in the aggregate, due
to the said event, but for the Maximum Indemnification Amount restriction.
5. Upon the occurrence of an event due to which you may be entitled to indemnification in accordance with the provisions of this
letter of indemnification, the Bank shall, from time to time, provide you with the moneys required to cover the expenses and various other
payments involved in the handling of such legal proceeding, including investigation proceedings, such that you will not be required to pay
or finance the same yourself, and all subject to the terms and provisions set forth in this letter of indemnification.
6. Without derogating from the aforesaid, the letter of indemnification shall be subject to the following conditions:
6.1 To the extent possible, you will notify the Bank of any legal proceeding which will be instituted against you or of any warning
in writing or threat in writing that such proceeding will be instituted against you in connection with any event due to which the
indemnification may apply, at the appropriate speed after first learning thereof, and you shall forward to the Bank or to whomever the Bank
shall notify you, any document to be delivered to you in connection with such proceeding; and all in circumstances in which you are aware
that the Bank is not a party to such legal proceeding or, as the case may be, is not cc'ed as an addressee in such warning or threat.
6.2 The Bank shall be entitled to assume the handling of your defense against such legal proceeding and/or to entrust such handling
to any attorney the Bank shall choose for this purpose. The Bank and/or such attorney will act in the context of such handling to bring the
said proceeding to an end, will provide you with current reports on the progress of the proceeding and will consult with you in connection
with the management thereof.
Where, in your opinion or in the attorney's opinion, a fear of a conflict of interests between you and the Bank shall be created and/or
representation by the attorney shall be required in a criminal proceeding which shall have been filed against you and/or if your objection
to the attorney appointed by the Bank shall be based on other reasonable grounds, you shall inform the Bank thereof, and will be entitled to
retain an attorney on your behalf, and the provisions of this letter of indemnification shall apply to the expenses you will incur due to
such appointment.
Insofar as the Bank and/or you may be entitled to indemnification in the context of the officers' insurance, in connection with the
proceeding, the appointment of the attorney as aforesaid will be made in consideration of the insurer's right to determine the identity of
the attorney who will represent you in the proceeding, and of the Bank's duties in this respect pursuant to such insurance, particularly if
according to the terms of the insurance, the insurer is entitled to determine the identity of the attorney who will represent you in the
proceeding, such that otherwise the insurer may be able to release itself from its indemnification undertaking or reduce the same. In any
event, the Bank will use its best efforts, within the framework of the terms of the insurance and subject thereto, to influence the choice
of the attorney in accordance with your wishes.
The Bank will not agree to make a settlement, as a result of which you will be required to pay amounts for which you will not be
indemnified pursuant to this letter of indemnification, nor will be paid in the context of insurance purchased by the Bank, other than with
your prior written consent, nor will the Bank agree to make a settlement if, in the context thereof, you will be convicted of a criminal
offense, other than with your prior written consent. In addition, in the event that the Bank shall choose to resolve disputes by way of
arbitration, it shall be entitled to do so provided that your prior written consent thereto is given, which consent you will not
unreasonably withhold. At the Bank's request, you will sign any document authorizing any attorney as aforesaid to handle your defense in the
said proceeding on your behalf and to represent you in anything related thereto, in accordance with the aforesaid.
If the Bank will not have informed you within 14 days from the date of receipt of the notice or of the Bank's learning as stated in
Section 6.1 above, that it is assuming the handling of your defense you will be entitled to appoint an attorney on your behalf and all of
the provisions of this letter of indemnification will apply accordingly.
You shall cooperate with the Bank and/or with any attorney as aforesaid in any manner reasonably required of you by either of them in
the context of their handling in connection with such legal proceeding, provided that the Bank shall arrange to cover all of your expenses
involved therein, such that you will not be required to pay or finance the same yourself, and all subject to the provisions of Section 4
above.
6.3 Regardless of whether or not the Bank shall act as specified in Section 6.2 above, the Bank will arrange to cover the liabilities
and expenses set forth in Section 2 above, such that you will not be required to pay or finance the same yourself, without thereby
derogating from the indemnification assured to you pursuant to the provisions of this letter of indemnification, and all subject to the
provisions of Section 4 above.
6.4 The indemnification in connection with any legal proceeding against you, as provided in this letter of indemnification, will not
apply to any amount that shall be due from you following a settlement or arbitration, unless the Bank shall have agreed in writing to such
settlement or to the holding of such arbitration, as the case may be. The Bank will not unreasonably refuse such settlement or the holding
of such arbitration, as the case may be.
6.5 The Bank will not be required to pay, pursuant to this letter of indemnification, monies that shall have actually been paid to
you or for you or in your stead in the context of insurance purchased by the Bank or any indemnification undertaking by any person other
than the Bank. The aforesaid does not prejudice your right to receive indemnification from the Bank for monies which you will be entitled to
receive from another person as aforesaid, but which shall not have actually been paid to you or for you or in your stead prior to the date
on which you will ask the Bank to make any payment by virtue of this letter of indemnification.
6.6 For the avoidance of doubt it is clarified that the amount of the indemnification pursuant to this letter of indemnification will
apply over and above, and in addition to the amount to be paid (if any) in the context of such insurance and/or indemnification.
6.7 Upon your request for the making of a payment in connection with any event pursuant to this letter of indemnification, the Bank
will take any and all acts required by law for payment thereof within 7 days from the date on which it is so required, and shall also act
for the arrangement of any approval required in connection therewith, if any. If any approval shall be required as aforesaid for any such
payment, and such payment shall not be approved in accordance therewith for any reason whatsoever, such payment or any part thereof which
shall not have been approved as aforesaid will be subject to approval by the court and the Bank will act to obtain the same.
6.8 In the event that the Bank will pay you or in your stead any amounts in the context of this letter of indemnification in
connection with a legal proceeding, following which it shall transpire that you are not entitled to indemnification from the Bank for such
amounts, for the reasons described below, the following provisions shall apply:
6.8.1 In the event that it shall be determined in the legal proceeding that you breached your fiduciary duty to the Bank and/or will
be convicted of a criminal charge in which general intent shall have been proven, you will be required to repay the said amounts to the Bank
upon being required in writing to do so and according to a payment schedule to be determined by the Bank.
6.8.2 In the event that it shall transpire that you are not entitled to indemnification from the Bank for other reasons, other than
those specified in Section 6.8.1 above, you will be required to repay the said amounts to the Bank, other than amounts for out-of-pocket
expenses incurred by you, by way of assignment to the Bank of your rights for reimbursement of the said amounts or, as the case may be, by
way of actual reimbursement thereof to the Bank, according to a payment schedule to be determined by the Bank.
7. The Bank's undertakings pursuant to this letter of indemnification will be available to you, or as the case may be, to (Heaven
forbid) your estate, also after termination of your office as an officer of the Bank, or your office (including your appointment) as
provided in Section 3 above in the Other Corporation, provided that the acts for which indemnification will be given shall have been
performed during your term of office as an officer of the Bank and/or your office, or appointment, in the Other Corporation.
8. In this letter of indemnification -
"Officer" within the meaning thereof in the Companies Law, 5759-1999 (the "Companies Law").
"Act" (or any other derivative thereof)
including a decision and/or an omission, and including an act (as defined herein) before the date of this letter of indemnification
during your term of office as an officer of the Bank and/or your office and/or appointment on behalf of the Bank in the Other Corporation.
Everything stated in the masculine also imports the feminine.
9. The Bank's undertakings pursuant to this letter of indemnification shall be interpreted broadly and in a manner aimed at
fulfillment thereof, to the extent permitted by law, for the purpose for which they were intended. In any event of discrepancy between any
provision of this letter of indemnification and a mandatory provision of law which cannot be modified or added to, such provision of law
shall prevail, although the other provisions of this letter of indemnification and the effect thereof shall not thereby be prejudiced.
10. The indemnification undertaking according to this letter is independent and is intended to add to, and not to derogate from, any
right you will have in the context of the Bank's officer insurance.
11. V.A.T. shall be added, if and to the extent required, to any payment pursuant to this letter of indemnification.
12. The Bank's undertakings pursuant to this letter of indemnification cannot be revoked and/or modified by the Bank, without
obtaining your prior written consent thereto. However, this letter of undertaking does not limit or prevent the Bank from increasing the
Maximum Indemnification Amount due to the indemnifiable events, either because the amounts of the insurance pursuant to the officers
insurance policy shall be reduced, or because the Bank will be unable to obtain officers insurance to cover the events contemplated in this
letter of indemnification under reasonable terms or for any other reason, provided that such decision shall be adopted in the manners set
forth in the Companies Law. Without derogating from the aforesaid, if at any time after the issuance of this undertaking, the Bank will
issue an undertaking to indemnify officers which benefits the officers over and above the provisions of this letter of indemnification
("Improved Letters of Indemnification"), the terms and conditions of the Improved Letters of Indemnification shall apply to you as if included in this letter of indemnification from the outset.
This letter of indemnification is effective from January 1, 2002.
In witness whereof, the Bank has hereto set its hand, via authorized signatories who have been duly authorized therefor.
Bank Hapoalim B.M.
Headquarters
___________________ ___________________
[signature] [signature]
I confirm receipt of this letter of indemnification and my consent to the conditions thereof, including Section 6.8 above.
____________________
Schedule A
Types of Events
1. A transaction (including an extraordinary transaction) or an act, including a transfer, sale, purchase or lease of assets or
liabilities (including land, securities or rights) or the granting or receipt of a right in any one thereof and an act directly or
indirectly involved in such transaction.
2. A securities issue including, but without derogating from the generality of the aforesaid, a public securities offering pursuant
to a prospectus, a private placement or any other securities offering, by the Bank, a subsidiary or an affiliate, including tender offers,
self purchase of securities by the Bank or a subsidiary or an affiliate.
3. The giving of information, representations, opinions, financial statements or notices to any competent authority (including the
Registrar of Companies, the Securities Authority, the Supervisor of Banks, the Commissioner of the Capital Market, Insurance and Savings at
the Ministry of Finance and the tax authorities).
4. Acts in the context of legal proceedings by and/or against the Bank.
5. The giving of information, representations, reports, opinions or notices to any third party including pursuant to the Companies
Law, the Securities Law including regulations promulgated thereunder or pursuant to rules or directives prevailing at the stock exchange in
Israel and/or at stock exchanges overseas and/or pursuant to the instructions of the Supervisor of Banks.
6. The transfer of information that is required by law to companies holding an interest in the Bank.
7. A payment or payment demand which apply to the Bank by law.
8. An act in connection with the Bank's risk management (including insurance for all types of risks to which the Bank is exposed).
9. Acts in connection with the issuance and receipt of licenses and permits (including business licenses and licenses and approvals
that are required for the Bank's business management).
10. Acts in connection with the distribution of dividends to the Bank's shareholders.
11. Investments by the Bank in securities issued by various bodies (including the State) and investments in other financial assets
either in Israel or overseas.
12. An act and/or transaction deriving from or related to the holding of an office on behalf of the Bank in an authorized organ of
any held corporation and/or an appointment on behalf of the Bank in the Other Corporation, including an act in connection with the exercise
of voting rights in held corporations.
13. Breaches of laws such as the Banking Ordinance, the Restrictive Trade Practices Law, the Prohibition on Money Laundering Law, the
Prohibition on Terror Financing Law, the Banking Law (Licensing), the Banking Law (Customer Service), the Joint Investments in Trust Law,
the Privacy Protection Law, the Proper Conduct of Banking Business Regulations, the Regulation of the Practice of Investment Advice Law, the
Consumer Protection Law.
14. Performance of an act in the context of the occupations permissible to the Bank in the framework of Section 10 of the Banking Law
(Licensing), 5741-1981.
15. Without derogating from the generality of the provisions of Section 14 above, the approval and/or provision of credit. For this
purpose, "credit" - including as defined in the Banking Law (Licensing), 5741-1981.
16. Events associated with employment relations.
17. An act and/or omission associated with the business ties between the Bank and its customers and/or suppliers.
18. A restructuring or reorganization of the Bank or any decision pertaining thereto including, but without derogating from the
generality of the aforesaid, a merger, split, recapitalization of the Bank, subsidiaries or affiliates, the dissolution or sale thereof, an
allotment or a distribution.
19. Any provision of this Schedule above which concerns the performance of a particular act, shall be interpreted as referring also
to the non-performance thereof or to refrainment from performance of such act, and all unless the context of a specific provision does not
tolerate such interpretation.
For purposes of this Schedule A:
"Companies Law" - The Companies Law, 5759-1999.
"Securities Law" - The Securities law, 5728-1968.
"Security" - within the meaning thereof in Section 1 of the Companies Law.
"Consumer Protection Law" - The Consumer Protection Law, 5741-1981.
"Restrictive Trade Practices Law" - The Restrictive Trade Practices Law, 5748-1988.
"Prohibition on Money Laundering Law" - The Prohibition on Money Laundering Law, 5760-2000.
"Prohibition on Terror Financing Law" - The Prohibition on Terror Financing Law, 5765-2005.
"Regulation of the Practice of Investment Advice Law" - The Regulation of the Practice of Investment Advice, Investment Marketing and
Investment Portfolio Management Law, 5755-1995.
"Joint Investments in Trust Law" - The Joint Investments in Trust Law, 5754-1994.
"Privacy Protection Law" - The Privacy Protection Law, 5741-1981.
"Banking Law (Licensing)" - The Banking Law (Licensing), 5741-1981.
"Banking Law (Customer Service)" - The Banking Law (Customer Service), 5741-1981.
"Banking Ordinance" - The Banking Ordinance No. 26 for 1941.
"Proper Conduct of Banking Business Regulations" - The Proper Conduct of Banking Business Regulations on behalf of the Supervisor of
Banks.
To download the Poll Card please click on this link:
http://www.rns-pdf.londonstockexchange.com/rns/3177L_-2009-1-8.pdf
This information is provided by RNS
The company news service from the London Stock Exchange
END
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