|
Form
20-F
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X
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Form
40-F
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Yes
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No
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X
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(1)
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reelection
of Ami Erel, Shay Livnat, Raanan Cohen, Oren Lieder, Avraham Bigger, Rafi
Bisker and Shlomo Waxe as directors and election of Haim
Gavrieli as a director;
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(2)
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approval
of a related party transaction - grant of letter of exemption and
indemnification to office holders who are controlling
shareholders;
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(3)
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reappointment
of Somekh Chaikin as our independent auditor; and
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(4)
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consideration
of our audited financial statements for the year ended December 31,
2007.
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Company
Contact
Shiri
Israeli
Investor
Relations Coordinator
investors@cellcom.co.il
Tel:
+972 52 998 9755
|
Investor Relations
Contact
Ehud
Helft / Ed Job
CCGK
Investor Relations
ehud@gkir.com /
ed.job@ccgir.com
Tel:
(US) 1 866 704 6710 / 1 646 213
1914
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(1)
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reelection
of Ami Erel,
Shay Livnat, Raanan Cohen, Oren Lieder, Avraham Bigger, Rafi Bisker and
Shlomo Waxe as directors and election of Haim Gavrieli as a
director;
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(2)
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approval
of a related party transaction - grant of letter of exemption and
indemnification to office holders who are controlling
shareholders;
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(3)
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reappointment
of Somekh Chaikin, a member of KPMG International, as our independent
auditor; and
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(4)
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consideration
of our audited financial statements for the year ended December 31,
2007.
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(1)
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reelection of Ami Erel, Shay Livnat, Raanan
Cohen, Oren Lieder, Avraham Bigger, Rafi Bisker and Shlomo Waxe as
directors and election of Haim Gavrieli as a
director;
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(2)
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approval
of a related party transaction - grant of letter of exemption and
indemnification to office holders who are controlling
shareholders;
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(3)
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reappointment
of Somekh Chaikin, a member of KPMG International, as our independent
auditors; and
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(4)
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consideration
of our audited financial statements for the year ended December 31,
2007.
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Shares
Beneficially Owned
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||||||||
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Name
of Beneficial Owner
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Number
|
Percent
|
||||||
|
Discount
Investment Corporation Ltd. ("DIC")*
|
54,750,000 | 56.02% | ||||||
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Directors
and executive officers as a group (21 persons)**
|
54,929,892 | 56.2% | ||||||
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*
|
Includes
24,375,855 ordinary shares held by two wholly-owned subsidiaries of DIC
(namely, PEC Israel Economic Corporation, a Maine corporation, and DIC
Communication and Technology Ltd., an Israeli company) and 5,362,500
ordinary shares, representing approximately 5.5% of our issued and
outstanding shares, held by four shareholders whose voting rights are
vested in DIC. DIC is a majority-owned subsidiary of IDB Development
Corporation Ltd., or IDB Development, which in turn is a majority-owned
subsidiary of IDB Holding Corporation Ltd., or IDB, IDB Development and
DIC are public Israeli companies traded on the Tel Aviv Stock
Exchange.
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IDB
is controlled as follows:
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·
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Ganden
Holdings Ltd., or Ganden, a private Israeli company controlled by Nochi
Dankner (who is also the Chairman of the board of directors and Chief
Executive Office of IDB, the Chairman of the board of directors of IDB
Development and DIC and one of our directors) and his sister Shelly
Bergman, holds, directly and through a wholly-owned subsidiary,
approximately 54.72% of the outstanding shares of
IDB;
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·
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Shelly
Bergman, through a wholly-owned company, holds approximately 4.23% of the
outstanding shares of IDB;
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·
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Avraham
Livnat Ltd., or Livnat, a private company controlled by Avraham Livnat
(one of whose sons, Zvi Livnat, is a director and Executive Vice President
of IDB, a director and Deputy Chairman of the board of directors of IDB
Development and a director of DIC, and another son, Shay Livnat, is one of
our directors and a director of IDB Development) holds, directly and
through a wholly-owned subsidiary, approximately 13.26% of the outstanding
shares of IDB; and
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·
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Manor
Holdings B.A. Ltd., or Manor, a private company controlled by Ruth Manor
(whose husband, Isaac Manor, is one of our directors, Deputy Chairman of
the board of directors of IDB, and a director of IDB Development and DIC,
and their son Dori Manor is a director of IDB, IDB Development and DIC)
holds, directly and through a majority-owned subsidiary, approximately
13.24% of the outstanding shares of
IDB.
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**
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Includes
179,892 shares issuable upon the exercise of stock options that are
exercisable on, or within 60 days following, June 10, 2008. However, the
terms of the 2006 Share Inventive Plan provide for a net exercise
mechanism, the result of which is to require us to issue a smaller number
of ordinary shares than represented by the outstanding options. Unless our
Board of Directors otherwise approves, the number of ordinary shares
issuable by us upon the exercise of an option will represent a market
value that equals the difference between the market price of the ordinary shares and the option
exercise price of the exercised options, at the date of
exercise. Also includes the 54,750,000 shares beneficially owned by DIC,
which may be deemed to be beneficially owned by Nochi Dankner by virtue of
his control of IDB. Each of our directors who is affiliated with IDB or
DIC disclaims beneficial ownership of such
shares.
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“RESOLVED, that
Ami Erel be re-elected to the Board of Directors of the Company, effective
immediately.
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RESOLVED, that Shay Livnat be re-elected to the Board of Directors
of the Company, effective
immediately.
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RESOLVED, that Raanan Cohen be re-elected to the Board of Directors
of the Company, effective
immediately.
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RESOLVED, that Oren Lieder be re-elected to the Board of Directors
of the Company, effective
immediately.
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RESOLVED, that Avraham Bigger be re-elected to the Board of
Directors of the Company, effective
immediately.
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RESOLVED, that Rafi Bisker be re-elected to the Board of Directors
of the Company, effective
immediately.
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RESOLVED, that Shlomo Waxe be re-elected to the Board of Directors
of the Company, effective
immediately.
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RESOLVED, that Haim Gavrieli be elected to the Board of Directors
of the Company, effective
immediately.”
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“RESOLVED, that
Somekh Chaikin, be reappointed as the independent auditors of the Company
until the 2009 Annual General
Meeting.”
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CONVENIENCE
TRANSLATION FROM HEBREW
THE HEBREW VERSION
IS THE BINDING VERSION
|
| Date: ____________ |
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1.
|
The Company
hereby exempts you in advance of any liability for any damage caused to it
due to a breach of your duty of care towards it in your actions by virtue
of your position as an office holder, and subject to those limitations
determined by any law. It is hereby clarified that the Company does not
exempt you in advance from your liability towards it due to a breach of
duty of care in an allocation, in as much as such applies to you, if at
all.
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2.
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The Company
hereby undertakes to indemnify you for indebtedness or expense as detailed
in Paragraph 4 below, which may be imposed upon you or which you paid
following actions you took by virtue of your being an office holder,
inasmuch as the indebtedness or expense was not actually paid by an
insurance policy or an indemnification of a third
party.
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3.
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The provisions
of this letter of exemption and indemnification are subject to the
provisions of Chapter 3 of Part 6 of the Companies
Law.
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4.1
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Monetary
indebtedness imposed upon you for the benefit of another person by a court
ruling, including a judgment given in a compromise or an arbitrator's
rulling approved by court, due to actions you carried out by virtue of
your being an office holder related, directly or indirectly, to one or
more of the events detailed in the appendix to this letter of exemption
and indemnification (henceforth – "the
Appendix") provided that the maximum amount of indemnification will
not exceed the amount detailed in Paragraph 5 below;
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4.2
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Reasonable
litigation expenses, including attorney's fees, which you spent because of
an investigation or proceedings which was conducted against you by an
authority authorized to conduct an investigation of proceedings, and which
concluded without filing an indictment against you and without
a monetary indebtedness being imposed upon you instead of criminal
proceedings, or which concluded without filing an indictment against you
but with a monetary indebtedness being imposed upon you instead of
criminal proceedings in a criminal offence not requiring criminal proof of
Mens Rea; in this
paragraph – conclusion of proceedings without filing an
indictment in a matter in which a criminal investigation was initiated –
shall mean closing the case in accordance with Section 62 of the
Criminal Procedure Law [Integrated Version], 5742 – 1982 (in this
Paragraph – the Criminal Procedure Law), or a stay in proceedings by the
Attorney General in accordance with Section 231 of the Criminal Procedure
Law;
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"Monetary
indebtedness instead of criminal proceedings" - monetary indebtedness
legally imposed instead of criminal proceedings, including an
administrative fine in accordance with the Administrative Offences Law,
5746-1985, a fine for an offence determined to be an offence punishable by
fine in accordance with the provisions of the Criminal Procedure Law, a
monetary sanction or redemption;
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||
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4.3
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Reasonable
litigation expenses, including attorney's fees, which you will pay or for
which you will be made liable by the court, in proceedings conducted
against you by
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or in the name
of the Company or by another person, or in a criminal indictment from
which you will be acquitted, or in a criminal indictment in which you will
be convicted of a crime not requiring proof of
Mens Rea.
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5.1
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The amounts
which the Company will pay in accordance with Paragraph 4.1 above to all
office holders in the aggregate, in accordance with all letters of
exemption and indemnification that were issued and /or will be issued in
accordance with the indemnification decisions (henceforth – the
"letter of indemnification"), will not exceed an amount equivalent
to all the insurance payments, which the Company will receive from time to
time in the framework of any Office Holders' Liability Insurance in the
Company, with the addition of an amount equivalent to 30% of the
shareholders' equity of the Company as per its audited financial
statements for 31.12.2001, after being adjusted from time to time to the
rate of increase of the Consumers Price Index from that date (henceforth –
"the
maximum indemnification amount").
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5.2
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If and to the
extent that the total of all the amounts which the Company will be
required to pay in accordance with Paragraph 4.1 above at any date
whatsoever, with the addition of the total of all the amounts that the
Company has paid up to that date, in accordance with the letters of
indemnification as defined in Paragraph 5.1 above, will exceed the maximum
indemnity amount, the maximum indemnity amount, or the balance remaining
of it, respectively, will be divided between the office holders who will
be entitled to the said amounts in respect of claims made by them to the
Company under the letters of indemnification and were not paid to them
prior to that date, so that the amount that each one of the said office
holders will actually receive will be calculated according to the ratio
between the amount due to each one of the office holders and the amount
due to all the said office holders, in the aggregate, at that date in
respect of these claims. If it becomes clear at a later date,
that amounts which the Company was required to pay have become available,
whether because of that stated in Paragraph 7 below or because
of the dismissal of claims against office holders without the need to pay
for them all or part of the amounts that the office holder claimed, the
balance of the indemnification amount will be increased by the amounts
made available and all the office holders who received only their relative
share as stated above will be entitled to their relative share, pro rata,
of the amounts made available.
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5.3
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In order to
clarify the manner of calculation detailed in Paragraph 5.2 above, we
shall give the following example: let us assume that the maximum indemnity
amount is 500. At a certain date, Office Holder A was paid an
amount of 100 in respect of an indemnification given to
him. As a result, the balance for indemnification after
the payment stands at 400. At a later date, Office Holders B, C
and D were sued, and they claim indemnification from the Company in the
amounts of 100, 200, and 300 respectively. In such a case,
since the amount of indemnification claimed (600) is larger than the
balance for indemnification (400), the balance will be divided
proportionately between the office holders in the following manner: Office
holder B will receive 400*100/600, Office holder C will receive
400*200/600, and Office holder D will receive 400*300/600. If
after the said payment, it will become clear that Office holder A was not
entitled to indemnification, an amount of 100 will become available and it
will be returned to the general fund. The amount that become
available (100) will be divided proportionately between B, C and D so that
B will be paid an additional amount of 100*100/600, C will be paid an
additional amount of 100*200/600, and D will be paid an additional amount
of 100*300/600.
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5.4
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In any event
the amount of indemnification paid to you by the Company, together with
the amounts paid to you in the framework of an insurance policy and/or in
accordance with an undertaking of indemnification by any third party
whatsoever, will not exceed the amount of monetary indebtedness and/or
expenses as stated in Paragraph 4 above, which was borne or incurred by
you. For this matter, the amounts of the self participation according to
the insurance policy, if such were set, will be considered as amounts not
actually paid. If the Company will pay you or in your place amounts which
you are entitled to receive in accordance with the insurance policy and/or
in accordance with the undertaking of indemnification by any third party
whatsoever, then you will assign the Company your rights to receive the
sums in accordance with the insurance policy or the undertaking of
indemnification by a third party, inasmuch as there is no impediment to
the assignment of these rights, and you will authorize the Company to
collect these amounts in your name, inasmuch as required to carry out the
provisions of this Paragraph. If you collected directly from the insurance
company or from any third party whatsoever, these amounts will be returned
by you to the Company in accordance with the provisions of Paragraph 7
below.
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6.1
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Subject to any
laws, the Company will notify you of any suspicion or threat that legal
proceedings, an investigation or proceedings by an authorized authority,
may be initiated against you, this with due promptness after it first
became known to the Company, and no later than at the end of 10 business
days after it first became known to the Company, and will give you,
without delay, a copy of any document connected with the proceedings
served to it by the originator of the proceedings.
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6.2
|
Subject to any
laws, you will notify the Company of any legal proceedings, investigation
or proceedings by an authorized authority, initiated against you, and of
any suspicion or threat that such will be initiated against you, this with
due promptness after it first became known to you, and no later than at
the end of 10 business days after it first became known to you, and you
will give the Company or to whom it directs, without delay, a copy of any
document connected with the proceedings served to you by the originator of
the proceedings.
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6.3
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The Company
will be entitled to take over the conducting of your legal defense in the
framework of such proceedings and/or transfer the said conducting to a
reputable attorney with experience in the relevant field whom the Company
will choose for this purpose. The Company may appoint an attorney as
stated above provided that your agreement is given in advance, in writing,
to the identity of the attorney. However, your said agreement will only be
withheld on reasonable grounds, including due to circumstances in which
there is, in your reasonable opinion, a conflict of interests between your
defense and that of the Company or another office holder. In the event of
such conflict of interests, a separate attorney acceptable to you will be
appointed on for you, in order to protect your personal
interests. Subject to the aforesaid, the Company and/or any
such lawyer are entitled to act in the framework of the said conducting
while reporting to you on a current basis and consulting with
you
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The Company
and/or the said attorney will be allowed to bring the proceedings to a
conclusion. However, the Company and/or the attorney will not
agree to a compromise being made, as a result of which you will be
convicted of a criminal offense or you will be required to pay amounts for
which you will not be
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indemnified in
accordance with this letter of indemnification and you will not be paid in
the framework of the insurance purchased by the Company or in the
framework of an indemnification by a third party, except with your prior
consent in writing. The Company will not agree to decide in a
dispute by way of arbitration except after your prior consent in writing
was received. However, your said consent will not be
withheld except on reasonable grounds.
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||
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At the request
of the Company, you will sign any document authorizing the Company and/or
any such attorney to conduct in your name your defense in the framework of
those proceedings and to represent you in everything connected to the
same, in accordance with the aforesaid.
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||
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6.4
|
You will
cooperate with the Company and/or any such attorney in every reasonable
way required of you by any of them in the framework of their conducting
concerning those proceedings, including dedicating all the time required
for dealing with those proceedings, signing requests, statements, powers
of attorney and any other document, provided that the Company will take
care of full cover of all the expenses involved so that you will not be
required to pay them or to finance them yourself, all subject to that
stated in Paragraphs 4 and 5 above.
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6.5
|
The Company
will not be obligated to indemnify you for any amount which will be
charged to you following a compromise or arbitration arrangement, unless
the Company's consent was given in advance in writing to the compromise
arrangement or the carrying out of that arbitration,
respectively.
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6.6
|
Whether the
Company exercises its right in accordance with Paragraph 6.3 above or not,
the Company will take care of full cover of all the litigation expenses
stated in Paragraphs 4.2 and 4.3 above, and will pay those expenses so
that you will not be required to pay them or to finance them yourself, all
subject to that stated in Paragraphs 4 and 5.4 above.
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Subject to
Paragraph 7.1 below, amounts that will be paid by the Company as stated
above will be credited as an advance payment on account of the
indemnification amount to which you will be entitled in accordance with
this letter of indemnification.
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||
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6.7
|
Upon your
request to make a payment in connection with any event whatsoever in
accordance with this letter of indemnification, the Company will take all
the steps required by law for its payment, and will act to arrange for any
approval that may be required in connection with the same, if
required.
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6.8
|
At any time,
you may contact the Corporate Secretary and receive information regarding
the amount of balance remaining for indemnification not yet paid by virtue
of the letters of indemnification as defined in Paragraph 5.1
above.
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7.1
|
If the Company
paid you or instead of you any amounts in accordance with this letter of
indemnification, including amounts in accordance with Paragraph 6.6 above,
and it became clear afterwards that you are not entitled to
indemnification from the Company for those amounts, the amounts will be
considered as a loan provided to you by the Company which will bear
interest at the minimum rate determined in accordance with section 3 (i)
of the Income Tax Ordinance, or any other law which will replace it, as
may be from time to time, and which does not represent a taxable benefit
to you.
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In the said
event, you will repay the loan when required in writing by the Company to
do so, and in accordance with a payment arrangement which the Company will
decide, with the approval of the Audit Committee of the
Company.
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||
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It is hereby
clarified that, in the event that the Company paid you, or instead of you,
litigation expenses, including attorney's fees, following an investigation
or proceedings carried out against by the authorized authority, or
concerning criminal proceedings initiated against you, these amounts will
be considered as a loan the Company provided you, on the conditions stated
in this Section. If and when it will be made clear that the
Company may legally indemnify you for these amounts, these amounts will
become indemnification amounts paid to you by the Company in accordance
with this letter of indemnification, you will not be required to refund
them to the Company, the interest in respect of them will be waived, and
the Company will bear tax payments which will therefore apply to you, in
as much as there will be such.
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||
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7.2
|
It is hereby
clarified that amounts ruled in your favor in the framework of legal
proceedings, a compromise arrangement or arbitration concerning
indebtedness or expenses which were previously paid to you or instead of
you by the Company in accordance with this letter of indemnification, will
be refunded by you to the Company immediately upon their receipt by
you. In the event that the said amounts were ruled in your
favor and you have not yet received them, you will assign the Company your
rights for the receipt of the said amounts and/or authorize the Company to
collect these amounts in your name.
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8.
|
The Company's
obligation in accordance with this letter of exemption and indemnification
will remain in your favor after the end of your service as an office
holder provided that the actions subject to this letter of exemption and
indemnification were carried out during your period of service as an
office holder.
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9.
|
The Company's
obligations in accordance with this letter of exemption and
indemnification will be interpreted widely and in a manner intended for
their implementation, inasmuch as permitted by law, for the purpose for
which they were intended. In the event of a contradiction
between any provision in this letter of exemption and indemnification and
the provision of law which cannot be conditioned upon, changed or added
to, the said provision of the law will prevail, but the aforesaid will not
impair or derogate from the validity of the other provisions in this
letter of exemption and indemnification.
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10.
|
The total of
all the indemnification amounts payable in accordance with Paragraph 4.1
of the letter of indemnification which were provided, including those
which will be provided in the future, by virtue of the indemnification
decisions, will not exceed the maximum indemnification amount as defined
in Paragraph 5 above.
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11.
|
This
letter of exemption and indemnification will not impair or derogate from
future decisions of the Company to provide indemnification in advance or
after the fact in any matter subject to all laws, and shall not oblige the
Company to provide you additional indemnification to that stated in this
letter of exemption and indemnification.
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12.
|
The Appendix
to this letter of exemption and indemnification is an integral part
thereof.
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1.
|
A transaction
within the meaning of Paragraph 1 of the Companies Law, including the
transfer, sale, letting or acquisition of assets or liabilities, including
securities, or the giving or receiving of right in any one of them, and an
action directly or indirectly involved in such a
transaction.
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2.
|
An action,
including provision of information and documents, in connection with a
transaction as set forth in Paragraph 1 above.
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3.
|
A report or
notice served by the Company or on its behalf, to the various supervisory
authorities, including, but not limited to, the Ministry of
Communications, The Ministry of Treasury, the Ministry for the
Environmental protection, the Ministry of Industry, Trade and employment,
etc.
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4.
|
A report or
notice served by the Company or on its behalf, by virtue of the
Communication Laws, Companies Laws, Securities Laws, the various Tax Laws,
Untitrust Laws, statutes regulating labor relations or any other law
obliging the Company to report or give notice, or a law of another country
regulating similar matters and/or avoidance of serving the aforesaid
report or notice.
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5.
|
A report or
notice to the shareholders, whether regulated by laws of Israeli and/or
foreign securities laws, or regulated by other laws.
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6.
|
A report or
notice which the Company is obligated to give by power of agreements with
credit lenders, institutions and other third parties.
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|
7.
|
Events in
connection with change in ownership of the Company or change in the
structure of the Company. Its reorganization, dissolution or any decision
concerning them, including, but not limited to, merger, division, change
in the capital of the Company, establishment of subsidiaries, their
dissolution or sale, issuance and allocation.
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8.
|
An action in
the areas of the Company's business in connection with the setting up of
sites and construction of technological engineering systems, including
matters of Building and Planning, licensing of sites, licensing of
businesses, security, insurance, environmental
protection.
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9.
|
An action in
the area of the Company's business in relation to interface with its
customers, including in connection with customer data banks, protection of
their privacy and matters covered by Consumer Protection
Laws.
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10.
|
An action in
the area of the Company's business with relation to the Company's billing
interface with its customers, and with other communications
operators.
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11.
|
An action
connected with the relationships with the various communications
operators, dealers, importers, suppliers, consultants and additional
bodies with whom the Company enters into agreements and/or
cooperates.
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12.
|
An action
connected with multi-participant events which the Company is accustomed to
hold from time to time with its customers, employees, agents, dealers or
suppliers.
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|
13.
|
A remark,
saying including an expression of a position or opinion made in good faith
by you as an office holder and by virtue of this position and including
within the framework of meetings of the Board of Directors, one of its
committees or in meetings of the Management.
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14.
|
The aforesaid
will apply with the required adjustments to such actions in "another
company".
|
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15.
|
An offer of
securities to the public/or listing of securities for trade in a stock
exchange, In Israel or abroad, and publishing of a prospectus for this
purpose.
|
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|
16.
|
An action,
including provision of information and documents, in connection with that
stated in Paragraph 15 above.
|
|
CELLCOM
ISRAEL LTD.
|
||||||
|
Date:
|
June
16, 2008
|
By:
|
/s/
Liat Menahemi Stadler
|
|||
|
Name:
|
Liat
Menahemi Stadler
|
|||||
|
Title:
|
General
Counsel
|
|||||