Amiad Water Systems Ltd Publication of Circular and Notice of Meetings (8900C)

TIDMAFS

RNS Number : 8900C

Amiad Water Systems Ltd

23 June 2021

23 June 2021

Amiad Water Systems Ltd.

("Amiad" or the "Company")

Publication of Circular and Notice of EGM

Notice of AGM

Further to the Company's announcement on 28 April 2021, Amiad (AIM: AFS), a leading global producer of water treatment and filtration solutions, announces that it has, today, published a circular to shareholders (the "EGM Circular") containing details of the proposed cancellation of the admission of the Company's Ordinary Shares to trading on AIM (the "AIM Cancellation") and the proposed listing of the Company's Ordinary Shares to trading on the Tel Aviv Stock Exchange ("TASE") (the "TASE Listing"). The Circular is available on the Company's website (here: https://amiad.com/list-circulars/ ) and will be posted to shareholders tomorrow.

In addition, the Company has also published a circular to shareholders (the "AGM Circular") containing a notice convening an annual general meeting (the "AGM") to be held at 12.00 p.m. BST on Thursday 29 July 2021.

In relation to the AIM Cancellation and the TASE Listing, the EGM Circular contains a notice convening an extraordinary general meeting of the Company ("EGM") to be held on Thursday 29 July 2021 at 12.30 p.m. or as soon thereafter as the AGM is concluded, if later. The AGM and EGM (the "Meetings") will be held at the offices of Bryan Cave Leighton Paisner LLP, Governor's House, 5 Laurence Pountney Hill, London, EC4R 0BR. As described further below, unless circumstances change, shareholders will not be allowed to attend either of the Meetings in person.

Background to the transfer of listing to TASE

The Board of Directors (the "Board") has undertaken a review of the merits or otherwise of the Company continuing to be admitted to trading on AIM and has concluded that a proposal for the AIM Cancellation should be made to shareholders at the EGM. In reaching their decision to propose this to shareholders, the Directors have taken the following factors into account:

-- the Company's operations are principally located in Israel and its management is based in Israel. The Directors are of the view that additional interest may be drawn from investors resident in Israel due to an increased knowledge of the Group, its industry and the market in which it operates. The Board considers that this stronger understanding of the Group and its industry will, in the future, make the raising of further capital easier to achieve on terms acceptable to the Board and/or favourable to the Company and in the best interests of the Company and the shareholders as a whole;

-- the Board believes the TASE Listing will further consolidate the Company's market position whilst also enhancing the Group's corporate profile, credibility, brand awareness and market status within its home state of Israel;

-- based on the above, it is not considered worthwhile for the Company to incur the additional costs of maintaining a dual listing status on AIM and the Tel Aviv Stock Exchange, which would (i) be likely to result in a division of liquidity between the two markets, divert the Company's resources and partly negate the benefit of listing on the Tel Aviv Stock Exchange and the potential benefits to the valuation of the Ordinary Shares; and (ii) entail additional compliance costs, as well as management time, as the Company would have to comply with two sets of regulatory and disclosure requirements; and

-- the Board believes a TASE Listing would be better aligned with the Group's business development strategies and beneficial to the Group and the shareholders as a whole.

The Company is therefore seeking shareholder approval for the proposed AIM Cancellation, conditional upon the TASE Listing taking place, at the EGM .

A summary of the resolutions to be proposed at the EGM is as follows:

-- Resolution 1 is a resolution to approve the AIM Cancellation for the purposes of Rule 41 of the AIM Rules and is conditional upon the TASE Listing and provided the AIM cancellation occurs within three months of the passing of this resolution .

-- Resolution 2 is a resolution to approve the adoption of new articles of association of the Company, which will only become effective upon the TASE Listing.

-- Resolution 3 is a resolution to approve the adoption of a new remuneration policy for directors and executives of the Company, which will become effective upon the passing of the resolution.

-- Resolutions 4 is a resolution to approve the entry into amended indemnification and exemption agreements with each of Yariv Avisar, Arie Schor, Ran Shahor, Ronit Fein and Avital Refaely, which will only become effective upon the TASE Listing taking place.

-- Resolution 5 is a resolution to approve the entry into amended indemnification and exemption agreements with each of Dori Ivzori, Lilach Asher Topilsky, Ishay Davidi and Oded Rosen, which will only become effective upon the TASE Listing taking place.

Rule 41 of the AIM Rules for Companies (the "AIM Rules") requires any AIM company that wishes the London Stock Exchange (the "LSE") to cancel the admission of its shares to trading on AIM to notify shareholders and to separately inform the LSE of its preferred cancellation date at least 20 business days prior to such date. In accordance with Rule 41 of the AIM Rules, once the exact date for the AIM Cancellation is confirmed, the Directors will notify the LSE of the Company's intention to cancel the Company's admission of the Ordinary Shares to trading on AIM.

The Company will keep the market appraised of developments with the application process with the Tel Aviv Stock Exchange and the intended date for the AIM Cancellation. If the AIM Cancellation is approved, Stifel Nicolaus Europe Limited will cease to be nominated adviser and the sole broker of the Company and the Company will no longer be required to comply with the AIM Rules.

A copy of the expected timetable and a letter from Yariv Avisar, Non-Executive Chairman of Amiad, are set out below.

Notice of AGM and EGM

The AGM of the Company will be held at 12.00 p.m. BST on Thursday 29 July 2021 and the EGM will be held at 12.30 p.m. BST, or as soon thereafter as the AGM is concluded, if later, on the same day at the offices of Bryan Cave Leighton Paisner LLP, Governor's House, 5 Laurence Pountney Hill, London, EC4R 0BR.

In light of the current circumstances of the ongoing COVID-19 pandemic and UK government guidance, unless circumstances change, the Board has arranged for the quorum of one shareholder present in person or by proxy holding, in aggregate, at least 25% of the voting rights in the Company to be physically present at each of the Meetings and, unless otherwise announced by the Company prior to the Meetings, no other shareholders will be allowed to attend in person. To have their votes counted, all shareholders are urged to appoint the Chairman of the meeting as their proxy and holders of depository interests are urged to instruct Link Market Services Trustees to vote on their behalf.

To provide an opportunity to engage with the Board and ask questions, the Company intends to make available a facility for shareholders or depositary interest holders who register their interest in advance to watch and listen to the Meetings live over a webcast and ask questions in writing during the Meetings through an online "chat" facility. Questions can also be submitted in advance via email. Shareholders and depositary interest holders will not be able to vote at the Meetings via the webcast. There will not be any presentations from directors at the Meetings.

Details on registering for the webcasts and submitting questions can be found in the AGM Circular (which includes the resolutions to be proposed at the AGM and contains the Notice of AGM) and the EGM Circular that, today, have been published on Amiad's website at: https://amiad.com/list-circulars/

This announcement contains inside information for the purposes of the Market Abuse Regulation (596/2014/EU) as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018. The person responsible for arranging for the release of this announcement on behalf of the Company is Dori Ivzori, Chief Executive Officer.

Enquiries

 
 Amiad Water Systems Ltd. 
 Dori Ivzori, Chief Executive 
  Officer 
  Relly Shimko, Chief Financial 
  Officer                          [phone] 
                                  ----------------- 
 
 Stifel Nicolaus Europe Ltd. 
                                  ----------------- 
 Fred Walsh, Stewart Wallace       [phone] 
                                  ----------------- 
 
 Luther Pendragon 
                                  ----------------- 
 Harry Chathli, Claire Norbury     [phone] 
                                  ----------------- 
 

About Amiad

Amiad Water Systems (AIM: AFS) is a leading global producer of automatic, self-cleaning water treatment and filtration products and systems. Through its engineering skills and ability to innovate, Amiad provides cost-effective "green" solutions for irrigation and industrial purposes. In these markets, its unique and high-quality products are being integrated into the core of systems for filtration and water treatment, micro irrigation and membrane protection, wastewater and potable water treatment, cooling systems and sea water filtration. Headquartered in Israel, Amiad provides these solutions through ten subsidiaries and a comprehensive network of distributors to customers in more than 80 countries.

FIMI Opportunity Funds, the leading private equity investor in Israel, is a controlling shareholder of Amiad, with an interest in 42.8% of the Company's outstanding issued share capital.

For additional information or product details, please visit www.amiad.com .

Expected Timetable of Principal Events

 
 Announcement of proposed AIM Cancellation           28 April 2021 
  and notice provided to the London 
  Stock Exchange 
 Publication of the Circular                          23 June 2021 
 Latest time and date for holders of         12.30 p.m. on 26 July 
  Depository Interests to submit their                        2021 
  proxy instructions through CREST in 
  respect of the Extraordinary General 
  Meeting 
 Latest time and date for receipt of         12.30 p.m. on 27 July 
  completed Forms of Proxy in respect                         2021 
  of the Extraordinary General Meeting 
 Time and date of the Extraordinary          12.30 p.m. on 29 July 
  General Meeting                                          2021(5) 
 

Notes:

1. All of the times referred to in this document and the Form of Proxy refer to London time, unless otherwise stated.

2. Each of the times and dates in the above timetable is subject to change. If any of the above times and/or dates change, the revised times and dates will be notified to shareholders by an announcement through a Regulatory Information Service.

3. Under the Israeli Companies Law, the Company is required to give at least 35 clear calendar days' notice of the Extraordinary General Meeting.

4. The AIM Cancellation requires the approval of not less than 75 per cent of the votes cast by Shareholders at the Extraordinary General Meeting. If passed, the resolution in respect of the AIM Cancellation will be conditional upon the TASE Listing and the AIM Cancellation taking place within three months of the passing of the resolution. The exact timing of the AIM Cancellation is contingent upon the timing of the TASE Listing and is expected to occur no later than 20 Business Days following the first trading day of the Ordinary Shares on the Tel Aviv Stock Exchange. Once the date of the TASE Listing and the date of the AIM Cancellation are confirmed, the Company will make further announcements regarding such dates as soon as practicable. The TASE Listing is subject to the approval of the ISA and the Tel Aviv Stock Exchange, and there is no guarantee that the ISA and/or the Tel Aviv Stock Exchange will approve the TASE Listing in a timely manner or at all.

5. Or as soon thereafter as the annual general meeting of the Company has been concluded, if later.

LETTER FROM THE NON-EXECUTIVE CHAIRMAN

Dear Shareholder or Depository Interest Holder

Proposed Cancellation of Admission to Trading on AIM

Adoption of New Articles of Association

Adoption of New Remuneration Policy for Directors and Executives

Adoption of Amendments to the Directors' and the CEO's Indemnification and Exemption Agreements

and

Notice of Extraordinary General Meeting

   1            INTRODUCTION 

1.1 On 28 April 2021, the Company announced that it had concluded that, following a careful review of the benefits and drawbacks of the Company's Ordinary Shares continuing to be admitted to trading on AIM and whether it should seek a listing on an alternative exchange, the Board had concluded that a TASE Listing and simultaneous AIM Cancellation would be likely to be in the best interests of both the Company and its Shareholders as a whole. For this reason, the Company is seeking Shareholders' approval for the cancellation of the admission of its Ordinary Shares from trading on AIM, which shall be conditional upon the Company achieving a listing on the Tel Aviv Stock Exchange.

1.2 The Board is proposing a resolution to approve the AIM Cancellation and certain other resolutions required in connection with the TASE Listing at the Extraordinary General Meeting to be held at 12.30 p.m. on 29 July 2021, or as soon thereafter as the annual general meeting of the Company has been concluded, if later. The purpose of this document is to set out the reasons for the AIM Cancellation and the TASE Listing and explain why the Directors unanimously consider the Resolutions to be in the best interests of the Company and its Shareholders as a whole and why the Directors unanimously recommend that you vote in favour of the Resolutions. A notice convening the Extraordinary General Meeting is set out at the end of this document.

1.3 The AIM Cancellation is conditional, pursuant to Rule 41 of the AIM Rules, upon the approval of not less than 75 per cent of the votes cast by Shareholders (whether present in person or by proxy) at the Extraordinary General Meeting, notice of which is set out at the end of this document. The AIM Cancellation is also conditional upon the completion of the TASE Listing. The Company is committed to remaining public and for the Ordinary Shares to be traded on an internationally recognised stock exchange, such as the Tel Aviv Stock Exchange. The Company will keep the market appraised of developments with the TASE Listing application process and the intended AIM Cancellation.

1.4 The London Stock Exchange has been notified by the Company of its intention to pursue the AIM Cancellation and the Company will keep the London Stock Exchange updated of any progress with the TASE Listing.

   2            BACKGROUND TO, AND REASONS FOR, THE TEL AVIV LISTING AND THE AIM CANCELLATION 

2.1 The Board has undertaken a review of the merits or otherwise of the Company continuing to be admitted to trading on AIM and has concluded that a proposal for the AIM Cancellation should be made to Shareholders at the Extraordinary General Meeting. In reaching their decision to propose this to Shareholders, the Directors have taken the following factors into account:

(a) the Company's operations are principally located in Israel and its management is based in Israel. The Directors are of the view that additional interest may be drawn from investors resident in Israel due to an increased knowledge of the Group, its industry and the market in which it operates. The Board considers that this stronger understanding of the Group and its industry will, in the future, make the raising of further capital easier to achieve on terms acceptable to the Board and/or favourable to the Company and in the best interests of the Company and the Shareholders as a whole;

(b) the Board believes the TASE Listing will further consolidate the Company's market position whilst also enhancing the Group's corporate profile, credibility, brand awareness and market status within its home state of Israel;

(c) based on the above, it is not considered worthwhile for the Company to incur the additional costs of maintaining a dual listing status on AIM and the Tel Aviv Stock Exchange, which would (i) be likely to result in a division of liquidity between the two markets, divert the Company's resources and partly negate the benefit of listing on the Tel Aviv Stock Exchange and the potential benefits to the valuation of the Ordinary Shares; and (ii) entail additional compliance costs, as well as management time, as the Company would have to comply with two sets of regulatory and disclosure requirements; and

(d) the Board believes a TASE Listing would be better aligned with the Group's business development strategies and beneficial to the Group and the Shareholders as a whole.

2.2 The TASE Listing is subject to, among other things, the approval of the ISA and the Tel Aviv Stock Exchange and the AIM Cancellation is conditional upon Shareholders' approval and the TASE Listing taking place. If these conditions are met, the AIM Cancellation is expected to take place no later than 20 Business Days following the first day of trading in the Ordinary Shares on the Tel Aviv Stock Exchange. The expected dates of the AIM Cancellation and TASE Listing are subject to change, and there is no guarantee that the ISA and/or the Tel Aviv Stock Exchange will approve the proposed TASE Listing in a timely manner or at all. The Company will keep the market appraised of developments with the TASE Listing application process and the intended AIM Cancellation. Announcements of the confirmed dates of the TASE Listing and the AIM Cancellation will be made as soon as practicable.

   3            PROCESS FOR, AND PRINCIPAL EFFECTS OF, THE RESOLUTIONS 

3.1 The Directors are aware that certain Shareholders may be unable or unwilling to hold directly or indirectly Ordinary Shares in a company listed on the Tel Aviv Stock Exchange. Such Shareholders should consider selling their interests in the market prior to the AIM Cancellation and the TASE Listing becoming effective.

3.2 Under the Companies Law, the Company is required to give at least 35 clear calendar days' notice of the Extraordinary General Meeting. Under Rule 41 of the AIM Rules, the Company is required to give at least 20 Business Days' notice of the AIM Cancellation. Additionally, the AIM Cancellation will not take effect until at least five clear Business Days have passed following the passing of the resolution for the AIM Cancellation. Once the date of the AIM Cancellation is confirmed, which in any event shall not be later than three months from the date of the relevant resolution, the Company will announce such date as soon as practicable bearing in mind the AIM requirements described above.

3.3 The principal effects that the AIM Cancellation will have on Shareholders include the following:

(a) there will no longer be a formal market mechanism enabling Shareholders to trade their Ordinary Shares on AIM (or any other UK recognised market or UK trading exchange);

(b) while the Ordinary Shares remain freely transferable pursuant to the Articles and through the Tel Aviv Stock Exchange, the Ordinary Shares may, for certain investors, be more difficult to sell compared to shares of companies traded on AIM;

(c) the holders of Ordinary Shares will no longer have the benefit of pre-emption rights due to the amendments to the Articles which, if approved, will be effective from the TASE Listing (but it is noted that the Company does not intend to issue any additional shares on a non-pre-emptive basis in the period between TASE Listing and AIM Cancellation);

(d) the Company will no longer be subject to the AIM Rules and, accordingly, Shareholders will no longer be afforded the protections given by the AIM Rules. In particular:

(i) to comply with any of the corporate governance practices applicable to AIM companies to the extent not otherwise mandated by Israeli law or the rules and regulations of the Tel Aviv Stock Exchange; and

(ii) the Company will no longer be required to retain a nominated adviser and, as a result, Stifel will cease to be the nominated adviser and sole broker to the Company; and

(e) the AIM Cancellation may have either positive or negative taxation consequences for Shareholders and Depository Interest Holders (Shareholders or Depository Interest Holders who are in any doubt about their tax position should consult their own professional independent adviser immediately).

3.4 In addition, while Israeli law and the rules and regulations of the Tel Aviv Stock Exchange will require the Company to make public announcements of material events, and announce and approve interim and final results, substantial transactions and related party transactions, such announcements will be made in Hebrew and in accordance with the disclosure and approval requirements of Israeli law.

3.5 In accordance with the Companies Law, the Company will retain an appropriate number of independent non-executive directors on its Board following the AIM Cancellation and continue to follow corporate governance practices customary for an Israeli company listed on the Tel Aviv Stock Exchange, including maintaining at least two statutory external directors on its Board as well as an audit committee, each of which shall be comprised solely of statutory external directors and other independent directors.

3.6 The FIMI Relationship Agreement and the HaChoshlim Relationship Agreement and the protections afforded by those agreements, including that all transactions between the Company and FIMI or HaChoshlim will be conducted at arm's length and on commercial terms, will cease to be effective from the AIM Cancellation. However, it is noted that, even after the FIMI Relationship Agreement and the HaChoshlim Relationship Agreement cease to be effective, any transaction between the Company and either FIMI or HaChoshlim, who are deemed to be controlling shareholders of the Company under the Companies Law, would require the approval of both the Audit Committee and the Board and, in the event of an extraordinary transaction (as such term is defined in the Companies Law), the majority of the Company's Shareholders.

3.7 The Company intends to continue to maintain the Company's website (www.amiad.com) in English and to post updates on that website from time to time, although Shareholders should be aware that there will be no obligation on the Company to include the information required under AIM Rule 26 or to update the website as required by the AIM Rules.

3.8 The Company will remain registered with the Israeli Registrar of Companies in accordance with and subject to the Companies Law, notwithstanding the AIM Cancellation. Shareholders should also note that the Takeover Code does not apply to the Company.

3.9 Following the AIM Cancellation, the Depository Interest structure will be cancelled and it will not be possible to hold Depository Interests in CREST. Shareholders will also no longer be able to hold their Ordinary Shares in physical certificated form following completion of the TASE Listing. Further details are set out in paragraph 5 (Dealing in Shares following the TASE Listing and AIM Cancellation) below on the process for dealing in the Ordinary Shares following the TASE Listing and the AIM Cancellation.

The above considerations are not exhaustive and Shareholders should seek their own independent advice when assessing the likely impact of the TASE Listing and the AIM Cancellation upon them.

   4            PROCESS FOR CANCELLATION 

4.1 Under the AIM Rules, it is a requirement that the AIM Cancellation must be approved by not less than 75 per cent of votes cast by Shareholders at an Extraordinary General Meeting. Accordingly, the Notice of Extraordinary General Meeting set out at the end of this document contains a resolution to approve the AIM Cancellation.

4.2 Furthermore, Rule 41 of the AIM Rules requires any AIM company that wishes the London Stock Exchange to cancel the admission of its shares to trading on AIM to notify shareholders and to separately inform the London Stock Exchange of its preferred cancellation date at least 20 Business Days prior to such date. In accordance with Rule 41 of the AIM Rules, once the exact date for the AIM Cancellation is confirmed, the Directors will notify the London Stock Exchange of the Company's intention to cancel the Company's admission of the Ordinary Shares to trading on AIM. The Company will keep the market appraised of developments with the application process with the Tel Aviv Stock Exchange and the intended date for the AIM Cancellation. If the AIM Cancellation is approved, Stifel will cease to be nominated adviser and the sole broker of the Company and the Company will no longer be required to comply with the AIM Rules.

   5            DEALING IN SHARES FOLLOWING THE TASE LISTING AND AIM CANCELLATION 

5.1 Following the TASE Listing and the AIM Cancellation, all Shareholders will retain their existing shareholding.

5.2 With effect from the AIM Cancellation, the appointment of Link Group as the Depository in respect of the Depository Interests shall be terminated and, from close of business on the date of the AIM Cancellation, the Depository Interests will cease to be eligible to settle in CREST.

5.3 Under Israeli law and the Tel Aviv Stock Exchange rules, once listed on the Tel Aviv Stock Exchange, the Company will be unable to provide share certificates or maintain a share register outside of Israel. Accordingly, Shareholders and Depository Interest Holders are strongly encouraged to transfer their holdings to a bank or broker who is or has an Israeli affiliate or correspondent broker and which, in either case, is a member of the Tel Aviv Stock Exchange or is able to make arrangements with the Israeli nominee of such a member (an "Israeli Representative") no later than five Business Days (whether in London or Tel Aviv) before the date of the AIM Cancellation. To the extent that Shareholders do not transfer their holdings to an Israeli Representative by no later than five Business Days before the date of the AIM Cancellation, all share certificates will be cancelled and electronic shares will be issued in place of them to an Israeli nominee appointed by the Company (the "Appointed Nominee") who will hold the Ordinary Shares on behalf of such Shareholder until such time as the relevant Shareholder transfers their holding to an Israeli Representative in the manner specified above.

5.4 Following the AIM Cancellation, Shareholders will be unable to trade their Ordinary Shares unless and until they transfer their holdings to an Israeli Representative in the manner specified above.

5.5 If a Shareholder's Ordinary Shares are held by the Appointed Nominee and they wishes to vote those Ordinary Shares, receive dividends in respect of those Ordinary Shares or transfer those Ordinary Shares from the Appointed Nominee to an Israeli Representative, Shareholders will need to contact the Company and the Appointed Nominee and provide them with evidence of their identity which, for an individual will be a copy of their identity card or passport and, in the case of a company or other corporate entity, a certification of incorporation along with any other document required by the Company and the Appointed Nominee for that purpose.

   6            ADOPTION OF NEW ARTICLES 

6.1 The Company is proposing, pursuant to Resolution 2 and conditional upon the TASE Listing, to adopt the New Articles. The New Articles will be in Hebrew and reflect the corporate governance practices and requirements for an Israeli company with a listing on the Tel Aviv Stock Exchange. The principal differences between the current articles of association and the New Articles are summarised as follows:

(a) the removal of the par value of the Ordinary Shares in the Company's authorised share capital so that the Ordinary Shares of the Company will be without par value;

   (b)     the removal of shareholder pre-emption rights; 
   (c)     the removal of the requirement that shareholder meetings be held in the UK; 

(d) the removal of shareholder notification requirements included for the purposes of the AIM Rules;

   (e)     the removal of provisions in relation to Depository Interests; and 

(f) the updating of the provisions relating to the directors' and officers' indemnification and insurance.

6.2 It is noted that, even though the New Articles will not include shareholder pre-emption rights, to the extent that the New Articles are approved and come into effect upon the TASE Listing, the Company does not intend to issue any additional shares on a non-pre-emptive basis between the TASE Listing and the AIM Cancellation.

6.3 A copy of the New Articles (together with an English translation) will be produced at the Extraordinary General Meeting but, in the meantime, can be accessed via the Company's website: https://amiad.com/investor-relations/. It should be emphasised that, if Resolution 2 is passed at the Extraordinary General Meeting, the New Articles will only become effective upon the TASE Listing occurring.

   7            ADOPTION OF NEW REMUNERATION POLICY FOR DIRECTORS AND EXECUTIVES 

7.1 The Company is proposing, pursuant to Resolution 3, to adopt the New Remuneration Policy to reflect the Company's current view on the appropriate remuneration and incentives for its officeholders.

7.2 Pursuant to the Companies Law, all public Israeli companies are required to adopt a written remuneration policy for their executives and directors, which addresses certain items prescribed by the Companies Law. The adoption, amendment and restatement of the policy is to be recommended by the Company's remuneration committee and approved by the Board and Shareholders every three years. The Company's current policy was adopted on 17 August 2016 and reapproved on 12 December 2019.

7.3 In connection with the proposed TASE Listing, the Company's remuneration committee and the Board have each recommended and approved the adoption of the New Remuneration Policy, which reflects updated corporate governance practices and requirements for an Israeli public company.

7.4 A copy of the New Remuneration Policy (together with an English translation) will be produced at the Extraordinary General Meeting but, in the meantime, can be accessed via the Company's website: https://amiad.com/investor-relations/. It should be emphasised that, if Resolution 2 is passed at the Extraordinary General Meeting, the New Remuneration Policy will become effective upon the resolution being passed.

8 ADOPTION OF AMMENTS TO THE DIRECTORS' AND THE CEO'S INDEMNIFICATION AND EXEMPTION AGREEMENTS

8.1 The Company is proposing, pursuant to Resolution 4 and Resolution 5, but conditional upon the TASE Listing occurring, to enter into amended indemnification and exemption agreements with each of the Directors and the CEO.

8.2 Pursuant to the Companies Law, the adoption of or amendment to the directors' or the chief executive officer's remuneration terms, which include (under the Companies Law) the terms of any indemnification and exemption undertaking, requires the approval of the Company's remuneration committee, its board of directors and its shareholders. In addition to this, if any of the remuneration terms being adopted or amended relate to the chief executive officer or any of the directors affiliated with a controlling shareholder (as such term is defined in the Companies Law), the relevant shareholder resolution is required to be approved by a special majority of the Company's shareholders, the details of which are included in paragraph 9.4 below.

8.3 As each of Lilach Asher Topilsky and Ishay Davidi are affiliated with FIMI and Oded Rosen is affiliated with HaChoshlim, the entry into amended indemnification and exemption agreements with each of these Directors shall, along with the entry into an amended indemnification and exemption agreement with Dori Ivzori (as the chief executive officer), require approval by a separate shareholder resolution, being Resolution 5, which will require approval by the special majority detailed in paragraph 9.4 below. The indemnification and exemption agreements with each of these Directors affiliated with a controlling shareholder will also be limited to a three-year term in accordance with the Companies Law.

8.4 The proposed amendments, which are intended to bring these agreements in line with common practice for an Israeli public company listed on the Tel Aviv Stock Exchange, provide the Directors and the CEO with indemnification in connection with certain administrative actions that may be commenced by the ISA, subject to the limitations and terms prescribed by Israeli law.

8.5 Copies of the updated Directors' and CEO's indemnification and exemption agreements will be produced at the Extraordinary General Meeting but, in the meantime, can be accessed via the Company's website: https://amiad.com/investor-relations/. It should be emphasised that, if both Resolution 4 and Resolution 5 are passed by the requisite majorities at the Extraordinary General Meeting, the amended indemnification and exemption agreements will only become effective upon the TASE Listing occurring.

   9            EXTRAORDINARY GENERAL MEETING 

9.1 You will find set out at the end of this document a notice convening an Extraordinary General Meeting to be held at 12.30 p.m. on 29 July 2021 (or as soon thereafter as the annual general meeting of the Company shall have been concluded, if later) at the offices of Bryan Cave Leighton Paisner LLP, Governor's House, 5 Laurence Pountney Hill, London EC4R 0BR, United Kingdom, at which the Resolutions will be proposed. A summary of the Resolutions is set out below:

(a) Resolution 1 is a resolution to approve the AIM Cancellation for the purposes of Rule 41 of the AIM Rules and is conditional upon the TASE Listing and the AIM Cancellation taking place within three months of the resolution.

(b) Resolution 2 is a resolution to approve the adoption of the New Articles, which will only become effective upon the TASE Listing.

(c) Resolution 3 is a resolution to approve the adoption of the New Remuneration Policy, which will become effective upon the passing of the resolution.

(d) Resolution 4 is a resolution to approve the entry into amended indemnification and exemption agreements with each of Yariv Avisar, Arie Schor, Ran Shahor, Ronit Fein and Avital Refaely, which will only become effective upon the TASE Listing taking place.

(e) Resolution 5 is a resolution to approve the entry into amended indemnification and exemption agreements with each of Dori Ivzori, Lilach Asher Topilsky, Ishay Davidi and Oded Rosen, which will only become effective upon the TASE Listing taking place.

9.2 The full text of each of the Resolutions is set out in the Notice of the Extraordinary General Meeting at the end of this document.

9.3 Resolution 1 requires a majority of not less than 75 per cent of the votes cast (by Shareholders present in person or by proxy) to be in favour of the resolution at the Extraordinary General Meeting in order to be passed.

9.4 Each of Resolutions 2, 3, 4 and 5 require a simple majority of the votes cast (by Shareholders present in person or by proxy) to be in favour of the resolution at the Extraordinary General Meeting in order to be passed. In addition, both Resolutions 3 and 5 also require either (i) the affirmative vote of the holders of a majority of the voting rights represented and voting on the Resolution, in person or by proxy, who are not controlling shareholders of the Company or shareholders who have a personal interest (as each such term is defined in the Companies Law) in such Resolution or (ii) the total Ordinary Shares of non-controlling shareholders and non-interested shareholders voting against such Resolution must not represent more than two per cent of the issued Ordinary Shares. For this purpose, you are asked to indicate on the Form of Proxy whether you are a controlling shareholder or have a personal interest in Resolution 3 and/or Resolution 5.

   10          ACTION TO BE TAKEN 

The action to be taken in respect of the Extraordinary General Meeting depends on whether you hold your Ordinary Shares in certificated form or as Depository Interests.

   10.1       Certificated Shareholders 

10.1.1 A Form of Proxy for use by Shareholders at the Extraordinary General Meeting or at any adjournment of it is enclosed. Due to the limitations on attendance at the Extraordinary General Meeting, as set out in more detail in the "Important Meeting Information" section above, Shareholders are urged to complete and return the Form of Proxy (in accordance with the instructions set out in that document) to the Company's registrar, Link Group, at PXS1, 10th Floor, Central Square, 29 Wellington Square, Leeds, LS1 4DL, United Kingdom as soon as possible and in any event so as to be received by the Company's registrar by no later than 12.30 p.m. (UK time) on 27 July 2021 or forty-eight (48) hours before any adjourned meeting. Shareholders can also vote by completing and submitting a Form of Proxy online through the Company's registrar's share portal at www.signalshares.com.

10.1.2 Shareholders should appoint the Chairman of the Extraordinary General Meeting as their proxy. If a Shareholder appoints someone else as their proxy, unless circumstances change, that proxy will not be able to attend the Extraordinary General Meeting in person or cast the Shareholder's vote.

   10.2       Depository Interest Holders 

10.2.1 Depository Interest Holders are requested to appoint, and give instruction to, the Depository through the CREST electronic proxy appointment service in accordance with the procedures described in the CREST Manual. In order for a proxy appointment made by means of CREST to be valid, the appropriate CREST message must be properly authenticated in accordance with Euroclear UK & Ireland Limited's specifications and must contain the information required for such instructions, as described in the CREST Manual. The message must be transmitted so as to be received by the Company's registrar, Link Group (ID RA10), no later than 12.30 p.m. (UK time) on 26 July 2021 or seventy-two (72) hours before any adjourned meeting. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST.

10.2.2 Depository Interest Holders cannot vote in person at the Extraordinary General Meeting. Depository Interest Holders are therefore requested to appoint and instruct the Depository to vote on their behalf through CREST as soon as possible and in any event by the times and dates stated above.

   11          RECOMMATION 

The Directors consider that the AIM Cancellation and the TASE Listing are both in the best interests of the Company and its Shareholders as a whole and therefore unanimously recommend that you vote in favour of each of the Resolutions, as they intend to do in respect of their own beneficial holdings.

Yours sincerely

Yariv Avisar

Non-Executive Chairman

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(END) Dow Jones Newswires

June 23, 2021 10:14 ET (14:14 GMT)