Re Option Warrants

RNS Number:6096Y
Technoplast Industries Ld
12 May 2004

                                                     R. YOHAY & CO., LAW OFFICES

                                 64332  TOP  TOWER,  50, DIZENGOFF ST., TEL AVIV
       FAX:  [phone]  TEL:      e-mail: [e-mail]      83 39 525-03

                                                     ROBERT YOHAY
                                                     GILL RIMON
                                                     EYNAT BRETSHNAIDER

Tel Aviv, 6 May 2004


The London Stock Exchange
Company Announcements Section
Fax: [phone]


Dear Sir,
                    
             RE:    Technoplast Industries Ltd - Immediate report

Immediate report pursuant to the Securities Regulations, (private offer of
securities of a listed company) 5760-2000 (hereinafter: "the Regulations"),
concerning a private offer of 8,131,053 option warrants realizable into
8,131,053 of the Company's ordinary shares.


1.            Introduction

            Technoplast Industries Ltd. (hereinafter "Technoplast" or "the
Company") announced, to the Israel Securities Authority (ISA) and to the Tel
Aviv Stock Exchange (TASE), that on 4 May 2004, Technoplast's Board of Directors
approved a private offer of option warrants realizable into ordinary shares of
the Company in accordance with and pursuant to the private offer as set forth
below.

            The securities offered pursuant to this private shall grant the
offerees less than 5% of the voting rights in the Company (on a fully diluted
basis) subsequent to the allotment of shares to Kidron management and Holdings
(1961) Ltd. (hereinafter: "Kidron") pursuant to the immediate report published
by the company on 30 November 2003 (including the exercise of the option as
defined in paragraph 3.3 of the said immediate report).


2.         The Offerees

The Offerees are 4 banks: Bank Leumi Le-Israel Ltd., Israel Discount Bank Ltd.,
Bank Hapoalim Ltd., United Mizrachi Bank Ltd.


None of the offerees are interested parties in the Company (as such term is
defined in the Regulations) and none of the offerees shall become an interested
party in the Company subsequent to the allotment of the offered securities and/
or upon the exercise of the offered securities.

3.         The offered securities

3.1       Bank Leumi Le-Israel Ltd. is offered, 5,098,170 non tradeable option
warrants exercisable into 5,098,170 of the Company's ordinary shares.

            Bank Hapoalim Ltd. is offered, 1,268,444 non tradeable option
warrants exercisable into 1,268,444 of the Company's ordinary shares.

            Israel Discount Bank Ltd. is offered, 1,057,037 non tradeable option
warrants exercisable into 1,057,037 of the Company's ordinary shares.


            United Mizrachi Bank Ltd. is offered, 707,402 non tradeable option
warrants exercisable into 5,098,170 of the Company's ordinary shares.


3.2         The offerees shall be entitled to realize the offered option
warrants, all or in part, into ordinary shares of the Company at any time
subsequent to their allotment.


              Any option warrant not realized within 5 years of the date  the
Tel Aviv District court approves the Company's creditors arrangement shall
expire, shall be void and shall not confer any right whatsoever upon the
offerees vis-a-vis the Company.


3.3         The exercise price of the offered option warrants shall be a sum in
NIS. equal to US$ 0.0178 per share calculated according to the representative
rate of exchange known at the time of exercise.

3.4         The option warrants shall be issued for no consideration.


3.5         The option warrants shall not be listed for trade on the stock
            exchange.

3.6         In the event that the Company distributes bonus shares to its
shareholders during the period of time between the allotment of the offered
option warrants and the realization of the offered option warrants, the quantity
of realizable shares that each offeree shall be entitled to receive upon
exercise of the offered securities shall be increased by such number of shares
of the company equal to the number of bonus shares such offeree would have been
entitled to receive had he exercised the option warrants offered to him prior to
the distribution of bonus shares.


3.7         In the event that the Company offers its shareholders securities by
way of a rights issue during the period of time between the allotment of the
offered option warrants and the realization of the offered option warrants, the
Company shall offer such offered securities to the offerees under the same terms
and conditions as offered to the Company's shareholders and the offerees shall
be deemed to have realized the option warrants on the record date for such
rights issue.


              In the event that the Company offers its shareholders securities
by way of a rights issue in which the expiration date of the offered securities
shall take place prior to the expiration date of the offered option warrants,
the offerees shall be entitled to receive such rights prior to the realization
of the option warrants but no later that last date for the exercising of the
offered rights and at the same terms and conditions as offered to the Company's
shareholders.



3.8         In the event the Company distributes dividends, in cash or in kind,
during the period of time between the allotment of the option warrants and the
realization of the offered option warrants the realization price shall be
adjusted by way of subtracting the per share dividend rate from the existing
realization price.



3.9         In the event the Company divides or consolidates its share capital
into larger or smaller quantities, the amount of shares to be allotted upon the
exercise of the offered option warrants shall be increased or decreased in
proportion to the rate of division or consolidation respectively and the
exercise price shall be decreased or increased, respectively, in proportion to
the rate of division or consolidation.



3.10       Bank Leumi Le-Israel Ltd. shall hold 2.95% of the equity and voting
rights in the Company on a fully diluted basis immediately after the allotment
of shares to Kidron and Michael and Sigal Suzs pursuant to the immediate report
published by the company on 30 November 2003, including 542,173 of the Company's
shares held by Bank Leumi Le-Israel Ltd. at present.



              Bank Hapoalim Ltd. shall hold 0.82% of the equity and voting
rights in the Company on a fully diluted basis immediately after the allotment
of shares to Kidron and Michael and Sigal Suzs pursuant to the immediate report
published by the company on 30 November 2003, including 293,889 of the Company's
shares held by Bank Hapoalim Ltd. at present.



              Israel Discount Bank Ltd. shall hold 0.55% of the equity and
voting rights in the Company on a fully diluted basis immediately after the
allotment of shares to Kidron and Michael and Sigal Suzs pursuant to the
immediate report published by the company on 30 November 2003.



              United Mizrachi Bank Ltd. shall hold 0.37% of the equity and
voting rights in the of the equity and voting rights in the Company on a fully
diluted basis immediately after the allotment of shares to Kidron and Michael
and Sigal Suzs pursuant to the immediate report published by the company on 30
November 2003.



              The information regarding the offerees' holdings as set forth
herein is based on information held by the Company at the time of the publishing
of this immediate report. The Company shall publish updated information
regarding the said holdings as soon as the Company receives such updated
information.



3.11     The Company has been informed that the offerees have been granted a tag
along right by Kidron and Michael and Sigal Suzs (who shall become the control
holders of the Company subsequent to the allotment of shares to Kidron pursuant
to the immediate report published by the company on 30 November 2003), i.e. a
right to demand that Kidron and/or Michael and Sigal Suzs include them in a sale
of the Company's shares by Kidron and/or Michael and Sigal Suzs, pursuant to
terms determined by the offerees and Kidron and Michael and Sigal Suzs.



4.         The Company's share quote at the Tel-Aviv Stock Exchange



              The Closing price of the Company's on the Tel-Aviv Stock Exchange
on the day prior to the Company's board of director's resolution to approve the
above private offer was NIS 0.247.



            5.             The consideration for the offered securities



            The option warrants will be issued to the offerees for no
consideration. The option warrants will be realizable into the Company's
ordinary shares in consideration for a cash payment the exercise price.



The consideration to be received by the Company in the event of full exercise of
the offered option warrants shall amount to approximately US$ 145,000.



The Company plans to designate the above consideration for the financing of its
ongoing activities.



6.         The required approvals



            The issuing of the option warrants to the offerees is subject to the
approval of the Tel Aviv Stock Exchange to the registration for trade of the
shares issued upon the realization of the option warrants.



            The issuing of the option warrants to the offerees is subject to the
approval of the Tel-Aviv district court's approval to the Company's proposed
creditor's arrangement, due to the fact that this private offer is a part of the
above creditor's agreement and due to the fact that the said creditors
arrangement requires the approval of the Tel Aviv district court.



            This private offer shall require the approval of the Company's
general meeting in the event that two directors so demand or in the event that
one or more shareholders holding at least 5% of the equity of the Company and at
least 1% of the voting rights in the Company so demand or in the event that one
or more shareholders holding at least 5% of the voting rights in the Company so
demand, provided that such demand has been submitted within no more than 14 days
of the publication of this immediate report or within the publication of an
amending immediate report.



            In the event that such demand has been made, the Company's board of
directors shall convene an extraordinary general meeting within 21 days of the
receipt of such demand. The extraordinary general meeting shall be convened
within 35 days of the publication of the notice of the convening of such general
meeting. The general meeting shall be convened by the publishing of a notice in
two wide spread Hebrew daily newspapers and by sending, by registered mail, of
such notice to all of the Company's shareholders who are entitled to receive
notice of the convening of a general meeting.



7.             Agreements between the offerees and other shareholders



            To the best of the Company's knowledge, there are no agreements
between any of the offerees and any other shareholder of the Company with
respect to the purchase or sale of securities of the Company or with respect to
voting agreements of any kind.



8.         Lock up arrangements



The offered option warrants and/or the shares issued upon their realization
shall be subject to the lock up arrangements pursuant to the Israeli Securities
Law, 5728 - 1968 and pursuant to the Securities regulations (specifics with
respect to sections 15 A through 15 C to the Securities Law), 5760 - 2000, as
follows:



8.1       In a period of one year commencing on the date of issuance of the
option warrants, the offerees shall not be entitled to effect any transaction or
disposition with the issued option warrants and/or the shares issued upon their
realization on the stock exchange.



8.2       From the end of one year of the date of issuance of the option
warrants until the end of three years from the issuance date, the offerees shall
be entitled to effect transactions or dispositions with the option warrants
realized into the Company's shares on the stock exchange, provided that the
quantity of shares offered for sale or trade shall not exceed the average daily
trade volume of the Company's stock in the Tel Aviv Stock Exchange in a 8 week
period prior to the date of such proposed transaction and, provided further,
that the total quantity of shares offered for sale or trade by Dekel in each
fiscal quarter shall not exceed 1% of the Company's issued and paid up share
capital at the time of such proposed trade or sale (for the purposes of this
section the Company's issued and paid up share capital shall not include
convertible securities issued at or prior to the date of the proposed sale or
trade but not yet realized).



8.3       At the end of 3 years commencing at the date of issuance, there shall
no longer be an impediment with respect to effecting a transaction or
disposition with all the issued option warrants and/or the shares issued upon
their realization.



9.         The Company's representative with respect to matters regarding the
report


            The Company's representative with respect to matters regarding this
immediate report shall be Mr. Robert Yohay, Adv. and or Mr. Gill Rimon, Adv. of
Top Tower, 50 Dizengoff Street, Tel Aviv 64332; tel: [phone]; fax:
972-3-5253983.


                                                    Yours Sincerely,


                                                    Gill Rimon, Adv.
                                               R. Yohay & Co., Law Offices


                      This information is provided by RNS
            The company news service from the London Stock Exchange
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