CELLCOM
ISRAEL LTD.
NOTICE
OF THE 2010 ANNUAL GENERAL MEETING OF SHAREHOLDERS
Notice is
hereby given that the 2010 Annual General Meeting of Shareholders (the “Meeting”) of Cellcom Israel
Ltd. (the “Company”)
will be held on April 7, 2010, at 4:00 p.m. (Israel time), at the
offices of the Company, 10 Hagavish Street, Netanya, Israel, for the following
purposes:
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(1)
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re-election
of Ami Erel,
Shay Livnat, Raanan Cohen, Avraham Bigger, Rafi Bisker, Shlomo Waxe, Haim
Gavrieli, Ari Bronshtein and Tal Raz as
directors;
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(2)
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Re-election
of Ronit Baytel and Joseph Barnea as external
directors;
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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,
2009.
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Shareholders
of record at the close of business on March 8, 2010 (“Record Date”) are entitled to
notice of, and to vote at, the Meeting. All shareholders are cordially invited
to attend the Meeting in person.
Shareholders
who are unable to attend the Meeting in person are requested to complete, date
and sign the enclosed form of proxy and to return it promptly in the
pre-addressed envelope provided. No postage is required if mailed in
the United States. If a shareholder’s shares are held by a member of the Tel
Aviv Stock Exchange for trading thereon, such shareholder should deliver or mail
(via registered mail) his, her or its completed proxy to the offices of the
Company at the address set forth above, Attention: Liat Menahemi Stadler,
General Counsel and Corporate Secretary, together with a proof of ownership
(ishur baalut), as of
the record date, issued by that member of the Tel Aviv Stock Exchange.
Shareholders who attend the Meeting may revoke their proxies and vote their
shares in person.
Joint
holders of shares should take note that, pursuant to Article 31(d) of the
Articles of Association of the Company, the vote of the most senior of such
joint holders who tenders a vote, in person or by proxy, will be accepted to the
exclusion of the vote(s) of the other joint holder(s). For this
purpose, seniority will be determined by the order in which the names stand in
the Company’s Register of Members.
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By Order
of the Board of Directors,
Liat
Menahemi Stadler
General Counsel and Corporate
Secretary
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Dated: February
25, 2010
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10
Hagavish Street
Netanya,
Israel
PROXY
STATEMENT
This Proxy Statement is furnished to
the holders of Ordinary Shares, par value NIS 0.01 per share (the “Ordinary Shares”), of Cellcom
Israel Ltd. (the “Company”) in connection with
the solicitation by the Board of Directors of proxies for use at the 2010 Annual
General Meeting of Shareholders (the “Meeting”), or at any
adjournment thereof, pursuant to the accompanying Notice of the 2010 Annual
General Meeting of Shareholders. The Meeting will be held on April 7,
2010, at 4:00 p.m. (Israel time), at the offices of the Company, 10 Hagavish
Street, Netanya, Israel.
The
agenda of the Meeting will be as follows:
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(1)
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re-election of Ami Erel, Shay Livnat, Raanan
Cohen, Avraham Bigger, Rafi Bisker, Shlomo Waxe, Haim Gavrieli Ari
Bronshtein and Tal Raz as
directors;
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(2)
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re-election
of Ronit Baytel and Joseph Barnea as external
directors;
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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,
2009.
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The Company currently is not aware of
any other matters that will come before the Meeting. If any other
matters properly come before the Meeting, the persons designated as proxies may
vote in accordance with their judgment on such matters.
A form of proxy for use at the Meeting
is enclosed. Unless otherwise indicated on the form of proxy, Ordinary Shares
represented by any proxy in the enclosed form will be voted in favor of all the
matters to be presented at the Meeting, as described above. To be valid, a proxy
must be properly executed and received by the Company not less than 72 hours
prior to the time scheduled for the Meeting, unless a shorter period is
determined by the chairman of the Meeting. Shareholders may revoke the authority
granted by their execution of proxies by delivering to the Company a written
notice of revocation or duly executed proxy bearing a later date, provided such
revocation notice or later proxy is received prior to the above deadline, or by
voting in person at the Meeting. On all matters considered at the Meeting,
abstentions and broker non-votes will be treated as neither a vote “for” nor
“against” the matter, although they will be counted in determining whether a
quorum is present.
Proxies for use at the Meeting are
being solicited by the Board of Directors of the Company. Only
shareholders of record at the close of business on March 8, 2010 will be
entitled to vote at the Meeting. Proxies are being mailed to shareholders on or
about March 8, 2010 and will be solicited mainly by mail. However, certain
officers, directors, employees and agents of the Company, none of whom will
receive additional compensation therefore, may solicit proxies by telephone,
e-mail or other personal contact. The Company will bear the cost for
the solicitation of the proxies, including postage, printing and handling, and
will reimburse the reasonable expenses of brokerage firms and others for
forwarding material to beneficial owners of Ordinary Shares.
On February 23, 2010, 98,895,729 Ordinary Shares were
outstanding. Subject to the voting restrictions described
below, each Ordinary Share is entitled to one vote upon each of the matters to
be presented at the Meeting. Two or more shareholders holding in the aggregate
at least one-third of the outstanding voting power in the Company, present in
person or by proxy and entitled to vote, will constitute a quorum at the
Meeting.
Voting
Restrictions under our Telecommunications Licenses
We provide our cellular services under
a non-exclusive general license granted to us by the Ministry of Communications
of the State of Israel. We also hold several other licenses for the
provision of certain telecommunications services. According to our licenses,
investors are prohibited from acquiring or transferring (alone or together with
relatives or with other parties who collaborate on a regular basis) our Ordinary
Shares, directly or indirectly (including by way of creating a pledge which if
foreclosed, would result in the transfer of shares), in one transaction or a
series of transactions, if such acquisition or transfer will result in a holding
or transfer of 10% or more of any of our means of control, or from transferring
any of our means of control if as a result of such transfer, control over our
Company will be transferred from one party to another, without the prior
approval of the Ministry of Communications. Our specific licenses also require
approval of the Minister of Communications before acquiring the ability to
exercise significant influence over us. In this context, holding 25% or more of
our means of control is presumed to confer significant influence. In addition,
according to our licenses, if you hold more than 5% of our means of control, you
may not (i) hold, directly or indirectly, more than 5% of the means of control
in Bezeq – The Israeli Telecommunications Corporation Ltd., or Bezeq, which is
the incumbent landline operator in Israel, or in another cellular operator in
Israel (subject to certain exceptions), (ii) serve as an office holder of one of
our competitors, other than in specific circumstances and subject to the
approval of the Ministry of Communications, or (iii) be party to any arrangement
whatsoever with Bezeq or another cellular operator that is intended or is likely
to restrict or harm competition in Israel in the field of cellular services,
cellular handsets or other cellular services. For more details relating to these
restrictions, please see “Item 4.B – Business Overview – Government
Regulations—Our Principal License” and "Other Licenses" of our Annual Report for
2009 on Form 20-F, which we intend to file with the SEC on or about March 2,
2010, and our principal license, a convenience English translation of which is
an exhibit to our Annual Reports. The holding and transfer restrictions under
our licenses are posted on our website at www.cellcom.co.il under “Investor
Relations – Corporate Governance – Company Profile - Legal &
Corporate.”
As required under our license, our
Articles of Association provide that any holdings of our Ordinary Shares that
contravene the holding or transfer restrictions contained in our licenses will
not be entitled to voting rights. In addition, our licenses and our Articles of
Association require that as a condition to voting by any shareholders, in person
or by proxy, at any meeting of shareholders, such shareholder must certify that
his, her or its holdings of our Ordinary Shares do not contravene any of the
restrictions contained in our licenses.
Since it is highly unlikely that any of
the Company’s shareholders has lost the right to vote his, her or its Ordinary
Shares pursuant to the Company’s licenses and to avoid confusion, the enclosed
form of proxy includes a certification that your holdings of our Ordinary Shares
do not contravene any of the holding or transfer restrictions set forth in our
licenses. If your holdings of Ordinary Shares do so contravene, then
you are not entitled to vote such shares and you should not sign or send the
form of proxy. If only a portion of your holdings of Ordinary Shares
so contravenes, you may be entitled to vote the portion that does not
contravene. In that case, please contact the Company's General Counsel at
+972-52-998-9595 for instructions on how to vote your non-contravening Ordinary
Shares or, if you hold your shares in "street name", you may also contact the
representative managing your account, who could then contact the Company on your
behalf.
Share Ownership
The following table sets forth
information regarding beneficial ownership of our shares as of December 31,
2009, by each person, or group of affiliated persons, known to us to be the
beneficial owner of 5% or more of our outstanding shares.
In
accordance with the rules of the U.S. Securities and Exchange Commission (SEC),
beneficial ownership includes voting or investment power with respect to
securities and includes any shares issuable pursuant to options that are
exercisable within 60 days of December 31, 2009. Any shares issuable pursuant to
options are deemed outstanding for computing the percentage of the person
holding such options but are not outstanding for computing the percentage of any
other person. The percentage of beneficial ownership for the
following table is based on 98,895,729 ordinary shares
outstanding
as of February 23, 2010. To our knowledge, except as indicated in the
footnotes to this table and pursuant to applicable community property laws, our
major shareholders do not have different voting rights and the persons named in
the table have sole voting and investment power with respect to all ordinary
shares held by them.
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Shares
Beneficially Owned
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Discount
Investment Corporation Ltd.*
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51,450,000 |
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52.02 |
% |
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Directors
and executive officers as a group (24 persons)**
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51,580,658 |
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52.16 |
% |
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*
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DIC,
a public Israeli company traded on the Tel Aviv Stock Exchange, is a
majority-owned subsidiary of IDB Development Corporation Ltd., or IDB
Development. Includes 23,661,645 Ordinary Shares held by DIC directly,
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 3,412,500
Ordinary Shares, representing approximately 3.45% of our issued and
outstanding shares, held by two shareholders whose voting rights are
vested in DIC. Does not include 125,658 Ordinary Shares (representing
approximately 0.13% of our issued and outstanding shares) held as of
December 31, 2009 by indirect subsidiaries of IDB Development for their
own account and 1,947,420 Ordinary Shares (representing approximately
1.97% of our issued and outstanding shares) held as of that date for
members of the public through, among others, provident funds, mutual
funds, pension funds, exchange traded funds, insurance policies and unaffiliated third-party
client accounts, which are managed by such
subsidiaries.
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IDB
Development, an Israeli company, is a wholly-owned subsidiary of IDB Holding
Corporation Ltd., or IDB, a public Israeli company traded on the Tel Aviv Stock
Exchange.
IDB is
controlled as follows:
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Ganden
Holdings Ltd., or Ganden, a private Israeli company controlled by Nochi
Dankner (who is also the Chairman of the boards of directors of IDB, IDB
Development and DIC and one of our directors) and his sister Shelly
Bergman, held as of December 31, 2009, directly and through a wholly-owned
subsidiary, approximately 55.26% of the outstanding shares of
IDB;
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Shelly
Bergman, through a wholly-owned company, held as of December 31, 2009
approximately 4.23% of the outstanding shares of
IDB;
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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) held as of December 31,
2009, directly and through a wholly-owned subsidiary, approximately 13.43%
of the outstanding shares of IDB;
and
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Manor
Holdings BA Ltd., or Manor, a private company controlled by Ruth Manor
(whose husband, Isaac Manor, is one of our directors a director and 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) held as of December 31, 2009, directly and through a
majority-owned subsidiary, approximately 13.42% of the outstanding shares
of IDB.
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Subsidiaries
of Ganden, Livnat and Manor have entered into a shareholders agreement with
respect to shares of IDB held by these subsidiaries, constituting 31.02%, 10.34%
and 10.34%, respectively, of the outstanding shares of IDB for the purpose of
maintaining and exercising control of IDB as a group. Their additional holdings
in IDB are not subject to the shareholders agreement. The term of the
shareholders agreement expires in May 2023.
Most of
the foregoing holdings in IDB have been pledged to financial institutions as
collateral for loans taken to finance the purchase of IDB's shares. Upon certain
events of default, these financial institutions may foreclose on the loans and
assume ownership of or sell such holdings.
Based on
the foregoing, IDB and IDB Development (by reason of their control of DIC),
Ganden, Manor and Livnat (by reason of their control of IDB) and Nochi Dankner,
Shelly Bergman, Ruth Manor, and Avraham Livnat (by reason of their control of
Ganden, Manor and Livnat, respectively) may be deemed to share with DIC the
power to vote and dispose of our shares beneficially owned by DIC. Each of these
entities (other
than DIC)
and persons disclaims beneficial ownership of such shares , and all of these
entities and persons disclaim beneficial ownership of our shares held under
management of subsidiaries of IDB Development for others.
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**
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Includes
the 51,450,000 shares held, directly or indirectly, by DIC and 125,658
shares held by indirect subsidiaries of IDB Development, for their own
account, which may be deemed to be beneficially owned by Nochi Dankner by
virtue of his control of IDB. Does not include an aggregate of
1,947,420 of our ordinary shares held, as of December 31, 2009,
by members of the public through, among others, provident funds, mutual
funds, pension funds, exchange traded funds, insurance policies and
unaffiliated third-party client accounts, which are managed by
indirect subsidiaries of IDB Development. Each of our directors
who is affiliated with IDB or DIC disclaims beneficial
ownership of such shares. Also includes5,000 shares issuable
upon the exercise of stock options that are exercisable on, or within 60
days following December 31,2009.
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AGENDA
OF THE 2010 ANNUAL GENERAL MEETING
Item
1 – Re-election of Directors
At the Meeting, the shareholders will
be asked to re-elect each of Ami Erel, Shay Livnat, Raanan Cohen, Avraham
Bigger, Rafi Bisker, Shlomo Waxe, Haim Gavrieli, Ari Bronshtein and Tal Raz to
our Board of Directors to serve until the next Annual General Meeting or his
earlier resignation or removal from this office. Mr. Shlomo Waxe is an
“independent director” under the rules of the U.S. Sarbanes-Oxley Act applicable
to audit committee members. These nominees have been approved by our Board of
Directors.
For details in relation to the
re-election of our statutory external directors, Ronit Baytel and Joseph Barnea,
see Item 2 below.
Our cellular license requires, and our
Articles of Association provide, that at least 20% of our directors will be
appointed and removed by shareholders who are Israeli citizens and Israeli
residents from among our founding shareholders. If our Board of Directors is
comprised of 14 directors or less, these Israeli shareholders will appoint two
directors, and if our Board of Directors is comprised of between 15 and 24
directors, these Israeli shareholders will appoint three directors. Our Articles
of Association provide that DIC, as our founding shareholder, is responsible for
complying with the requirement under our cellular license that Israeli citizens
and residents from among our founding shareholders hold at least 20% of our
outstanding shares, and that so long as DIC so complies, it will be entitled to
appoint and remove these directors. Accordingly, DIC has designated
Nochi Dankner and Isaac Manor as its appointees to our Board of Directors as of
February 2007, and their appointment as our directors does not require approval
of the shareholders at the Meeting.
A brief biography of each nominee
is set forth below:
Ami Erel has served as
Chairman of our Board of Directors since 2005. Mr. Erel has served as President
and Chief Executive Officer of Discount Investment Corporation Ltd. since 2001.
From March to December 2007, Mr. Erel also served as the Chief Executive Officer
of NetVision Ltd., where he served prior to March 2007 and continues to serve
from January 2008, as Chairman of the board of directors. From 1999 to 2001, he
served as President of Elron Electronic Industries Ltd., where he continues to
serve as a member of the Board of Directors and also served, until January 2007,
as Chairman of the board of directors. From 1997 to 1999, he served as President
and Chief Executive Officer of Bezeq – The Israeli Telecommunications
Corporation Ltd. Mr. Erel also serves as the Chairman of the board of
directors of Koor Industries Ltd. and as a member of the boards of directors of
Makhteshim-Agan Industries Ltd., Shufersal Ltd., Property and Building
Corporation Ltd. and other IDB group companies. Mr. Erel has served as the
chairman of the executive committee of the Manufacturers Association of Israel
from 2005 to 2009 and since September 2009 he has served as the chairman of the
Israel Export & International Cooperation Institute. Mr. Erel
holds a B.Sc. in electrical engineering from the Technion, Israel Institute of
Technology.
Shay Livnat has served as a
member of our Board of Directors since 2005. Mr. Livnat has served as
the President and Chief Executive Officer of Zoe Holdings Ltd., a holding
company that manages a diverse portfolio of international telecommunications
operations and hi-tech companies, which was founded by him in 1988, since 2001
and as Vice President and member of the board of Taavura Holdings
Ltd. From 1988 to 1998, he served as Chief Executive Officer of
Tashtit Ltd. Mr. Livnat also serves as a member of the boards of
directors of various IDB group companies, including IDB Development Corporation
Ltd., Clal Industries and Investments Ltd., Clal Insurance Enterprises Holdings
Ltd., Elron Electronic Industries Ltd. and other companies in the Avraham Livnat
Group and Zoe/Cyphertech Group of companies. Mr. Livnat also serves as a member
of the board of the Academic College of Tel-Aviv-Jaffa. Mr. Livnat holds a
B.Sc. in electrical engineering from Fairleigh Dickinson University, New Jersey,
USA.
Raanan Cohen has served as a
member of our Board of Directors since 2000. Mr. Cohen also has
served as Chief Executive Officer of Koor Industries Ltd. since July
2006. From 2004 to 2006, he also served as Chief Executive Officer of
Scailex Corporation Ltd.. Since 2001 he has served as Vice President
of Discount Investment Corporation Ltd., having previously served, from 1999 to
2001, as executive assistant to the chief executive officer of Discount
Investment Corporation Ltd. From 1997 to 1999, he was an associate at
McKinsey & Company Inc., London. Mr. Cohen also serves as a
member of the boards of directors of Makhteshim-Agan Industries Ltd. and various
private companies. Mr. Cohen is a member of the Israeli Bar
Association and holds an L.L.B. and a B.A. in economics from Tel Aviv University
and an M.B.A. in management from the J.L. Kellogg Graduate School of management
of Northwestern University.
Avraham Bigger has served as
a member of our Board of Directors since 2005. Mr. Bigger is the
owner and managing director of three family-owned companies. Since October 2006,
Mr. Bigger has served as the Chairman, and from January 2007 to December 2009 he
has also served as Chief Executive Officer of Makhteshim-Agan Industries Ltd.
From June 2003 to July 2007, Mr. Bigger served as the Chairman of the board of
directors of Shufersal Ltd.; as the chairman of the boards of directors of
various private companies; as the Deputy Chairman of the Caesarea Edmond
Benjamin De Rothschild Foundation and the Caesarea Edmond Benjamin De Rothschild
Development Corporation Ltd.; and as a member of the boards of directors of the
First International Bank of Israel Ltd. and various private companies.
Mr. Bigger holds a B.A. in economics and an M.B.A. from the Hebrew
University.
Rafi Bisker has served as a
member of our Board of Directors since 2006. Mr. Bisker currently
serves as co-Chairman of Shufersal Ltd. and as the Chairman of Property and
Building Corporation Ltd., Bayside Land Corporation Ltd. and various private
companies. From 2000 to 2005, he served as Chief Executive Officer of
Ganden Holdings Ltd and Ganden Real Estate Ltd.. From 1989 to 1999,
he served as Chief Executive Officer of Dankner Investments
Ltd. Mr. Bisker also serves as a member of the boards of
directors of IDB Holding Corporation Ltd., IDB Development Corporation Ltd.,
Discount Investment Corporation Ltd., Clal Industries and Investments Ltd., Koor
Industries Ltd., Ganden Holdings Ltd., ISPRO The Israel Properties Rental
Corporation Ltd., Mehadrin Ltd., and various private
companies. Mr. Bisker holds a B.Sc. in civil engineering from
the Technion, Israel Institute of Technology.
Shlomo Waxe has served as a
member of our Board of Directors since 2006. Mr. Waxe has served as
Director General of the Israel Association of Electronics and Software
Industries since 2006. From 2002 to 2005, he worked in the field of
communications management and consultancy. From 1999 to 2001, he
served as Chief Executive Officer of Zeevi Communications Ltd. From
1997
to 1999,
he served as a consultant to cellular communications projects in Sao Paulo,
Brazil and in Northeast Brazil. From 1993 to 1997, he served as the
Director General of Israel’s Ministry of Communications. From 1990 to
1993, he served as commanding officer of the signal, electronics and computer
corps of the Israel Defense Forces and he is a retired brigadier general.
Mr. Waxe also serves as a member of the boards of directors of Tambour Ltd.
and C. Mer Industries Ltd. and until 2009, served as a board member of Shrem,
Fudim – Technologies Ltd. Mr. Waxe holds a B.A. in political
science from the University of Haifa.
Haim Gavrieli has served as a
member of our Board of Directors since, 2008. Mr. Gavrieli has served
as the Chief Executive Officer of IDB Holding Corporation Ltd. since 2009 and
also as Executive Vice President of IDB Development Corporation Ltd. since 2006.
He also serves as a member of the boards of directors of Discount Investment
Corporation Ltd., Koor Industries Ltd., Makhteshim-Agan Industries Ltd.,
NetVision Ltd., Clal Finance Ltd., other IDB group companies and various private
companies. Mr. Gavrieli also serves as the Deputy Chairman of Shufersal Ltd. and
chairman of the board of directors of IDB Tourism (2009) Ltd. From April 2005 to
November 2006 he served as Vice President of IDB Development Corporation Ltd..
From April 2001 to April 2005, he served as personal assistant to the chairman
of IDB Holding Corporation Ltd. and also as personal assistant to the chairman
of the board of directors of Ganden Holdings Ltd., and previously, from 1999 to
2001, Mr Gavrieli served as an advisor to the Israeli Minister of Finance.
Mr. Gavrieli holds a B.A. in political science and sociology from the
University of Haifa and an M.A. in management from the University of
Haifa.
Ari Bronshtein has served as
a member of our Board of Directors since, 2008. Mr. Bronshtein has
served as Vice-President of DIC since January 2006 and since 2009, he also
serves as a co-Chief Executive Officer of Elron Electronic Industries Ltd.. Mr.
Bronstein also serves as a member of the boards of directors of Maxima Air
Separation Center Ltd. and various private companies. Until 2009, Mr. Bronstein
also served as a member of the board of directors of Hadera Paper
Ltd. From 2004 to 2005, he served as Vice President and head of the
Economics and Business Development division and from 2000 to 2003, as Director
of Finance and Investments at Bezeq – The Israeli Telecommunications Corporation
Ltd.. Mr. Bronshtein holds a B.A. in finance and management and M.Sc. degree in
finance and accounting, both from Tel Aviv University.
Tal Raz has served as a
member of our Board of Directors since September 2009. Mr. Raz has served
as Chief Executive Officerof Clal Finance, since September 2009. From
2005 to September 2009, Mr Raz served as our Chief Financial Officer. From 2002
to 2005, Mr. Raz served as Chief Financial Officer of Elron Electronic
Industries Ltd. From 2001 to 2002, he served as the President and
Chief Executive Officer of Elbit Ltd. From 1997 to 2001, he served as
Elbit’s Chief Financial Officer, having previously served in the same capacity
at Agentsoft Ltd. and Paul Winston Corporation. Prior to that, he was a senior
auditor at Deloitte & Touche’s New York office. Until January
2007, Mr. Raz served as a director of NetVision Ltd. Mr. Raz is a
member of the steering committee of the Israeli CFO (Chief Financial Officers)
Forum and is a certified public accountant. He holds a B.A. in accounting and
business administration and an M.B.A. in business administration, from the City
University of New York.
Required
Approval
The affirmative vote of the holders of
a majority of the voting power in the Company present, in person or by proxy,
and voting on the matter, is required for the approval of the re-election of the
directors set forth above.
Proposed
Resolutions
It is proposed that at the Meeting the
following resolutions be adopted:
“RESOLVED, that Ami Erel be
re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Shay Livnat be
re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Raanan Cohen be
re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Avraham Bigger
be re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Rafi Bisker be
re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Shlomo Waxe be
re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Haim Gavrieli
be re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Ari Bronshtein
be re-elected to the Board of Directors of the Company, effective
immediately.
RESOLVED, that Tal Raz be
re-elected to the Board of Directors of the Company, effective
immediately.”
The Board of Directors recommends a
vote FOR approval of the proposed resolution.
Item
2 – Re-election of External Directors
Companies incorporated under the laws
of the State of Israel whose shares have been offered to the public, such as the
Company, are required by the Israeli Companies Law to appoint at least two
external directors. To qualify as an external director, an individual
or the individual's relative, partner, employer or any entity under the
individual's control may not have, and may not have had at any time during the
previous two years, any affiliations with the Company or any person controlling,
controlled by or under common control with the Company. In addition,
no individual may serve as an external director if the individual’s position or
other activities create or may create a conflict of interest with his or her
role as an external director. For a period of two years from termination of an
external director's service, the Company may not appoint such former external
director as a director or employee of the Company or receive professional
services from such former external director for pay.
Pursuant to the Companies Law, the
external directors are required to be elected by the shareholders for a term of
three years which may be renewed for another three-year term. Further extensions
are possible under certain conditions. All of the external directors of a
company must be members of its Audit Committee and each other committee of a
company’s board of directors which is authorized to exercise powers of the board
of directors must include at least one external director. Our
external directors are also considered independent directors under the rules of
the Sarbanes-Oxley Act applicable to audit committee members.
Our
external directors, Ronit Baytel and Joseph Barnea, were elected to our board of
directors in the 2007 annual meeting of shareholders for an initial term of
three years, which shall end on May 8, 2010. On February 23, 2010, our Board of
Directors nominated Ronit Baytel and Joseph Barnea for re-election as external
directors for an additional term of three years. Our Board of
Directors confirmed that each of these nominees possesses the professional
qualifications required under the Companies Law and designated Ms. Baytel as our
“audit committee financial expert” under the U.S. Sarbanes-Oxley Act and SEC
rules.
The
remuneration for external directors is established by regulations promulgated
under the Companies Law. Our Board of Directors designated each of our external
Directors as an "Expert External Director", as defined in the such regulations,
and resolved that we shall pay our external directors an annual fee of NIS
126,900 (approximately $33,616) and a meeting attendance fee of NIS 4,880
(approximately $1,293), payable in accordance with the aforesaid regulations to
"Expert External Director", as adjusted for changes in the Israeli CPI since
December 2007 (which inclusive
of CPI
adjustment to December 31, 2009 equals
NIS136,885
(approximately $36,261) and
NIS
5,264( approximately $1,394), respectively).
A brief biography of each nominee
is set forth below:
Ronit Baytel has served as a
member of our Board of Directors since 2007. Ms. Baytel is a
director in the finance department of Ormat Technologies, Inc., a
company listed on the NYSE, in charge of SOX internal controls in the
preparation of financial statements and tax and special projects. From 1998 to
2005 she served as senior manager at Kesselman & Kesselman, a certified
public accountants firm in Israel, which is a member of the international
PriceWaterhouseCoopers Accountants firm. Ms. Baytel is a certified public
accountant and holds a B.A. in economics and accountancy from Tel Aviv
University and an M.B.A. from the Hebrew University.
Joseph Barnea has served as a
member of our Board of Directors since 2007. Mr. Barnea is a retired
businessman. He served as the Chief Executive Officer of Oxygen &
Argon Works Ltd. from 1987 to 2005 and continued to serve as a member of its
management until 2006. From 1985 to 1987, he served as the Chief Executive
Officer of Telkoor Ltd. From 1980 to 1985, he served as a Vice President of
Elscint Medical Imaging Ltd. Mr. Barnea is a member of the executive committee
of the Israeli Industrialists Association and until 2007 he served as
the Chairman of its Chemistry and Environment Association. From 2004 to 2009 Mr
Barnea served as a member of the board of the Israeli Export & International
Cooperation Institute, from 2005 to 2009 he served as a member of the standard
committee of the Israeli Standards Institute and prior to that, as a member of
its board. From 2001 to 2004 he served as Chairman and President of the
International Oxygen Manufacturers Association (IOMA) USA. He served as Deputy
Commander of the signal, electronics and computer corps of the Israeli Defense
Forces. Mr. Barnea holds a B.Sc. in electrical engineering from
the Technion, Israel Institute of Technology and an M.Sc. in electrical
engineering from Columbia University, New York, USA.
At
the Meeting, shareholders will be asked to re-elect Ronit Baytel and Joseph
Barnea as external
directors, each for a term of three years commencing on May 8, 2010
- the expiration date of their current office.
Required
Approval
The election of an external director
requires the affirmative vote of the holders of a majority of the voting power
in the Company present, in person or by proxy, and voting on the matter,
provided that either (i) at least one third of the shares of non-controlling
shareholders are voted in favor of the election of the external director or (ii)
the total number of shares of non-controlling shareholders voted against the
election of the external director does not exceed one percent of the outstanding
voting power in the Company. According to the
Companies Law, for this purpose, "control" means the ability to direct the
company's actions, except such ability deriving solely from holding the office
of director or officer in the Company, and any person who holds (including
through a subsidiary and/or an affiliate) 50% or more of the voting rights or
the right to appoint directors or a CEO, shall be deemed a controlling
shareholder.
Proposed
Resolution
It is proposed that at the Meeting the
following resolutions be adopted:
“RESOLVED, that Ronit
Baytel be
re-elected as an external director of the Company for a three-year term,
commencing May 8, 2010.
RESOLVED, that Joseph Barnea
be re-elected as an external director of the Company for a three-year term,
commencing May 8, 2010.”
The Board of Directors recommends a
vote FOR approval of the proposed resolutions.
Item
3 – Reappointment of Independent Auditors
At the Meeting, pursuant to the
recommendation of our Audit Committee, the shareholders will be asked to approve
the reappointment of Somekh
Chaikin, a member of KPMG International,
independent
certified public accountants in Israel, as our independent auditors until the
next Annual General Meeting. We intend to reappoint Somekh Chaikin as the auditor of
our controlled subsidiaries, as well. A representative of the auditors will be
present at the Meeting and will be available to respond to appropriate questions
from the shareholders.
In accordance with our Articles of
Association and as contemplated by the U.S. Sarbanes-Oxley Act, our Board of
Directors has delegated to our Audit Committee the authority to fix the fees
paid to our independent auditors. Such fees for the past fiscal year
will be disclosed under Item 16C of our Annual Report for the year 2009 on Form
20-F, which we intend to file on or about March 2, 2010, and we will report them
to the shareholders at the Meeting, as well.
Required
Approval
The affirmative vote of the holders of
a majority of the voting power in the Company present, in person or by proxy,
and voting on the matter is required for the approval of the proposed resolution
in this matter.
Proposed
Resolution
It is proposed that at the Meeting the
following resolutions be adopted:
“RESOLVED, that Somekh Chaikin be reappointed as
the independent auditors of the Company until the 2011 Annual General
Meeting.”
The Board of Directors recommends a
vote FOR approval of the proposed resolution.
Item
4 - Consideration of the 2009 Financial Statements
Our audited financial statements for
the year ended December 31, 2009 are included in our Annual Report on Form 20-F,
which we intend to file with the SEC on or about March 2, 2010. Upon filing, you
may read and copy this report without charge at the SEC's public reference room
at 100 F Street, N.E., Washington, D.C. 20549. Copies of such
material may be obtained by mail from the Public Reference Branch of the SEC at
such address, at prescribed rates. Please call the SEC at
1-800-SEC-0330 for further information on the public reference
room. Our SEC reports are also available to the public at the SEC's
website at http://www.sec.gov. The annual
report will also be available on our website at http://investors.ircellcom.co.il/sec.cfm.
These financial statements and annual report are not a part of this Proxy
Statement. We will hold a discussion with respect to the financial
statements at the Meeting.
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By
Order of the Board of Directors,
Liat
Menahemi Stadler
General
Counsel and Corporate Secretary
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Dated:
February 25, 2010
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