NEWS AND PUBLICATIONS

November 11, 2013 "Profit Test" as a pre-condition to dividend distribution (A motion to approve Derivative Action no. 49615-04-13 Lahav Vs. IDB Development Ltd. et al.)
November 11, 2013 The Boards duties to shareholders during merger approval procedures (Civil Case 9433-11-09 Mirkaei Tikshoret Ltd. et al. Vs. Gilat Satellites Networks Ltd. et al.)
December 17, 2013 A Violation of fiduciary duty by directors and officers (Civil Case 13484-03-09 Gad Hitron et al. Vs. Adi Teler)
November 28, 2013 A mechanism to adjust the exercise price of employees stock options plan
December 24, 2013 Public Utility Authority Electricity updates Feed-in-Tariff rates of residential and commercial PV systems
January 16, 2014 The minimal overall efficiency threshold of cogeneration plants is increased from 60% to 70%
 

November 11, 2013 The Boards duties to shareholders during merger approval procedures (Civil Case 9433-11-09 Mirkaei Tikshoret Ltd. et al. Vs. Gilat Satellites Networks Ltd. et al.)

A lawsuit against Gilat Satellites Networks Ltd. (the "Company") and its board of directors (the "Board") in regards to the alleged breach of duty of care, fiduciary duty, and disclosure duty to shareholders, after the failure of a merger transaction between the Company and the purchaser . The lawsuit considered the question of whether the Board, when rejecting the proposed merger, was also obliged to bring the decision to the General Assembly; and additionally, what are the duties of the directors towards the shareholders during  a merger transaction.

  • The court rejected the suit and ruled that the Board may generally reject a proposed merger without transferring the decision to the shareholders' approval.
  • The court also rejected the claim that the Board has a duty to uphold the interests of shareholders in a merger agreement which will include provisions regarding shareholders’ compensation in the event of a breach of such a merger agreement.
  • The Board is presumed to violate the duty of disclosure in the event that an undisclosed fact was a significant fact which would affect the considerations of a reasonable shareholder in deciding how to vote at the general meeting or, whether to sell or hold shares.
  • A duty of disclosure exists whenever shareholders are required to vote using their own judgment as shareholders. In the present case, no such duty existed as no concrete offer was submitted for the shareholders’ approval.

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