TIDMBSD
RNS Number : 2793Z
Yossi Willi Management & Invs. Ltd
13 March 2017
13 March 2017
YOSSI WILLI MANAGEMENT AND INVESTMENTS LTD
Re: General Meeting of Shareholders of B.S.D Crown Ltd. (the
"Company")
Dear Fellow Shareholder,
I am writing to you to ask for your support at the forthcoming
General Meeting of the Company to be held on 29 March 2017, which
has been requisitioned by myself.
As I wrote in my letter dated 28 February 2017, while we are
confident in the Company's prospects and potential for growth, we
are gravely concerned by recent developments and by the execution
of the strategic direction of the Company and other value
detracting actions undertaken by the Company's board of directors
(the "Board"), and we have therefore requisitioned an extraordinary
general meeting of the Company's shareholders where we are
proposing, inter alia, to remove from office all of the existing
directors of the Company (apart from the Company's external
director) and the appointment of several individuals instead of
such existing directors (the "Resolutions").
I would like to reiterate my points below:
1. Composition of the Current Board
The shareholders of the Company have not elected any of the
currently serving directors (excluding the Chairman). Instead, all
of such directors (excluding the Chairman) were appointed by the
Board.
-- On 5 July, 2016 the Company announced the results of the
General Meeting in which the following directors were elected: Mrs.
Neomi Enoch, Mr. Gil Leidner and Mrs. Iris Even-Tov.
-- Following announcements released by the Company on 12 August,
2016 and on 5 September, 2016, all the aforementioned directors
resigned from their position as directors (excluding Iris Even Tov,
who was appointed as an external director instead of as a
non-external director).
-- On 28 November, 2016 the Company announced that Mr. Zvi Shur
resigned from his position as an external director.
-- All of the currently serving directors (excluding the
Chairman) were not appointed by the shareholders but rather were
self-appointed by the board, and have never received an affirmative
vote for their appointments by the shareholders.
In addition, not only are the current directors lacking the
support and affirmative vote of the shareholders, the previously
duly elected directors have all resigned from the Board. The
resignation of the appointed Board members is a clear indication
and a red flag as to the lack of direction of the Company and the
poor confidence that these members had in the Company. Furthermore,
the lack of leadership at the helm of the Company during such times
of turbulence, coupled with the matters described herein, should be
of great concern to all shareholders.
2. Misappropriations of Company Funds
The shareholders of the Company have the right to be informed as
to what has happened to the misappropriated funds of approximately
USD 45 million and elect Board members that will actively pursue
this misappropriation and seek to reclaim these lost funds.
-- On 17 May, 2016 the Company announced, in relation to cash
deposits of approximately US$30 million held by the Company with
Meinl Bank in Austria ("Meinl"), that certain documents purporting
to relate to such deposits were received from Meinl, indicating
that since 2013, these deposits have been allegedly used as
collateral for loans taken by off-shore companies unknown to the
Company.
-- On 3 August, 2016 the Company announced that it has filed a
claim against Israel 18 B.V., the controlling shareholder of the
Company ("Israel 18"), a company controlled by Mr. Gregory
Gurtovoy, the Chairman of the Company's board, for the return of
US$13.6 million deposited with the International Bank of Azerbaijan
("IBAR") by the Company, which IBAR now claims has been used as
security for a loan taken by Israel 18.
-- On 5 September, 2016 the Company announced that cash deposits
of approximately US$ 2.2M were transferred to Alko R Capta LLP as
an advance payment in relation to the proposed purchase by the
Company of certain car dealerships in the US. However, the
transaction was never consummated, and although the Company
demanded the return of these deposits, they were not returned.
The misappropriations of funds and the ongoing repatriation of
Company assets amount to approximately US$ 45M and should be of
grave concern to all shareholders. My nominees for election to the
Board will actively pursue the retrieval of these funds, and ensure
that no such misappropriations will happen in the future.
3. Dividends from Company Subsidiaries
The shareholders are entitled to be informed as to what has
happened to the dividends that the Company has received from its
subsidiaries during the last 18 months.
-- The Company's subsidiaries G. Willi-Food International Ltd
and Willi-Food Investments Ltd. have distributed to their
shareholders over the last 18 months dividends in the aggregate
amount of approximately NIS 30 million.
The Company does not provide financial statements and
consequently this lack of transparency as to the dividends (which
is the primary income of the Company) is of grave concern. This
serves the agenda of the current management and enables the
Company's management to continue to misappropriate funds from the
Company. It is of primary interest to replace the current Board
with members who will be keen to allocate the missing funds, hold
accountable the individuals who misappropriated the funds and
institute proper procedures and compliancy guidelines so that such
actions do not happen in the future.
4. Mr. Gregory Gurtovoy
The shareholders of the Company have the right to hold Mr.
Gurtovoy accountable for the current situation of the Company, the
ongoing extended deterioration of the Company and the devaluation
in value of their holding in the Company.
-- On 19 February, 2016, the Israel Securities Authority
initiated criminal investigations against the Company and its
Chairman of the Board, Mr. Gregory Gurtovoy, as a result of
allegations of breaches of Israeli securities laws and offenses.
Thereafter, the Company announced that a number of officers and
directors were questioned by the ISA, and that Mr. Gurtovoy was
detained.
-- Mr. Gurtovoy is also the controlling shareholder of Israel
18, against which the Company filed various claims, which puts Mr.
Gurtovoy in a clear conflict of interests.
-- Mr. Gurtovoy, who is the chairmen of the Board is directly
responsible for the Company's devaluation in share value.
It is clearly in the best interest of the shareholders and the
Company to remove the Chairman from office and to elect Board
members who are not in conflict with the misappropriations of
funds, are not responsible for the poor results of the Company and
have not created this great devaluation in value. The incumbent
directors (except for the external director), all of whom are
affiliated, directly or indirectly, with Mr. Gurtovoy should be
replaced by directors who are not affiliated with him, and
therefore I encourage you to support the election of my nominees to
the Board.
5. Company's Shares Suspended From Trading
The Company must take all action to cancel the suspension from
trading of its securities, as set forth below:
-- On 29 April, 2016, the Company announced that it will not
publish its annual financial statements for the year ended 31
December, 2015 by 30 April, 2016 (as required by the Listing Rules
and the Disclosure and Transparency Rules of the UKLA and the
London Stock Exchange) and that, given the delay in publishing such
financial statements, the Company requested that trading in its
shares be temporarily suspended as of such date.
-- The Company has not released any financial statements of the
Company for 2016, and has not indicated that it has any intention
of releasing them in the near future.
-- Pursuant to UK regulations, since the Company has not
provided its financial statements within six months from the
suspension, the Financial Conduct Authority may delist the
Company's shares from the London Stock Exchange.
Although this breach has been outstanding for an extended
period, the Company has not remedied it, and therefore the Company
shares may be delisted from the London Stock Exchange as a direct
result of the failure of the Company and its board to release the
Company's financial statements.
6. New Board Will Push Our Company Forward
The shareholders deserve to have an independent board that can
change the Company's situation and get it back on track. My
nominees for election to the Board possess the necessary skills,
experience and market understanding needed to achieve this (For a
full list of biographies please refer to Exhibit A of my letter
dated 28 February 2017).
Upon election, the new Board will take the following actions
(among others):
-- Fully investigate the misappropriation of funds and seek to
repatriate such funds to our Company.
-- Release the Company's financial statements in order to cancel
the suspension of trading of the Company's securities.
YOUR VOTE IS IMPORTANT
For the reasons stated above, we have requested to submit to the
approval of the Company's shareholders (i) the removal of all the
incumbent non-external directors and (ii) the nomination of the
following persons to the Company's Board of Directors instead of
the incumbent non-external directors: Shmuel Messenberg, Keren
Marcus, Avi Zigelman, Joseph Williger and Shlomo Wertheim (the
latter, to serve as an external director), and to approve that
their remuneration and benefits shall be as determined for external
directors in accordance with the Companies Regulations (Rules
regarding Compensation and Expenses of an External Director),
5760-2000.
Please vote "Against" the following directors:
-- Resolution 7: Mr Gregory Gurtovoy
-- Resolution 8: Mr Eli Arad
-- Resolution 9: Mr Nir Netzer
-- Resolution 10: Mr Arik Safran
Please vote "For" the following proposed directors:
-- Resolution 4: Shlomo Wertheim
-- Resolution 11: Mr Shmuel Messenberg
-- Resolution 12: Mrs Keren Marcus
-- Resolution 13: Mr Avi Zigelman
-- Resolution 14: Mr Joseph Williger
We believe that the knowledge, experience and market
understanding of the nominees listed in Resolutions 4, 11, 12, 13
and 14 above will significantly change the direction of the Company
and improve the execution of its strategy, and therefore we urge
all shareholders to participate in the upcoming General Meeting and
vote in favour of the above resolutions.
Sincerely,
Joseph Williger
Yossi Willi Management & Investments Ltd
For further information please contact:
YOSSI WILLI MANAGEMENT & INVESTMENTS LTD
Yossi Williger yossi@ydekel.co.il
GEORGESON
Domenic Brancati 020 7019 7003
Anthony Kluk 020 7019 7032
This information is provided by RNS
The company news service from the London Stock Exchange
END
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