Sources inform “Globes” that the state attorney’s office department for taxation and economics recently decided to indict Tamir Fishman controlling shareholders Eldad Tamir and Danny Fishman.
The decision followed misleading item in the prospectus for the Tamir Fishman 2 venture capital fund issue. Before an indictment is filed, Tamir Fishman will be granted a hearing at the firm’s request. Tamir Fishman CFO Daniel Leventhal, who served as a director in Tamir Fishman 2, and an attorney from the Shimonov, Barnea & Co. law firm will also be granted a hearing.
In April 2001, Tamir Fishman 2 announced that the Israel Securities Authority was investigating allegations that company officials had included a misleading item in the issue prospectus published in March 2000. The item concerned the bylaws affecting the firing and appointment of directors. Allegations of late reports and misleading items in an immediate report issued by the company on the matter were also investigated.
Under the company bylaws, as published in the prospectus, a director can be replaced only four years after his appointment. Another section in the bylaws states, however, that a shareholders meeting is entitled to fire a director at any time by a majority vote of the shareholders.
Tamir Fishman reported to the Tel Aviv Stock Exchange in September 2000 that the prospectus included a printing error. This was two months after the company had discovered the error.
A Tamir Fishman spokesperson said today, “The company and the board of directors believes it can convince the State Attorney’s Office not to file an indictment against them. In any case, the matter is completely technical, and the company acted according to the opinion of its legal advisors. We are sure that what we did was right.”
In September 2001, the Royal Bank of Canada acquired 30% of Tamir Fishman, at a NIS 120 million company value. American Jewish billionaires Sam Zell and Irving Schneider invested in the firm last year, both acquiring a 5% stake.
The Tamir Fishman 2 fund current trades at a NIS 100 value, and has a NIS 220 million equity. The firm invests in communications, software, and Internet companies.
Including a misleading item in a prospectus is one of the most serious violations in the criminal section of the Securities Law (1968). The maximum penalty is a four-year prison term. A misleading report in the course of trading carries a maximum three-year sentence.
Published by Globes [online] - www.globes.co.il - on May 13, 2003