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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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F O R M 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR
15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of April 2003
ELTEK LTD.
(Name of Registrant)
Sgoola Industrial Zone, Petach Tikva, Israel
(Address of Principal Executive Office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F X Form 40-F ___
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(1): ___
Indicate by check mark if the registrant is submitting the Form 6-K in
paper as permitted by Regulation S-T Rule 101(b)(7): ___
Indicate by check mark whether by furnishing the information contained in
this Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes __ No X
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82- ______________
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ELTEK LTD.
6-K Items
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1. Eltek Ltd. Proxy Statement for Extraordinary Meeting to be held May 15,
2003.
2. Eltek Ltd. Proxy Card.
ITEM 1
ELTEK LTD.
NOTICE OF AN EXTRAORDINARY MEETING OF SHAREHOLDERS
Eltek Ltd. Shareholders:
We cordially invite you to an Extraordinary Meeting of Shareholders. It
will be held at 10 a.m. on Thursday, May 15, 2003 at our offices at 4 Drezner
Street, Sgoola Industrial Zone, Petach Tikva, Israel.
The purpose of the meeting is to consider and vote upon the approval of
the issuance and sale in a private placement of a convertible promissory note in
the principal amount of $500,000 to Merhav M.N. F. Ltd., or Merhav, an Israeli
privat company controlled by our controlling shareholder, Mr. Joseph A. Maiman,
or to one of Merhav's subsidiaries.
The Board of Directors recommends that you vote in favor of the
proposal which is described in the attached Proxy Statement.
You can vote by proxy either by mail or in person. If voting by mail,
the proxy must be received by our transfer agent or at our registered office in
Israel at least 48 hours prior to the meeting to be validly included in the
tally of ordinary shares voted at the meeting. Detailed proxy voting
instructions are provided both in the Proxy Statement and on the enclosed proxy
card.
Sincerely,
/s/Nissim Gilam
Nissim Gilam,
Chairman
BY ORDER OF THE BOARD OF DIRECTORS
Arieh Reichart, Chief Executive Officer
and Secretary
PROXY STATEMENT
This statement is being furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of Eltek Ltd. to be voted at the
Extraordinary Meeting of Shareholders, or the Meeting, to be held on Thursday,
May 15, 2003 and any adjournment thereof. This Proxy Statement and the enclosed
proxy card are being mailed to shareholders on or about April 15, 2003.
Shares eligible to be voted and for which a proxy card is properly
signed and returned at least 48 hours prior to the beginning of the Meeting will
be voted as directed. If directions are not given or directions are not in
accordance with the options listed on a signed and returned proxy card, such
shares will be voted FOR the proposal. Unsigned or unreturned proxies, including
those not returned by banks, brokers, or other record holders, will not be
counted for quorum or voting purposes. You may revoke your proxy at any time
prior to the exercise of authority granted in the proxy by giving a written
notice of revocation to our Corporate Secretary, by submitting a subsequently
dated, validly executed proxy, or by voting in person.
As of April 10, 2003, the record date for determination of shareholders
entitled to vote at the Meeting, there were outstanding 4,885,651 ordinary
shares. Each ordinary share entitles the holder to one vote. The ordinary shares
have a par value of NIS 0.6 per share. The presence of two shareholders, holding
at least forty percent of our share capital voting rights, represented in person
or by proxy at the Meeting, will constitute a quorum. Should a quorum not be
present at the Meeting, the Meeting will be adjourned to three business days
later at the same time and place. This notice shall serve as notice of the
adjourned meeting. In the event the Board will unanimously designate any other
time or place for the adjourned meeting, notice will be given to shareholders.
The approval of the proposal requires the affirmative vote of the holders of a
majority of the ordinary shares represented at the Meeting, in person or by
proxy and voting thereon, provided that one of the following conditions is
fulfilled: (i) at least one third of the non-interested shareholders represented
and voting at the Meeting vote for the approval of the proposal; or (ii) that
the total shareholdings of those who have no personal interest in the
transaction who vote against the proposal do not represent more than 1% of the
voting rights in our company. Under the Israeli Companies Law, the proposal
requires that our shareholders notify us prior to the vote at the Extraordinary
Meeting, or if such vote is made by proxy on the proxy card, whether or not they
have a personal interest with respect to the issuance and sale of the
convertible promissory note to an affiliate of our controlling shareholder, Mr.
Joseph A. Maiman, in a private placement. The term "personal interest" is
defined as "a person's personal interest in an act or transaction of the
company, including the personal interest of his relatives and of any other
corporation in which he or his relatives are an interested party, and exclusive
of personal interest that stems solely from the fact of holding shares in the
company." If a shareholder fails to notify us as to whether he or she has a
personal interest in this item, the shareholder may not vote and his vote will
not be counted with respect to such item. There will be a specific place on the
proxy card to indicate if you have a personal interest with respect to the
issuance and sale of the convertible promissory note to the affiliate of our
controlling shareholder in a private placement.
Abstentions and broker "non-votes" will not be counted in determining
the outcome of the matter being acted upon. They are counted only for
determining a meeting quorum. A broker "non-vote" occurs when a nominee holding
ordinary shares of our company for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting power
with respect to that proposal and has not received instructions from the
beneficial owner.
We have received indications from our principal shareholders (including
Joseph A. Maiman, Integral International Inc., A. Sariel Ltd., Ohad Maiman and
Michele Yankielowicz, some of which may be deemed "interested parties"), and
directors and officers, who together hold approximately 38.5% of our issued and
outstanding ordinary shares, that they presently intend to vote in favor of the
proposal to be acted upon at the Meeting.
We will bear the cost of soliciting proxies from our shareholders.
Proxies will be solicited by mail and may also be solicited personally or by
telephone by our directors, officers and employees. We will reimburse brokerage
houses and other custodians, nominees and fiduciaries for their expenses in
accordance with the regulations of the Securities and Exchange Commission
concerning the sending of proxies and proxy material to the beneficial owners of
our stock.
You may vote by submitting your proxy with voting instructions by mail
if you promptly complete, sign, date and return the accompanying proxy card in
the enclosed self-addressed envelope to our transfer agent or to our registered
office in Israel at least 48 hours prior to the Meeting.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information as of April 8, 2003
regarding the beneficial ownership by (i) all shareholders known to us to own
beneficially more than 10% of our ordinary shares, (ii) each director and (iii)
all directors and executive officers as a group:
Number of
Ordinary Shares Percentage of
Beneficially Outstanding
Name Owned (1) Ordinary Shares (2)
---- --------- -------------------
Joseph A. Maiman (3)........................ 1,395,496 28.56%
Integral International Inc. (3)............. 1,068,396 21.87%
Nissim Gilam (4)............................ 41,590 *
David Banitt................................ -- --
Jack Bigio.................................. -- --
Revital Dgani............................... -- --
Leo Malamud................................. -- --
Erez Shachar................................ -- --
All directors and executive officers as a
group (12 persons) (5)...................... 1,702,461 34.0%
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* Less than 1%
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and generally includes voting or
investment power with respect to securities. Ordinary shares issuable
upon exercise of options currently exercisable or exercisable within 60
days of April 10, 2003 are deemed outstanding for computing the
ownership percentage of the person holding such securities but are not
deemed outstanding for computing the percentage of any other person.
Except as indicated by footnote, and subject to community property laws
where applicable, the persons named in the table above have sole voting
and investment power with respect to all shares shown as beneficially
owned by them.
(2) Based on 4,885,651 ordinary shares issued and outstanding as of April
10, 2003.
(3) Of such shares, 341,500 ordinary shares are held directly by Mr. Maiman,
1,040,645 ordinary shares are held of record by Integral International
Inc. ("Integral"), a Panama corporation controlled by Mr. Maiman, and
27,751 ordinary shares are held of record by Integral's wholly owned
subsidiary, A. Sariel Ltd. Mr. Maiman may be deemed to be the beneficial
owner of the 1,068,396 ordinary shares held directly by Integral
International and A. Sariel. Mr. Maiman disclaims beneficial ownership
in 470,000 ordinary shares held by each of his son, Ohad Maiman, and Mr.
Maiman's sister, Michele Yankielowicz.
(4) Includes 20,000 ordinary shares subject to currently exercisable options
granted under our 2000 Stock Option Plan, at an exercise price of $4.375
per share, which options expire in July 2005.
(5) Includes 28,000 ordinary shares issuable upon exercise of currently
exercisable stock options granted under our 1996 Stock Option Plan, and
89,333 ordinary shares issuable upon exercise of currently exercisable
stock options granted under our 2000 Stock Option Plan
2
APPROVAL OF THE ISSUANCE AND SALE OF A CONVERTIBLE PROMISSORY
NOTE TO OUR CONTROLLING SHAREHOLDER
(Item 1 on the Proxy Card)
Our Audit Committee and Board of Directors have approved, subject to the
execution of a definitive purchase agreement between the parties, the issuance
and sale of a convertible promissory note, or the Note, in the original
principal amount of $500,000 to Merhav M.N.F. Ltd. or one of its subsidiaries in
a private placement. Merhav is an Israeli private company controlled by our
controlling shareholder, Mr. Joseph A. Maiman The Note and accrued interest
thereon will be due and payable four years after its issuance. The Note will
bear interest at the rate of 10% per year, compounded on a quarterly basis.
Under the terms of the Note, Merhav will have the right, at any time after the
issuance of the Note, to convert it and any accrued interest thereon into
ordinary shares of our company, par value of NIS 0.6, at a price of $0.33 per
ordinary share, the market price of our ordinary shares on April 6, 2003, the
date on which our Audit Committee approved the transaction, or we may, at our
sole discretion, repay the accrued interest on the principal of the Note to
Merhav.
Our company is seeking this infusion of working capital as a result of
the worsening market conditions that have negatively impacted our revenues and
financial condition and resulted in our reporting negative cash flow in fiscal
2002. During the past six months our company has attempted to raise financing
through either private investors or financing institutions and has been
unsuccessful in its efforts. As a result, our Audit Committee and Board of
Directors are of the unanimous opinion that the proposed transaction is in the
best interest of our company and its shareholders. Accordingly, our Board of
Directors unanimously recommends a vote in favor of the resolution.
Shareholder approval is required both under the Israeli Companies Law
and the rules of the Nasdaq Stock Market. Nasdaq Marketplace Rule 4350(i)(1)(D)
provides that shareholder approval is required for the issuance of common stock
(or securities convertible into or exercisable for common stock) equal to 20
percent or more of the common stock or 20 percent or more of the voting power
outstanding before the issuance for less than the greater of book or market
value of the stock. Under the terms of the Note, in excess of 1,500,000 of our
ordinary shares are issuable upon conversion. Such number is in excess of 20% of
our currently outstanding shares and the exercise price may be below the book or
market value of our ordinary shares at the time of conversion. Accordingly,
shareholder approval is also required under the rules of the Nasdaq Stock
Market.
It is therefore proposed that at the Meeting our shareholders adopt the
following resolution:
"RESOLVED, that the Agreement by and between Eltek Ltd. and
Merhav M.N.F. Ltd. or one of it subsidiaries, providing for
the issuance and sale in a private placement to Merhav or
one of it subsidiaries of a convertible promissory note in
the original principal amount of $500,000, bearing interest
at a rate of 10% per year compounded quarterly, and
convertible into ordinary shares of the Company at a price
of $0.33 per ordinary share be and hereby is approved."
Under the Companies Law, the approval of the proposal requires either
the affirmative vote of the holders of a majority of the ordinary shares
represented at the Meeting, in person or by proxy and voting thereon, provided
that one of the following conditions is fulfilled (i) at least one third of the
non-interested shareholders represented and voting at the Meeting vote for the
approval of the proposal; or (ii) the total shareholdings of those who have no
personal interest in the transaction who vote against the proposal do not
represent more than 1% of the voting rights in our company. Under the Nasdaq
Marketplace Rules, the approval of the above resolution will require the
affirmative vote of the holders of a majority of the ordinary shares represented
at the Meeting.
The Board of Directors recommends a vote FOR the foregoing resolution.
3
OTHER MATTERS
The Board of Directors does not intend to bring any matters before the
Extraordinary Meeting other than the matter specifically set forth in the Notice
of the Extraordinary Meeting and knows of no matters to be brought before the
Extraordinary Meeting by others. If any other matters properly come before the
Extraordinary Meeting, it is the intention of the persons named in the
accompanying proxy to vote such proxy in accordance with the judgment of the
Board of Directors.
By Order of the Board of Directors,
/s/Arieh Reichart
Arieh Reichart
Chief Executive Officer and Secretary
Dated: April 15, 2003
4
ITEM 2
ELTEK LTD.
4 Drezner Street
Sgoola Industrial Zone
Petach Tikva, 49101 Israel
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoint(s) Arieh Reichart and Nissim Gilam, or
either of them, attorneys or attorney of the undersigned, for and in the name(s)
of the undersigned, with power of substitution and revocation in each to vote
any and all ordinary shares, par value NIS 0.6 per share, of Eltek Ltd. (the
"Company"), which the undersigned would be entitled to vote as fully as the
undersigned could if personally present at the Extraordinary Meeting of
Shareholders of the Company to be held on Thursday, May 15, 2003 at 10:00 a.m.
at the principal offices of the Company, 4 Drezner Street, Sgoola Industrial
Zone, Petach Tikva, Israel and at any adjournment or adjournments thereof, and
hereby revoking any prior proxies to vote said shares, upon the following items
of business more fully described in the notice of and proxy statement for such
Extraordinary Meeting (receipt of which is hereby acknowledged):
(Continued and to be signed on the reverse side)
EXTRAORDINARY MEETING OF SHAREHOLDERS OF
ELTEK LTD.
May 15, 2003
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
Please detatch and mail in the envelope provided
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PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE.
PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
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(1) To approve the issuance and sale in a private placement of a convertible
promissory note in the principal amount of $500,000 to Mervav M.N.F. Ltd.
an Israeli company controlled by our controlling shareholder, Mr. Joseph A.
Maiman, or to one of Merhav's subsidiaries.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
Pursuant to Israeli law, in order to ensure specific majority requirements we
are required to inquire of you as to whether you have a personal interest (as
described in the proxy statement) with respect to Item 1.
Do you have a personal interest in the issuance and sale in a private placement
of a convertible promissory note in the principal amount of $500,000 to Mervav
M.N.F. Ltd. an Israeli company controlled by our controlling shareholder, Mr.
Joseph A. Maiman, or to one of Merhav's subsidiaries? YES [ ] NO [ ]
THIS PROXY WILL BE VOTED AS SPECIFIED ABOVE. IN THE ABSENCE OF SUCH
SPECIFICATION, THE SHARES REPRESENTED BY THIS PROXY CARD WILL BE VOTED FOR
PROPOSAL 1. ON ANY OTHER BUSINESS THAT MAY PROPERLY COME BEFORE THE
EXTRAORDINARY MEETING, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE JUDGMENT
OF THE PERSONS NAMED ABOVE AS PROXIES.
To change the address on your account, please check the box at right and
indicate your new address in the space above. Please note that changes to the
registered name(s) on the account may not be submitted via this method. [ ]
Signature of Shareholder _________________________ Date ___________
Signature of Shareholder _________________________ Date ___________
Note: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized
officer, giving full title as such. If signer is a partnership, please sign in
partnership name by authorized person.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ELTEK LTD.
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(Registrant)
By: /s/Arieh Reichart
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Arieh Reichart
President and Chief Executive Officer
Date: April 17, 2003