RETALIX LTD.

NOTE 2 – ACQUISITIONS (continued):
RETALIX LTD.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
j. On October 23, 2003, the Company and StoreAlliance, signed an agreement with Isracard Ltd. (“Isracard”). According to the
agreement, StoreAlliance issued Isracard 454,590 of its shares representing 13% of its issued and outstanding share capital in
consideration of $2,525,000 ($5.6 per share). Under the agreement, Store Alliance also issued Isracard an option to acquire up to
305,973 shares representing post issuance of such shares, 8% of its issued and outstanding share capital, bearing an exercise
price as stipulated in the agreement. This option was originally granted for twelve months from the closing date of the agreement
and was extended on October 2004 by additional twelve months. The number of shares into which the option can be exercised is
subject to the dilution of the Company’s share in Store Alliance, which cannot be diluted to less than 50.01%. In case of a
limited exercise due to the above dilution restrictions, Isracard would have an additional 12 months to exercise that part of the
option that was not exercised, under the same terms. In case the Company’s share in Store Alliance is diluted to less than
50.01% as a result of the issuance of shares to a third party, Isracard would be able to exercise the option in full.
As a result of the Isracard investment, the Group’s ownership in Store Alliance decreased during 2003 from 59.17% to 51.47%
and the Company recorded a gain in the amount of $1,068,000 in the statement of income.
As to the employee stock option plan of StoreAlliance, see note 9b(2).
k. In 2002, the Company acquired shares from minority shareholders in Palm-Point Ltd. (“Palm Point”) in consideration for the
issuance of share capital of the Company at a total value of approximately $66,000. As a result, the Company held 96.18% of the
shares of Palm-Point.
In February 2003, the Company acquired all the remaining minority shareholders shares in Palm-Point in consideration for the
issuance of 13,339 shares of the Company at a total value of approximately $138,000 (based on the fair market value of the
Company’s shares). The excess of cost of investment in the amount of approximately $89,000 was attributed to goodwill.
l. Following are data relating to subsidiaries consolidated for the first time as of the acquisition date (including additional
considerations resulting from increase in shareholding):
F-23
IDS TCI (1) MPS Total
Current assets 4,142 6,961 211 11,314
Non current assets - 23 - 23
Deferred taxes 3,942 (3,458) (88) 396
Property and equipment, net of accumulated depreciation 546 1,253 68 1,867
Goodwill arising on Acquisition 29,383 31,983 305 61,671
Identified intangible assets 15,463 9,596 238 25,297
Current liabilities (8,616) (11,015) (208) (19,839)
Long-term liabilities - (5) - (5)
(1) Including an additional investment of approximately $2,570,000 (see note 2a).
44,860 35,338 526 80,724