Avner Oil - Annual Report 2011 - Delek Energy Systems

5) Publication of shelf prospectusOn July 21, 2011 a shelf prospectus (as emended on July, 24, August 2 and August 8, 2011)was published for an issue of participation units in the Partnership and option warrantsexercisable for participation units. The final structure and the scope of the issue have not yetbeen decided, and it is not definite that the issue will in fact take place.6) Working capital deficitThe Partnership has a working capital deficit of USD 225 million at December 31, 2011,comprising liabilities to banks that were used to finance investments in oil and gas assets,mostly in connection with the Tamar project. The Partnership intends to complete the raisingof long-term financing for the Tamar project within a few months, to replace, inter alia, theUSD 190 million bridge loan which must be repaid by June 2012 (see Note 9B to thefinancial statements). Completion of raising the project financing is influenced, inter alia, bythe gas supply agreement signed recently with IEC (see Note 12M2a to the financialstatements). In addition, on February 12, 2012, the general meeting of the holders ofparticipation units approved an offering of participation units and/or securities convertible toparticipation units during 2012, of up to USD 125 million. It is not certain that the offering willbe made. The Partnership believes that the finance agreement signed in the Leviathanproject in December 2011, completion of the project financing for Tamar and raising capital,if accomplished, will enable continued financing of investments and repayment of theaforementioned liabilities to banks.D. Resolutions of the general meeting1) On August 8, 2011, the general meting of participation unit holders adopted the followingresolutions:A. To amend section 11.1 of the trust agreement from July 1, 1993 (as amended from time totime) with regard to the pay of the Supervisor, so as to include the following changes: (1) toraise the fees of the Supervisor from NIS 21,000 per month (plus VAT) to NIS 28,000 (plusVAT), effective from January 1, 2011. The monthly pay will be updated every three monthsaccording to the changes in the Consumer Price Index ("the CPI") compared with the CPIpublished on October 15, 2010; (2) to raise and update the supplementary fees of theSupervisor in the following manner: in the current situation, in the event of a rights offering,the additional fee to which the Supervisor is entitled is based on actual work at the hourlyrate customary for him, up to a sum equal in shekels to USD 10,000 (plus VAT) ("the OldFees"). After the amendment and update, the Old Fees will be cancelled and thesupplementary fees to which the Supervisor is entitled in the event of publication of aprospectus (including a shelf prospectus) will be a sum equal in shekels to USD 20,000(plus VAT), irrespective of the number of hours actually worked ("the Amended Fees"). It isclarified that in the case of a shelf prospectus, the Amended Fees includes the fee for allthe work required of the Supervisor after its publication, in connection with a shelfprospectus relating to which the Supervisor received the Amended Fees, if required, whichincludes shelf reports published according to the shelf prospectus and/or any offering thatis made pursuant to a shelf prospectus and/or any raising of moneys pursuant to a shelfprospectus ("Work after a Shelf Prospectus"). After being paid the Amended Fees, theSupervisor will not be entitled to any additional payment for his work in connection with thepublication of a prospectus in respect of which he was paid the Amended Fees and inconnection with Work after a Shelf Prospectus; (3) in addition, the Supervisor will beentitled to payment of a sum equal in shekels to USD 20,000 (plus VAT), irrespective ofactual work hours in respect of his work, if required, in connection with financing against acharge on an oil asset of the Partnership, including in respect of his work in connection withthe bridge loan agreement for financing the Tamar project, which was signed on June 24,2010 between the Partnership and foreign banks and in connection with the loanagreement based on revenues from the Yan Tethys project, which was signed on June 6,2100 between the Partnership and a consortium of banks led by Morgan Stanley & Co.International Plc.B. To approve a commitment with the General Partner, Delek Drilling Management (1993)Ltd., in a further amendment to the option agreement of January 22, 2009 (as amended inaccordance with resolutions of general meetings of unit holders on December 29, 2009 andDecember 20, 2010), between the Partnership and the General Partner, whereby theGeneral Partner will grant the Partnership an option to receive 15% of the rights in theproduction sharing contract from October 24, 2008, which grants rights in Block 12 in theB-7