CUSIP No. M40868107 13D
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. 17)
ESC Medical Systems Ltd.
(Name of Issuer)
Ordinary Shares, NIS 0.10 par value per share
(Title of Class of Securities)
M40868107
(CUSIP Number)
Barnard J. Gottstein
Carr-Gottstein Properties
550 West 77th Avenue, Suite 1540
Anchorage, Alaska 99501
(907) 278-2277
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
with a copy to:
Joseph J. Giunta, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue, Suite 3400
Los Angeles, California 90071-3144
(213) 687-5000
June 23, 1999
(Date of Event which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d- 1(e), 13d-1(f) or 13d-1(g), check
the following box:
/ /
This Amendment No. 17 (the "Amendment") amends and
supplements the Statement on Schedule 13D, dated September 29,
1998, as amended by Amendment No. 1, dated January 15, 1999,
Amendment No. 2, dated March 9, 1999, Amendment No. 3, dated
March 22, 1999, Amendment No. 4, dated March 24, 1999, Amendment
No. 5, dated April 14, 1999, Amendment No. 6, dated April 19,
1999, Amendment No. 7, dated May 10, 1999, Amendment No. 8, dated
May 11, 1999, Amendment No. 9, dated May 20, 1999, Amendment No.
10, dated May 27, 1999, Amendment No. 11, dated May 29, 1999,
Amendment No. 12, dated June 15, 1999, Amendment No. 13, dated
June 16, 1999, Amendment No. 14, dated June 17, 1999, Amendment
No. 15, dated June 18, 1999, and Amendment No. 16, dated June 21,
1999(the "Original Schedule 13D"), relating to the Ordinary
Shares, par value NIS 0.10 per share (the "Shares"), of ESC
Medical Systems Ltd., an Israeli corporation (the "Company").
Each of the Barnard J. Gottstein Revocable Trust, Barnard J.
Gottstein, as trustee of the Barnard J. Gottstein Revocable
Trust, and Barnard J. Gottstein, as an individual (collectively,
the "Reporting Persons"), are filing this Amendment to update the
information with respect to the Reporting Persons' purposes and
intentions with respect to the Shares.
ITEM 4. PURPOSE OF TRANSACTION.
Item 4 of the Original Schedule 13D is hereby amended and
supplemented as follows:
On June 23, 1999, Messrs. Genger and Gottstein and the Company
reached a compromise with respect to the election of directors of the
Company which had been contested by Messrs. Genger and Gottstein and which
was to be decided at the June 23 shareholders meeting. The terms of the
compromise are set forth in the letter of agreement attached hereto as
Exhibit 31 and which is incorporated herein by reference.
Other than as described above and as previously described in the
Original Schedule 13D, the Reporting Persons do not have any present plans
or proposals which relate to or would result in (although they reserve the
right to develop such plans or proposals) any transaction, change or event
specified in clauses (a) through (j) of Item 4 of the form of Schedule 13D.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Item 7 of the Original Schedule 13D is hereby amended to add the
following exhibit:
Exhibit 31 Letter of Agreement, dated June 23, 1999,
from Messrs. Genger and Gottstein to the
Company
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: June 28, 1999
/s/ Barnard J. Gottstein
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Barnard J. Gottstein
Individually and as Trustee of
the Barnard J. Gottstein Revocable
Trust
BARNARD J. GOTTSTEIN REVOCABLE
TRUST
/s/ Barnard J. Gottstein
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Barnard J. Gottstein
Trustee
EXHIBIT INDEX
Exhibit
Number Title Page
31 Letter of Agreement, dated 6
June 23, 1999, from Messrs.
Genger and Gottstein to the
Company
Exhibit 31
June 23, 1999
To the Board of Directors
of ESC Medical Systems Ltd.
Gentlemen:
Effective upon your adoption of the resolutions attached hereto as
Annex A, we hereby agree on behalf of ourselves and our affiliates that
immediately following the certification of the vote by CT Corporation of
the combined extraordinary and annual general meeting, we will support and
take all necessary actions within our power to effect the prompt election
to the Board of the directors on the reconstituted Board (the
"Reconstituted Board"), as contemplated by the attached resolutions, who
were not elected at such meeting, it being understood that there will be no
obligation to thereafter continue to support such nominations by Messrs.
Genger, Gottstein or the current Board.
We and our affiliates agree to waive any claims we or our
affiliates may have against any existing directors with respect to the
proxy contests. As of today we are not aware of any other claims we have
against the current Board of Directors.
We further agree to jointly issue the press release attached hereto
as Annex B.
Our agreements are expressly conditioned on the resignation of
Shimon Eckhouse as President and Chief Executive Officer of the Company and
Karen Sarid and Hillel Bachrach as directors pursuant to executed
resignation letters attached hereto as Annex C and the receipt of the
certification as to the adoption of the resolutions from Gene Kleinhendler,
counsel to the Company.
We and our affiliates will vote all shares controlled by us and our
affiliates in favor of a shareholder resolution for indemnification of
current directors for certain litigation, as specified in Annex D hereto.
We agree not to challenge the proxies of ESC and authorize CT
Corporation to certify the vote on all three matters and the adjournment
resolution presented at the June 23, 1999 meeting.
This agreement will expire if the resolutions as attached as Annex
A are not adopted by the Board by 11:59 p.m., New York City time, on June
23, 1999.
Sincerely,
/s/ Arie Genger /s/ Barnard J. Gottstein
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On behalf of himself On behalf of himself
and his affiliates, all as and his affiliates, all as
identified in his Schedule 13Ds identified in his Schedule 13Ds
filed with the Securities and filed with the Securities and
Exchange Commission Exchange Commission
June 23, 1999
As counsel to ESC Medical Systems Ltd., I hereby agree that the resolutions
attached as Annex A have been validly adopted by the Board of Directors on
this date and are in full force and effect.
/s/ Gene Kleinhendler
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Gene Kleinhendler
ANNEX A
RESOLVED, that all costs and expenses of Messrs. Arie Genger and Barnard J.
Gottstein and their affiliates in connection with the election contest
shall be reimbursed by the Company promptly on submission of invoices
therefor, subject to refund when such reimbursement is submitted to
shareholders and not approved by such shareholders at a meeting noticed for
such purpose; [to be adopted by both audit committee and Board of
Directors]
FURTHER RESOLVED, that the Company and its directors and officers and their
affiliates shall not challenge the proxies of Genger and Gottstein at the
shareholders meeting held on June 23, 1999, and hereby authorizes and
instructs CT Corporation to certify as expeditiously as possible the vote
on the three proposals presented at the meeting and on the adjournment
motion;
FURTHER RESOLVED, that the Board hereby accepts the resignation of Karen
Sarid and Hillel Bachrach as directors of the Company;
FURTHER RESOLVED, that the Board hereby accepts the resignation of Shimon
Eckhouse as President and Chief Executive Officer of the Company,
recognizing that he will remain as Chairman of the Board and acting Chief
Executive Officer until further action by the Board;
FURTHER RESOLVED, that all litigation pending against Messrs. Genger and
Gottstein and their affiliates, including the litigation pending in Federal
District Court regarding Schedule 13D violations, shall be dismissed with
prejudice, in the form attached to the resolutions;
FURTHER RESOLVED, that the following persons are hereby appointed to the
Board of Directors, in addition to the six remaining directors
(collectively, the "Reconstituted Board"), effective immediately;
Aharon Dovrat
Philip Friedman
Darrell S. Rigel, M.D.
S.A. Spencer
Mark Tabak
Professor Zehev Tadmor
FURTHER RESOLVED, that immediately following the certification by CT
Corporation of the vote at the meeting convened on June 23, 1999, the
current Board will take all necessary actions to support the election of
the individuals constituting the reconstituted Board it being understood
that there will be no obligation to thereafter continue to support such
nominations by Messrs. Genger, Gottstein or the current Board; and
FURTHER RESOLVED, that the attached joint press release is approved.
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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ESC MEDICAL SYSTEMS, LTD.
:
Plaintiff, No. 99 CV 2984 (KMW)
:
-against- STIPULATION & ORDER OF
: DISMISSAL WITH PREJUDICE
ARIE GENGER, BARNARD J. GOTTSTEIN,
THOMAS G. HARDY, TPR INVESTMENTS
ASSOCIATES, INC., TRANS-RESOURCES, :
INC., HAIFA CHEMICALS LTD., HAIFA
CHEMICALS HOLDINGS, INC., and :
BARNARD J. GOTTSTEIN REVOCABLE
TRUST, :
Defendants.:
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It is hereby stipulated and agreed by the undersigned counsel
to the parties hereto that this action shall be, and hereby is, dismissed
with prejudice, each side to bear its own costs.
Dated: June , 1999
New York, New York
SIMPSON THACHER & SKADDEN, ARPS, SLATE,
BARTLETT MEAGHER & FLOM LLP
By:_______________________ By:_______________________
Paul C. Curnin (PC 7209) Samuel Kadet (SK 1856)
425 Lexington Avenue 919 Third Avenue
New York, New York 10017 New York, New York 10022
(212) 455-2000 (212) 735-3000
Attorneys for Plaintiff Attorneys for Defendants
SO ORDERED:
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U.S.D.J.
ANNEX B
For Immediate Release
ESC MEDICAL SYSTEMS AND GENGER AND GOTTSTEIN
REACH COMPROMISE ON BOARD COMPOSITION
NEW BOARD TO CONSIST OF NOMINEES FROM BOTH SLATES
June 23, 1999, New York, New York - ESC Medical Systems Ltd. (Nasdaq:
ESCMF) and Messrs. Arie Genger and Barnard J. Gottstein jointly announced a
compromise reached today with respect to the election of directors of ESC
which had been contested by Messrs. Genger and Gottstein and was to be
decided at the shareholders meeting held today.
Under the compromise, the six new nominees proposed by the
Genger/Gottstein group have joined the Board immediately, plus Mr. Hardy
who is already on the Board. In addition, two management directors of the
Company, Karen Sarid and Hillel Bachrach, have stepped down. Effective
today, the restructured Board consists of twelve directors and both sides
have agreed that immediately following the certification of the vote by the
inspector of election, the Board will be so reconstructed, regardless of
the outcome of the vote.
In order to facilitate the selection of a new CEO which both sides
have previously supported, Shimon Eckhouse, current President, CEO and
Chairman of ESC, has relinquished the titles of President and CEO and
remains Chairman of the new Board of Directors until further decision of
the Board. The new Board will select ESC's new chief executive officer as
promptly as possible. In the interim, Dr. Eckhouse has agreed to serve as
acting chief executive officer.
In addition, as part of a compromise, Messrs. Genger and Gottstein
have agreed to support at the next shareholders meeting a resolution
providing for indemnification of the incumbent directors of ESC, and ESC
has agreed to reimburse Messrs. Genger and Gottstein for their expenses in
conducting the election contest. Both sides have agreed to dismiss with
prejudice all litigation pending against them.
Dr. Eckhouse stated, "I am very pleased to see this matter resolved.
The interest of the Company will best be served by the joint efforts of all
of the shareholders. I look forward to returning my focus to our
restructuring efforts to enhance ESC's position in the market."
Messrs. Genger and Gottstein stated "We are gratified that we were
able to amicably resolve our differences with the Board of Directors. We,
of course, recognize the tremendous contribution made by Shimon Eckhouse
and are pleased that he and the current Board are willing to resolve the
issues in a constructive manner. We think this compromise will accelerate
the Company's ability to focus 100% of its energy to returning the Company
to profitability and restoring shareholder value."
[ESC tag line.]
ANNEX C-1
June 23, 1999
I hereby resign as President and Chief Executive Officer of ESC Medical
Systems Ltd. effective immediately, and agree to serve as acting chief
executive officer, until further action by the Board.
/s/ Shimon Eckhouse
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Shimon Eckhouse
ANNEX C-2
June 23, 1999
I hereby resign as a Director of ESC Medical Systems Ltd. effective
immediately.
/s/ Karen Sarid
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Karen Sarid
ANNEX C-3
June 23, 1999
I hereby resign as a Director of ESC Medical Systems Ltd. effective
immediately.
/s/ Hillel Bachrach
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Hillel Bachrach
ANNEX D
RESOLVED to indemnify each of Shimon Eckhouse, Karen Sarid, Kenneth Rind,
Hillel Bachrach, Marshall Butler, Halley S. Faust, Dan Suesskind, Thomas
Hardy and Benjamin Givli (all together and each separately the "Directors")
in respect of the actions consolidated under the caption In Re ESC Medical
Systems Ltd. Securities Litigation, Case No. 98 Civ. 7530 (MBM) filed in
the United States District Court, Southern District of New York, including
the events described in the complaints relating thereto and any amendments
thereof (the "Complaint") and any other claims relating thereto for (a) any
monetary obligation imposed upon any of them for the benefit of a third
party by a judgment, including a settlement agreed to in writing by the
Company, or an arbitration decision certified by the court, as a result of
an act or omission of any of their capacity as a director or an office
holder of the Company, and (b) reasonable litigation expenses, including
legal fees, incurred by any of the Directors or which he/she is obligated
to pay by a court order, in a proceeding brought against him/her by or on
behalf of the Company or by others, in each case relating to acts or
omissions of any of the Directors in his/her capacity as a director or an
office holder of the Company relating to the events described in the
Complaint and any claims relating thereto. Said indemnification shall be
limited to any amounts not covered by the officer's and director's
liability insurance policy for him/her which is currently in effect.
RESOLVED that in the event that any of Shimon Eckhouse, Hillel Bachrach,
Halley S. Faust, Thomas Hardy, Karen Sarid, Kenneth Rind, Marshall Butler
and Dan Suesskind (all together the "Directors" and each separately a
"Director") of the Company becomes involved, in their capacity as an
officer or a director, in any claim, suit, action, proceeding,
investigation or inquiry with respect to the filing with the U.S.
Securities and Exchange Commission of Schedule 13D, and any amendment
thereto by Messrs. Arie Genger and/or Mr. Barnard Gottstein, the Company
shall indemnify and reimburse any such Director for his/her legal and other
expenses, to the fullest extent permitted by the Companies Ordinance [New
Version], 1983-5743 and/or the Companies Law, 1999-5759, as the case may
be, as such expenses incurred by such director in connection therewith.
Said indemnification shall be limited to any amounts not covered by the
officer's and director's liability insurance policy for him/her which is
currently in effect.
June 23, 1999
We, the undersigned, do hereby agree to vote all shares controlled by us or
our affiliates for their reimbursement of the expenses incurred by Messrs.
Genger and Gottstein and reimburse by the Company pursuant to the Board
resolution adopted on June 23, 1999.
/s/ Dr. Shimon Eckhouse
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Dr. Shimon Eckhouse
/s/ Karen Sarid
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Karen Sarid
/s/ Hillel Bachrach
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Hillel Bachrach
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Dan Suesskind
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Marshall Butler
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Halley S. Faust
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Kenneth Rind
