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. 4)
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
March 24, 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:
/ /
CUSIP No. M40868107 13D
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This Amendment No. 4 (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, and Amendment No. 3, dated March 22, 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:
As previously set forth in Messrs. Genger's and Gottstein's letters to
the legal representative of the Company, dated March 11, 1999 and March 22,
1999 (copies of which were previously attached as Exhibit 1 and Exhibit 2,
respectively, to the Original Schedule 13D), Messrs. Genger and Gottstein
have proposed a restructuring of the current Board of Directors of the
Company (the "Board") by replacing two management directors (other than the
Chairman, President and Chief Executive Officer of the Company (the
"Chairman")) and one non-management director selected by the Board (other
than the representative of Trans-Resources, Inc.), with three directors
nominated by Messrs. Genger and Gottstein and by increasing the number of
directors by one director, with such new director being nominated by
Messrs. Genger and Gottstein. The effect of such proposal would be that
the Board would then have nine directors, consisting of the Chairman, four
existing directors and four new directors nominated by Messrs. Genger and
Gottstein.
On March 24, 1999, the legal representative of Messrs. Genger and
Gottstein received a letter from the legal representative of the Company,
informing them that the Board is prepared to consider nominating to the Board
only two of the four directors proposed by Messrs. Genger and Gottstein, and
that the Board is prepared to propose nominating two of its own selected
directors to the Board. A copy of the letter is attached hereto as Exhibit 3.
On March 24, 1999, the legal representative of Messrs. Genger and
Gottstein sent a response letter to the legal representative of the
Company, declining to modify Messrs. Genger's and Gottstein's proposal to
restructure the Board. In the letter, Messrs. Genger and Gottstein noted,
however, that the Board is free to substitute the Board's two nominees for
two existing non-management directors if it so chooses, but that Messrs.
Genger and Gottstein would continue to propose that the Board replace three
of its current directors (as previously discussed above) with their four
nominated directors, resulting in a Board consisting of nine directors.
Pursuant to the letter, Messrs. Genger and Gottstein gave the Company until
the close of business on March 25, 1999, Los Angeles time, to accept their
proposal. A copy of the letter is attached hereto as Exhibit 4. However,
Messrs. Genger and Gottstein were notified by the legal representative of
the Company that the Company would not be able to respond by such time.
The letter further indicated that, failing such acceptance, Messrs.
Genger and Gottstein intend to take all steps necessary to convene an
extraordinary general meeting of shareholders pursuant to Section 109 of
the Israel Companies Ordinance for the purpose of removing all of the
current directors (other than the representative of Trans-Resources, Inc.
and possibly the Chairman), and fill all vacancies then existing with the
four nominees named in their proposal, together with such additional
nominees as may be necessary to fill all vacancies.
In addition, on March 24, 1999, the legal representative of Messrs.
Genger and Gottstein sent a letter addressed to the Chairman and to the Vice
President and Chief Financial Officer of the Company, notifying them that
Messrs. Genger and Gottstein were exercising their right under Section 65 of
the Israel Companies Ordinance to review and make copies of the Company's
Register of Members. A copy of such letter is attached hereto as Exhibit 5.
Messrs. Genger and Gottstein have been informed by the Company that its
Register of Members is not current.
Messrs. Genger and Gottstein intend to continue to have discussions
with other shareholders of the Company regarding their proposal and to seek
shareholder support.
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 exhibits:
Exhibit 3: Letter, dated March 24, 1999, from the legal
representative of the Company to the legal
representative of Messrs. Genger and
Gottstein
Exhibit 4: Letter, dated March 24, 1999, from the legal
representative of Messrs. Genger and
Gottstein to the legal representative of the
Company
Exhibit 5: Letter, dated March 24, 1999, from the legal
representative of Messrs. Genger and
Gottstein to the Chairman, President and
Chief Executive Officer of the Company and
to the Vice President and Chief Financial
Officer of 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: March 25, 1999
/s/ Barnard J. Gottstein
--------------------------------------
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
-------- ----- ----
3 Letter, dated March 24, 1999, 7
from the legal representative
of the Company to the legal
representative of Messrs.
Genger and Gottstein
4 Letter, dated March 24, 1999, 9
from the legal representative
of Messrs. Genger and
Gottstein to the legal
representative of the Company
5 Letter, dated March 24, 1999, 11
from the legal representative
of Messrs. Genger and
Gottstein to the Chairman,
President and Chief Executive
Officer of the Company and to
the Vice President and Chief
Financial Officer of the
Company
Exhibit 3
Joe Giunta, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
300 South Grand Avenue
Los Angeles, CA 90071-3144
March 24, 1999
Our File No. 358
Re: ESC Medical Systems Ltd.
Dear Joe:
Further to our conversation last night, and further to the desire of the
ESC Board of Directors to make a good faith effort to reach a compromise to
avoid an unnecessary proxy battle and the resulting damage to the company,
the Board is prepared to consider the proposal to expand the Board of
Directors. Of the directors you proposed, Mr. Dovrat is known to members of
the Board and could be a valuable addition to the Board of Directors. Mr.
Friedman appears, based on the material received, a person that can also
make a considerable contribution. The Board would be interested in
interviewing these two gentlemen for the purpose of considering their
nomination to the Board.
In addition the Board is prepared to propose the nomination of Mr. Dan
Barnea to the Board of Directors and Dr. Moti Beyer has also indicated his
willingness to be appointed to the Board. Both Mr. Barnea and Dr. Beyer are
highly experienced in the field of medical devices and have very successful
business track records. Neither Mr. Barnea nor Dr. Beyer are affiliated
with ESC, its management or any of the members of the Board. Background
information is attached.
I look forward to receiving your views to the possible addition of Mr.
Barnea and Dr. Beyer and hopefully we can put this matter behind us and
allow the company's management and Board to apply their full attention to
the business of the company.
Best regards,
/s/ Gene Kleinhendler, Adv.
Background Information re: Board's Proposed Directors
(resumes intentionally omitted)
1. Dan Barnea
2. Motti Beyar
Exhibit 4
March 24, 1999
VIA FACSIMILE
Mr. Gene Kleinhendler
Kleinhendler & Halevy
30 Kalisher St.
Tel Aviv, Israel 65257
Re: ESC Medical Systems Ltd. (the "Company")
Dear Gene:
We are in receipt of your letter dated March 24, 1999. Messrs.
Genger and Gottstein have carefully considered the Company's proposed
substitutions of two nominees to the Board of Directors in lieu of two of
the nominees of Messrs. Genger and Gottstein. After such consideration, Mr.
Genger and Mr. Gottstein have declined to modify their proposal. They note,
however, that the directors of the Board are free to substitute its two
nominees for two existing non-management directors if they so choose. Mr.
Genger and Mr. Gottstein also want to emphasize that the two outside,
independent directors of Trans-Resources, Inc. proposed by them, Mr.
Spencer and Mr. Tadmor, are not employees of Trans-Resources, Inc. and in
no way can these individuals be considered to be persons under the control
of Mr. Genger. In any event, these two individuals, together with Mr.
Hardy, would constitute less than a majority of the Company's Board of
Directors as proposed to be restructured.
As two of the Company's largest shareholders, Messrs. Genger
and Gottstein believe that the Company's shareholders should have the right
to a Board of Directors which include representatives that are acceptable
to them, and a majority of which are not beholden to current management in
any way. Furthermore, they believe that it is not the exclusive province of
the Board of Directors to determine the entire composition of the Board.
The events that have occurred during recent months and weeks, including the
significant deterioration in market value of the Company's stock and its
profitability, have further convinced Mr. Genger and Mr. Gottstein that the
Board needs to be restructured. Additionally, in light of the Board of
Directors' recent actions, it has become apparent that there will be a need
for the restructured Board of Directors to evaluate whether changes and/or
additions to management, including the possible replacement of the chief
executive, are necessary or desirable. Mr. Genger's and Mr. Gottstein's
current proposal is the minimum that they will accept in terms of
restructuring the Board.
Accordingly, failing your acceptance of Messrs. Genger's and
Gottstein's proposal by the close of business on March 25, 1999, Los
Angeles time, Mr. Genger and Mr. Gottstein intend to take all steps
necessary to convene an extraordinary general meeting of shareholders
pursuant to Section 109 of the Israel Companies Ordinance for the purpose
of replacing all of the current directors (other than Mr. Hardy and
possibly Mr. Eckhouse) with their proposed nominees. We reiterate, however,
that it is not Mr. Genger's nor Mr. Gottstein's intention to control the
Company, but rather to restructure the Board of Directors with an
independent Board that can honestly evaluate the Company's strengths and
weaknesses, restore profitability and credibility to the Company and
enhance the ability of the Company to maximize shareholder value.
We await your reply.
Very truly yours,
/s/ Joseph J. Giunta
cc: Arie Genger
Barnard J. Gottstein
Exhibit 5
Tel-Aviv, March 24, 1999
By facsimile No.: 04-9599050
ESC Medical Systems Ltd.
Industrial Park
P.O. Box 240
Yokneam 20692
Attention: Dr. Shimon Eckhouse
President and CEO
Chairman of the Board
Karen Sarid
Vice President and
Chief Financial Officer
Dear Sir and Madam,
Re: Review of Register of Members
This firm represents certain shareholders of ESC Medical
Systems Ltd. ("ESC"), including Mr. Arie Genger, TPR Investment Associates,
Inc., Trans-Resources, Inc., Haifa Chemicals Holdings Ltd., Barnard Jacob
Gottstein TTEE and Barnard J. Gottstein Revocable Living Trust
(collectively, the "Shareholders"), and have been instructed by the
Shareholders to review and make copies of ESC's Register of Members,
pursuant to their right under Section 65 of the Companies Ordinance [New
Version], 1983.
We wish to inform you that a representative of this firm will
come to your principal office tomorrow, March 25, 1999, during early
afternoon, to perform the said review.
Very truly yours,
/s/ Michael Zellermayer, Adv.
Cc: Mr. Arie Genger
Barnard Jacob Gottstein
TPR Investment Associates, Inc.
Trans-Resources, Inc.
Haifa Chemicals Holdings Ltd.
