Israel Company Law 1999

Chapter 4: Rights of Director

265. (a) Every director shall have the right to inspect the documents and records of the company and to receive copies thereof, and to examine the assets of the company, to the extent required for the fulfillment of his duties as a director.

(b) The company may prevent a director from examining a document or asset of the company if the board of directors is of the opinion that the director is acting other than in good faith, or that such examination might harm the best interests of the company.

(c) The court may, on the application of an External Director, rule that the right set out in subsection (a) shall also apply to the documents and records of any related company, if it is convinced that the information requested is important for the performance of his role as an External Director.

Right to receive information

266. (a) For the purpose of performing his functions, a director may, in special cases, receive professional advice at the company’s expense, if coverage of the expense is approved by the board of directors of the company or by the court.

(b) The court, when ruling on an application as provided in subsection (a), shall consider, inter alia, whether the company’s specialists are not providing the assistance required by the director for the purpose of performing his function, and the reasonableness of the sum requested, taking into account the reason for seeking advice and the financial status of the company.

Right to employ advisers

267. (a) Where a director has reasonable cause to presume that an act is about to be performed by an office holder which might constitute a breach of the office holder’s duty, he may, after acting as provided in section 257 if the circumstances so permit, apply to the court with a request that it enforce the duty or prevent the act; the court may grant an order preventing the act or any other remedy that it may see fit in the circumstances of the case.

(b) Unless otherwise ruled by the court, the company shall bear all expenses incurred by a director who applied to the court pursuant to the provisions of this section, including court fees and advocates’ fees, on the date determined by the court.

Right to sue

Chapter 5: Company Transactions with Interested Parties >>

Transactions with Interested Parties