However, even after Mr. Nehemiah's willingness to make changes, Mr. Knepfler was unable to persuade the Fund to move forward with the transaction, in light of the risks associated with the engagement with it. "Everyone [at the Tamir Fishman Foundation] did their job, they divided the work. We brought everything from A to Z, and they didn't agree to move forward with the deal... Mainly I gave it to Tal Levy, who is the CFO, to study it, and he said - not to make the transaction and therefore I did not dictate to the board of directors that deal against their wishes" (p. 177, s.3). Later, Mr. Knepfler was asked again whether the fund did not move forward with the transaction because of the due diligence it carried out, and his answer was in the affirmative: "Yes, because of the results of the due diligence, it was not accepted, the transaction was not closed" (p. 178, s. 12).
Mr. Knepfler further testified that the person who conducted the examination at Tamir Fishman "also saw problems in the property that I did not see" (p. 109, S. 23).
- Against this background, it is not possible to accept Mr. Knepfler's testimony that at this stage he was satisfied with the company's situation when the commitment with the Tamir Fishman Fund was improved (and its surplus share in the yield was defined).
First, the fact is that the fund still thought that the deal was problematic and that it was not worth engaging in.
Second, Adv. Pereg, who accompanied the transaction and tried to reconcile the two parties, shed light on the matter. Adv. Pereg testified that he was aware of the tests from personal knowledge, and testified that "I was part of the matter" (p. 220, s.1). He added (ibid., Q.5): "I'm not a financial person, I didn't do the checks on Excel. They were done by a guy named Tal Levy, who was in regular contact with me and checked and saw that it did not come close to what was discussed, because the properties were not managed and were not rented and the debts were not paid to the management company and everything was not, the business was not working."