According to Section 9 of the Licence Agreement, a Licence Agreement is subject to the Concession Agreement, as long as it is valid.
- The Rothschild Café Partnership gave Sol a franchise to operate the café in Herzliya - the chain's first branch, under the Rothschild Café chain.
With regard to the concession period, with reference to the interpretation of section 8a. In the concession agreement [Appendix 17 to the claim], counsel for the parties announced at p. 609 of the transcript line 7: "We agree that the concession given to the plaintiff was for 10 years."
According to section 15a. For the concession agreement, the Rothschild Café Partnership undertook to provide Sol with all the knowledge, experience, training and public relations, in order to assist Sol, the franchisee, in the success of the café branch in Herzliya; In other words: ongoing accompaniment of the Sol Company by the Rothschild Café Partnership during the 10-year franchise period.
- The consideration in the transaction was artificially divided between two agreements: a concession agreement [Appendix 17] and a sale agreement [Appendix 18], apparently for tax purposes.
Landau, Yakubov's partner in the partnership, testified in his interrogation: "The cost of establishing a café of this size is around ILS 1.5 million" [p. 876 of the transcript, lines 16-17]; "We asked [Sol-Y.G.] for ILS 1.5 million for the café" [p. 876 of the transcript, line 19]; "Q. Why in the end in the agreements was changed to ILS 1.1 million [a sale agreement - Y.G.], and ILS 450,000 in franchise fees [a franchise agreement - Y.G.]? A. I am thinking about tax matters" [p. 876 of the transcript, lines 33-34].
The concession agreement stipulates the payment of a one-time franchise fee in the amount of 450,000 + VAT.
The sale agreement stipulated consideration in the amount of ILS 1,050,000 + VAT.
In the preamble to the sale agreement, the sale was defined as "the right to serve as an authorized tenant in the leased property", by virtue of the lease contract signed by the partnership with the owner, and as the sale of the equipment in the café as detailed in Appendix A to the agreement.