Derivative Claim (Tel Aviv) 58205-11-23 Harel Primack v. Delek Group Ltd. - part 2

Regarding the success of the business operations, it was written as follows:

"These successful actions led to a significant strengthening of the Group's capital, an increase in the company's value by hundreds of percent, from a value of about NIS 550 million at the height of the COVID-19 crisis to a market cap of about NIS 10 billion (close to the date of publication of this report), and a significant decline in the yields of the company's bonds."

11. The report noted that the CEO did not receive any bonus for his tenure as CEO of the company, except for a special bonus of 3 salaries received for the completion of a series of bonds, and that the CEO does not receive a capital remuneration, even though this can be done according to the company's remuneration policy.  With regard to the comparative opinion that was presented to the members of the remuneration committee and the board of directors, it was stated in the immediate report that it was reconsidered and determined that the remuneration was proper, fair and appropriate (section 2.5). 4) to Appendix 4 to the application).  The immediate report did not mention what was presented to the board of directors during the reconsideration, other than a reference to the fact that a document written by the external consultant regarding the manner in which the CEO was compensated – and did not specify how the document was re-examined, how it was challenged, and what was presented in it.  In addition, the immediate report did not mention the shareholders' position and it is not possible to see whether they tried to find out why the shareholders voted in this way or whether they were told the reasons for doing so.
12. Hence the request before me.  An order was requested for discovery and review of the documents prior to the filing of a derivative claim under Section 198A to the Companies Law.  At the same time, the court was asked to award expenses in favor of the applicant, together with his attorneys' fees and the addition of value-added tax as required by law, together with linkage differences and interest until the date of payment.

Documents Requested

13. The documents requested were detailed on pages 1-2 of the application:

• All the minutes of the meetings of the Company's Remuneration Committee and the Board of Directors on the agenda of the discussion and/or the approval of the granting of a special grant in the amount of NIS 2.6 million to the Company's CEO, without derogating from the aforesaid, from March 27, 2022, March 29, 2022, May 22, 2022 and May 24, 2022, together with all their appendices;
• Any document reflecting the business objectives set by the Company in the two years preceding the summons of the General Meeting, which were achieved by the Company's CEO, together with the Company's management, as stated in clause 2.3.2. (3) to the immediate report dated March 30, 2022 regarding the summoning of the general meeting;
• All engagement agreements with the CEO of the Company (including through a company he owns) as well as any extensions and additions thereto;
• Procedures established by the Board of Directors or determined by any committee of the Board of Directors intended to prevent a violation of the Company's remuneration policy;
• Any document prepared by an external consultant and presented to the Remuneration Committee and the Company's Board of Directors in the framework of the meetings as stated in Section A above, including the document mentioned in Section 2.3.2. (5) to the report of the meeting summons;
• Minutes of the General Meeting of May 3, 2022.

Reasons for the application

14. According to the Applicant, the over-ruling process approving the special grant was not done lawfully and in any manner for the benefit of the company.  The conditions for the over-rolling listed were not met In sections 272(c1)(1)(c) and272(c)(3) to the Companies Law, according to which The position of the General Meeting can be overcome in special cases, on the basis of detailed reasons, after a reconsideration of the remuneration and after an examination of the objection of the General Meeting.
15. As to the requirement of a "special case", the Applicant argues that this is not a special case, but rather a CEO's handling of the company's management out of his duty to manage the company in the best possible way, for which he receives his salary.  In the company's reports, it was not claimed that the company had a special dependence on the CEO, and it was not determined that he was a key person in it (Appendix 5 to the application), and it was not determined that dependence on the CEO is one of the risk factors of the company's business (Appendix 6 to the application).  In addition, it was argued that the reasons do not relate to the fact that this is a special case, since the immediate report retracts the reasons presented in the report summoning the meeting.
16. The Applicant claims that there was no reconsideration of the decision to grant the CEO a grant that deviates from the company's remuneration policy.  The reasons of the remuneration committee and the board of directors in the immediate report are almost identical, according to the applicant, to those that appeared in the report summoning the meeting.  According to the immediate report, no new considerations were considered; No new information or opinion was presented; Representatives of the minority shareholders were not summoned to detail their objections.
17. It was argued that the decision was not made on the basis of detailed reasons.  This, as stated, follows the repetition of the reasons presented in the report of the summoning of the meeting, according to the Applicant, in the sense of "copy and paste".  Moreover, it was argued that no reference was made to the objection of the shareholders at the general meeting to the approval of the grant, no explanation was made of the reasons for which the general meeting objected to the approval of the grant, and no reference was made to why the grant should nevertheless be approved despite the objection of the general meeting.  It was argued that no reference was made to the fact that the grant deviated from the remuneration policy and why it should be approved.
18. The Applicant argues that the position of the General Meeting was not properly examined for the purpose of the Overruling Decision.  It was claimed that the shareholders rejected the reasons presented in the report of the meeting summons, with 58.76% of the shareholders who do not have a personal interest voting against the decision to grant a grant to the CEO.  According to the Applicant, the mere repetition in the immediate report of the reasons raised in the report summoning the meeting in itself constitutes a disregard of the position of the shareholders who did not approve the grant.
19. The Applicant claims that he is entitled to file a derivative claim since he is a shareholder in the Company, the claim and its management are in the interest of the Company, since the Applicant seeks to protect the Company's rights and return the grant to the Company's coffers – which will increase the Company's coffers and greatly benefit the Company.  In addition, it was argued that there is a benefit in the company's compliance with the requirements of the law regarding the manner in which compensation is approved.  The applicant is in good faith as he has no foreign interest whatsoever in filing the claim.
20. The Applicant claims that he has provided a preliminary evidentiary basis for the purpose of the discovery, which shows that there is a chance that the derivative claim will be accepted.  It was claimed that the grant was given to the CEO in violation of the law because the over-rolling process was flawed and therefore in accordance with the instructions Article 280 According to the Companies Law, the engagement with the CEO for the purpose of the grant is void and he must return it to the company.  In addition, the company's directors breached their duty of care and fiduciary duty under Articles 252 and254 to the Companies Law, respectively.  In addition, it was claimed that the directors breached a statutory duty under Article 63 To the Ordinance The Torts [New Version]
21. As to the relevance of the requested documents, the Applicant claims that they are required in order to enable him to examine the submission of an application for a well-founded derivative claim, and from them it will be possible to learn about the process of approving the remuneration to the General Manager and whether it was done in accordance with the law in the over-ruling decision.

Respondent's Response

22. The Respondent opposes the application and seeks to dismiss it out of hand or on its merits, as well as to impose on the Applicant the Respondent's expenses, including attorneys' fees and VAT.  It was argued that the over-ruling proceeding was carried out lawfully and does not constitute a cause of action.
23. As to the requirement of a "special case", it was argued that the argument that this condition was not met should not be accepted.  Delek experienced an extreme and unusual crisis, according to the Respondent, from which great efforts were required.  According to the Respondent, it has not been proven that this is a routine matter, and no examples or preliminary evidence have been brought to prove this.  In addition, it was argued that there is no dependence on the definition of the CEO in the reports as a key person or on the company's dependence on him and the decision regarding a special grant in overruling on the decision of the general meeting.
24. With regard to the requirement to hold a rehearing, the Respondent argues that no evidence was presented to contradict what was published in the immediate report regarding the re-holding of the report, and that their claim that no such hearing took place should be rejected.  According to them, the mere fact that they did not add new reasons does not indicate that there was no new discussion.  In addition, according to the Respondent, there is no requirement to demand additional or other information or to summon any of the shareholders in order to obtain an additional perspective.  The Remuneration Committee and the Board of Directors also approved the special grant on the basis of comparative work presented to them and determined according to it that the grant was proper and fair (paragraph 107 of the Respondent's response).
25. As to the examination of the position of the General Meeting, the Respondent argues that the General Meeting did not at all explain its objection to the grant and that The Standing Reasons for which it is not appropriate to approve.  The vote at the general meeting is binary and the company has not been provided with a position document from the shareholders or anyone on their behalf.  However, the Respondent notes that it held informal talks with representatives of some of the institutional bodies, and their objection stems from general policy and not from considerations relating to the concrete decision to grant the grant to the CEO.  In addition, it was argued that the rejection of the proposal by the General Assembly does not make it illogical or appropriate or not in the best interest of the company.  Moreover, the Respondent notes that some of the institutional bodies did vote in favor of the special grant (paragraph 91 of the Respondent's response; Appendix 5 to the Respondent's response).
26. The Respondent argues, inter alia, that there is a material difference in our case than in the case Electra And in the matter Matrix (and in all related cases and in other cases in which the applicant filed a similar application).  According to her, the approval of a one-time special grant that deviates from the company's remuneration policy is different from changing the entire remuneration policy by means of over-rolling, as well as a matter centered on changing the terms of employment of a CEO entirely.  It was argued that there is a substantial difference between the cases also in terms of the scope of the funds and in terms of the percentage of opponents to the decision that existed in the other cases, in our case it was argued that the percentage of opponents is relatively small.
27. With regard to the claim that the directors breached the duty of care imposed on them, the Respondent argues that even if the Applicant's claims were true, the Company adopted an exemption from liability for breach of the duty of care with the approval of the General Meeting (Appendix 12 to the Respondent's Response).  In addition, the Respondent argues that the exemption cannot be circumvented by means of the tort of the framework of a breach of statutory duty, and that no preliminary evidentiary basis was provided for the breach of the duty of fiduciary.
28. As to the conditions for receiving the request for disclosure in the documents prior to the filing of the derivative claim, the Respondent argues that the Applicant is not entitled to file a derivative claim due to lack of good faith and that the management of the claim will not be in the best interest of the Company.  First, it was argued that any claim is likely to enrich the company's coffers, and this is not the only criterion that must be taken into account when examining the company's best interest.  It is not in the company's best interest to conduct a proceeding against its organs, while some of the claims are silenced or inapplicable due to the exemption of the board members.  Second, the applicant's lack of good faith is expressed, inter alia, that the applicant did not contact the company in advance or in real time, and that he filed additional disclosure requests against other companies with similar or identical claims.
29. The Respondent claims that no initial evidentiary basis was provided for the purpose of discovery and that the requested documents are irrelevant.  It was argued that it was not explained why all the documents were relevant for the purpose of examining the filing of an application for a derivative claim, including the company's business objectives; Engagement agreements with the CEO; and the procedures of the committees and the board of directors intended to prevent deviation from the remuneration policy.  It is claimed that the documents include business secrets of the company, which are not justified in disclosing them in the framework of this request.  In addition, the Respondent insisted that an additional one-time grant and a change in the company's remuneration policy, which were later put to the vote of the general meeting, did receive the approval of the minority shareholders.  Thus, according to the Respondent, there is an indication of the desire of the shareholders to benefit the CEO.

The Applicant's Response to the Respondent's Arguments

30. It was argued that this was not a special case, since the increase in the Respondent's share was rooted in global market trends and not in the actions of the CEO, because at the time of the meetings of the Remuneration Committee and the Board of Directors, Delek's share price was lower than its share price before the COVID-19 crisis, and it was argued that the increase in Delek's value was partly due to additional investment by the shareholders of great value (Appendix 1 to the response to the response).  In light of this, the Applicant maintains that a distorted factual picture was presented in order to justify the grant to the CEO.  Moreover, the Applicant claims that these are reasons that relate to the amount of the grant to the CEO and not to the overruling process itself.  It was claimed that the board of directors did not know at the time of the vote on the overruling that the CEO would indeed improve Delek in the future.
31. With regard to the objection of the general meeting and the reference to it in the over-ruling, it was argued that institutional investors have the authority to consider broad and moral considerations when voting, and that it has not been proven that if the institutional investor mentioned in the response had voted in favor, the decision on the grant would have been made.  In addition, it was argued that the Respondent admitted that it did not reconsider the decision when it stated in the reply that there was no requirement in the law to collect new information or to summon a representative on behalf of the shareholders in the framework of the rehearing.  The Applicant further argued that the directors are not entitled to the protection of the exemption since the Respondent did not attach the wording of the exemption letter and that the transfer of an over-ruling decision in violation of the law amounts to a breach of the company's fiduciary duty and therefore the directors must be held accountable if they believed in good faith that they acted in accordance with the law.

Discussion and Decision

32. First of all, I would like to note that the normative framework that I will present above is similar to that detailed and reviewed in the decisions in the Electra case and in the Matrix case.  Therefore, I will briefly elaborate with reference to my previous decisions regarding document discovery requests following over-ruling decisions.

Disclosure of documents prior to filing a derivative claim under Section 198A of the Companies Law - The Normative Framework

33. The procedural framework in our case is a provision Section 198A to the Companies Law, which deals with a request for disclosure of documents prior to the filing of a derivative claim.  The derivative claim is a justified exception but is limited to the principle of the separate legal personality of the company and to the rule of non-intervention of its shareholders in the manner of its management.  It allows a shareholder or director to file a claim on behalf of the company, by virtue of the cause of action it has due to breach of duty towards it, whether by officers, a controlling shareholder or a party outside the company (Civil Appeal Authority 4857/16 Menashe v. Eugene Air Ltd., paragraph 27 (Nevo April 24, 2018); Civil Appeal Authority 5296/13 Antorg v. Stevinsky, (24.12.2013); Derivative Claim (Tel Aviv Economic) 815-09-13 Lenoel v. Maor, paragraph 22 (April 14, 2015)).
34. The need for a derivative action proceeding exists when the company's board of directors, which holds the power to sue the company, refrains from filing a claim on its behalf and is intended to deal with situations in which the avoidance stems from the "representative problem" that exists where the officers and controlling shareholders are in a conflict of interest in relation to the filing of the claim.  The most common situation is when it comes to a lawsuit against them on the grounds that they breached their duties and caused damage to the company (Civil Appeal Authority 4024/14 Africa Israel Investments in Tax Appeal v. Cohen, paragraph 15 (Nevo, April 26, 2015); Civil Appeal 6913/18 Shkedi v. Herodium Investments Ltd., paragraph 20 of the judgment of the Honorable Justice Amit (Nevo, August 4, 2020); Civil Appeal Authority 4417/18 Balfour v. Israel Discount Bank Ltd., paragraph 17 (Nevo 3.12.2018); Irit Habib Segal Corporate Law A 675, 686 (2007); Tziporah Cohen Shareholders in the Company - Rights of Claim and Remedies C 453-454 (2nd ed., 2010)).
35. Section 198A The Companies Law allows the court to apply to the court before a request to certify a derivative claim has been filed, with a request to instruct the company to disclose documents for the application to certify the derivative claim (Civil Appeal Authority 3487/16 Yifat v. Bank Leumi Le-Israel, paragraph 14 (September 6, 2016) (hereinafter: "The Yifat Matter")).  It is customary to view the applicants in derivative claims as being at a disadvantage in relation to the potential defendants due to the lack of access to the information required to provide a sufficient evidentiary basis for the purpose of filing a derivative claim (Civil Appeal Authority 2903/13 Intercoloni Investments in Tax Appeal v. Shkedi, paragraph 58 of the judgment of the Honorable Vice-President (as described at the time) by Judge M. Naor (August 27, 2014); Derivative Claim (Tel Aviv District) 58267-02-24 L.R.N.  Projects and Trading in Tax Appeal v. Weissbrod, paragraph 13 (February 16, 2025)).  The purpose of disclosure prior to filing a request for a derivative claim is mainly to bridge these inherent information gaps and thus increase the effectiveness of the derivative claim as a tool for enforcing the company's rights (Civil Appeal Authority 4461/24 Machluf Gideon & Sons in Tax Appeal v. Machluf Bechor & Sons Ltd., paragraph 9 (December 2, 2024); Civil Appeal Authority 7327/16 Barak v. Gazit-Globe Ltd., paragraph 7 (December 6, 2016); Civil Appeal Authority 4725/16 Boxer v. Langholtz, Paragraph 15 (October 26, 2016)).  However, there may be concern that this mechanism will be misused and may even cause damage to the company (Civil Appeal Authority 255/24 Itzhaki v. Max Stock Ltd., paragraph 12 (March 31, 2024); Civil Appeal Authority 8243/21 Ginosar v. Israel Electric Company, paragraph 18 (February 16, 2023) (hereinafter: "Matter Ginosar"); Civil Appeal Authority 804/20 Gan Shmuel Mazon in Tax Appeal v. K.R.N.A.  Ltd., paragraph 27 (5.5.2020) (hereinafter: "The Gan Shmuel Matter")).
36. In order to eliminate this concern, a request for disclosure of documents under Section 198A The Companies Law meets a number of conditions: first, the applicant may file a derivative claim; second, the existence of a preliminary evidentiary basis that teaches that there is a chance that the derivative claim will be accepted; Third, the requested documents are relevant.  In addition, the application must comply with the restrictions that apply to the disclosure of documents in the general law (Matter Gan Shmuel, paragraph 27; Civil Appeal Authority 784/20 Extel Limited v. Baruch, paragraph 13 (June 15, 2020); Civil Appeal Authority 5403/17 Rebecca Technologies in Tax Appeal v. Israel Chemicals Company Ltd., paragraph 19-20 (December 5, 2017) (hereinafter: "The Rebecca Technologies Matter"); Civil Appeal Authority 6122/14 Bank Hapoalim in Tax Appeal v. Nesher, paragraph 5 (May 6, 2015)) (hereinafter: "The Eagle Matter").  The evidentiary threshold required for the discovery of the documents is at the lower threshold of the evidentiary burden and is lower than the threshold of prima facie evidence required for the purpose of obtaining a motion to certify a derivative claim, but this is still an obstacle that the applicant must overcome (Matter Yifat, paragraph 16; Interest Rebecca Technologies, paragraph 20; Interest Eagle, paragraph 11; Interest Gan Shmuel, paragraph 28).

00Over-Rolling Authority in Relation to CEO Remuneration - The Normative Framework

37. 0 Section 272(c1) to the Companies Law, as amended under the Companies Law (Amendment No. 20), 5773-2012 (hereinafter: "Amendment 20 to the Companies Law"), determines how the terms of employment of the CEO in a public company must be approved.  The following is the language of the law:

"(c1) (1) A transaction of a public company or a private company that is a bond company, with the general manager of the company, in which the provisions of section 270(2) are fulfilled, requires the approval of the following in this order:

• the Remuneration Committee;
• The Board of Directors;
• the general meeting, provided that in a public company the provisions of section 267A(b)(1) or (2) are fulfilled; With regard to the approval of the general meeting in accordance with this subparagraph, the provisions of subsection (c)(3) shall apply;

(2) The approval of the remuneration committee and the approval of the board of directors as stated in paragraph (1) will be in accordance with the remuneration policy, but the remuneration committee and thereafter the board of directors may, in special cases, approve the transaction not in accordance with such policy, provided that the provisions of subsection (c)(2)(a) are met; The provisions of this subsection shall not derogate from the provisions of paragraph (1)(c);"

38. Regarding the over-rolling, In section 272(c1)(1)(c) It was determined that provisions would apply Section 272(c)(3) With regard to the approval of the General Assembly, and this is what he said:

")3) Notwithstanding the provisions of paragraph (2), in a company, with the exception of a public grandmother company as defined in section 267A(c), the remuneration committee and thereafter the board  of directors may, in special cases, approve a transaction as stated in that paragraph even if the general meeting objected  to the approval of the transaction, provided that the remuneration committee and thereafter the board of directors decided accordingly, on the basis of detailed reasons, after reconsidering the transaction and examining in such discussion, inter alia, the objection of the general meeting" (emphases added,  M.A.).

39. From the provisions of these law, it appears that when the general meeting opposes the remuneration of the CEO who deviates from the company's remuneration policy, The Remuneration Committee and the Board of Directors may, in special cases, approve the remuneration despite the objection of the General Meeting, only when the Remuneration Committee and the Board of Directors have decided, on the basis of detailed reasons, and after a reconsideration and after considering the objection of the General Meeting, that this will be in the best interest of the Company (Derivative Claim (Tel Aviv Economic) 18994-07-15 De Lange v. Israel Corporation Ltd., paragraph 38 of Judge Ronen's decision (April 30, 2017) (hereinafter: "The De Lange Affair").
40. Remuneration for officers is a significant matter that affects the company's business, as the remuneration policy may affect the incentives of officers to maximize the company's profits and achieve results that will increase its value and also affect the company's ability to recruit manpower (Matter Electra, in paragraph 60; Interest De Lange, paragraph 34).  The main authority to formulate the company's remuneration policy was given to the company's board of directors, assuming that he is the right person to do so due to his role in formulating the company's strategy and his supervisory role.  At the same time, it was decided to allow the shareholders to supervise this ( Electra, Paragraph 61).  The over-rolling process leaves the decision in the hands of the board of directors, but allows the shareholders to express their position and requires that all the components of the over-rolling decision include this position seriously. (ibid., para. 63 ibid.).  The legislature did not find it necessary to determine the nature of the new hearing and what considerations should be considered within its framework, but rather limited its existence to special cases and required that the objection of the meeting be addressed with detailed reasons (ibid., at paragraph 64).  The variety of considerations and aspects that the remuneration committee and the board of directors must consider are considered as an open list, and there is room to allow flexibility in the treatment that corresponds to the circumstances of each case on its own merits (ibid., at paragraph 65).  The consideration regarding the objection of the General Assembly is the only consideration that the legislature explicitly stated as one that should be addressed in the framework of the rehearing, and in this way a real discussion of the merits of the arguments will be ensured (Matter Matrix, at paragraph 60).
41. in decisions on the matter Electra And so it is in the matter of Matrix I found that the appropriate criterion in my view with regard to judicial review of over-ruling decisions is an examination according to The rule of full fairness (See further and detailed the other criteria for examining the company's decisions in the Electra case, at paragraph 67).  One of the reasons for this is the inherent biases of the remuneration committee and the board of directors when re-examining their decision, due to the difficulty in changing a decision that has already been accepted, the closeness of the board members to the CEO, cognitive biases that may determine the initial decision, and group thinking ( Matrixparagraphs 61-64).  The Over-Rolling Procedure as Determined inCompanies Law was intended to minimize the fear of such biases, and this is what the legislature meant when he determined "after we have re-discussed" and also "we have examined in such a discussion, among other things, the objection of the assembly"[1].  When its terms are adhered to: Overruling the shareholders' position in special cases, re-examining the decision and detailed reasons while giving weight to the shareholders' objections.  The use of methodologies that help neutralize bias may help overcome these difficulties (ibid., at paragraph 65 and the references therein).  Section 272(c)(3) Companies Law It requires the fulfillment of four conditions: 1. A special case; 2. Remuneration Committee And afterwards The Board of Directors Reconsider; Discussion of the objection of the assembly, among others; 4. On the basis of detailed reasons.
42. The language of the section is unequivocal In my opinion The need for a substantive examination NEW While considering the position of the opposing shareholders.  The fact that the legislature chooses the words "Re-Discuss" and chooses to clarify that the remuneration committee will first reconsider and only then the board of directors - intends that the over-ruling process will be relied upon. About A new, "fresh" and unbiased decision As much as possible.  A decision that was reformulated by these two bodies, while giving weight to the objection of the meeting.  The legislature's clarification regarding the need for detailed reasons also indicates both its intention in a reexamination and its intention in the need for a detailed explanation, including a reference to the position of the meeting and the reasons for the objection.

Thus, the use of the words "in special cases" also seems to shift the hand from a criterion of business judgment to a special judgment that takes into account the position of the general meeting.  Otherwise, what is the point of bringing the matter to the approval of the meeting if, within the framework of "regular" business judgment, its position can be overcome? Discretion that has already been exercised is transferred to presenting the position of the board of directors at the general meeting.  When the Board of Directors, following the recommendation of the Remuneration Committee, formulates the remuneration package prior to its presentation to the meeting, it operates within the scope of the Business Judgment Rule.  Once the meeting opposes its approval, the remuneration committee is required to set a higher threshold than business judgment.  The increased threshold of examination entails, in my opinion, difficulties that I discussed in the Electra case, since it does not have clear criteria, it is liable to vary from case to case and is influenced when it is examined by the court, by the bias of retrospective wisdom (the Electra case, paragraph 67).

43. A clean re-examination using the bias neutralization mechanisms that I discussed on the matter Matrix (paragraph 65), by way of transparency and a new comparison with the market price and the corresponding market, It creates clear criteria and the possibility of examining the decision to overcome them in light of them.  The examination should not be on the merits of the decision, for there is usually no substitute court Consider his opinion is at the discretion of the board of directors, but rather an examination of the manner in which it is accepted in accordance with the aforesaid.  Imposing the burden of proof and persuasion on the company (the remuneration committee and the board of directors), along with the duty of maximum transparency, subject to the confidentiality of business information and trade secrets, ensures proper conduct and the formulation of an over-ruling decision while meeting the purpose set by the legislature.  In the parallel of forces between the company's management as the executing organ and the shareholders owning the company, the legislature leaves the executing organ to manage the company on the question of remuneration after it has allowed the meeting Expressing its position and states that this position has weight, even if it is not decisive (the section uses the words "inter alia"), but it is worth considering and explaining in detail why it is not accepted.  This is not a matter of veto power by the board of directors, but rather an attempt by the legislature to create a parallelism of forces in which the position of the meeting, the shareholders, has weight in formulating the board of directors' decision, which outweighs the opposition of the meeting.
44. About the Remuneration Committee and the Board of Directors to re-examine what was before the Remuneration Committee and the Board of Directors prior to the General Meeting; the positions of the opposing shareholders; receiving feedback from the experts; and anything that can attest to the fact that a real re-examination was conducted (for details on how the re-examination was conducted, see the The Matrix, in paragraph 67).  The standard of full fairness reflects the need to examine the "market price" of the remuneration package and to ensure full transparency of the proceeding and the meticulous reasoning underlying the over-ruling decision (ibid., at paragraph 65).

From the general to the individual