Needless to say, to the extent that the current theoretical concern crystallizes into a real concern in the future – which may justify the operation of the protection plan despite the temporary relief granted – the way is open for the company to act in this context as it sees fit, including applying to the court with an appropriate request that will be discussed in accordance with its circumstances.
- On the other hand, the damage that will be caused to the respondents if the requested temporary relief is not provided as a result of the dilution of their shares – is significant and to a large extent irreversible. This damage is not limited to the damage that can be compensated financially, since without the temporary remedy, the holding rate of the company's shares may change, in a way that will change the balance of power in the company. A change in the balance of power may lead to corporate decision-making, as well as the reliance of third parties on the new state of affairs or on shares that will be sold after their allocation. In these circumstances, even if it is determined retroactively that the allocation was not made lawfully, there may be significant difficulty in turning the wheel back, and it may not be sufficient to compensate for the aforementioned defect.
- The company argued, as stated, that the damage caused to the respondents was only financial damage, since they were entitled to take a public solicitation proceeding – and therefore the only damage that would be caused to them would be the cost of such a proceeding. Indeed, the damage caused by the dilution of the shares will be caused to the Respondents only if they choose to demand the convening of the meeting before the final decision on the claim; And they did so without using the permissible gathering mechanisms.
However, at the center of the dispute between the parties in the main proceeding is, inter alia, the question of whether the existence of these mechanisms is sufficient to neutralize the harm caused to the shareholders due to the limitations on their right to convene a special meeting by virtue of the Article 63 to the law. As stated, according to the respondents' approach, the mechanism of public solicitation violates their rights. This is due, inter alia, to the veto power of the board of directors; and also due to the respondents' claims that their ability to secure cooperation through the public solicitation mechanism is impaired – due to the potential thwarting of this proceeding by the company, as well as the difficulty in public persuasion (as opposed to the alternative of contacting the shareholders personally).