Cellcom Israel Reschedules Annual General Meeting of Shareholders

Jul 11, 2008 (TELECOMWORLDWIRE via COMTEX) -- TCNYF | Quote | Chart | News | PowerRating -- Cellcom Israel, an Israeli cellular provider, announced that the 2008 Annual General Meeting of Shareholders (the "Meeting) of Cellcom Israel (the "Company) scheduled to be held on July 30, will be held instead on August 18, at 4 p.m. (Israel time), at the offices of the Company, 10 Hagavish Street, Netanya, Israel, and will include an additional matter: amendment of certain terms of outstanding options as well as a change of one of the director nominees.

The record date for the Meeting is July 17. A proxy statement describing the various matters on the agenda and proxy cards for use by shareholders that cannot attend the meeting in person will be mailed to the Company's shareholders that hold shares registered with American Stock Transfer & Trust Company, including shares held via DTC members.

The agenda of the Meeting is as follows:

(1) reelection of Ami Erel, Shay Livnat, Raanan Cohen, Avraham Bigger, Rafi Bisker and Shlomo Waxe as directors and election of Haim Gavrieli and Ari Bronshtein as directors;

(2) approval of a related party transaction - grant of letters of exemption and indemnification to office holders who are controlling shareholders;

(3) approval of a related party transaction - amendment of certain terms of outstanding options held by our Chairman of the Board;

(4) reappointment of Somekh Chaikin as our independent auditor; and

(5) consideration of our audited financial statements for the year ended December 31, 2007.

Quorum

Two or more shareholders holding in the aggregate at least one-third of the outstanding voting power in the Company, present in person or by proxy and entitled to vote, will constitute a quorum at the Meeting.

Voting Requirements

Items 1 , 3 and 4 require the affirmative vote of the holders of a majority of the voting power in the Company present, in person or by proxy, and voting on the matter.

Item 2 requires the affirmative vote of the holders of a majority of the voting power in the Company present, in person or by proxy, and voting on the matter, provided that either (i) such majority includes at least one third of the votes of shareholders voting on the matter who do not have a personal interest in the proposed resolution or (ii) the total number of votes against the proposed resolution of shareholders voting on the matter who do not have a personal interest in the proposed resolution does not exceed one percent of the outstanding voting power in the Company.

Item 5 will not involve a vote.

Amendment to Employee Share Incentive Plan

On July 6, the Company's audit committee and board of directors approved an amendment to the Company's 2006 Share Incentive Plan (the "Plan). The Plan previously provided that the vesting of options and restricted share units (RSUs) (together "Awards) issued under the Plan would fully accelerate prior to the occurrence of certain Corporate Transactions, as defined under the Plan, and immediately terminate upon the effective date of any such Corporate Transaction if not exercised by such date. The events constituting Corporate Transactions include, among others, a decrease in share ownership by Discount Investment Corp. and its subsidiaries (DIC) to less than 50.01 percent of the Company's outstanding share capital. As of June 30, DIC holds approximately 50.5 percent of the Company's outstanding share capital.

The amendments to the Plan include (1) changing the 50.01 percent threshold to a trigger when DIC ceases to control (as such term is defined in the Israeli Securities Law, 1968) the Company; and (2) requiring the Company to provide each grantee with a ten-day period to exercise the Awards upon a Corporate Transaction. Such amendments are intended to apply also with respect to outstanding options.

The first change requires the consent of each grantee with respect to the options currently held by him or her. All option holders have consented to the first change described above with respect to the options held by them. Erel's consent is subject to approval of the change by the Company's competent bodies. No RSU's have been granted under the Plan.

The Company's audit committee and board of directors further approved a change to the terms of outstanding options for grantees who consent to the first change described above, to allow, if the grantee is dismissed without cause, up to additional six (6) months from the Date of Cessation, as defined under the Plan, for vesting of the third or forth portions to occur.

The changes in regards to Ami Erel require the further approval of the Company's shareholders.

The Company is examining the accounting implications of DIC's holdings decreasing below 50.01 percent, which may require the Company to accelerate the remaining unrecognized option related expenses (amounting to appx. NIS 20 million, as of March 31,).

For additional information regarding the Plan and the options outstanding thereunder, please see the Company's most recent annual report for the year ended December 31, 2007 on Form 20-F under "Item 6. Directors, Senior Management And Employees - E. Share Ownership - 2006 Share Incentive Plan".

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