Allocation of Company Shares to the Debenture Holders
4.1 The Company shall issue (and/or transfer out of the quota of shares it currently holds) to those Debenture Holders A and Debenture Holders B as detailed in Section 4.3 below, a total of 15,092,863 of the Company's ordinary shares, representing, as of the Completion Date, 12% of the Company's issued and paid up capital (fully diluted) (hereinafter, in this section: the "Allocated Shares"), and all in accordance with the following terms. The Company shall issue and/or transfer the shares allocated to the said Debentures free and clear, on the date of their receipt by Debenture Holders A and Debenture Holders B, of any debt, pledge, pawn, foreclosure, and any third party right, as well as free, on the date of their receipt, of any restriction or limitation on their transfer.
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Regarding Section 4 above and below, "Fully Diluted" shall mean – fully diluted including the allocation and/or transfer of all of the Allocated Shares but without taking into account options convertible into shares granted to employees in any of the Kardan Group subsidiaries prior to the Completion Date, which – if fully exercised, shall dilute the percentage of allocated shares to no less than 11.5% of the Company's issued and paid up capital (fully diluted).