Further to the immediate report of Koor Industries Ltd. ("the Company") on August 29, 2013 (Ref. 2013-01-132931) concerning an application for the removal of discrimination and an application for its certification as a class action against Koor, Discount Investments Ltd. ("DIC") and IDB Development Ltd. ("IDB") in the matter of the merger transaction between Koor and DIC ("the Request for Certification"), and further to the Company's immediate report on November 22, 2013 (Ref. 2013-01-199788) concerning a settlement agreement signed with the plaintiffs in that legal proceeding ("the Settlement Agreement"), the Company hereby reports that on January 2, 2014, opposition to approval of the Settlement Agreement was filed in the Tel Aviv District Court by the Attorney General ("the Opposition").

In the Opposition, the Court is requested not to approve the Settlement Agreement before considering the following: (1) the term whereby the supplementary arrangement under the Settlement Agreement will not be implemented if the rate of response to the supplementary arrangement is lower than the minimum rate set in the Settlement Agreement, is unfair, unreasonable and unworthy inappropriate; (2) an examiner should be appointed to review whether the cause of claim on which the legal proceeding is based is or is not unlikely and to assess the value of the claim and the value of the settlement; (3) the Settlement Agreement will generate a decision relating to causes which were not alleged in the application for certification of the class action and will generate a waiver of allegations against entities which were not included in it; and (4) the amounts of the fees of the plaintiff's attorneys and the compensation to the plaintiff should be set as a derivative of the actual benefit that the Settlement Agreement contributes to the represented group.

The Opposition is similar in essence to the opposition of the Israel Consumer Council to approval of the Settlement Agreement, on which the Company reported on December 22, 2013.

At this stage, it is not certain that the Settlement Agreement will come into force.

It is noted that the Company is a subsidiary of DIC, which currently has approximately a 67% holding, and that IDB, which is the controlling shareholder in DIC, currently holds approximately 1.2% in the Company and 74% in DIC.



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