<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>6
<FILENAME>lon441292-e.txt
<DESCRIPTION>EX E - TRANSLATION OF AMENDED FEDERMANN AGMT
<TEXT>

                                                                       Exhibit E
                                                                       ---------


                    TRANSLATION OF THE AMENDED FEDERMANN DEED

                      [TRANSLATED FROM THE HEBREW ORIGINAL]

             [Marked to show changes from 27 December 2004 original]

                               SHARE TRANSFER DEED
                 Made in Tel Aviv this 27th day of December 2004
                            as amended on 6 July 2005

BETWEEN FEDERMANN ENTERPRISES LTD. (Public Company No. 51 - 227839-1) of 99
Hayarkon Street, Tel Aviv ("Federmann") of the one part AND KOOR INDUSTRIES LTD.
(Public Company No. 52 - 001414-3) of 14 Hamalacha Street, Afek Industrial Park,
Rosh Ha'ayin 48091 ("Koor") of the other part (hereinafter the "Parties")

WHEREAS Federmann is the holder of 19,915,448 Ordinary Shares of the issued and
paid up share capital of Elbit Systems Ltd., a public company duly incorporated
in Israel, whose number with the Companies Registrar is Public Company No.
52-004302-7 (hereinafter the " Company "); AND

WHEREAS Federmann wishes to sell and transfer to Koor, in two stages, 4,000
3,160,000 ( four three million one hundred and sixty thousand ) Ordinary Shares,
which on the date of signing this Deed constitute d approximately 9 7.75 .8 % of
the Company's issued and paid-up share capital, while in the first stage
Federmann will sell and transfer to Koor 2,160,000 (two million one hundred and
sixty thousand) Ordinary Shares, which on the date of signing this Deed
constitute d approximately 5.3% of the Company's issued and paid-up share
capital, and in the second stage Federmann will sell and transfer to Koor 1, 840
000 ,000 (one million eight hundred and forty thousand ) Ordinary Shares, which
on the date of signing this Deed constitute d approximately 4.5 2.45 % of the
Company's issued and paid-up share capital, subject to and in accordance with
the provisions of this Deed; AND

WHEREAS Koor wishes to purchase and receive from Federmann the Shares Being
Sold, subject to and in accordance with the provisions of this Deed; AND

WHEREAS the performance of this Deed, in both stages Stage 'A' of the
Transaction, is subject to Conditions Precedent as provided below in this Deed;
AND

WHEREAS the Parties wish to set forth their relationship with respect to the
sale and purchase of the Shares Being Sold in the context of this Deed; AND

WHEREAS Koor is interested in the performance of the Transaction contemplated by
this Deed as part of an overall Transaction, in the scope of which Koor will
sell to the Company shares of Tadiran Communications, as set out in the
Elbit-Koor Deed and this Deed.

NOW, THEREFORE, IT IS WARRANTED, PROVIDED AND AGREED BETWEEN THE PARTIES AS
FOLLOWS:

1.       Preamble, Appendices and Interpretation

1.1      The preamble and appendices hereto constitute an integral part hereof.

1.2      The clause headings in this Deed are solely for the sake of convenience
         and shall not be applied in the interpretation hereof.

2.       Definitions

2.1      In this Deed, the following terms shall have the meanings herein
         ascribed to them, unless expressly stated otherwise:

         "Elisra"               means Elisra Electronic Systems Ltd., Private
                                Company No. 52-003587-4;

         "General Meeting"      means as defined in the Companies Law, and any
                                adjourned meeting;

         "U.S. Dollar" or "$"   means United States dollars;

         "Company"              means as defined in the preamble hereto;

         "Shareholders
         Agreement"             means the Agreement between Federmann and Koor
                                in the form of Appendix "10.7" hereto, which is
                                to be signed on the signature of this Deed and
                                will enter into effect on the First Closing
                                Date, including its amendments;

         "Stage 'A' Conditions
         Precedent"             means the Conditions Precedent for Stage 'A' of
                                the Transaction, as provided in Appendix
                                "9.2"hereto;

         "Stage 'B' Conditions
         Precedent"             means the Conditions Precedent for Stage 'B' of
                                the Transaction, as provided in Appendix
                                "12.2"hereto;

         "Conditions
         Precedent"             means the Stage 'A' Conditions Precedent and the
                                Stage 'B' Conditions Precedent;

         "Companies Law"        means the [Israel] Companies Law, 5759-1999;

         "Business Day"         means a day on which the two major banks in
                                Israel are open for business, other than Fridays
                                and holiday eves, which shall not betreated as a
                                "Business Day";

         "Koor"                 means as defined in the preamble hereto;

         "First Closing Date"   means the third Business Day after the date on
                                which all the Stage 'A' Conditions Precedent
                                have been fulfilled or such later date as agreed
                                by the Parties, as provided in Clause 20.3
                                below;

         "Elbit-Koor Deed
         First Closing Date"    means the First Closing Date as the term is
                                defined in the Elbit-Koor Deed;

         "Second Closing
         Date"                  means 4 October 2005 or such earlier date as may
                                be agreed in writing by the parties the third
                                Business Day after the date on which all the
                                Stage 'B' Conditions Precedent have been
                                fulfilled or in the event that the Stage 'B'
                                Conditions Precedent are deemed wholly fulfilled
                                in accordance with the provisions of Clause 12.4
                                or 12.5 below, as the case may be, the 14th
                                Business Day after 30th June 2005 or after the
                                date of receiving Koor's notice pursuant to
                                Clause 12.5, as the case may be, or such later
                                date as agreed by the Parties, as provided in
                                Clause 20.3 below;

         "Elbit-Koor Deed
         Second Closing
         Date"                  means the Second Closing Date as the term is
                                defined in the Elbit-Koor Deed;

         "Stage 'A' Completion
         Deadline"              means as defined in Clause 9.1 below;

         "Stage 'B' Completion
         Deadline"              means as defined in Clause 12.1 below;

         "Elbit-Koor Deed
         Stage 'B' Completion
         Deadline"              means the Stage 'B' Completion Deadline as the
                                term is defined in the Elbit-Koor Deed;

         "Confidential
         Information"           means all information relating to the Parties
                                hereto or to the Company, other than (a)
                                information that was in the public domain or
                                came into the public domain otherwise than due
                                to a breach of this Deed and (b) information the
                                disclosure of which is required in accordance
                                with the provisions of law;

         "Ordinary Share" or
         "Ordinary Shares"      means Ordinary Shares of 1 NIS par value each of
                                the Company's issued share capital;

         "Stage 'A' Shares"     mean 2,160,000 (two million one hundred and
                                sixty thousand) Ordinary Shares;

         "Stage 'B' Shares"     mean 1,840000,000 (one million, eight hundred
                                and forty thousand) Ordinary Shares;

         "Shares Being Sold"    means the Stage 'A' Shares and the Stage 'B'
                                Shares;

         "Free and Clear"       means free and clear of any charge, pledge,
                                attachment, levy, debt, lien, claim, right of
                                pre-emption, right of refusal, option, lock-up
                                arrangement or any further or other third party
                                right whatsoever, other than restrictions with
                                respect to the transfer and/or negotiability of
                                shares that are imposed pursuant to U.S.
                                securities law (shares which are not registered
                                under U.S. securities laws);

         "Elisra Transaction"   means a transaction pursuant to which Tadiran
                                Communications will purchase shares constituting
                                at least 70% of Elisra's issued share capital;

         "Federmann"            means as defined in the preamble to this Deed;
                                "Interest" means three-month LIBOR at Bank Leumi
                                Le-Israel B.M., plus annual interest at the rate
                                of 1.5%, compounded every three months;

         "Deed"                 means this Share Transfer Deed together with all
                                the appendices hereto, including its amendments;

         "Elbit-Koor Deed"      means the Share Transfer Deed together with all
                                the appendices thereto made between the Company
                                and Koor on the signature of this Deed, subject
                                to and in accordance with the conditions of
                                which Koor will sell and transfer to the
                                Company, in two stages, 3,944,276 (three million
                                nine hundred forty-four thousand two hundred and
                                seventy-six) Ordinary Shares of 1 NIS par value
                                each of TadiranCommunications, which on the date
                                of signing this Deed constitute approximately
                                32% of Tadiran Communication's issued share
                                capital;

         "Stage 'A' of the
         Transaction"           means as defined in Clause 8.1 below;

         "Stage 'B' of the
         Transaction"           means as defined in Clause 11.1below;

         "Elbit-Koor Deed
         Stage 'A'"             means Stage 'A' of the Transaction contemplated
                                by the Elbit-Koor Deed as the term is defined in
                                the Elbit-Koor Deed;

         "Elbit-Koor Deed
         Stage 'B'"             means Stage 'B' of the Transaction contemplated
                                by the Elbit-Koor Deed as the term is defined in
                                the Elbit-Koor Deed;

         "Tadiran
         Communications"        means Tadiran Communications Ltd. (Private [sic]
                                Company No. 51-207441-0);

         "Stage 'A'
         Consideration"         means US$24.70 (twenty-four U.S. dollars and
                                seventy cents) for each of the Stage 'A' Shares,
                                totaling US$53,352,000 (fifty-three million
                                three hundred and fifty-two thousand U.S.
                                dollars), and insofar as all or part of that
                                amount is actually paid after April 1, 2005,
                                such amount as aforesaid shall be subject to the
                                addition of the Interest from April 1, 2005
                                until the time of actual payment, all subject to
                                the adjustments as provided in Clause 15 below;

         "Stage 'B'
         Consideration"         means US$24.70 (twenty-four U.S. dollars and
                                seventy cents) for each of the Stage 'B' Shares,
                                totaling US$- 45,448,00024,700,000(forty-five
                                twenty-four million four seven hundred and
                                forty-eight thousand U.S. dollars), and insofar
                                as all or part of that amount is actually paid
                                after April 1, 2005, such amount as aforesaid
                                shall be subject to the addition of the Interest
                                from April 1, 2005 until the time of actual
                                payment, all subject to the adjustments as
                                provided in Clause 15 below;

         "Consideration"        means the Stage 'A' Consideration and the Stage
                                'B' Consideration together;

         "Qualification
         Conditions"            means all the requirements in accordance with
                                applicable law and pursuant to the Company's
                                incorporation documents for a person to serve as
                                a director of the Company, including security
                                clearance as required in Israel for the purpose
                                of such service, but excluding the conditions
                                for an Independent Director; "Independent
                                Director" means a director who meets the
                                independence criteria in accordance with U.S.
                                securities law, including the Sarbanes-Oxley Act
                                and the rules and regulations that have been and
                                are in future issued by virtue thereof,
                                including rules of the Nasdaq.

2.2      The following terms shall have the meanings defined in Section 1 of the
         [Israel] Securities Law, 5728-1968: "securities", "company",
         "subsidiary", "acquisition of securities", "holding and acquisition"
         and "control".

2.3      The following terms shall have the meanings defined in Section 1 of the
         Companies Law: "dividend", "director", "external director", "public
         company", "distribution", "bonus shares", "officer", "personal
         interest","transaction", "extraordinary transaction", "act", the
         "Companies Registrar" and "share certificate".

3.       Appendices The following appendices, which constitute an integral part
         hereof, are annexed to this Deed: 3.1 Appendix "9.2"-- the Stage 'A'
         Conditions Precedent;

3.2      Appendix "10.7" --the Shareholders Agreement between Federmann and
         Koor, which is to be signed contemporaneously with the signature of
         this Deed and will enter into effect on the First Closing Date;

3.3      Appendix "12.2" --the Stage 'B' Conditions Precedent.

4.       The Elbit-Koor Deed Contemporaneously with the signing of this Deed,
         the Elbit-Koor Deed is also being signed. The Elbit-Koor Deed and this
         Deed are separate and unrelated deeds, except as expressly provided in
         this Deed. For the avoidance of doubt it is hereby clarified that the
         Company is not a Party to this Deed, and the provisions of the
         Elbit-Koor Deed do not impose any duty on Koor to Federmann or on
         Federmann to Koor that is not expressly provided in this Deed.

5.       The Parties' Warranties and Undertakings The Parties hereby warrant and
         undertake to each other as follows:

5.1      The representations and warranties of the Parties in this Deed are
         solely as provided in this Clause 5 and in Clauses 6 and 7 below, as
         the case may be.

5.2      The Parties' warranties and undertakings as provided in this Clause 5
         and in Clauses 6 and 7 below, as the case may be, will continue to be
         correct, complete and accurate on the First Closing Date and the Second
         Closing Date, and they shall be deemed as having been provided again by
         each of the Parties on both the First Closing Date and on the Second
         Closing Date.

6.       Federmann's Warranties and Undertakings Federmann hereby warrants and
         undertakes to Koor as follows:

6.1      That it is a duly incorporated private company, that its number with
         the Companies Registrar is as appears in the preamble hereto and that
         no actions or proceedings for delisting, liquidation, winding-up,
         receivership or like acts have been taken or are threatened against it.

6.2      That on signing this Deed and until the completion of Stage 'A' of the
         Transaction it is and shall be the sole owner of the Shares Being Sold
         (subject to the Lien), and after the completion of Stage 'A' of the
         Transaction and until the completion of Stage 'B' of the Transaction it
         is and shall be the sole owner of the Stage 'B' Shares (subject to the
         Lien, as will be modified, amended as provided in Clause 10.4 below),
         that it will not grant any person or entity an option or right to
         purchase all or any of the Shares Being Sold, that it has not
         undertaken to grant such an option or right as aforesaid, that no
         person or entity has any right of first refusal or tag-along right in
         connection with all or any of the Shares Being Sold and that on the
         date of signing this Deed it holds 19,915,448 Ordinary Shares.

6.3      That the Shares Being Sold are fully paid and Free and Clear, except
         for a first ranking fixed lien and an assignment by way of charge, of
         unlimited amount, which are registered in favor of Bank Leumi Le-Israel
         B.M. (in this Deed the " Bank ") over the Shares Being Sold and over
         Federmann's rights in the Shares Being Sold (in this Deed the " Lien ")
         and that pursuant to the Lien the Shares Being Sold are held by and
         registered in the name of Bank Leumi Le-Israel Trust Co. Ltd., and that
         on the First Closing Date, upon the Stage 'A' Consideration being
         received in Federmann's Account, the Stage 'A' Shares will be Free and
         Clear and that on the Second Closing Date, upon the Stage 'B'
         Consideration being received in Federmann's Account, the Stage 'B'
         Shares will be Free and Clear.

6.4      That apart from approval by Federmann's General Meeting and board of
         directors, Federmann has no need, including pursuant to its
         incorporation documents and applicable law, in Israel or abroad, to
         obtain any other approvals from any of its organs for the purpose of
         entering into this Deed and performing all its obligations pursuant
         hereto.

6.5      That subject to ratification by Federmann's General Meeting and board
         of directors, the signatories on Federmann's behalf to this Deed and
         the documents ancillary hereto are the persons who are empowered, on
         Federmann's behalf, to sign this Deed and the documents ancillary
         hereto and/or necessary for the performance hereof and to obligate
         Federmann by their signature, and this Deed, together with all its
         terms and conditions, obligates Federmann in all respects.

6.6      That subject to the approval of Federmann's General Meeting and board
         of directors and the fulfillment of the Conditions Precedent, there is
         no legal or other impediment to its entering into this Deed and the
         performance hereof and that this Deed and the performance of its
         obligations pursuant hereto are not contrary to any judgment, order or
         direction of a court, to any contract, understanding or agreement to
         which Federmann is a party, to its incorporation documents or to any
         other obligation of Federmann, whether by virtue of an contract (oral,
         by conduct or written) or by virtue of law.

6.7      That apart from the approval of Federmann's General Meeting and board
         of directors and the Conditions Precedent, all the approvals, consents
         and permits have been obtained and all the necessary proceedings have
         been performed, including with any authorities, government entities or
         any other body, for the purpose of Federmann's entering into this Deed
         and performing its obligations pursuant hereto, including transferring
         the Shares Being Sold to Koor.

6.8      That neither the Company nor any of its subsidiaries is party to any
         transaction or agreement in which Federmann and/or its subsidiaries
         and/or the controlling shareholders and/or officers of Federmann and/or
         the companies controlled by any of them has a personal interest, other
         than (1) payment of remuneration to directors of the Company, in the
         same amounts as paid to the Company's external directors; (2)
         arrangements for the grant of relief, insurance and indemnity by the
         Company to the Company's directors; and (3) apart from, for the
         avoidance of doubt, Federmann's holding of securities of companies
         whose securities are also held by the Company.

7.       Koor's Warranties and Undertakings Koor hereby warrants and undertakes
         to Federmann as follows:

7.1      That it is a duly incorporated public company, that its number with the
         Companies Registrar is as appears in the preamble hereto and that no
         actions or proceedings for delisting, liquidation, winding up the
         receivership or like acts have been taken or are being threatened
         against it.

7.2      That it has the ability and resources to perform its obligations
         pursuant to this Deed in full and on time and that it is in possession
         of the financial resources sufficient for payment of the Consideration
         in full and at the times provided in this Deed.

7.3      That apart from approval by Koor's board of directors, Koor has no
         need, including pursuant to its incorporation documents and applicable
         law, in Israel or abroad, to obtain any other approvals from any of its
         organs for the purpose of entering into this Deed and performing all
         its obligations pursuant hereto.

7.4      That subject to ratification by Koor's board of directors, the
         signatories on behalf of Koor to this Deed and the documents ancillary
         hereto are those who are empowered, on Koor's behalf, to sign this Deed
         and the documents ancillary hereto and/or necessary for the performance
         hereof, and to obligate Koor by their signatures, and this Deed,
         including all its terms and conditions, obligates Koor in all respects.

7.5      That subject to the approval of Koor's board of directors and the
         fulfillment of the Conditions Precedent, there is no legal or other
         impediment to its entering into and performing this Deed and that this
         Deed and the performance of its obligations pursuant hereto are not
         contrary to any judgment, order or direction of a court, to any
         contract, understanding or agreement to which it is a party, to its
         incorporation documents or to any other obligation of Koor, whether by
         virtue of a contract (oral, by conduct or written) or by virtue of law.

7.6      That except for the approval of Koor's board of directors and except
         for the Conditions Precedent, all the approvals, consents and permits
         have been obtained and all the necessary proceedings have been
         performed, including with any authorities, government entities or any
         other body, for the purpose of Koor's entering into this Deed and
         performing its obligations pursuant hereto, including the acquisition
         from Federmann of the Shares Being Sold.

7.7      That subject only to Federmann's warranties and representations in
         Clauses 5 and 6 of this Deed, the Shares Being Sold are being purchased
         in their actual condition, and the actual condition of the Company and
         its assets, and they are "As Is", without any other representations or
         warranties being received from or on behalf of Federmann and that the
         Consideration, as agreed between the Parties, has been fixed having
         regard also to the fact that the purchase is on such a "As Is" basis as
         aforesaid.

8.       Stage 'A' of the Transaction

8.1      On the First Closing Date and subject to the fulfillment of the Stage
         'A' Conditions Precedent by the Stage 'A' Completion Deadline,
         Federmann shall sell and transfer to Koor, on and against payment of
         the full amount of the Stage 'A' Consideration, 2,160,000 (two million
         one hundred and sixty thousand) Ordinary Shares (the Stage 'A' Shares),
         fully paid and Free and Clear, and Koor shall purchase and receive from
         Federmann the Stage 'A' Shares and pay Federmann the full amount of the
         Stage 'A' Consideration (in this Deed " Stage 'A' of the Transaction
         ").

8.2      Furthermore, on the First Closing Date, the Company shall purchase from
         Koor 1,700,000 (one million seven hundred thousand) Ordinary Shares of
         1 NIS par value each of Tadiran Communications, which on the date of
         signing this Deed constitute approximately 13.8% of Tadiran
         Communication's issued share capital, in accordance with the Elbit-Koor
         Deed, which is being signed contemporaneously with this Deed. The
         Elbit-Koor Deed Stage 'A' and Stage 'A' of the Transaction contemplated
         by this Deed shall be performed contemporaneously and Stage 'A' of the
         Transaction (contemplated by this Deed) shall not be performed without
         the Elbit-Koor Deed Stage 'A' being performed.

8.3      For the avoidance of doubt, after the performance and completion of
         Stage 'A' of the Transaction, Stage 'A' of the Transaction will not be
         revoked, even if Stage 'B' of the Transaction is not performed or
         completed for any reason.

9.       The Stage 'A' Completion Deadline and the Stage 'A' Conditions
         Precedent

9.1      In this Deed the " Stage 'A' Completion Deadline " means:

         9.1.1    March 31 April 15 , 2005 [extended by consent in the past] ;
                  or

         9.1.2    if by March 31 April 15 , 2005 [extended by consent in the
                  past] all the Stage 'A' Conditions Precedent have been
                  fulfilled, other than the approval of the [Israel]
                  Commissioner of Restrictive Trade Practices, as provided in
                  Clause 1 of Appendix "9.2" , the Stage 'A' Completion Deadline
                  shall be automatically deferred until May 31, 2005 or to such
                  later date as agreed by the Parties as provided in Clause 20.3
                  below.

9.2      The Stage 'A' Conditions Precedent are provided in Appendix "9.2".

9.3      Should all the Stage 'A' Conditions Precedent not have been fulfilled
         by the Stage 'A' Completion Deadline, this Deed shall be void, except
         for the provisions of Clause 17 hereof, without either of the Parties
         having any complaint and/or claim and/or demand against the other. The
         foregoing provisions of this Clause 9.3 shall not derogate from any
         right or other remedy pursuant to this Deed or by law that is available
         to the Parties with respect to a breach of any of the provisions of
         this Deed (insofar as breached).

10.      The First Closing Date Subject to the Stage 'A' Conditions Precedent
         being fulfilled by the Stage 'A' Completion Deadline, the Parties shall
         meet on the First Closing Date at such place as determined by the
         Parties and the following interdependent acts shall be performed
         contemporaneously:

10.1     Koor shall remit the Stage 'A' Consideration by bank transfer to
         Federmann's bank account at the Bank, the details of which shall be
         provided to it in writing by Federmann by the First Closing Date (in
         this Deed " Federmann's Account "), and confirmation from the Bank that
         the Stage 'A' Consideration has been received in Federmann's Account
         shall be provided to Federmann.

10.2     Federmann shall deliver to the Company a share transfer deed pursuant
         whereto the Stage 'A' Shares are being transferred from Bank Leumi
         Le-Israel Trust Co. Ltd to Federmann, signed by Bank Leumi Le-Israel
         Trust Co. Ltd and Federmann, and the Company shall enter Federmann in
         its shareholder registry as the holder of the Stage 'A' Shares.

10.3     Federmann shall provide Koor confirmation from the Bank, according to
         which the Bank agrees that, on and against receipt of the Stage 'A'
         Consideration in Federmann's Account, it will discharge the Lien from
         the Stage 'A' Shares.

10.4     Federmann shall provide Koor written instructions from the Bank, in the
         Bank's standard form, addressed to the Companies Registrar, pursuant to
         which the Bank applies to the Companies Registrar to amend the Lien to
         the effect that the Lien will be discharged from the Stage 'A' Shares.

10.5     Federmann and Koor shall deliver this Deed to the Company, and
         Federmann shall procure that Koor is entered in the Company's
         shareholder registry as the holder of the Stage 'A' Shares and that
         Koor receives a share certificate from the Company, in the Company's
         standard form, attesting to Koor's ownership of the Stage 'A' Shares.

10.6     Federmann shall provide Koor a copy of the Company's board of
         directors' resolution to the effect that, subject to the performance of
         Stage 'A' of the Transaction, as of the First Closing Date there shall
         be added to the Company's board of directors and serve thereon as a
         director one nominee who shall be nominated for office by Koor and who
         meets the Qualification Conditions. Federmann undertakes that there
         will be a vacancy on the Company's board of directors so that it will
         be possible to add Koor's nominee as aforesaid to the Company's board
         of directors. Koor shall provide Federmann and the Company prior
         written notice of the name of such nominee or of another nominee, as
         nominated by Koor, in his place, and Koor (with Federmann's assistance)
         shall coordinate with the Company's corporate secretary such nominee's
         compliance with the Qualification Conditions, all no later than 14 days
         prior to the earlier of: (1) the Stage 'A' Completion Deadline or (2)
         the First Closing Date. If for any reason it is not possible to appoint
         the nominee nominated by Koor as aforesaid as a director of the
         Company, another nominee nominated by Koor, who meets the Qualification
         Conditions, shall be appointed in his place. Without derogating from
         the foregoing, if the nominee nominated by Koor as aforesaid is not
         added to the Company's board of directors on the First Closing Date,
         Federmann shall call a General Meeting of the Company as soon as
         possible, on the agenda of which shall be the appointment of the
         nominee nominated by Koor as aforesaid as a director of the Company.
         Federmann undertakes to vote in favor of the appointment of the nominee
         nominated by Koor, who was not appointed as aforesaid but does meet the
         Qualification Conditions.

10.7     The Shareholders Agreement, in the form annexed hereto as Appendix
         "10.7", shall become effective. 1

10.8     Federmann shall provide Koor a written declaration, duly signed by
         Federmann, according to which all the warranties and representations of
         Federmann as provided in Clauses 5 and 6 of this Deed are also correct,
         complete and accurate as of the First Closing Date.

10.9     Koor shall provide Federmann a written declaration, duly signed by
         Koor, according to which all the warranties and representations of Koor
         as provided in Clauses 5 and 7 of this Deed are also correct, complete
         and accurate as of the First Closing Date.

10.10    The Elbit-Koor Deed Stage 'A' shall be completed, namely all the acts
         that are to be performed on the Elbit-Koor Deed First Closing Date
         shall be performed, as provided in Clause 10 of the Elbit-Koor Deed.

10.11    Each Party undertakes to do all the acts for which it is responsible
         pursuant to this Clause 10.

10.12    All the acts mentioned above in this Clause 10 shall be deemed as being
         made concurrently, no individual act shall be deemed as completed and
         no individual document shall be deemed as delivered until all the
         concurrent acts have been completed and all the documents have been
         delivered.

11.      Stage 'B' of the Transaction

11.1     On the Second Closing Date:

         11.1.1   subject to the fulfillment of the Stage 'B' Conditions
                  Precedent by the Stage 'B' Completion Deadline; or

         11.1.2   in the event that the Stage 'B' Conditions Precedent are
                  treated as wholly fulfilled in accordance with the provisions
                  of Clause 12.4 below or Clause 12.5 below, as the case may be;
                  On the Second Closing Date, Federmann shall sell and transfer
                  to Koor, on and against payment of the full amount of the
                  Stage 'B' Consideration, 1,840000,000 (one million eight
                  hundred and forty thousand) Ordinary Shares (the Stage 'B'
                  Shares), fully paid and Free and Clear, and Koor shall
                  purchase and receive from Federmann the Stage 'B' Shares and
                  pay Federmann the full amount of the Stage 'B' Consideration
                  (in this Deed "Stage 'B' of the Transaction"). For the
                  avoidance of any doubt, the performance of Stage 'B 'of the
                  Transaction is not conditioned upon any condition precedent,
                  and is not connected in any way or form whatsoever with the
                  Elbit-Koor Deed and/or Stage 'B' of the Elbit-Koor Deed.

11.2     On the Second Closing Date the Company shall purchase from Koor
         2,244,276 Ordinary Shares of 1 NIS par value each of Tadiran
         Communications, constituting approximately 18.2% of Tadiran
         Communication's issued share capital in accordance with the Elbit-Koor
         Deed, which is being signed contemporaneously with this Deed, so that
         Stage 'B' of the Transaction (contemplated by this Deed) and the
         Elbit-Koor Deed Stage 'B' shall be performed contemporaneously, and
         Stage 'B' of the Transaction (contemplated by this Deed) shall not be
         performed without the performance of the Elbit-Koor Deed Stage 'B'.
         This Clause 11.2 shall not apply if Federmann provides notice to Koor
         as provided in Clause 12.1.3 below or Clause 12.1.5 below, as the case
         may be.

12.      REVOKED [including the extension of certain deadlines, in accordance
         with the protocol dated 18 April 2005] The Stage 'B' Completion
         Deadline and the Stage 'B' Conditions Precedent

12.1     In this Deed "the Stage 'B' Completion Deadline" means:

         12.1.1   30th June 2005; or -

         12.1.2   subject to the provisions of Clause 12.1.3 and Clause 12.1.4
                  below, if all the Stage 'B' Conditions Precedent have not been
                  fulfilled by 30th June 2005, the Stage 'B' Completion Deadline
                  shall be automatically deferred until 30th September 2005;

         12.1.3   notwithstanding as provided in Clause 12.1.2 above, it is
                  agreed that Federmann may provide notice to Koor, to be
                  received by Koor by 21st June 2005, that Federmann is not
                  willing to extend the Stage 'B' Completion Deadline as
                  provided in Clause 12.1.2 above, and in such event the Stage
                  'B' Completion Deadline shall be the date specified in Clause
                  12.1.1 above, namely 30th June 2005;

         12.1.4   notwithstanding as provided in Clause 12.1.2 above, if Koor
                  provides notice to the Company as provided in Clause 12.1.3 of
                  the Elbit-Koor Deed, and Federmann does not provide notice as
                  provided in Clause 12.1.3 of this Deed, the Stage 'B'
                  Completion Deadline shall be deferred until April 30, 2006;

         12.1.5   notwithstanding as provided in Clause 12.1.4 above, if Koor
                  provides notice to the Company as provided in Clause 12.1.3 of
                  the Elbit-Koor Deed, Federmann may provide notice to Koor, to
                  be received by Koor within seven Business Days after the date
                  on which Koor's notice is received by the Company as
                  aforesaid, that Federmann is not willing to extend the Stage
                  'B' Completion Deadline as provided in Clause 12.1.4 above,
                  and in such event the Stage 'B' Completion Deadline shall be
                  the date specified in Clause 12.1.2, namely September 30,
                  2005, even if Federmann's notice as aforesaid is provided to
                  Koor after September 30, 2005.

12.2     The Stage 'B' Conditions Precedent are provided in Appendix "12.2".

12.3     Subject to Clauses 12.4 and 12.5 below, should all the Stage 'B'
         Conditions Precedent not be fulfilled by the Stage 'B' Completion
         Deadline, Stage 'B' of the Transaction shall not be performed, the
         provisions in connection with Stage 'B' of the Transaction in this Deed
         shall be deemed null and void and be of no effect and, inter alia,
         Federmann shall not sell to Koor the Stage 'B' Shares and Koor shall
         not pay the Stage 'B' Consideration to Federmann, and neither Party
         shall have any demand, claim or complaint against the other in
         connection with Stage 'B' of the Transaction. It is clarified that the
         provisions of this Clause 12.3 are not such as to derogate from the
         validity of any other provision of this Deed and/or from the effect of
         the Shareholders Agreement, which shall enter into effect on the First
         Closing Date, or to derogate from any other right or remedy pursuant to
         this Deed or by law that is available to the Parties with respect to a
         breach of any of the provisions of this Deed (if and insofar as
         breached).

12.4     Notwithstanding as provided in Clause 12.3 above, it is agreed that if
         the Stage 'B' Completion Deadline is determined in accordance with the
         provisions of Clause 12.1.3 above, and insofar as Koor wishes to
         perform Stage 'B' of the Transaction despite the non-fulfillment of all
         the Stage 'B' Conditions Precedent, Koor may provide written notice to
         Federmann, to be received by Federmann by no later than 30th June 2005,
         that Koor waives the fulfillment of the Stage 'B' Conditions Precedent.
         In such event and provided that all the Conditions Precedent for the
         completion of Stage 'B' detailed in Appendix "12.2" of this Deed, other
         than the Conditions Precedent in Clauses 3 and 4 of Appendix "12.2" ,
         have been fulfilled by the Stage 'B' Completion Deadline, all the Stage
         'B' Conditions Precedent shall be treated as though wholly fulfilled,
         and the Parties shall perform and complete Stage 'B' of the Transaction
         on the Second Closing Date. The foregoing is without the Elbit-Koor
         Deed Stage 'B' being performed and completed at the same time and
         without the provisions of Clause 11.2 above and Clause 13.9 below
         applying and without Clauses 3 and 4 of Appendix "12.2" constituting
         Conditions Precedent for Stage 'B'. The foregoing shall not preclude
         the performance of the Elbit-Koor Deed Stage 'B' pursuant to and
         subject to the provisions of the Elbit-Koor Deed on the Elbit-Koor Deed
         Second Closing Date if and when the Elbit-Koor Deed Stage 'B'
         Conditions Precedent (as defined in the Elbit-Koor Deed) are fulfilled
         by the deadline fixed for their performance in the Elbit-Koor Deed.

12.5     Notwithstanding as provided in Clause 12.3 above, it is agreed that if
         the transaction's Stage 'B' Completion Deadline is fixed in accordance
         with the provisions of Clause 12.1.5 and insofar as Koor wishes to
         perform Stage 'B' of the Transaction despite the non-fulfillment of all
         the Stage 'B' Conditions Precedent, Koor may provide Federmann written
         notice (in this Deed " Koor's Notice Pursuant to Clause 12.5" ), to be
         received by Federmann within seven Business Days after the date on
         which Koor receives Federmann's notice as provided in Clause 12.1.5
         above, that it waives the fulfillment of the Stage 'B' Conditions
         Precedent. In such event and provided that all the Stage 'B' Conditions
         Precedent detailed in Appendix "12.2" of this Deed, other than the
         Conditions Precedent in Clauses 3 and 4 of Appendix "12.2" , have been
         fulfilled by the Stage 'B' Completion Deadline, all the Stage 'B'
         Conditions Precedent shall be deemed as wholly fulfilled and the
         Parties shall perform and complete Stage 'B' of the Transaction on the
         Second Closing Date. The foregoing is without the Elbit-Koor Deed Stage
         'B' being performed D-1-11 and completed at the same time and without
         the provisions of Clause 11.2 above and Clause 13.9 below applying and
         without Clauses 3 and 4 of Appendix "12.2"constituting Conditions
         Precedent for Stage 'B'. The foregoing shall not preclude the
         performance of the Elbit-Koor Deed Stage 'B' pursuant to and subject to
         the provisions of the Elbit-Koor Deed on the Elbit-Koor Deed Second
         Closing Date, if and when the Elbit-Koor Deed Stage 'B' Conditions
         Precedent (as defined in the Elbit-Koor Deed) are fulfilled by the
         deadline fixed for their performance in the Elbit-Koor Deed.

13.      The Second Closing Date Subject to the fulfillment of the Stage 'B'
         Conditions Precedent by the Stage 'B' Completion Deadline or if they
         are deemed as wholly fulfilled in accordance with the provisions of
         Clause 12.4 above or Clause 12.5 above, as the case maybe. On the
         Second Closing Date, the Parties and the Company shall meet on the
         Second Closing Date at such place as determined by the Parties and the
         Company, and they shall perform the following interdependent acts
         contemporaneously:

13.1     Koor shall remit the Stage 'B' Consideration by bank transfer to
         Federmann's Account, and confirmation from the Bank that the Stage 'B'
         Consideration has been received in Federmann's Account shall be
         provided to Federmann.

13.2     Federmann shall deliver to the Company a share transfer deed pursuant
         to which the Stage 'B' Shares are being transferred from Bank Leumi
         Le-Israel Trust Co. Ltd. to Federmann, signed by Bank Leumi Le-Israel
         Trust Co. Ltd. and Federmann, and the Company shall enter Federmann in
         its shareholders registry as the holder of the Stage 'B' Shares.

13.3     Federmann shall provide Koor confirmation from the Bank, according to
         which the Bank agrees that on and against receipt of the Stage 'B'
         Consideration in Federmann's Account, it will discharge the Lien from
         the Stage 'B' Shares.

13.4     Federmann shall provide Koor a letter of instructions from the Bank, in
         the Bank's standard terms, addressed to the Companies Registrar
         pursuant whereto the Bank applies to the Companies Registrar to amend
         the Lien to the effect that the Lien will be discharged from the Stage
         'B' Shares.

13.5     Federmann and Koor shall deliver this Deed to the Company, and
         Federmann shall procure the entry of Koor in the Company's shareholder
         registry as the holder of the Stage 'B' Shares and that Koor receives a
         share certificate from the Company in the Company's standard form
         attesting to Koor's ownership of the Stage 'B' Shares.

13.6     Federmann shall provide Koor a copy of the Company's board of
         directors' resolution that, subject to the performance of Stage 'B' of
         the Transaction, there shall be added to the Company's board of
         directors and serve on it an additional director or directors another
         nominee or such number of other nominees who is or are nominated for
         office by Koor to the effect that after his or their addition to the
         board of directors, the number of the Company's directors who have been
         nominated for office by Koor and meet the Qualification Requirements,
         including the director added to the Board of Directors as provided in
         Clause 10.6 above, shall be the greater of: (1)two directors; or (2)a
         number of directors equal to 20% of the number of the Company's
         directors (including external directors and including the director or
         directors added on Koor's nomination as aforesaid), rounded up to the
         nearest whole number. Said board of directors' resolution shall provide
         that Koor's nominee or nominees as aforesaid shall be added to the
         Company's board of directors on the Second Closing Date. Federmann
         undertakes that there will be sufficient vacancies on the Company's
         board of directors to make the addition of Koor's nominee or nominees
         as aforesaid possible. Koor shall arrange to provide Federmann and the
         Company prior written notice of the name or names of its nominee or
         nominees as aforesaid or of another nominee or other nominees, as
         nominated by Koor in his or their place, and Koor (with Federmann's
         assistance) shall coordinate with the Company's corporate secretary
         those nominees' compliance with the Qualification Requirements, all by
         no later than 14 days prior to the earlier of (i) the Stage 'B'
         Completion Deadline; or (ii)the Second Closing Date. If for any reason
         it is not possible to appoint the nominee or nominees that Koor
         proposes as aforesaid as a director or directors of the Company,
         another nominee or nominees, meeting the Qualification Requirements,
         shall be appointed on Koor's nomination in his or their place. If and
         insofar as according to U.S. securities laws, including the U.S.
         Sarbanes-Oxley Act and the rules and regulations that have been and are
         in future issued by virtue thereof, including the rules of Nasdaq, it
         is required that a majority of the Company's directors be Independent
         Directors, then there shall be appointed as additional directors of the
         Company, on Koor's nomination as aforesaid, such number of nominees who
         fulfill the requirements for Independent Directors, equal to one half
         (50%) of the total number of directors who are elected to office on
         Koor's nomination as provided in Clause 10.6 above and in this Clause
         13.6, that number being rounded up to the nearest whole number.

13.7     Federmann shall provide Koor a written declaration duly signed by
         Federmann that all Federmann's warranties and representations as
         provided in Clauses 5 and 6 of this Deed are also correct, complete and
         accurate as of the Second Closing Date.

13.8     Koor shall provide Federmann a written declaration duly signed by Koor
         that all Koor's warranties and representations as provided in Clauses 5
         and 7 of this Deed are also correct, complete and accurate as of the
         Second Closing Date.

13.9     The Elbit-Koor Deed Stage 'B' shall be completed, namely all the acts
         that are to be performed on the Elbit-Koor Deed Second Closing Date as
         provided in Clause 13 of the Elbit-Koor Deed shall be performed.
         Nevertheless, this Clause 13.9 shall not apply if Federmann provides
         notice as provided in Clause 12.1.3 or as provided in Clause 12.1.5
         above.

14.      Each Party undertakes to perform all the acts for which it is
         responsible pursuant to this Clause 13.109 13.All the acts mentioned
         above in this Clause 13 shall be deemed as being performed
         concurrently, no individual act shall be deemed11 as completed and no
         individual document shall be deemed as delivered until all the
         concurrent acts have been completed and all10 the documents are
         delivered.

15.      Acts And Obligations after the Signature of this Deed

15.1     Immediately after the signature of this Deed, the Parties shall act and
         use their best efforts for the fulfillment of all the Conditions
         Precedent, including obtaining all the certificates, permits and
         consents necessary, as early as possible. In such connection and
         without derogating from the generality of the foregoing, the Parties
         shall apply to every competent authority and to every other entity
         whose approval is necessary for the performance of the transaction
         contemplated by this Deed, in both its stages, they shall submit all
         the applications and deliver all the information, data and particulars
         in their possession, without delay, and act to resolve or avoid a
         disapproval, if any, by the various government authorities in any
         respect relating to or arising out of this Deed.

15.2     It is hereby agreed that the provisions of this Deed are not such as to
         place either of the Parties under a duty to make any payment for the
         fulfillment of the Conditions Precedent or any of them, other than
         official fees and other reasonable expenses (such payment as aforesaid,
         excluding official fees and other reasonable expenses, is hereinafter a
         " Fulfillment Payment "), provided that if a Party to this Deed refuses
         to make a Fulfillment Payment, the other Party may make it for the
         fulfillment of all or any of the Conditions Precedent, provided that
         the first Party shall not be responsible to indemnify the other Party
         in respect of a Fulfillment Payment and the Party that makes the
         Fulfillment Payment shall have no demand, claim or right of recourse
         against the other Party with respect to the making of such payment.

15.3     Without prejudice to the provisions of Clauses 15 and 16 below,
         Federmann hereby undertakes that from the date of signing this Deed
         until the earlier of:

         15.3.1   the Stage 'A' Completion Deadline, if the Stage 'A' Conditions
                  Precedent have not been fulfilled by that time; or

         15.3.2   the Stage 'B' Completion Deadline, if the Stage 'B' Conditions
                  Precedent have not been fulfilled by that time; or

15.4     the Second Closing Date;

15.5     Federmann and/or its subsidiaries and/or the controlling shareholders
         and/or officers of Federmann and/or companies under the control of any
         of them shall not enter into an extraordinary transaction with the
         Company in which any of them has a personal interest, other than the
         transactions contemplated by this Deed and the Elbit-Koor Deed.

15.6     Modifications to the Consideration or the Number of Shares Being Sold

15.7     During the period from the date of signing this Deed until the earlier
         of: (1) the Stage 'A' Completion Deadline, if the Stage 'A' Conditions
         Precedent have not been fulfilled by that time; or (2) the Stage 'B'
         Completion Deadline, if the Stage 'B' Conditions Precedent have not
         been fulfilled by that time; or (3) the Second Closing Date; Federmann
         shall, insofar as it is able, oppose and vote by virtue of all the
         Company's shares that it holds at that time against any resolution that
         concerns: (a) the making of any distribution whatsoever, whether in
         cash, in kind or by a distribution of bonus shares, to the Company's
         shareholders, apart from the distribution of a current dividend in cash
         of not more than $ 0.23 per Ordinary Share in any calendar quarter; (b)
         an rights offering for the acquisition of any securities of the
         Company; (c) any modification to the Company's incorporation documents
         that is such as to affect Koor's rights pursuant to the Company's
         incorporation documents in a way that is prejudicial to Koor in
         comparison with Federmann, all unless Koor's consent is provided
         thereto by written notice to be signed by two officers of Koor without
         any further approval being necessary.

15.8     Insofar as during the period from the date of signing this Deed until
         the First Closing Date or until the Second Closing Date, as the case
         may be, one or more of the following events occurs, despite or in
         accordance with the provisions of Clause 15.1 above, the Consideration
         or number of the Shares Being Sold, as the case may be, shall be
         adjusted in accordance with the following provisions:

         15.8.1   If the Company resolves to make any distribution to its
                  shareholders, the Consideration shall be subject to the
                  deduction of any amount (translated into Dollars at the
                  representative exchange rate on the earlier of the date of
                  actually making the distribution or the First Closing Date or
                  the Second Closing Date, as the case may be) that Federmann
                  will be entitled to receive in respect of the Shares Being
                  Sold (gross) (namely that the record date for its distribution
                  is prior to the First Closing Date or the Second Closing Date,
                  as the case may be).

         15.8.2   If the Company offers its Shareholders rights for the
                  acquisition of any securities, the record date for the
                  exercise of which is prior to the First Closing Date or the
                  Second Closing Date, as the case may be, the Consideration
                  shall be adjusted for the bonus element embodied (if at all)
                  in the rights, unless Koor instructs Federmann in writing
                  prior to the exercise date in respect of those rights to
                  exercise the rights and in such event Federmann shall exercise
                  the rights by virtue of the Shares Being Sold which have not
                  yet been transferred to Koor as at that time, and it shall
                  transfer to Koor, immediately on the occurrence of the earlier
                  of (1) the exercise date or (2) the First Closing Date, or
                  after the Second Closing Date, as the case may be, the
                  securities exercised as aforesaid on and against payment of
                  the whole exercise price paid by Federmann to the Company for
                  the exercise thereof, plus Interest from the date of
                  Federmann's paying the exercise price to the date of actual
                  payment to Federmann by Koor.

         15.8.3   If the Company distributes bonus shares or dividend in kind to
                  its shareholders prior to the First Closing Date or the Second
                  Closing Date, as the case may be, the Consideration shall not
                  be adjusted but the Shares Being Sold shall be subject to the
                  addition of the bonus Shares, Free and Clear, or of assets
                  received as dividend in kind (gross) in respect of the Shares
                  Being Sold, Free and Clear, without Koor being required to pay
                  additional Consideration for them.

         15.8.4   If the Company makes a consolidation, reduction or
                  sub-division of its share capital or does any other act of
                  similar effect, the number of Shares Being Sold shall be
                  adjusted pro rata to the consolidation or sub-division and the
                  Consideration shall not be modified.

16.      Koor's Right to Rescind the Deed

16.1     On the occurrence of one or more of the events set out in Clause 16.2
         below, unless it occurs with Koor's consent, Koor may rescind this Deed
         or any of its the stages of this Deed before it has been completed and
         performed (provided that if one of the events set out in Clause 16.2
         below occurs prior to the performance of Stage 'A' of the Transaction,
         Koor may only rescind this Deed in full). Such rescission shall be
         effected by Koor by written notice, to be received by Federmann within
         10 Business Days of the date on which Koor learns of the occurrence of
         one of the events set out in Clause 16.2 below. Should Koor provide
         such notice of the rescission of this Deed after the completion of
         Stage 'A' of the Transaction, the sale of the Stage 'A' Shares to Koor
         shall not be set aside, Koor shall not return to Federmann the Stage
         'A' Shares and Federmann shall not refund to Koor the Stage 'A'
         Consideration. Nevertheless, all the Parties' other obligations and
         rights pursuant to this Deed and the appendices hereto, except for the
         Shareholders Agreement, shall be void.

16.2     The events are as follows:

         16.2.1   If a temporary or permanent receiver and/or temporary
                  liquidator and/or liquidator and/or trustee is appointed for
                  the Company and/or if a winding-up order and/or receivership
                  order and/or suspension of proceedings order is awarded
                  against it and/or if any of the Company's material assets is
                  attached, provided that such appointment, order or attachment
                  is not set aside within 30 days.

         16.2.2   If the Company enters into merger proceedings as provided in
                  Chapter Eight of the Companies Law or compromise or
                  arrangement proceedings in accordance with Section 350 of the
                  Companies Law or restructuring and/or merger proceedings in
                  accordance with Section 351 of the Companies Law.

16.3     Subject to applicable law, Federmann shall provide written notice to
         Koor of the occurrence of any of the events set out in Clause 16.2
         above, immediately upon its publication.

16.4     The foregoing provisions of this Clause 16 shall not derogate from any
         other right or remedy pursuant to this Deed or by law that is available
         to Koor with respect to a breach of any of the provisions of this Deed
         (if and insofar as breached).

17.      Confidentiality and Notices

17.1     The Parties shall use Confidential Information that comes into their
         possession in connection with this Deed and the Company solely for the
         performance of their obligations pursuant to this Deed, and they shall
         not disclose or transfer in any manner whatsoever Confidential
         Information to any third party, other than to their employees or
         independent advisors and except insofar as required for the fulfillment
         of the Conditions Precedent and insofar as possible by prior
         coordination with the other Party. Without derogating from the
         foregoing, if the transaction contemplated by this Deed is not actually
         implemented, each Party shall return to the other Party hereto all
         Confidential Information that has come into its possession in
         connection with this Deed, if any. This obligation is not limited in
         time and shall continue in force even after the term of this Deed or if
         this Deed is cancelled or rescinded for any reason.

17.2     If and insofar as possible and subject to applicable law and to the
         time periods mandated by law, the Parties shall coordinate in advance
         the wording of every report, communication or notice published by
         either of them in connection with their entering into this Deed, its
         performance and the fulfillment of the terms pursuant hereto.

18.      Taxes and Mandatory Payments

18.1     Unless otherwise provided in this Deed, each Party shall bear the
         mandatory payments and taxes that may be imposed on it by law (if and
         insofar as charged) in respect of the sale or acquisition of the Shares
         Being Sold pursuant to this Deed.

18.2     If any amount payable in accordance with the provisions of this Deed is
         subject to a duty to withhold taxes at source, the tax shall be duly
         withheld by the paying Party unless the recipient Party produces a
         valid tax withholding exemption certificate issued by the tax
         authorities.

18.3     Each Party shall bear its own expenses, including the professional fees
         of its legal advisers in connection with the preparation and
         performance of this Deed.

18.4     If any amount paid by one Party to the other in accordance with the
         provisions of this Deed is subject under applicable law to value added
         tax (VAT), the paying Party shall, at the same time and in the same
         manner as it pays that amount, also pay the VAT at its legal rate on
         and against a duly issued tax invoice.

19.      Entry into Effect

19.1     This Deed shall enter into effect upon the receipt of all the following
         approvals:

         19.1.1   Approval from Federmann's General Meeting and board of
                  directors for it to enter into this Deed and the Shareholders
                  Agreement and for performance thereof by Federmann in
                  accordance with their terms and conditions, including
                  ratification of the signatures of Messrs Michael Federmann and
                  Dov Ninveh to this Deed and the Shareholders Agreement.

         19.1.2   Approval by Koor's board of directors for it to enter into
                  this Deed and the Shareholders Agreement and for performance
                  thereof by Koor in accordance with their terms and conditions,
                  including ratification of the signatures of Messrs Jonathan
                  Kolber and Danny Biran to this Deed and the Shareholders
                  Agreement. Provided that: (1)such approvals as mentioned in
                  Clauses 19.1.1 and 19.1.2 have been obtained by no later than
                  January 6, 2005 by 17:00 hours (in this Clause referred to as
                  the " Effective Date "); (2) by the Effective Date copies of
                  the resolutions of Federmann's General Meeting and board of
                  directors, as mentioned in Clause 19.1.1 above, have been
                  received at Koor's offices jointly with written confirmation
                  from Federmann's attorneys that the said resolutions were duly
                  adopted and Messrs Michael Federmann and Dov Ninveh were
                  together empowered to sign, on behalf of Federmann, this Deed
                  and the documents ancillary hereto or those necessary for the
                  purpose of its performance, and also the Shareholders
                  Agreement, and to obligate it thereunder; and written
                  confirmation from the attorneys of Heris Aktiengesellschaft
                  that the competent organs of Heris Aktiengesellschaft have
                  approved its entering into the Shareholders Agreement and Mr.
                  Michael Federmann has been empowered to sign, on behalf of
                  Heris Aktiengesellschaft, the Shareholders Agreement and
                  obligate it by virtue thereof; (3)by the Effective Date a copy
                  of the resolution of Koor's board of directors, as mentioned
                  in Clause 19.1.2 above, has been received at Federmann's
                  offices, together with written confirmation from Koor's legal
                  counsel that the resolution was duly adopted and Messrs
                  Jonathan Kolber and Danny Biran were together empowered to
                  sign, on Koor's behalf, this Deed and the documents ancillary
                  hereto or those necessary for the purpose of its performance
                  and also the Shareholders Agreement and to obligate it
                  thereunder; and (4)all the approvals, as mentioned in Clause
                  19.1 of the Koor-Elbit Deed, have been obtained by the
                  Effective Date.

19.2     Should all the approvals as mentioned in Clauses 19.1.1 and 19.1.2 not
         have been obtained by the Effective Date, and without derogating from
         the provisions of Clause 20.3 below, this Deed shall automatically
         expire and be null and void, without either of the Parties having any
         complaint, claim or demand against the other.

19.3     This Deed shall become effective, if and insofar as it becomes
         effective, at such time as mentioned in Clause 19.1 above.
         Nevertheless:

         19.3.1   the performance and completion of Stage 'A' of the Transaction
                  are conditional upon the fulfillment of all the Stage 'A'
                  Conditions Precedent by the Stage 'A' Completion Deadline and,
                  except for the obligations in Clauses 14 to 18 above and
                  Clause 20.8 below, neither Party shall be liable to do any act
                  for the performance and completion of Stage 'A' of the
                  Transaction before the fulfillment of all the Stage 'A'
                  Conditions Precedent; and

         19.3.2   the performance and completion of Stage 'B' of the Transaction
                  are conditional upon the fulfillment of all the Stage
                  'B'3.2Conditions Precedent by the Stage 'B' Completion
                  Deadline and, except for the obligations in Clauses 14 to 18
                  above and Clause4 20.8 below, neither Party shall be liable to
                  do any act for the performance and completion of Stage 'B' of
                  the Transaction before the fulfillment of all the Stage 'B'
                  Conditions Precedent. The performance and completion of Stage
                  'B' of the Transaction is not conditioned upon any condition
                  precedent .

20.      Miscellaneous

20.1     This Deed shall be governed by the laws of the State of Israel. Sole
         and exclusive jurisdiction in all respects relating to this Deed shall
         be vested only in the courts of the District Court in the City of Tel
         Aviv-Jaffa, and no other court shall have jurisdiction thereover.

20.2     Any modification, addendum or addition, waiver, extension, concession
         or failure to exercise a right pursuant to this Deed shall only be
         effective if done in an express document signed by all the Parties
         hereto and shall only apply to the case specified in such document and
         shall not derogate from other rights of any Party pursuant to this
         Deed.

20.3     The Parties hereto may extend or reduce any time specified in this Deed
         and waive the performance of any of the provisions of this Deed, either
         once or several times, by written notice signed by two officers of each
         of Federmann and Koor, without any further authority being necessary.

20.4     This Deed fully contains, embodies, merges, expresses and exhausts all
         the understandings of the Parties hereto solely in respect of the
         matters mentioned herein. Any promises, guarantees or agreements,
         whether written or oral, undertakings or representations concerning the
         subject matter of this Deed provided or made by the Parties prior to
         entering into this Deed, orally or in writing, that are not
         specifically expressed herein, shall not be deemed to augment the
         rights and obligations prescribed in this Deed or to derogate from or
         modify them, and the Parties shall not be bound by them, insofar as
         existed, as from the date of this Deed. Without derogating from the
         generality of the foregoing, the documents exchanged between the
         Parties prior to the signature hereof, including the drafts exchanged
         between them, shall have no significance in the interpretation of this
         Deed. For the avoidance of doubt, the terms of the Elbit-Koor Deed
         shall not be applied in the interpretation hereof.

20.5     No conduct by either of the Parties shall be construed as a waiver of
         any of its rights pursuant hereto or by law or as its waiver of or
         acquiescence to any breach or non-performance of a condition of the
         Deed by the other Party or as granting a postponement or extension or
         as a modification, cancellation or addition of any condition, unless
         done expressly and in writing.

20.6     Unless otherwise expressly provided in this Deed, the Parties hereto
         may not assign or transfer their rights or obligations pursuant to this
         Deed to any third party or perform this Deed through any third party,
         unless the other Party's prior written consent has been obtained, and
         nothing in this Deed shall be deemed to vest any right in anyone who is
         not a Party hereto.

20.7     Should either of the Parties not enforce or delay in enforcing any of
         the rights vested in it pursuant to this Deed or by law in a particular
         case or series of cases, such shall not be deemed a waiver of said
         right or of any other rights.

20.8     Subject to the provisions of Clause 14.2 above in connection with the
         Conditions Precedent, the Parties shall cooperate between them in the
         implementation of the provisions of this Deed and they shall assist
         each other insofar as reasonable and necessary and in such connection
         they shall sign every reasonable document, application and approval
         necessary for such purpose.

20.9     Notices pursuant to this Deed shall be provided in writing to the
         Parties' addresses as set out in the preamble hereto or to such other
         addresses of which the Parties may provide notice in accordance with
         the provisions of this Clause. Any notice sent by one Party to the
         other by registered mail shall be deemed to have reached the addressee
         following the passage of three days from the date of being posted, and
         notice delivered in person by 17:00 hours on any Business Day shall be
         treated as received immediately on delivery, or if delivered after
         17:00 hours on any Business Day, it shall be treated as received on the
         first Business Day after its delivery.

20.10    IN WITNESS WHEREOF THE PARTIES HAVE EXECUTED THIS AGREEMENT

(signed)

(signed) --------------------------------------------------

KOOR INDUSTRIES LTD.

FEDERMANN ENTERPRISES LTD.

By:Jonathan Kolber

By:Michael Federmann Danny Biran Dov Ninveh

The Conditions Precedent for the Performance of Stage 'A' of the Transaction Set
out below are the Conditions Precedent and approvals required, insofar as
necessary, for the completion of Stage 'A' of the Transaction contemplated by
the Deed of which this Appendix is an integral part ("this Deed") -

1.       Obtaining the [Israel] Commissioner of Restrictive Trade Practices'
         approval of the Parties' contracting pursuant to this Deed and the
         performance of Stage 'A' of the Transaction, provided that the
         Commissioner's disapproval of Stage 'B' of the Transaction is not
         received.

2.       Obtaining all the consents and approvals necessary and the fulfillment
         of all the Conditions Precedent for the Elbit-Koor Deed Stage 'A' to
         become effective, as provided in the Elbit-Koor Deed.

3.       Obtaining the [Israel] Ministry of Defense's approval of the Parties'
         contracting pursuant to this Deed and the performance of all their
         obligations pursuant hereto, including in connection with Stage 'B' of
         the Transaction, all insofar as necessary.

4.       Obtaining the [Israel] Chief Scientist's approval of the Parties'
         contracting pursuant to this Deed and the performance of all their
         obligations pursuant hereto, including in connection with Stage 'B' of
         the Transaction, all insofar as necessary.

5.       Obtaining the [Israel] Investment Center's approval of the Parties'
         contracting pursuant to this Deed and the performance of all their
         obligations pursuant hereto, including in connection with Stage 'B' of
         the Transaction, all insofar as necessary.

6.       Obtaining approval from banks, all insofar as necessary.

In this Appendix 9.2, "approval" means--including an approval that is subject to
conditions but excluding an approval that is subject to conditions that are such
as to materially alter the business activity of Elbit, as existing at the time
of signing this Deed or as may arise in the future in accordance with
resolutions that have been adopted by Elbit prior to signing this Deed, or the
way in which Elbit conducts its business.

Appendix 12.2 Set out below are the Conditions Precedent and approvals required,
insofar as necessary, for the completion of Stage 'B' of the Transaction
contemplated by the Deed of which this Appendix is an integral part ("this
Deed") -

1.       Insofar as necessary, obtaining the [Israel] Commissioner of
         Restrictive Trade Practices' approval of the Parties' contracting
         pursuant to this Deed and the performance of Stage 'B' of the
         Transaction contemplated by this Deed, insofar as such approval is not
         provided in Stage 'A' of the Transaction.

2.       The completion of Stage 'A' of the Transaction contemplated by this
         Deed.

3.       The completion of the Elisra Transaction.

4.       Obtaining all the consents and approvals necessary and the fulfillment
         of all the Koor-Elbit Deed Stage 'B' Conditions Precedent, as provided
         in the Koor-Elbit Deed, except for completion of the Elisra
         Transaction.

In this Appendix 12.2, "approval" means - including an approval that is subject
to conditions but excluding an approval that is subject to conditions that are
such as to materially alter the business activity of Elbit, as existing at the
time of signing this Deed or as may arise in the future in accordance with
resolutions that have been adopted by Elbit prior to signing this Deed, or the
way in which Elbit conducts its business.
</TEXT>
</DOCUMENT>
