<PAGE>   1

[TRANSLATED FROM THE HEBREW]

                                  APPENDIX "G"

                                    AGREEMENT

                Made this _____ day of ___________________ 199__

BETWEEN:    1.     AMPAL ISRAEL LTD (Public Company No. 52-002622-0)
                   of 111 Ariozorov St., Tel Aviv
                   (hereinafter referred to as "Ampal")

            2.    AMOT INVESTMENTS LTD (Public Company No. 52-002668-3)
                  of 8 Shaul Hamelech Blvd., Tel Aviv
                  (hereinafter referred to as "Amot")

            3.    GMUL INVESTMENT CO. (Public Company No. 52-0018136)
                  of 8 Shaul Hamelech Blvd., Tel Aviv
                  (hereinafter referred to as "Gmul")

                  (hereinafter jointly referred to as "the Vendors")

                                                                 of the one part

AND:              __________________________________________________

                  of________________________________________________

                  (hereinafter referred to as "the Purchaser")

                                                               of the other part

Samuel, Moshinsky & Co., Law Offices and Notary
Firon, Kami, Sarov & Firon, Advocates and Notaries
<PAGE>   2

WHEREAS           Ampal holds 783,778 ordinary shares of NIS 1 n.v. each in
                  Moriah Hotels Ltd (Private Company No. 51-0508160-1)
                  (hereinafter referred to as "Ampal's shares") (hereinafter
                  referred to as "the Company");

AND WHEREAS       Amot holds 460,725 ordinary shares of NIS 1 n.v. each in the
                  Company (hereinafter referred to as "Amot's shares");

AND WHEREAS       Gmul holds 340,773 ordinary shares of NIS 1 n.v. each in the
                  Company (hereinafter referred to as "Gmul's shares");

AND WHEREAS       the Vendors wish to jointly sell Ampal's shares, Amot's shares
                  and Gmul's shares to the Purchaser pursuant to the matters
                  provided and set forth in this agreement below (Ampal's
                  shares, Amot's shares and Gmul's shares are hereinafter
                  referred to as "the sold shares");

AND WHEREAS       the Purchaser wishes to purchase the sold shares from the
                  Vendor pursuant to the matters provided and set forth below in
                  this agreement;

AND WHEREAS       the Purchaser has, to its full satisfaction, carried out a due
                  diligence examination of the Company, its business, assets and
                  liabilities, its legal, accounting and financial position and
                  also additional examinations which it deemed appropriate to
                  make, and after the examinations as aforesaid it made an offer
                  to the Vendors to enter into this agreement with them and to
                  purchase the sold shares from them, for the consideration and
                  upon the terms and conditions set forth below herein;

AND WHEREAS       the Vendors wish to enter into this agreement with the
                  Purchaser and to sell the offered shares to the Purchaser for
                  the consideration and upon the terms and conditions set forth
                  below herein;

             IT HAS ACCORDINGLY BEEN WARRANTED, PROVIDED AND AGREED
                           BY THE PARTIES AS FOLLOWS:
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1.    Recitals, Appendices and Headings

      1.1   The recitals and the appendices to this agreement constitute an
            integral part hereof.

      1.2   The headings in this agreement are for convenience purposes only,
            and no regard shall be had thereto for the purposes of interpreting
            this agreement or any part hereof.

      1.3   Set forth below is an itemisation of the appendices annexed hereto:

            Appendix "Al" -               the Company's audited financial
                                          statements as at 30th December 1997;

            Appendix "A2" -               the Company's reviewed financial
                                          statements as at 30th September 1998;

y           Appendices "B1" to "B3" -     texts of share transfer deeds;

            Appendix "C" -                text of minutes of a meeting of the
                                          Company's board of directors;

            Appendix "Dl" -               text of HVE's notice of exercising
                                          HVE's option;

            Appendix "D2" -               text of HVE's share transfer deed.

2.    Definitions

      In this agreement the following expressions shall bear the meanings set
      forth alongside them.

       "dollar" -                   a US dollar;

       "HVE's option" -             as defined in clause 9 below;

       "the approvals" -            the approvals specified in clause 5.2 herein
                                    and each of them;

       "the Company" -              Moriah Hotels Ltd. Private Company No.
                                    51-050816-1;

       "the last date" -            90 days after the date of the agreement as
                                    defined below or a later date upon which the
                                    parties shall agree in writing;
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       "the sold shares" -          Ampal's shares, Amot's shares and Gmul's
                                    shares;

       "the representative rate"
       and/or "the representative
       rate of the dollar" -        the representative rate of The US dollar as
                                    published by the Bank of Israel; if at any
                                    time a representative rate of the US dollar
                                    shall not be published, "the representative
                                    rate of the dollar shall be the average
                                    between the lowest cash rate at which, at
                                    the relevant time at noon, Bank Hapoalim Ltd
                                    purchases US dollars from Israeli citizens
                                    without rights and special exemptions and
                                    the highest cash rate at which, at the
                                    relevant time at noon, Bank Hapoalim Ltd
                                    sells US dollars to Israeli residents
                                    without rights and special exemptions;

       "the consideration" -        US$75,827,600 (seventy-five million, eight
                                    hundred twenty-seven thousand, six hundred
                                    US dollars) which is the price which the
                                    Purchaser undertakes to pay the Vendors for
                                    the sold shares as provided in clause 8
                                    below;

       "Ampal's part of
       the consideration" -         49.44% of the consideration as provided in
                                    clause 8.1.1 below;

       "Amot's part of
       the consideration" -         29.06% of the consideration as provided in
                                    clause 8.1.2 below;

       Gmul's part of
       the consideration" -         21.50% of the consideration as provided in
                                    clause 8.1.3 below;

       "HVE" -                      HVE - Hevrat Ovdim Investments Ltd (Public
                                    Company No. 52-002847-3);

       "business day" -             a day on which there is trading in foreign
                                    currency by the banks in Israel; for the
                                    avoidance of doubt, Sundays are not a
                                    business day;

       "the completion date" -      as defined in clause 6 below;

       "Ampal's shares" -           783,778 ordinary stares of NIS 1 n.v. each
                                    in the Company;
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       "Amot's shares" -            460,725 ordinary shares of NIS 1 n.v. each
                                    in the Company;

       "Gmul's shares" -            340,773 ordinary shares of NIS 1 n.v. each
                                    in the Company;

       "HVE's shares" -             as defined in clause 9 below;

       "the agreement date" -       the date on which this agreement shall be
                                    executed by the Vendors;

       "the interim period" -       the period between the agreement date and
                                    the completion date.

3.    The Vendors' Warranties

      3.1   Ampal warrants that:

            (a)   It is the owner of Ampal's shares and that Ampal shares are
                  fully paid up and are free of any charge, attachment or third
                  party rights whatsoever and when they shall be transferred to
                  the Purchaser pursuant to the provisions of this agreement,
                  they shall be transferred free of any charge, attachment or
                  third party right.

            (b)   There is no impediment at law and/or agreement into its
                  entering into this agreement.

            (c)   It is duly incorporated and is entitled pursuant to its
                  documents of incorporation to enter into this agreement and to
                  act pursuant thereto and that all its competent organs have
                  passed all the resolutions required to approve its contractual
                  relationship in this agreement and to perform all its
                  obligations pursuant hereto.

      3.2   Amot warrants that:

            (a)   It is the owner of Amot's shares and that Amot shares are
                  fully paid up and are free of any charge, attachment or third
                  party rights whatsoever and when they shall be transferred to
                  the Purchaser pursuant to the provisions of this agreement,
                  they shall be transferred free of any charge, attachment or
                  third party right.
<PAGE>   6

            (b)   There is no impediment at law and/or agreement into its
                  entering into this agreement.

            (c)   It is duly incorporated and is entitled pursuant to its
                  documents of incorporation to enter into this agreement and to
                  act pursuant hereto and that all its competent organs have
                  passed all the resolutions required to approve its contractual
                  relationship in this agreement and to perform all its
                  obligations pursuant hereto.

      3.3   Gmul warrants that:

            (a)   It is the owner of Gmul's shares and that Gmul shares are
                  fully paid up and are free of any charge, attachment or third
                  party rights whatsoever and when they shall be transferred to
                  the Purchaser pursuant to the provisions of this agreement,
                  they shall be transferred free of any charge, attachment or
                  third party right.

            (b)   There is no impediment at law and/or agreement into its
                  entering into this agreement.

            (c)   It is duly incorporated and is entitled pursuant to its
                  documents of incorporation to enter into this agreement and to
                  act pursuant hereto and that all its competent organs have
                  passed all the resolutions required to approve its contractual
                  relationship in this agreement and to perform all its
                  obligations pursuant hereto.

      3.4   The Vendors warrant, that as far as they are aware, the Company's
            audited financial statements as at 31st December 1997 and the
            Company's reviewed financial statements as at 30th September 1998,
            annexed hereto as appendices "A1" and "A2", fairly reflect, in
            conformity with generally accepted accounting principles, the
            Company's financial position as at the respective date that each of
            them were drawn up.

      3.5   The Vendors warrant that they requested the Company to centralise at
            the Company's offices and/or Ampal's offices, at 111 Ariozorov St.,
            Tel Aviv, material documents and data in connection with the Company
            which did not include agreements with suppliers, customers and/or
            agents, and to enable the Purchaser to inspect, at its election,
            such documents and data and that they are unaware of any material
            agreement of the Company, save for agreements with suppliers,
            customers and/or agents, that were not made available for the
            Purchaser's inspection nor of any material claim against the Company
            the documents in connection with which were not made available for
            the Purchaser's inspection.
<PAGE>   7

      3.6   The Vendors warrant that, apart from the matters set forth in
            sub-clauses 3.4 and 3.5 above, they and/or any of them and/or anyone
            on their behalf do not expressly or impliedly make any
            representation whatsoever and/or assume any undertaking whatsoever
            with regard to the correctness, accuracy and/or completeness of the
            documents and/or the data that were made available for the
            Purchaser's inspection as in clause 3.5 above and/or that were
            delivered to the Purchaser by the Company and/or the Vendors and/or
            any of them and/or anyone on their behalf and/or which reached the
            Purchaser's knowledge in any manner whatsoever, whether in writing
            or orally, directly or indirectly, whether within the context of the
            tours of the Company's hotels or in any other manner.

4.    The Purchaser's Warranties

      The Purchaser warrants and undertakes that:

      4.1   It independently and to its full satisfaction carried out a due
            diligence examination of the Company, its business, assets and
            liabilities and legal, accounting and financial position and also
            additional examinations which it deemed appropriate to make, that it
            and/or anyone on its behalf received all the information they
            requested to receive and that it was given the opportunity of
            carrying out any examination it wished to make and to receive all
            information, irrespective of whether it requested it, within the
            context of the documents and the data that were made available for
            its inspection as provided in clause 3.5 above, during the course of
            the tours of the Company's hotels and also in any other manner, and
            that insofar as any information was not delivered to it, whether it
            requested that it should be delivered to it or otherwise, it has
            decided to enter this agreement notwithstanding the fact that such
            information was not delivered to it, and while giving a full waiver
            of any claim and/or complaint and/or demand in such regard, and that
            it has found the Company and the sold shares appropriate for its
            objects and that it is purchasing the sold shares `as is' and with
            the Company being `as is', and that it fully and finally waives any
            claims and/or demands and/or complaints whatsoever against the
            Vendors and/or the Company and/or any of them and/or anyone on their
            behalf, including with regard to a patent and/or latent
            non-conformity and/or defect in respect of the sold shares and/or
            the Company, and that it is purchasing the sold shares without
            relying upon any representation and/or undertaking on behalf of the
            Vendors and/or the Company and/or any of them and/or anyone on their
            behalf, save for these expressly set forth in clause 3 above.
<PAGE>   8

      4.2   It waives any complaint and/or claim and/or demand against the
            Vendors and/or against the Company and/or any of them and/or anyone
            on their behalf in respect of incorrectness, inaccuracy and/or
            incompleteness of the documents and/or the data that were made
            available for its inspection as provided in clause 3.5 above and/or
            that were brought to its knowledge during the course of the tours of
            the Company's hotels and/or that were delivered to it by the Company
            and/or the Vendors and/or any of them and/or anyone on their behalf
            and/or that reached it in any other manner, directly or indirectly,
            whether in writing or orally.

      4.3   It is aware and it agrees that the Vendors and/or the Company and/or
            any of them and/or anyone on their behalf are not making any
            representation with regard to the correctness, accuracy and/or
            completeness of the documents and/or the information that were
            delivered to it, whether in writing or orally, directly or
            indirectly, including, but without derogating from the generality of
            the aforegoing, any statement, information or representation that
            were made or given, if made or given, by any of the employees and/or
            officers and/or shareholders of the Company and/or of the Vendors,
            and without prejudice to the generality of the aforegoing, directors
            and/or representatives and/or consultants (legal or others) of the
            Vendors and/or of the Company and/or by any other person and/or
            entity on behalf of any of those enumerated above.

      4.4   It is aware and it agrees that the Company and all its subsidiaries
            have confirmed to the Vendors that they do not and shall not have
            and they waive in advance any claim and/or complaint and/or demand
            against the Vendors, any of them and anyone on their behalf,
            including anyone who served and/or is serving as a director of the
            Company and/or of any of its subsidiaries, and the Purchaser hereby
            undertakes to indemnify the Vendors and/or any of them and/or anyone
            on their behalf and/or anyone who served and/or is serving as a
            director of the Company and/or of any of its subsidiaries in respect
            of any expense that shall be incurred and/or payment that shall be
            made in connection with any claim and/or complaint and/or demand
            that shall be raised against any of them by the Company and/or any
            of its subsidiaries on its behalf in any matter whatsoever.

      4.5   That there is no impediment at law and/or agreement and/or any other
            impediment to its entering into this agreement and purchasing the
            sold shares.
<PAGE>   9

      4.6   That it is duly incorporated and is entitled pursuant to its
            documents of incorporation to enter into this agreement and to act
            pursuant hereto and that all its competent organs have passed all
            the resolutions required to approve its contractual relationship in
            this agreement and to perform all its obligations pursuant hereto.

5.    Validity of the Agreement and Terms and Conditions for the Sale of the
      Sold Shares

      5.1   This agreement shall come into effect immediately upon the execution
            hereof by the Vendors.

      5.2   Notwithstanding the provisions of clause 5.1 above, the performance
            of the parties' obligations pursuant to clauses 7, 8 and 9 to this
            agreement is conditional upon obtaining all the approvals specified
            below by the last date:

            (a)   unconditional and unqualified approval of the Director of
                  Restrictive Trade Practices pursuant to the Restrictive Trade
                  Practices Law, 5748-1988;

            (b)   approval of the Investment Centre of the Ministry of Industry
                  and Trade;

            (c)   approval of Bank Hapoalim Ltd as required pursuant to the
                  debentures signed in its favour by the Company.

      5.3   The parties shall cooperate insofar as required to obtain the
            Director of Restrictive Trade Practices' approval as provided in
            clause 5.2(a) above and they shall, inter alia, within 14 days from
            the agreement date, submit an appropriate application to the
            Director of Restrictive Trade Practices and thereafter shall furnish
            the Restrictive Trade Practices Authority with any document or
            information that it shall require for the purposes of granting the
            approval.

      5.4   Within 14 days of the agreement date the Vendors shall make
            application to the entities mentioned in sub-clauses 5.2(b) and
            5.2(c) to grant the approvals mentioned in sub-clauses 5.2 and
            5.2(c) above; copies of the said applications shall be sent to the
            Purchaser.

            The parties shall cooperate and furnish every document or
            information that shall be required by any of the entities mentioned
            in sub-clauses 5.2(b) and 5.2(c) in order to grant such approvals.
<PAGE>   10

      5.5   All the expenses and payments that must be effected, if any, in
            order to obtain the approvals shall be borne and paid by the
            Company.

      5.6   If any of the approvals are not received by the last date (and there
            is no undertaking and/or representation by any of the parties hereto
            in connection with the possibility of receiving the approvals), this
            agreement shall automatically terminate at the end of 14 days from
            the last date, unless all the approvals have been received prior to
            the end of the said 14 days.

            If the agreement terminates as aforesaid, each of the Vendors shall
            refund to the Purchaser the first instalment paid made by the
            Purchaser on account of its part of the consideration, as provided
            in clause 8.5 below, and none of the parties shall have any
            complaint and/or claim and/or demand against the others in
            connection with this agreement and/or the proceeding which led to
            the execution hereof and/or the failure to obtain any of the
            approvals and/or the termination of this agreement.

      5.7   The Purchaser hereby confirms that it is aware that pursuant to
            various agreements between the Company and its subsidiaries and/or
            any of them and Israel Land Administration, Israel Land
            Administration's consent is required for the transfer of the sold
            shares from the Vendors to the Purchaser, and that the Israel Land
            Administration may require, as a condition for giving its said
            consents, consent charge payments from the Company and/or the
            Company's subsidiaries and/or any of them and that Israel Land
            Administration has not given any consent to the transfer of the
            offered shares to the Company. The Purchaser hereby undertakes to do
            every action and to make every necessary payment, including consent
            charges and/or capitalisation charges required in order to obtain
            all the necessary consents from Israel Land Administration to the
            transfer of the sold shares to the Purchaser. It is hereby agreed
            that if the Purchaser does not obtain Israel Land Administration's
            consent to the transfer of the sold shares to the Purchaser by
            completion date, the Purchaser shall be entitled to act as aforesaid
            in order to obtain the said consents even after the completion
            dates, and that in such event the Purchaser may require the Company
            and/or any of its subsidiaries to pay Israel Land Administration the
            Payments that it shall require in order to grant its consents. In
            any event, failure to obtain Israel Land Administration's consents
            shall not impair the validity of this agreement and/or constitute a
            cause for the annulment hereof, whether prior to the completion date
            or thereafter, and all the liability and damages that may be
            occasioned to the Purchaser and/or the Company and/or the Company's
            subsidiaries and/or any of them shall be borne by the Purchaser,
            without it having any claim and/or demand and/or complaint against
            the Vendors and/or any of them and/or anyone on their behalf.
<PAGE>   11

6.    The Completion Date and the Interim Period

      6.1   After receiving all the approvals, the Vendors shall determine the
            date and time at which the operations set forth in clauses 7 and 8
            below shall take place, which shall not be later than the end of 14
            business days from the last date, and they shall give written notice
            thereof to the Purchaser (the said date and time as shall be
            determined by the Vendors are hereinafter referred to in this
            agreement as "the completion date").

            On the completion date, the parties shall meet at the offices of
            Advs. Firon, Kami, Sarov & Firon, at 111 Ariozorov St., Tel Aviv and
            shall effect the operations enumerated in clauses 7 and 8 below:

      6.2   (a)   The Purchaser hereby confirms that it agrees that in the
                  interim period the Company shall declare and distribute cash
                  dividends in any amount whatsoever not exceeding the sum of
                  all the Company's distributable profits in respect of 1998 and
                  in respect of previous periods, as shall be determined by the
                  Company's auditors.

            (b)   The dividend amounts that shall actually be distributed by the
                  Company to Ampal, Amot and Gmul during the interim period, in
                  their dollar value according to the representative rate of the
                  dollar on the date of actual payment to Ampal, Amot and Gmul,
                  shall be deducted from the consideration which the Purchaser
                  is liable to pay the Vendors as provided in clause 8 below and
                  each of the Vendors' part of the consideration shall be
                  reduced respectively.

            (c)   Without prejudice to the generality of the provisions of
                  clause 4.4 above, the Purchaser warrants and undertakes to
                  each of the Vendors and to HVE that it is aware and it agrees
                  that the Company has confirmed to the Vendors that it does not
                  and shall not have and it waives in advance any claim and/or
                  complaint and/or demand against the Vendors and/or any of them
                  and/or anyone on their behalf, including anyone who served
                  and/or is serving as a director of the Company and/or against
                  HVE in respect at and in connection with the dividends that
                  shall be declared and/or distributed by the Company in the
                  interim period, and the Purchaser hereby undertakes to
                  indemnify the Vendors and/or any of then and/or anyone on
                  their behalf, including anyone who served and/or serves as a
                  director of the Company and/or HVE, in respect of any expense
                  that shall be incurred
<PAGE>   12

                  and/or payment that shall be made in connection with any claim
                  and/or complaint and/or demand that shall be raised against
                  any of them by the Company and/or anyone on its behalf in
                  connection with the Company's declaration and/or distribution
                  of dividends.

      6.3   Any event or occurrence that shall occur during the interim period,
            whether as a result of a decision of the Company and/or the Vendors
            or otherwise, shall not confer any right upon the Purchaser to
            rescind the agreement.

      6.4   In the interim period, the Vendors shall inform the Purchaser of
            every board of directors' meeting that shall be convened in the
            interim period and they shall enable a representative on the
            Purchasers behalf to be present as an observer at such meeting.

7.    Transfer of the Sold Shares

      On the completion date, after all the approvals have been received and
      after all the payments which the Purchaser is liable to pay Ampal, Amot
      and Gmul as provided in clause 8 below have been effected:

      (a)   Ampal shall deliver a share transfer deed to the Purchaser in the
            text annexed hereto as appendix "B1" in respect of Ampal's shares;

      (b)   Amot shall deliver a share transfer deed to the Purchaser in the
            text annexed hereto as appendix "B2" in respect of Amot's shares;

      (c)   Gmul shall deliver a share transfer deed to the Purchaser in the
            text annexed hereto as appendix "B3" in respect of Gmul's shares;

      (d)   the Vendors shall deliver to the Purchaser minutes of the Company's
            board of directors approving the transfer of Ampal's shares, Amot's
            shares and Gmul's shares to the Purchaser in the text annexed hereto
            as appendix "C", signed by the chairman of such meeting.

      By delivering the aforementioned documents, the Vendors will have
      fulfilled their duty to transfer and sell the sold shares to the
      Purchaser.
<PAGE>   13

8.    The Consideration

      In consideration for the sold shares, the Purchaser shall pay the Vendors
      the sum of US$75,827,600 (seventy-five million, eight hundred twenty-seven
      thousand, six hundred US dollars) hereinafter referred to as "the
      consideration") in the apportionment and instalments and at the times
      specified below.

      8.1   The Purchaser shall pay each of the Vendors its part of the
            consideration in two instalments as specified below:

            8.1.1 To Ampal - an amount equal to 49.44% as the consideration for
                  Ampal's shares (hereinafter referred to as "Ampal's part of
                  the consideration");

            8.1.2 To Amot - an amount equal to 29.06% as the consideration for
                  Amot's shares (hereinafter referred to as "Amot's part of the
                  consideration");

            8.1.3 To Gmul - an amount equal to 21.50% as the consideration for
                  Gmul's shares (hereinafter referred to as "Gmul's part of the
                  consideration");

      8.2   The Purchaser shall pay the consideration to the Vendors in the
            following instalments and at the following times:

            8.2.1 The first instalment - at 08:30 hours on the second business
                  day after the agreement date, the Purchaser shall pay the
                  Vendors 20% of the consideration as a first instalment on
                  account of the consideration as follows:

                  8.2.1.1     the Purchaser shall pay Ampal 20% of Ampal's part
                              of the consideration;

                  8.2.1.2     the Purchaser shall pay Amot 20% of Amot's part of
                              the consideration;

                  8.2.1.3     the Purchaser shall pay Gmul 20% of Gmul's part of
                              the consideration;

            8.2.2 The Second Instalment

                  The Purchaser shall pay the Vendors the balance of the
                  consideration on the completion date, that is to say 80% of
                  the consideration as follows:
<PAGE>   14

                  8.2.2.1     the Purchaser shall pay Ampal 80% of Ampal's part
                              of the consideration;

                  8.2.2.2     the Purchaser shall pay Amot 80% of Amot's part of
                              the consideration;

                  8.2.2.3     the Purchaser shall pay Gmul 80% of Gmul's part of
                              the consideration;

            8.2.3 A breach of any of the Purchaser's obligations pursuant to
                  clause 8.2.1 above and/or pursuant to clause 8.2.2 above shall
                  constitute a fundamental breach of this agreement.

      8.3   The consideration and each and every instalment in respect thereof
            shall be paid by the Purchaser in new shekels according to the
            representative rate at the time of actually effecting the payment.

      8.4   The consideration and each and every instalment in respect thereof
            shall be paid by way of bank cheques to the order of Ampal, Amot or
            Gmul, as the case may be, drawn on one of the five largest
            commercial banks in Israel.

            The consideration amount and/or each and every instalment in respect
            thereof shall only be deemed as having been paid at the time that
            the bank accounts of Ampal, Amot and/or Gmul, as the case may be,
            are credited with the amount of the relevant bank cheque.

      8.5   If this agreement is terminated as provided in clause 5.6 above,
            each of the Vendors, without mutual liability inter se, shall,
            within 21 days of the last date, refund to the Purchaser its part of
            the first instalment paid to it by the Purchaser on account of the
            consideration as provided in clause 8.2.1 above, in its dollar value
            and in new shekels according to the representative rate of the
            dollar known at the time of actually effecting the refund.

      8.6   It is hereby agreed that if the Purchaser breaches its obligation to
            pay the Vendors on due date the full amount of the first instalment
            as provided in clause 8.2.1, or the full amount of the second
            instalment as provided in clause 8.2.2 above, the Vendors shall in
            each of the said events be entitled to rescind this agreement upon
            written notice to the Purchaser, without giving it any advance
            notice thereof and without giving it any opportunity to rectify the
            breach.
<PAGE>   15

      8.7   The parties hereby determine, after a cautious evaluation, that the
            damage that can be anticipated at the time of entering into this
            agreement as a reasonable consequence of a breach of the Purchaser's
            obligation to pay the Vendors on due date the full amount of the
            first instalment, as provided clause 8.2.1 above, and/or the full
            amount of the second instalment, as provided in clause 8.2.2 above,
            and of the rescission of the agreement by the Vendors as provided in
            clause 8.6 above, is 10% of the consideration (in dollar values).

            Without prejudice to any other and/or additional right and/or relief
            of the Vendors, it is hereby agreed that if the Purchaser breaches
            its obligation to pay the Vendors the first instalment, as provided
            in clause 8.2.1 above, and/or the second instalment, as provided in
            clause 8.2.2 above, and if the Vendors rescind the agreement as
            provided in clause 8.6 above, the Purchaser shall pay each of the
            Vendors, by way of liquidated damages, and immediately upon being
            required to do so by the Vendors, an amount equal to 10% of the
            consideration (in dollar values) (hereinafter referred to as "the
            liquidated damages").

            The liquidated damages shall be apportioned between the Vendors as
            follows: to Ampal - 49.44% of the liquidated damages; to Amot -
            29.06% of the liquidated damages and to Gmul - 21.50% of the
            liquidated damages. The Purchaser hereby agrees that if this
            agreement is rescinded by the Vendors as provided in clause 8.6
            above, each of the Vendors shall be entitled, without prejudice to
            any right and/or relief available to it at law and/or agreement, to
            set-off its part of the liquidated damages or part thereof, at its
            election, against any amount due from it to the Purchaser.

9.    Purchase of HVE's Shares by the Purchaser

      The Purchaser warrants and confirms that it is aware that HVE is the owner
      of 118,589 ordinary shares of NIS 1 n.v. each in the Company (hereinafter
      referred to as "HVE's shares"). The Purchaser hereby grants HVE an option
      (hereinafter referred to as "HVE's option") to sell it all HVE's shares as
      follows:

      9.1   The exercise of HVE's option is conditional upon all the approvals
            being received, that the Vendors shall determine the completion date
            as provided in clause 6 above, and that on the completion date the
            Vendors shall deliver to the Purchaser the share transfer deeds and
            the minutes of the Company's board of directors as provided in
            clause 7 above.
<PAGE>   16

      9.2   Immediately after the completion date and the performance of the
            matters set forth in clause 7 above, the Purchaser and/or the
            Vendors shall give notice thereof to HVE.

      9.3   HVE shall be entitled to exercise HVE's option within 14 days of the
            date on which the Purchaser's and/or the Vendors' notice is
            delivered to HVE as provided in clause 9.2 above by giving the
            Purchaser, within the 14 days, written notice of its decision to
            exercise HVE's option in the text annexed hereto as appendix "D1" to
            which shall be annexed a share transfer deed in the text annexed
            hereto as appendix "D2" signed by HVE (hereinafter referred to as
            "HVE's notice").

            If HVE's notice is not delivered to the Purchaser together with a
            share transfer deed as aforesaid within the said 14 days, HVE's
            option shall expire, and HVE and/or the Purchaser shall not be
            granted any right whatsoever.

      9.4   By twelve noon on the seventh business day after the date on which
            HVE's notice is delivered to the Purchaser, the Purchaser shall pay
            HVE, in consideration for HVE's shares (and in addition to the full
            amount of the consideration that it paid the Vendors as provided in
            clause 8 above, an amount equal to 7.48% of the consideration in new
            shekels according to the representative rate known on the date of
            actual payment.

            If the Company distributes cash dividends in the interim period, the
            value of the dividends which HVE shall actually receive in the
            interim period, in their dollar value according to the
            representative rate of the dollar on the date of the actual payment
            thereof to HVE, shall be deducted from the amount that shall be paid
            by the Purchaser in consideration for HVE's shares as aforesaid.

            The Purchaser hereby undertakes that if it directly or indirectly
            purchases HVE's shares within twelve months of the agreement date,
            whether in consequence of exercising HVE's option or in any other
            manner it shall deduct 1% (one percent) of the amount of the payment
            to HVE together with VAT and shall remit it to the Vendors as HVE's
            contribution to the costs of preparing this agreement. The payment
            shall be effected by way of a bank cheque to HVE's order drawn on
            one of the five large commercial banks in Israel; the payment amount
            shall only be deemed as having been paid at the time HVE's bank
            account is credited with the amount of the bank cheque as aforesaid.
<PAGE>   17

      9.5   If HVE exercises HVE's option, the Purchaser shall be deemed as also
            having given HVE all the warranties and undertakings in clause 4
            above and in clause 10.2 below, mutatis mutandis, in connection with
            HVE's shares and HVE.

      9.6   The Purchaser warrants and confirms that it is aware and it agrees
            that the Vendors and/or the Company and/or any of them and/or anyone
            on their behalf do not make any representation with regard to HVE's
            shares and/or the possibility of HVE's option being exercised by
            HVE, and it waives any complaint and/or claim and/or demand against
            the Vendors and/or against the Company and/or any of them and/or
            anyone on their behalf in connection with HVE's shares and/or HVE's
            option, including, but without prejudice to the generality of the
            aforegoing, the exercise or non-exercise thereof by HVE.

      9.7   The provisions of this clause 9 constitute a contract in favour of a
            third party - HVE; however, it is hereby expressly agreed that the
            Vendors and the Purchaser are entitled to amend the provisions of
            this clause 9 at any time, either prior to or after notice thereof
            is given to HVE.

10.   Taxes, Expenses and Various Payments

      10.1  Income tax and/or capital gains tax that shall apply, if at all, to
            Ampal, Amot or Gmul in connection with the sale of the sold shares
            pursuant to this agreement shall be borne by Ampal, Amot or Gmul, as
            the case may be. Any tax and/or levy and/or other official fee,
            including, but without prejudice to the generality of the
            aforegoing, stamp duty, shall be borne and paid by the Purchaser.

      10.2  Save for those deductions of income tax at source which the
            Purchaser shall be statutorily liable to deduct the Purchaser shall
            not deduct and shall not set-off any amount from any payment it is
            liable to make to the Vendors and/or to any of them and/or to HVE,
            and any such deduction and/or set-off, whether justified or
            otherwise, shall constitute a breach of the provisions of this
            agreement.

            For the avoidance of doubt if a certificate of the income tax
            authorities is produced to the Purchaser exempting the payment to
            the Vendors and/or any of them from deduction of income tax at
            source, tax shall not be deducted at source from the payments to
            such party.
<PAGE>   18

      10.3  In addition, but without prejudice to the provisions of clause 5
            above, it is hereby expressly agreed that any tax, official fee,
            levy, consent charges, capitalisation charges and/or other payment
            and/or other expense which the Company and/or any of its
            subsidiaries (hereinafter jointly and severally referred to as "the
            Group") paid and/or incurred and/or shall pay and/or shall incur in
            accordance with a determination of the Vendors in connection with
            the preparation of this agreement and/or in connection with the
            proceeding within the context whereof this agreement was executed
            and/or in connection with the implementation of this agreement
            and/or the exercise of HVE's option, and, but without prejudice to
            the generality of the aforegoing, any payment of capitalisation
            charges and/or consent charges to Israel Land Administration which
            the Group shall pay in accordance with the Vendors' determination in
            connection with obtaining the approvals, shall be borne and paid by
            the Group, without the Group and/or the Purchaser having any
            complaint and/or claim and/or demand whatsoever against the Vendors
            and/or any of them and/or anyone on their behalf and/or against any
            officers of the Group, and the Purchaser hereby undertakes to
            indemnify the Vendors and/or any of them and/or anyone on their
            behalf and/or any officer of the Group in respect of any expense
            that shall be incurred and/or payment that shall be made in
            connection with any claim and/or complaint and/or demand that shall
            be raised against any of them by the Group and/or the Purchaser
            and/or anyone on their behalf.

11.   Arbitration

      11.1  All the disputes, contentions or differences that may arise between
            the parties in all matters relating to this agreement or the
            rescission hereof or any of the terms and conditions hereof
            (including the issue of the validity thereof) shall be referred to
            the decision of a sole arbitrator who shall agreed upon by the
            parties.

      11.2  If the parties to not reach agreement as to the arbitrator's
            identity, he shall be appointed by the Tel Aviv-Jaffa District Court
            upon written application by any party.

      11.3  The arbitrator shall be released from the laws of evidence and the
            rules of procedure, but he shall make his award in accordance with
            the substantive law, he shall give reasons for his decision and his
            decision shall be final and bind the parties.
<PAGE>   19

12.   Miscellaneous

      12.1  The parties' rights and duties in connection with the subject matter
            of this agreement shall only be determined in accordance with the
            provisions hereof and any amendment or addendum thereto shall
            require the parties' written consent.

      12.2  Without prejudice to the Purchaser's duty to make every payment
            pursuant to this agreement on due date, it is agreed that any
            payment made by the Purchaser after the date on which it was under a
            duty to make it pursuant to the provisions hereof shall be linked to
            the representative rate of the dollar and shall bear interest at the
            rate of 9% per annum.

      12.3  This agreement annuls and replaces any agreement, consent and/or
            undertaking whatsoever between the Purchaser and the Vendors and/or
            any of them, and/or anyone on their behalf.

      12.4  This agreement shall be governed by Israeli law and exclusive
            jurisdiction in connection herewith, subject to the provisions of
            clause 11 above, is hereby given to the Tel Aviv-Jaffa courts alone.

      12.5  Notices

            For so long as a party does not give another written notice to the
            other, the parties' addresses for the purpose of this agreement are
            as appear in the recitals and any such notice sent by any party to
            another shall be deemed as having been received by the party to
            which it was sent; if delivered or left at its address - at the time
            of delivery thereof; if sent by registered post - three (3) business
            days from the date of delivery thereof to the post office for
            dispatch by registered post; and if transmitted by facsimile - at
            the end of the first business day after the time of transmission.

            For so long as any party does not give another notice to the other,
            the parties' addresses for the purpose of this agreement shall be as
            follows:

            (a)   Ampal Israel Ltd -
                  111 Ariozorov St., Tel Aviv, Fax: 03-6090827, with a copy to
                  Adv. Zvi Firon of 111 Ariozorov St., Tel Aviv, Fax:
                  03-6953802;
<PAGE>   20

            (b)   Amot Investments Ltd.
                  8 Shaul Hamelech Blvd, Tel Aviv, Fax: 03-6938501, with a copy
                  to Adv. Yoram Samuel of 138 Rothschild Blvd, Tel Aviv, Fax:
                  03-6867533;

            (c)   Gmul Investments Co. Ltd.
                  8 Shaul Hamelech Blvd, Tel Aviv, Fax: 03-6979480, with a copy
                  to Adv. Yoram Samuel of 138 Rothschild Blvd. Tel Aviv, Fax:
                  03-6867533;

            (d)   The Purchaser --
                  Sheraton Intercontinental Ltd. and Koor Tourism Ltd., Fax: For
                  Sheraton Intercontinental Ltd: 32 2 224 3592; for Koor Tourism
                  Ltd.:_________________________________________________________

      12.6  Each of the Vendors (hereinafter referred to as "the selling party")
            is entitled to sell its shares in the Company to the other Vendors.
            In such event, the selling party shall assign and transfer to the
            other Vendors all the selling party's rights pursuant hereto, and
            such rights and obligations shall be apportioned between the other
            Vendors in a form and manner that shall be determined in a notice to
            be given by the other Vendors to the Purchaser.

            AS WITNESS THE HANDS OF THE PARTIES:

 /s/ [ILLEGIBLE]                                              /s/ [ILLEGIBLE]
-----------------       -------------------------          ---------------------
 Ampal Israel Ltd.      Gmul Investment Co., Inc.          Amot Investments Ltd.

                          /s/ Robert F. Cotter
                        -------------------------
                              The Purchaser

I the undersigned, Robert L. Scott, Adv., hereby certify that on January 20,
1999 Mr. Robert Cotter signed this agreement in my presence on behalf of
Sheraton Intercontinental Ltd. (hereinafter, together with Koor Tourism Ltd.,
referred to as "The Purchaser") and that the signatures of Mr. Robert Cotter to
this agreement, together with the signature of the authorized representative of
Koor Tourism Ltd., collectively on the Purchaser's behalf, binds the Purchaser
for all intents and purposes.

/s/ Robert L. Scott
----------------------
Robert L. Scott, Adv.

20.1.99 [ILLEGIBLE TRANSLATION OF A HEBREW PARAGRAPH]

 [ILLEGIBLE - HEBREW]
 [ILLEGIBLE - HEBREW]
 [ILLEGIBLE - HEBREW]

   /s/ [ILLEGIBLE]
----------------------
 [ILLEGIBLE - HEBREW]

<PAGE>   21

                        PUT OPTION SIDE LETTER AGREEMENT

                              Dated: April 12, 1999

Further to an Agreement dated the 27th day of January, 1999, by and between
Ampal Israel Ltd. ("Ampal"), Amot Investments Ltd. ("Amot") and Gmul Investments
Company Ltd. ("Gmul"), (collectively, the "Vendors") of the one part, and
Sheraton Intercontinental Ltd. ("Sheraton") and Koor Tourism Ltd. ("Koor")
(jointly and severally, the "Purchasers"), of the other part (the "Main
Agreement").

WHEREAS the Purchasers entered into the First Closing SLA with Gmul (attached
hereto as Appendix A) and the Purchasers entered into the Second Closing SLA and
the Dividend Side Letter Agreement with Ampal and Amot (attached hereto as
Appendices B and C) (collectively the "Other SLAs"); and

WHEREAS the bifurcation of the Completion Date under the Main Agreement into the
First Closing and the Second Closing (as specified in the Other SLAs) was made
at Ampal's and Amot's request and the Purchasers have agreed thereto subject to
Ampal granting the Put Option as herein defined, so that in the event that the
First Closing is completed but the Second Closing is not completed, and if the
Purchasers exercise the Put Option, Ampal shall purchase the Gmul's Shares and
for all purposes Ampal shall be deemed to have purchased such Shares from Gmul
in accordance with Section 12.6 of the Main Agreement as if the First Closing
had never happened, and Ampal, Amot and the Purchasers shall have the same
rights and obligations as they would have had under the Main Agreement in the
event of such purchase under Section 12.6 of the Main Agreement and as if the
above bifurcation had never happened.

Now therefore the Parties have agreed:

1.    If, for reasons other than the acts or omissions of the Purchasers, the
      Second Closing is not completed as provided for in Section 2.2 of the
      Second Closing SLA, within fourteen days of the First Closing, Purchasers
      shall hold a put option against Ampal (the "Put Option") for the MHL
      shares purchased by the Purchasers from Gmul at the First Closing (the
      "Option Shares").

      1.1   The Put Option shall be in effect and exercisable as of the
            fifteenth day following the First Closing until the one hundred and
            twentieth day following the First Closing (the "Option Period").
            Delivery to Ampal during the Option Period of written notice from
            the Purchasers of the exercise of the Put Option (the "Notice")
            shall require Ampal to purchase the Option Shares for a
            consideration equal to the full consideration paid by the Purchasers
<PAGE>   22

                                       -2-


            to Gmul pursuant to Sections 8.2.1.3 and 8.2.2.3 of the Main
            Agreement (in US dollars), i.e. $16,302,934, less the US dollar
            equivalent of any dividends actually paid by MHL with respect to the
            Option Shares after the completion of the First Closing (the
            "Consideration"). The said US dollar equivalency shall be determined
            by the Bank of Israel representative rate in effect at the time of
            the payment of the said dividends by MHL.

      1.2   Ampal shall be required to pay to the Purchasers the Consideration
            within fourteen days of delivery of the Notice (the "Payment
            Period") but only if the Purchasers deliver to Ampal against such
            payment a share transfer deed with respect to all Option Shares, in
            the text annexed hereto as Appendix D, and a written confirmation by
            the person or entity registered as shareholder with respect to the
            Option Shares, confirming that upon payment of the Consideration
            Ampal is the beneficial owner of the Option Shares and all rights
            attached thereto, and that the Option Shares are registered in such
            person or entity's name as trustees for Ampal until they are
            registered in Ampal's name.

2.    In the event the Second Closing is not completed within forty-eight hours
      of the First Closing as a result of acts or omissions attributed to any
      third party ("Third Party"), the parties will cooperate fully in pursuing
      any claim against such Third Party.

3.    The provisions of this agreement do not prejudice, unless expressly stated
      herein, in any way existing legal and/or contractual rights of the parties
      hereto including, but not limited to, with respect to sale and purchase of
      Ampal's Shares and Amot's Shares (as defined in the Main Agreement) under
      the Main Agreement.

4.    If the Put Option is exercised, Ampal shall be deemed to have purchased
      from Gmul all the Gmul Shares (as defined in the Main Agreement) in
      accordance with Section 12.6 of the Main Agreement, together with all of
      Gmul's rights and obligations under the Main Agreement, as if the First
      Closing has never happened, so that if the purchase of the Ampal Shares
      (as defined in the Main Agreement) by the Purchasers and/or any of their
      affiliates will be completed by virtue or as a result of the Main
      Agreement, the Purchasers will purchase, simultaneously with the purchase
      of Ampal Shares (as defined in the Main Agreement), and as a condition to
      the purchase of the Ampal's Shares, all the Option Shares for an amount
      equal to the Consideration plus interest at an annual rate of LIBOR as of
      the date on which Ampal pays the Consideration to the Purchasers until the
      payment by the Purchasers to Ampal.

      The above does not reflect on the question of whether or not interest
      should accumulate on other payments made or due under the Main Agreement.
<PAGE>   23

                                       -3-


      Koor Industries Ltd.                                        AMPAL

      /s/ [ILLEGIBLE]                           /s/ [ILLEGIBLE]
      --------------------------                -----------------------


      SHERATON


      --------------------------
<PAGE>   24

                                      -3-


      Koor Industries Ltd.                                        AMPAL

      /s/ [ILLEGIBLE]                           /s/ [ILLEGIBLE]
      --------------------------                ------------------------


      SHERATON

      /s/ Robert F. Cotter
      --------------------------
      Robert F. Cotter

I confirm that Robert F. Cotter, by his above signature, is authorized to
represent Sheraton Intercontinental Ltd.


                                                /s/ Robert L. Scott
                                                --------------------------------
                                                Robert L. Scott
                                                General Counsel
                                                Sheraton Intercontinental Ltd.
<PAGE>   25

                         DIVIDEND SIDE LETTER AGREEMENT

                              Dated: April 12, 1999

Further to an Agreement dated the 27th day of January, 1999, by and between
Ampal Israel Ltd. ("Ampal"), Amot Investments Ltd. ("Amot") and Gmul Investments
Company Ltd. ("Gmul"), (collectively, the "Vendors") of the one part, and
Sheraton Intercontinental Ltd. ("Sheraton") and Koor Tourism Ltd. ("Koor")
(jointly and severally, the "Purchasers"), of the other part (the "Main
Agreement").

WHEREAS, in accordance with the Main Agreement, Ampal shall sell 783,778 shares
of Moriah Hotels Ltd. ("MHL") to the Purchasers ("Ampal's Shares") for
consideration in the amount of US$37,489,165, Amot shall sell 460,725 shares of
MHL to the Purchasers ("Amot's Shares") for consideration in the amount of
US$22,035,509, and Gmul shall sell 340,773 shares of MHL to the Purchasers
("Gmul's Shares") for consideration in the amount of US$16,302,934;

WHEREAS the Purchasers paid on January 27, 1999, to each of the Vendors as
required by the Main Agreement, their share of 20% of the consideration for the
shares of the Vendors in MHL;

WHEREAS the Purchasers entered into the First Closing SLA with Gmul (attached
hereto as Appendix A) and the Purchasers entered into the Second Closing SLA
with Ampal and Amot (attached hereto as Appendix B);

WHEREAS Ampal, Amot and the Purchasers have agreed to separate the closing of
the sale of Ampal's Shares and Amot's Shares (the "Second Closing" as specified
in the Second Closing SLA), from the closing of the sale of Gmul's Shares to the
Purchasers (the "First Closing" as specified in the First Closing SLA) so that
the Second Closing will take place no earlier than 24 hours and no later than 48
hours following the First Closing;

Now therefore the Parties have agreed:

1.    DIVIDEND DISTRIBUTION AFTER THE FIRST CLOSING

      1.1   The board of directors of MHL shall be convened immediately
            following the First Closing to discuss the distribution of dividends
            in the amount of NIS.69,000,000 (the "Dividends"). The Board will
            take note of the legal opinion of Prof. J. Gross, Hodak & Co. and
            the expert opinion of the independent auditors of MHL and shall
            decide whether MHL can distribute such dividends. If so decided by
            the board of directors of MHL, the Dividends shall be distributed to
            the shareholders in accordance with their pro rata shareholding in
<PAGE>   26

                                       -2-


            MHL. Thus if the Board will decide to distribute dividends in the
            total amount of NIS.69,000,000, such dividend will be distributed as
            follows:

            To Ampal - 46%, namely, NIS.31,740,000

            To Amot - 27.04%, namely, NIS.18,657,600

            To the Purchasers and to their Affiliates, to which the Gmul Shares
            will be transferred at the First Closing, in the total - 20%,
            namely, NIS.13,800,000

            To Hevrat Haovdim - 6.96%, namely, NIS.4,802,400.

      1.2   Since the Second Closing SLA requires implementation of the Second
            Closing within forty-eight hours of the First Closing, the Dividends
            shall be paid by MHL to the shareholders within twenty-four hours of
            the First Closing, by bank transfer to the said shareholders' bank
            accounts.

2.    REDUCTION OF CONSIDERATION

      2.1   In accordance with the provisions of Section 6.2(b) of the Main
            Agreement the US dollar equivalent of the portion of the Dividends
            which shall be distributed and actually paid by MHL to Ampal shall
            be deducted from the remainder of Ampal's Part of the Consideration,
            and the US dollar equivalent of the portion of the Dividends which
            shall be distributed and actually paid by MHL to Amot shall be
            deducted from the remainder of Amot's Part of the Consideration.

            2.1.1 Thus, it is agreed by the parties hereto that for purposes of
                  the Second Closing SLA, the dollar figure constituting the
                  term "Remaining Ampal Consideration" (Section 2.2 of the
                  second Closing SLA) shall be reduced by the US Dollar
                  equivalent of the portion of the Dividends actually paid to
                  Ampal and the dollar figure constituting the term "Remaining
                  Amot Consideration" (Section 2.2 of the second Closing SLA)
                  shall be reduced by the US Dollar equivalent of the portion of
                  the Dividends actually paid to Amot.

            2.1.2 Also for the avoidance of doubt, the unconditional
                  confirmation included in the Bank Documentation (as defined in
                  Section 2.3 of the Second Closing SLA) shall confirm without
                  any reservation the payment to Ampal and Amot of the Remaining
                  Ampal Consideration and of the Remaining Amot Consideration
                  (as defined in Section 2.2 of the Second Closing SLA), as
                  reduced by the portion of the Dividend actually paid to Ampal
                  and Amot respectively as provided hereunder, and the Trustees
                  are hereby instructed accordingly.
<PAGE>   27

                                       -3-


      2.2   For purposes of calculating the US dollar equivalent of the said
            portions of the Dividends, the Bank of Israel's representative rate
            in effect at the time of the bank transfer of the said portions of
            the Dividends to Ampal's and Amot's accounts shall apply.

      3.    The Purchasers undertake to convene a general meeting of the
            shareholders of MHL, no later than 30.6.99, for the purpose of
            approving the dividends to be distributed as provided above as final
            dividends for the periods ending 31.12.98, and to vote in favor of
            such approval. The Purchasers will provide Ampal and Amot with a
            copy of the minutes of such meeting.

      4.    In this side letter agreement each of the terms defined in the Main
            Agreement shall have the same meaning ascribed to it therein.


      Koor Industries Ltd.                                            AMPAL

      /s/ [ILLEGIBLE]                           /s/ [ILLEGIBLE]
      -----------------------------             ---------------------------

      SHERATON                                                         AMOT

                                                /s/ [ILLEGIBLE]
      -----------------------------             ---------------------------

APPENDICES

Appendix A: The First Closing SLA

Appendix B: The Second Closing SLA
<PAGE>   28

                                       -3-


      2.2   For purposes of calculating the US dollar equivalent of the said
            portions of the Dividends, the Bank of Israel's representative rate
            in effect at the time of the bank transfer of the said portions of
            the Dividends to Ampal's and Amot's accounts shall apply.

      3.    The Purchasers undertake to convene a general meeting of the
            shareholders of MHL, no later than 30.6.99, for the purpose of
            approving the dividends to be distributed as provided above as final
            dividends for the periods ending 31.12.98, and to vote in favor of
            such approval. The Purchasers will provide Ampal and Amot with a
            copy of the minutes of such meeting.

      4.    In this side letter agreement each of the terms defined in the Main
            Agreement shall have the same meaning ascribed to it therein.


      Koor Industries Ltd.                                            AMPAL

      /s/ [ILLEGIBLE]                           /s/ [ILLEGIBLE]
      -----------------------------             ---------------------------

      SHERATON                                                         AMOT

      /s/ Robert F. Cotter                      /s/ [ILLEGIBLE]
      -----------------------------             ---------------------------

      I confirm that Robert F. Cotter, by his above signature, is authorized to
      represent Sheraton Intercontinental Ltd.

                                                /s/ Robert L. Scott
                                                ---------------------------
                                                Robert L. Scott
                                                General Counsel,
                                                Sheraton Intercontinental Ltd.

APPENDICES

Appendix A: The First Closing SLA

Appendix B: The Second Closing SLA
<PAGE>   29

                   Side Letter Agreement on the First Closing
                     (hereinafter, the "First Closing SLA")

                              Dated: April 12, 1999

Further to an Agreement dated the 27th day of January, 1999, by and between
Ampal Israel Ltd. ("Ampal"), Amot Investments Ltd. ("Amot") and Gmul Investments
Company Ltd. ("Gmul"), (collectively, the "Vendors") of the one part, and
Sheraton Intercontinental Ltd. (hereinafter, "Sheraton") and Koor Tourism Ltd.
(hereinafter, "Koor") (jointly and severally, the "Purchasers"), of the other
part (hereinafter the "Main Agreement").

Whereas, in accordance with the Main Agreement, Ampal shall sell 783,778 shares
of Moriah Hotels Ltd. ("MHL") to the Purchasers ("Ampal's Shares") for
consideration in the amount of US$37,489,165, Amot shall sell 460,725 shares of
MHL to the Purchasers ("Amot's Shares") for consideration in the amount of
US$22,035,509, and Gmul shall sell 340,773 shares of MHL to the Purchasers
("Gmul's Shares") for consideration in the amount of US$16,302,934;

Whereas the Purchasers paid on January 27, 1999, to each of the Vendors as
required by the Main Agreement, their share of 20% of the consideration for the
shares of the Vendors in MHL; and

Whereas Ampal, Amot and the Purchasers have agreed to separate the closing of
the sale of Ampal's Shares and Amot's Shares (the "Second Closing"), from the
closing of the sale of Gmul's Shares to the Purchasers (the "First Closing") so
that the Second Closing will take place no earlier than 24 hours and no later
than 48 hours following the First Closing.

NOW THEREFORE THE PARTIES AGREE:

1.    Gmul and the Purchasers hereby agree that Gmul's Shares shall be sold at
      the First Closing.

2.    For purposes of the First Closing and pursuant to Section 7(d) of the Main
      Agreement, Gmul shall deliver minutes of the board of directors of MHL in
      the form of Appendix C-1 hereto, instead of delivering minutes in the form
      of Appendix C of the Main Agreement.

3.    The Purchasers shall have the right to execute the acts required of them,
      in the Main Agreement and in this First Closing SLA, through either of the
      Purchasers and/or any of their affiliates or together in any proportion
      the Purchasers deem fit. In light thereof, the share transfer deeds
      attached as Appendix B3 to the Main Agreement shall be delivered to the
      Purchasers such that
<PAGE>   30

                                      -2-


      the Purchasers shall be able to fix in writing on the said deed the names
      of the transferees and distribution of Gmul's Shares among them in any
      proportion the Purchasers deem fit.

4.    Gmul confirms that it is aware of the Second Closing SLA and has no
      objection thereto.

5.    This First Closing SLA constitutes an integral part of the Main Agreement
      and shall be read and interpreted as an integral part thereof.


      Koor Industries Ltd.           SHERATON                               GMUL

      /s/ [ILLEGIBLE]                                       /s/ [ILLEGIBLE]
      ---------------------      --------------------       --------------------

APPENDICES

Appendix C-1: Resolution of the Board of Directors regarding transfer of Gmul's
Shares
<PAGE>   31

                                      -2-


      the Purchasers shall be able to fix in writing on the said deed the names
      of the transferees and distribution of Gmul's Shares among them in any
      proportion the Purchasers deem fit.

4.    Gmul confirms that it is aware of the Second Closing SLA and has no
      objection thereto.

5.    This First Closing SLA constitutes an integral part of the Main Agreement
      and shall be read and interpreted as an integral part thereof.


      Koor Industries Ltd.           SHERATON                               GMUL

      /s/ [ILLEGIBLE]            /s/ Robert F. Cotter       /s/ [ILLEGIBLE]
      ---------------------      --------------------       --------------------

      I confirm that Sheraton Intercontinental Ltd. is duly represented by
Robert F. Cotter, who has signed above on behalf of the Company.

                                           /s/ Robert L. Scott
                                           ----------------------------------
                                           Robert L. Scott
                                           General Counsel,
                                           Sheraton Intercontinental Ltd.

APPENDICES

Appendix C-1: Resolution of the Board of Directors regarding transfer of Gmul's
Shares
<PAGE>   32

                   Side Letter Agreement on the Second Closing
                           (the "Second Closing SLA")

                              Dated: April 12, 1999

Further to an Agreement dated the 27th day of January, 1999, by and between
Ampal Israel Ltd. ("Ampal"), Amot Investments Ltd. ("Amot") and Gmul Investments
Company Ltd. ("Gmul"), (collectively, the "Vendors") of the one part, and
Sheraton Intercontinental Ltd. ("Sheraton") and Koor Tourism Ltd. ("Koor")
(jointly and severally, the "Purchasers"), of the other part (the "Main
Agreement").

Whereas, in accordance with the Main Agreement, Ampal shall sell 783,778 shares
of Moriah Hotels Ltd. ("MHL") to the Purchasers ("Ampal's Shares") for
consideration in the amount of US$37,489,165, Amot shall sell 460,725 shares of
MHL to the Purchasers ("Amot's Shares") for consideration in the amount of
US$22,035,509, and Gmul shall sell 340,773 shares of MHL, to the Purchasers
("Gmul's Shares") for consideration in the amount of US$16,302,934;

Whereas the Purchasers paid on January 27, 1999, to each of the Vendors as
required by the Main Agreement, their share of 20% of the consideration for the
shares of the Vendors in MHL; and

Whereas Ampal, Amot and the Purchasers have agreed to separate the closing of
the sale of Ampal's Shares and Amot's Shares (the "Second Closing"), from the
closing of the sale of Gmul's Shares to the Purchasers (the "First Closing", as
specified in the First Closing SLA attached here as Appendix A) so that the
Second Closing will take place no earlier than 24 hours and no later than 48
hours following the First Closing.

1.    In this Second Closing SLA, each of the terms defined in the Main
      Agreement shall have the same meaning ascribed to it therein.

2.    The transfer of the Sold Shares and payment of the Second Installment
      shall be carried out in two (2) stages as follows:

      2.1   In the First Closing, the Purchaser shall pay Gmul the remainder of
            Gmul's Part of the Consideration (80% [eighty percent] of Gmul's
            Part of the Consideration) against delivery to the Purchaser of a
            share transfer deed in the text annexed to the Main Agreement as
            Appendix B3 and as stipulated in Section 3 of the First Closing SLA,
            and the Minutes of MHL's Board of Directors approving the transfer
            of the Gmul Shares in the text annexed hereto and marked "Appendix
            C-1".
<PAGE>   33

                                       -2-


      2.2   In the Second Closing, the Purchaser shall pay to Ampal the
            remainder of Ampal's Part of the Consideration, namely, $29,991,332
            (hereinafter - the "Remaining Ampal Consideration") and to Amot the
            remainder of Amot's Part of the Consideration, namely, $17,628,407
            (hereinafter - the "Remaining Amot Consideration") against delivery
            to the Purchaser of the Minutes of the Company's Board of Directors
            approving the transfer of Ampal's Shares and Amot's Shares to the
            Purchaser in the text annexed hereto and marked "Appendix C-2".

      2.3   Upon paying the Remaining Ampal Consideration and the Remaining Amot
            consideration, the Purchasers shall deliver to the Trustees (as
            hereinafter defined) documents signed by either Bank Hapoalim Ltd.
            confirming, without any reservation, the payment of the Remaining
            Ampal Consideration to Ampal's Account No.277002 in Bank Hapoalim
            Ltd. Arlozorov Branch, and of the Remaining Amot Consideration to
            Amot's Account No.44670 in Bank Hapoalim Ltd. Hameasfim Branch (the
            "Bank Documentation").

3.    Upon execution of this Second Closing SLA, Ampal and Amot shall deliver to
      Muriel Matalon, Adv. and Zvi Firon, Adv. (the "Trustees") in trust the
      following documentation:

      3.1   Share transfer deeds (the "Deeds") attached as Appendices B1* and B2
            to the Main Agreement. The Deeds shall be delivered so that if and
            when such deeds of transfer are delivered to the Purchasers by the
            Trustees in accordance with this Section 3, the Purchasers shall be
            able to fix in writing on the Deeds the distribution of Ampal's
            Shares and Amot's Shares to either of the Purchasers and/or any of
            their affiliates in any proportion the Purchasers deem fit.

            *the serial numbers recited for Ampal's Shares in the English
            language Appendix B1 are short by around 550,000 Shares of the total
            of 783,778 Shares to be transferred. The Hebrew version is correct.

      3.2   Letters of resignation from the Board of Directors of MHL of the
            following directors: Daniel Steinmetz, Raz Steinmetz, Yehoshua
            Gleitman, Yoseph Steinman, Eli Wagner, Haim Kimche, Zamir Sofer,
            BenAmi Zukerman and Zvi Fichman, to become effective only upon
            delivery thereof, if at all, to MHL.

      The parties hereby instruct the Trustees, and the Trustees hereby
      undertake to fulfill the following instructions:

      If the Trustees have received:
<PAGE>   34

                                       -3-


      (a)   a written confirmation signed by Ampal and Amot confirming that they
            have received all the consideration due to them under the Main
            Agreement (the "Confirmation"); or

      (b)   The Bank Documentation.

      Then, and only then, will the Trustees transfer the Deeds and the said
      letters of resignation to the Purchasers.

      If the Trustees do not receive either the Confirmation or the Bank
      Documentation within fourteen days of the date of First Closing, the
      Trustees shall return the Deeds and the said letters of resignation to
      Ampal and Amot.

4.    The Purchasers shall have the right to execute the acts required of them,
      in the Main Agreement and in this Second closing SLA, through either of
      the Purchasers and/or any of their affiliates or together in any
      proportion the Purchasers deem fit.

5.    All the terms of the Main Agreement with respect to the Completion Date
      will apply with the respect to both the First Closing and the Second
      Closing, and whenever the term Completion Date is referred to, it shall
      mean the First closing and the Second Closing, or either of them, as
      appropriate. To avoid doubt, for the purpose of Section 9 of the Main
      Agreement - the Completion Date shall mean the date of the completion of
      the Second Closing.

6.    To avoid doubt:

      6.1   The acts referred to in Sections 7(c) and 8.2.2.3 of the Main
            Agreement shall be performed on the First Closing.

      6.2   The Interim Period is the period between the date of the Main
            Agreement and the Second Closing.

      6.3   Appendix C to the Main Agreement is hereby replaced by Appendices
            C-1 and C-2 annexed hereto. Appendix C-1 shall be delivered to the
            PURCHASER on the First Closing, and Appendix C-2 shall be delivered
            to the PURCHASER on the Second Closing and the provisions of Section
            7(d) to the Main Agreement are amended accordingly.

7.    Between the First Closing and the Second Closing, Koor, Sheraton, Ampal
      and Amot shall make their best effort to prevent the taking of any
      decisions and/or acts by MHL which are not in the ordinary course of
      business. The act and decisions required under the Main Agreement, the
      First Closing SLA, this Second Closing SLA and/or any other written
      agreement between the above parties shall constitute exceptions to the
      aforesaid prohibition.
<PAGE>   35

                                      -4-


8.    All other terms and conditions of the Main Agreement remain unchanged, and
      the terms of this Second Closing SLA do not prejudice, unless expressly
      stated herein, in any way existing legal and/or contractual rights of the
      parties hereto.

9.    This Second Closing SLA constitutes an integral part of the Main Agreement
      and shall be read and interpreted as an integral part thereof.


      Koor Industries Ltd.                                                 AMPAL

      /s/ [ILLEGIBLE]                              /s/ [ILLEGIBLE]
      --------------------------                   -----------------------------


      SHERATON                                                              AMOT

                                                   /s/ [ILLEGIBLE]
      --------------------------                   -----------------------------

APPENDICES

Appendix A: The First Closing SLA

Appendix C-1: Resolution of Board of Directors approving transfer of Gmul's
              Shares

Appendix C-2: Resolution of Board of Directors approving transfer of Ampal's
              Shares and Amot's Shares

We hereby agree to act in accordance with the instructions in Section 3 of this
Second Closing SLA.

      -------------------------                    -----------------------------
      Muriel Matalon                                                   Zvi Firon
<PAGE>   36

                                      -4-


8.    All other terms and conditions of the Main Agreement remain unchanged, and
      the terms of this Second Closing SLA do not prejudice, unless expressly
      stated herein, in any way existing legal and/or contractual rights of the
      parties hereto.

9.    This Second Closing SLA constitutes an integral part of the Main Agreement
      and shall be read and interpreted as an integral part thereof.


      Koor Industries Ltd.                                                 AMPAL

      /s/ [ILLEGIBLE]                             /s/ [ILLEGIBLE]
      --------------------------                  ------------------------------


      SHERATON                                                              AMOT

      /s/ Robert F. Cotter                        /s/ [ILLEGIBLE]
      --------------------------                  ------------------------------

      I confirm that Robert F. Cotter is authorized to sign on behalf of
Sheraton Intercontinental Ltd.

                                                  Robert L. Scott
                                                  General Counsel, 
                                                  Sheraton Intercontinental Ltd.

APPENDICES

Appendix A: The First Closing SLA

Appendix C-1: Resolution of Board of Directors approving transfer of Gmul's
              Shares

Appendix C-2: Resolution of Board of Directors approving transfer of Ampal's
              Shares and Amot's Shares

We hereby agree to act in accordance with the instructions in Section 3 of this
Second Closing SLA.


      -------------------------                   ------------------------------
      Muriel Matalon                                                   Zvi Firon
<PAGE>   37

April 12, 1999

Ampal (Israel) Ltd.

Amot Investments Ltd.

Gmul Investments Company Ltd.

Gentlemen,

                  Re: Sale of Holdings in Moriah Hotels Ltd.

Further to the agreement dated 27.1.99 (hereinafter "the Agreement") for the
sale of your holdings in Moriah Hotels Ltd. (hereinafter "the Company"), we
hereby confirm as follows:

In all matters concerning authorizations of the Company and other companies of
the Moriah group, that were given to you as set out in Sections 4.4 and 6.2(c)
of the Agreement, we or the Company or another company in the Moriah group will
not have any claim against you emanating from the change in identity of the
purchasers of your holdings in the Company.

                                   Sincerely yours,

Koor Industries Ltd.

/s/ [ILLEGIBLE]              /s/ [ILLEGIBLE]
-------------------------    -------------------  ------------------------------
Koor Industries Ltd.         Koor Tourism Ltd.    Sheraton Intercontinental Ltd.

Authorization

I, the undersigned, Muriel Matalon, attorney of Koor Industries Ltd., Koor
Tourism Ltd., and Sheraton International Ltd. (hereinafter "my Clients") hereby
confirm that the above signatures are binding on my Clients in everything
connected with this document or emanating herefrom.


                                                  ------------------------------
                                                  Muriel Matalon, Adv.
<PAGE>   38

April 12, 1999

Ampal (Israel) Ltd.

Amot Investments Ltd.

Gmul Investments Company Ltd.

Gentlemen,

                  Re: Sale of Holdings in Moriah Hotels Ltd.

Further to the agreement dated 27.1.99 (hereinafter "the Agreement") for the
sale of your holdings in Moriah Hotels Ltd. (hereinafter "the Company"), we
hereby confirm as follows:

In all matters concerning authorizations of the Company and other companies of
the Moriah group, that were given to you as set out in Sections 4.4 and 6.2(c)
of the Agreement, we or the Company or another company in the Moriah group will
not have any claim against you emanating from the change in identity of the
purchasers of your holdings in the Company.

                                   Sincerely yours,

Koor Industries Ltd.

/s/ [ILLEGIBLE]              /s/ [ILLEGIBLE]      /s/ Robert F. Cotter
-------------------------    -------------------  ------------------------------
Koor Industries Ltd.         Koor Tourism Ltd.    Sheraton Intercontinental Ltd.

Authorization

I, the undersigned, Muriel Matalon, attorney of Koor Industries Ltd., Koor
Tourism Ltd., and Sheraton International Ltd. (hereinafter "my Clients") hereby
confirm that the above signatures are binding on my Clients in everything
connected with this document or emanating herefrom.


                                                  ------------------------------
                                                  Muriel Matalon, Adv.