Document:

FOR IMMEDIATE
RELEASE

     

    Magal  Announces
That It Will Seek Shareholder Approval For A Rights Offering To Its

    Shareholders
At An  Extraordinary General Meeting  At Which Dissident
Shareholder

    Proposals
Will Also Be Voted On

     

    YAHUD, ISRAEL, July 1, 2010 — Magal
Security Systems Ltd. (NASDAQ GMS: MAGS, TASE: MAGS) today announced that
an Extraordinary Meeting of its shareholders will be held on August 12, 2010 at
10AM in the Company's offices in Yehud, Israel. As requested by certain
shareholders, the agenda of the meeting will include their demand that an
election take place to replace all of the current board members other than Mr.
Nathan Kirsh and the Company’s two outside directors that are appointed in
accordance with Israeli law, by a slate of directors proposed by such
shareholders.  The Company’s Board of Directors recommends that
shareholders vote "AGAINST" the proposals of the dissident shareholders. Should
the proposals raised by the dissident shareholders be rejected, the Company’s
shareholders will be asked to approve a transaction with Mr. Kirsh under which
he will provide a bridge loan to the Company, purchase shares in a private
placement and participate in an approximately $15
million rights offering of the Company's shares to be made to all of the
Company’s shareholders..

     

    The
record date of this Meeting is July 7, 2010. Notice of this meeting as well as
proxy statements will be published on or about July 8, 2010.

     

    This
press release does not constitute an offer to sell or the solicitation of offers
to buy any securities of Magal Security Systems Ltd. and shall not constitute an
offer, solicitation or sale of any security in any state or jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such state or
jurisdiction

     

    About Magal
S3

     

    Magal S3
is a leading international provider of security, safety and site management
solutions and products (NASDAQ: MAGS).

     

    Over the
past 40 years, Magal S3 has delivered tailor-made solutions to hundreds of
satisfied customers in over 80 countries.

     

    Magal S3
offers a broad portfolio of unique products used to protect sensitive
installations in some of the world’s most demanding locations and harshest
climates. This portfolio covers the following three categories:

     

    
      	
              ·

            	
              Perimeter Intrusion Detection
      Systems (PIDS) - a variety of smart barriers and fences, fence
      mounted detectors, virtual gates, buried and concealed detection
      systems

            

    

    

    
      	
              ·

            	
              Close Circuit TV (CCTV)
      – a comprehensive management platform with a leading Intelligent Video
      Analysis (IVA) and Video Motion Detection (VMD)
  engine

            

    

    

    
      
        
          	
                  P.O.Box
      70, Yahud, Industrial Zone 56100, Israel.

                	
                  Tel:
      972-3-5391444     Fax:
    972-3-5366245

                
	
                  E-MAIL:
      magalssl@trendline.co.il

                	
                  Web Site:
      http://www.magal-s3.com

                

        

      

    
 

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      

    

    

    
      	
              ·

            	
              Physical Security Information
      Management (PSIM) - a proprietary site management system that
      enhances command, control and decision making during both routine
      operations and crisis situations

            

    

    

    This
press release contains forward-looking statements, which are subject to risks
and uncertainties. Such statements are based on assumptions and expectations
which may not be realized and are inherently subject to risks and uncertainties,
many of which cannot be predicted with accuracy and some of which might not even
be anticipated. Future events and actual results, financial and otherwise, may
differ from the results discussed in the forward-looking statements. A number of
these risks and other factors that might cause differences, some of which could
be material, along with additional discussion of forward- looking statements,
are set forth in the Company's Annual Report on Form 20-F filed with the
Securities and Exchange Commission.

     

    
      
        	
                For more
      information:

              	
                Financial
      Communication Public & Investor

              
	 
      	
                Relations

              
	 
      	 
      
	
                Magal
      Security Systems Ltd.

              	
                Hadas
      Friedman

              
	
                Ilan
      Ovadia, CFO

              	
                Tel:
      +972-3-695-4333 Ext. 6

              
	
                Tel:
      +972 (3) 539-1444

              	
                E-mail:
      hadas@fincom.co.il

              
	
                E-mail:
      ilano@magal-s3.com

              	
                Web:
      www.fincom.co.il

              
	
                Web:
      www.magal-s3.com

              	 
      

      

    

    

    
      
        
          	
                  P.O.Box
      70, Yahud, Industrial Zone 56100, Israel.

                	
                  Tel:
      972-3-5391444     Fax:
    972-3-5366245

                
	
                  E-MAIL:
      magalssl@trendline.co.il

                	
                  Web Site:
      http://www.magal-s3.comPROMISSORY
NOTE

    

    
      
        	
                $___________

              	
                New
      York, New York

              
	 
      	
                June
      30, 2010

              

      

    

    

    THIS
PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY
STATE SECURITIES LAWS.  IT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED
OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH
RESPECT TO THIS PROMISSORY NOTE UNDER THE SECURITIES ACT OF 1933 AND
QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF COUNSEL
SATISFACTORY TO THE BORROWER THAT SUCH REGISTRATION IS NOT
REQUIRED.

    

    Florham
Consulting Corp. ("Borrower"), a Delaware Corporation whose address is 845 Third
Avenue, 6th Floor,
New York, NY 10022 for value received, hereby promises to pay to the order of
___________ (“___________”), whose address is ___________ the sum of ___________
($___________), or such lesser amount as shall then equal the outstanding
principal amount hereof, on September 30, 2010 (such date, or such earlier date
upon which the principal and interest is due upon acceleration pursuant to
Section 3 hereof, hereinafter referred to as the "Due Date") and to pay interest
from the date hereof on the unpaid principal amount hereof at the rate set forth
below, all on the terms and conditions set forth herein.  Payment for
all amounts due hereunder shall be made in lawful money of the United States of
America by certified mail, return receipt requested, or by hand or by overnight
mail to the address of the Holder (as hereinafter defined) or by wire transfer
to an account designated in writing by the Holder.

    

    The
following is a statement of the rights of the Holder of this Note and the
conditions to which this Note is subject, and to which the Holder hereof, by the
acceptance of this Note, agrees:

    

    1.  Definitions.  As
used in this Note, the term "Holder" shall mean ___________ or any subsequent
holder of this Note.

    

    2.  Interest.  Interest
shall accrue from the date hereof until all outstanding principal and interest
on this Note shall have been paid in full at the rate of thirteen and one-half
(13.5%)  percent per annum on the unpaid principal balance hereof and
shall be payable on the Due Date or the date of any other payment of principal
on this Note.  In the event that the principal amount of this Note is
not paid in full on the Due Date, interest at the rate equal to the lesser of
(i) the maximum legally permitted interest rate and (ii) eighteen percent (18%)
per annum shall accrue on the balance of any unpaid principal and accrued
interest from the Due Date until such balance is paid.

    

    3.  Events of
Default.  If any of the events specified in this Section 3
shall occur (herein individually referred to as an "Event of
Default"):

    

    (i)
Default in payment of principal or interest under this Note when
due;

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    

    (ii) The
occurrence of an event of default under any other obligation owed by the
Borrower to the Holder;

    

    (iii) A
material default by the Borrower in any obligation, or breach by the Borrower of
any representation, warranty, covenant or agreement, set forth in any other
document signed by the Borrower in connection with the issuance of this Note
which is not cured or cannot be cured by the Borrower within ten (10) days after
the Holder has given the Borrower written notice of such default;

    

    (iv) Any
default of the Borrower under any indebtedness or other obligations which
aggregate at least $50,000 if such default is not cured by the Borrower before
the earlier of (1) ten (10) days after the Holder has given the Borrower written
notice of such default or (2) the obligee of such indebtedness or other
obligation has made demand or notified the Borrower of any acceleration and in
either case, any cure period has lapsed; or

    

    (v) The
rendering of one or more judgments or orders against the Borrower for the
payment of money exceeding any applicable insurance coverage by more than
$50,000 in the aggregate, and either (1) enforcement proceedings shall have been
commenced by any creditor upon any such judgment or order, or (2) there shall be
any period of 30 consecutive days during which a stay of enforcement of any such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or

    

    (vi) The
institution by the Borrower of proceedings to be adjudicated as bankrupt or
insolvent, or the consent by it to the institution of bankruptcy or insolvency
proceedings against it or the filing by it of a petition or answer or consent
seeking reorganization or release under the federal Bankruptcy Code, or any
other applicable federal or state law, or the consent by it to the filing of any
such petition or the appointment of a receiver, liquidator, assignee, trustee or
other similar official for all or any substantial part of its property or the
taking of any action by it in furtherance of any such action; or

    

    (vii) If,
within sixty (60) days after the commencement of an action against the Borrower
seeking any bankruptcy, insolvency, reorganization, liquidation or similar
relief under any present or future statute, law or regulation, such action shall
not have been resolved in favor of the Borrower or all orders or proceedings
thereunder affecting the property of the Borrower stayed, or if the stay of any
such order or proceeding shall thereafter be set aside, or if, within sixty (60)
days after the appointment without the consent or acquiescence of the Borrower
of any trustee or receiver for all or any substantial part of its property such
appointment shall not have been vacated;

    

    then,
with the exception of an Event of Default specified in clauses (vi) or (vii)
above, the Holder of this Note may, by notice to the Borrower, declare the
principal of this Note, all interest thereon and all other amounts payable
hereunder to be immediately due and payable, without presentment, demand,
protest or other notice of any kind, all of which are hereby expressly waived by
the Borrower, whereupon the principal amount of this Note, all such interest and
all such amounts shall become and be immediately due and payable, and exercise
any and all of its other rights under applicable law hereunder.

    
      
         

      

      
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    Upon the
occurrence of an Event of Default specified in clauses (vi) or (vii) above, the
principal amount of this Note, all interest thereon and all other amounts
payable hereunder shall thereupon and concurrently therewith become due and
payable, all without any action by the Holder of this Note, and without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrower, anything in this Note to the contrary
notwithstanding.

    

    4.  Representations and
Warranties and Covenants.  The Borrower represents and warrants
to the Holder that:  (i) this Note is a legal, valid and binding
agreement of the Borrower, enforceable against the Borrower in accordance with
its terms; and (ii) the execution and delivery by the Borrower of this Note and
the performance by the Borrower of the transactions contemplated hereby do not
and will not conflict with, or result in a breach of, or constitute a default
under, the Certificate of Incorporation bylaws of the Borrower or under any
agreement to which the Borrower is a party or to which the Borrower may be bound
or affected.  The Borrower covenants that the proceeds of the loan
represented by this Note shall be used for its working capital
purpose.

    

    5.  Waiver of Presentation,
Demand, Etc.  All parties now or hereafter liable with respect
to this Note, whether Borrower, guarantor, endorser or any other person hereby
expressly waive presentment, demand of payment, protest, notice for demand of
payment, protest and notice of non-payment, or any other notice of any kind with
respect thereto.  No delay or failure on the part of the Holder in the
exercise of any right or remedy hereunder or at law or in equity, shall operate
as a waiver thereof, and no single or partial exercise by the Holder of any
right or remedy hereunder shall preclude or estop another or further exercise or
any other right or remedy.

    

    6.  Defenses, Set-Offs,
Counterclaims.  The Borrower hereby agrees not to raise or
interpose any defense, set-off or counterclaim of any kind or nature whatsoever
it may have against the Holder in any action brought upon this Note and Borrower
acknowledges that it has no defense of any kind or nature to the enforcement of
this Note or to the binding nature of the obligations represented
hereby.

    

    7.  Amendments.  No
amendment, modification, alteration or change of any of the provisions of this
Note shall be effective unless in writing signed by the Borrower and the Holder
and only to the extent therein set forth.

    

    8.  Governing Law;
Jurisdiction.  This Agreement shall be governed by and
construed in accordance with the laws of the State of New York excluding the
body of law relating to conflict laws.  The Borrower hereby
irrevocably and unconditionally consents to the exclusive jurisdiction of the
courts located in New York County, New York in connection with any action or
proceedings relating to this Note or the transactions contemplated
hereby.

    

    9.  Time of the
Essence.  Time is of the essence of this Note and in case this
Note is collected by law or through an attorney at law or under advice
therefrom, the Borrower agrees to pay all costs of collection including
reasonable attorneys' fees.  The Holder shall be under no duty to
exercise any or all of the rights and remedies given by this Note and no party
to this instrument shall be discharged from the obligations or undertakings
hereunder (a) should the Holder release or agree not to sue any person against
whom the party has, to the knowledge of Holder, a right to recourse, or (b)
should the Holder agree to suspend the right to enforce this Note against such
person or otherwise discharge such person.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    10.  Severability.  In
the event that any term or provision of this Note shall be finally determined to
be superseded, invalid, illegal or otherwise unenforceable pursuant to
applicable law by any authority having jurisdiction, such determination shall
not impair or otherwise affect the validity, legality or enforceability of the
remaining terms and provisions of this Note, which shall be enforced as if the
unenforceable term or provision were deleted.

    

    11.  Consent to Service and
Waiver of Jury Trial.  The Borrower hereby consents to service
of any notice, process, motion or other document in connection with any lawsuit
or other proceeding arising out of or relating to this Note, by registered mail,
return receipt requested, to its address set forth herein or such other address
as the Borrower shall provide Holder in writing and the Borrower hereby waives
any right to trial by jury in any such lawsuit or proceeding.

    

    12.  Successors and
Assigns.  The Note shall be binding upon the Borrower and its
successors and assigns and shall inure to the benefit of the Holder and its
successors and assigns.

    

    13.  Facsimile and pdf
Signatures.  Facsimile and pdf signatures hereto shall have the
same validity as original signatures hereto.

    

    IN
WITNESS WHEREOF, the undersigned has caused this Note to be issued as of the
30th
day of June 2010.

    

    
      
        
          
            	
                    FLORHAM
      CONSULTING CORP.

                  
	 
      	 
      
	
                    By:

                  	 
      
	 
      	
                    Joseph
      J. Bianco

                  
	 
      	
                    Chief
      Executive Officer

                  

          

        

      

    

    
      
      

    

     

    
      
        
        

      

      
        4

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