CERAGON NETWORKS LTD.
(Translation of registrant’s name into English)
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3 Uri Ariav st., Rosh Ha’Ayin, Israel, 4810002
(Address of principal executive offices)
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CERAGON NETWORKS LTD.
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Date: April 18, 2024
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By: /s/ Ronen Stein
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Name: Ronen Stein
Title: Chief Financial Officer |
Exhibit
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Description
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1. |
To re-elect each of Ilan Rosen, Efrat Makov, Yael Shaham, Shlomo Liran, Rami Hadar and David Ripstein, and to elect Robert Wadsworth, to serve on the Board of Directors of the Company (the “Board”)
for a term of approximately three (3) years ending on the date of the annual general meeting that will be held in 2027;
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2. |
To approve certain compensation terms of the Company’s non-executive directors, including the grant of equity consideration, all, as part of their compensation for service as such;
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3. |
To approve certain compensation terms for the Company’s Chief Executive Officer;
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4. |
To approve amendments to the Company's Articles of Association, including without limitations, to increase the share capital of the Company to Two Million Four Hundred Thousand New Israeli Shekels (NIS 2,400,000) divided into Two Hundred
and Forty Million (240,000,000) Ordinary Shares of a nominal value of One Agora (NIS 0.01) each;
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5. |
To approve the Company’s 2024 Equity Incentive Plan; and
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6. |
To re-appoint Kost Forer Gabbay & Kasierer, A Member of EY Global, as the Company’s independent auditor for the fiscal year ending December 31, 2024 and for the year commencing January 1, 2025 and until immediately following the next
annual general meeting of shareholders, and to authorize the Board (with power of delegation to its Financial Audit Committee), to set the annual compensation of the independent auditor in accordance with the volume and nature of its
services.
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1. |
To re-elect each of Ilan Rosen, Efrat Makov, Yael Shaham, Shlomo Liran, Rami Hadar and David Ripstein, and to elect Robert Wadsworth, to serve on the Board of Directors of the Company (the “Board”)
for a term of approximately three (3) years ending on the date of the annual general meeting that will be held in 2027;
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2. |
To approve certain compensation terms of the Company’s non-executive directors, including the grant of equity consideration, all, as part of their compensation for service as such;
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3. |
To approve certain compensation terms for the Company’s Chief Executive Officer;
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4. |
To approve amendments to the Company's Articles of Association, including without limitations, to increase the share capital of the Company to Two Million Four Hundred Thousand New Israeli Shekels (NIS 2,400,000) divided into Two
Hundred and Forty Million (240,000,000) Ordinary Shares of a nominal value of One Agora (NIS 0.01) each;
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5. |
To approve the Company’s 2024 Equity Incentive Plan; and
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6. |
To re-appoint Kost Forer Gabbay & Kasierer, A Member of EY Global, as the Company’s independent auditor for the fiscal year ending December 31, 2024 and for the year commencing January 1, 2025 and until immediately following the
next annual general meeting of shareholders, and to authorize the Board (with power of delegation to its Financial Audit Committee), to set the annual compensation of the independent auditor in accordance with the volume and nature of its
services.
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1 |
The term “Office Holder” as defined in the Companies Law includes a director, the chief executive officer, the chief business officer, the vice chief executive officer, the deputy chief executive officer, any other person fulfilling or
assuming any of the foregoing positions without regard to such person's title, and any manager who is directly subordinated to the chief executive officer.
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Name of Beneficial Owner
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Number of Ordinary Shares Beneficially Owned
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Percentage of Ordinary Shares Beneficially Owned (1)
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Greater than 5% Shareholders
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Zohar Zisapel Estate (2)
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7,117,174
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9.67%
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Joseph D. Samberg (3)
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8,280,000
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8.31%
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Office Holders
All Office Holders as a group consisting of 16 people (4)
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1,661,727
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1.94%
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(1)
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Based on 85,640,591 Ordinary Shares issued and outstanding as of April 16, 2024 (this amount does not include 3,481,523 ordinary shares held by the Company as treasury shares).
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(2)
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Includes (i) 3,694,986 ordinary shares held directly; (ii) 200,000 ordinary shares issuable upon the exercise of options granted to Mr. Zisapel exercisable as of April 16, 2024 or within
60 days thereafter; (iii) 1,101,245 ordinary shares held by Lomsha Ltd., an Israeli company that was controlled by Mr. Zisapel; (iv) 18,717 ordinary shares held by RAD Data Communications Ltd., an Israeli company of which Mr. Zisapel was
a principal shareholder and a director, and of which Mr. Zisapel and his late brother, Mr. Yehuda Zisapel, and Ms. Nava Zisapel, had shared voting and dispositive power; and (v) 2,102,226 ordinary shares held by Michael and Klil Holdings
(93) Ltd., an Israeli company that was controlled by Mr. Zisapel. The number of ordinary shares beneficially held by Zohar Zisapel’s Estate is based on a Schedule 13D/A filed by Mr. Zisapel with the SEC on February 22, 2021.
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(3)
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Joseph D. Samberg’s address is 1091 Boston Post Road, Rye, NY 10580.
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(4)
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Each of the directors and senior management beneficially owns less than 1% of the outstanding ordinary shares as of April 16, 2024 (including options held by each such person and which
are vested or shall become vested within 60 days of April 16, 2024) and have therefore not been separately listed.
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To Mr. Rosen, Chairman of the Board of Directors, an increased amount of NIS 238,000 (approximately $63,129 based on the Exchange Rate; indexed to Consumer Price Index in accordance with the Remuneration Regulations) as annual fee
(the “Chairman Annual Fee”), due to his ongoing involvement with the Company, as the Chairman of the Board of Directors, as determined by our compensation Committee and Board. Mr. Rosen’s
participation fees will not be changed and remain equal to those of the other members of the Board of Directors. The Chairman Annual Fee is in excess of the annual cash fee amount listed under the Remuneration Regulations, as
supplemented by the Foreign Listed Regulations, and it exceeds the annual fee amount referred to in our Compensation Policy.
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Mr. Robert Wadsworth, our new nominee independent director, will be paid an in-person participation fee also for in-person Board meetings in which he participates by electronic means, as determined by our compensation Committee and
Board, since he is the only director residing outside of Israel (“Mr. Wadsworth’s Participation Fee”). Mr. Wadsworth’s Participation Fee exceeds the participation fees referred to in our
Compensation Policy, with respect to the fees that will be paid to him for participation by electronic means.
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To each of Ms. Efrat Makov, Ms. Yael Shaham, Mr. Shlomo Liran, Mr. Rami Hadar, Mr. David Ripstein, and Mr. Robert Wadsworth, non-executive directors of the Company, an annual grant of equity, on the date of this Meeting of
shareholders of the Company and subject to his or her election or continuous service, be granted with annual equity awards based on the mechanism and under the terms detailed below, without the need for further approval, to be granted
at the date of this Meeting, and upon the first and second anniversaries of this Meeting (i.e., on May 23, 2025, and May 23, 2026) (each, a “Grant Date”), subject to his or her continuous service
as our director.
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(a) |
Each of our non-executive directors shall be granted an equal value mix of options to purchase Shares (the “Options”) and Restricted Share Units (“RSUs”)
(the Options and the RSUs together, the “Annual Equity Award”);
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(b) |
The value of the Annual Equity Award shall be 75,000 USD (“Annual Equity Value”);
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(c) |
The actual number of Options and RSUs to be granted each year, bearing the foregoing Annual Equity Value, shall be determined based on the average closing price per Share as quoted on the NASDAQ Stock Market during the 30 consecutive
trading days preceding the Grant Date (the “Market Value”); and
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(d) |
In case a non-executive director is appointed in between annual general meetings, in accordance with our Articles – the Annual Equity Award will be pro-rated according to the part of the year that has passed since the previous annual
general meeting of shareholders.
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(e) |
Exercise Price: The exercise price of the Options will be equal to the Market Value plus a 10% premium, and the RSUs shall have an exercise price of NIS 0.01 per share, which is the par value of each Share;
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(f) |
If approved by our shareholders, the Annual Equity Award granted each year, as detailed above, will be fully vested on the Grant Date. The exercise price for the proposed grants shall be equal to the average closing price of the
Company’s Shares on the Nasdaq Global Select Market for the period equal to thirty (30) consecutive trading days immediately preceding the Grant Date of each portion of the total grant, provided that with respect to Mr. Wadsworth, our
director nominee who is a U.S resident, we may adjust this calculation method to comply with the applicable 409A regulations. In addition, subject to an earlier expiry in accordance with the terms of the Option Plan (as defined below),
the Annual Equity Award will expire upon the earlier of (i) six (6) years after the date of grant, or (ii) at such time as the closing price of the Company’s ordinary shares on Nasdaq falls below fifty percent (50%) of the exercise price
detailed above and remains in such price or in a lower price for a period of at least 90 days (the “Knockout”), in which case the options shall be cancelled automatically.
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(g) |
The Directors Equity Grant will be made under the Company’s 2024 Equity Incentive Plan (the “2024 Plan”) and under the Capital Gains Route of Section 102(b)(2) of the Israeli Income Tax Ordinance
(the “Ordinance”).
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(h) |
The grant of the Annual Award is in line with the Compensation Policy, according to which, each of the Company’s non-executive directors is entitled to receive equal annual equity-based compensation, which value shall not exceed
$150,000 (per annum).
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To Mr. Rosen, our Chairman of the Board, an annual grant of equity in equal terms to the above Annual Award, provided however that the Annual Equity Value of Mr. Rosen’s Annual Award shall be $112,500 (the “Chairman Annual Award”, and together with the Annual Award, the “Directors Equity Grant”). All other terms and conditions of the Annual Award shall apply to the Chairman Annual
Award, mutatis mutandis. The Compensation Committee and Board are of the opinion that, it would be appropriate to compensate Mr. Rosen with the grant of an increased equity grant in comparison
to the equity consideration granted to the other non-executive members of the Board, taking into account, among others, the considerable amount of time required from him in order to fulfill his Board activities as a Chairman and his
contribution to the Company’s success. The grant of the Chairman Annual Award is in line with the Compensation Policy, according to which, the Chairman of the Board of Directors of the Company is entitled to receive an annual
equity-based compensation of up to 3 times the annual equity-based compensation of the other directors (see below).
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According to the CEO Cash Bonus Plan the “On-Target” bonus amount for the year 2024 it will be equal to ten (10) months’ base salary (the “On-Target Bonus”).
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Financial Measurable Targets: Ninety percent (90%) of the targets forming part of the CEO Cash Bonus Plan will be measurable targets and will include financial measurable targets (the “Financial
Measurable Targets”). The proposed Financial Measurable Targets shall be as follows: seventy percent (70%) of the 2024 On Target Bonus shall be based on the Company’s non-GAAP operating profit targets, ten percent (10%) of the
2024 On Target Bonus shall be based on the Company’s cash flow targets, and ten percent (10%) of the 2024 On Target Bonus shall be based on the Company’s booking targets, all to be determined based on the Company’s financial results for
the year 2024. These targets were determined based on the Company’s 2024 annual business targets at the beginning of 2024, together with the targets determined for the annual bonus plans of the entire Company’s management.
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Non-Measurable Criteria: ten percent (10%) of the targets forming part of the CEO Cash Bonus Plan will be non-measurable criteria, which shall be concluded by assessing the CEO performance during the year, his contribution to the
achievement of the Company's goals, and his evaluation by the Board of Directors.
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The Annual CEO Equity Grant shall be granted on the date of this Meeting (the “Grant Date”);
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The exercise price of the Options shall be equal to the average closing price of the Company’s Shares on the Nasdaq for the period equal to thirty (30) consecutive trading days immediately preceding the Grant Date, plus a 10% premium;
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The Annual CEO Equity Grant shall vest over a period of four (4) years, in four (4) equal tranches following the Grant Date, with a one-year cliff, so that on each anniversary of the Grant Date, 25% of the total grant shall vest
(subject to acceleration of vesting in the circumstances detailed below); and
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The Annual CEO Equity Grant shall be granted pursuant to the 2024 Plan, and the grant shall be made through a trustee under the “Capital Gains Route” of Section 102(b)(2) of the Ordinance.
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1. |
Object and Purpose of the Company
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2. |
Limitation of Liability
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3. |
Interpretation
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4. |
Share Capital
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5. |
Increase of Share Capital
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6. |
Special Rights; Modifications of Rights
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7. |
Consolidation, Subdivision, Cancellation and Reduction of Share Capital
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8. |
Issuance of Share Certificates; Replacement of Lost Certificates
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9. |
Registered Holder
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10. |
Allotment of Shares
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11. |
Payment in Installments
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12. |
Calls on Shares
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13. |
Prepayment
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14. |
Forfeiture and Surrender
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15. |
Lien
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16. |
Sale after Forfeiture or Surrender or in Enforcement of Lien
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17. |
Redeemable Shares
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18. |
[reserved]
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19. |
Effectiveness and Registration
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20. |
Record Date for General Meetings
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21. |
Decedents’ Shares
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22. |
Receivers and Liquidators
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23. |
Annual General Meeting
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24. |
Extraordinary General Meetings
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25. |
Notice of General Meetings
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26. |
Quorum
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27. |
Chairman
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28. |
Adoption of Resolutions at General Meetings
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29. |
Resolutions in Writing
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30. |
Power to Adjourn
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31. |
Voting Power
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32. |
Voting Rights
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33. |
Instrument of Appointment
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34. |
Effect of Death of Appointor or Revocation of Appointment
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35. |
Powers of Board of Directors
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(a) |
In General
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(b) |
Borrowing Power
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(c) |
Reserves
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36. |
Exercise of Powers of Directors
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37. |
Delegation of Powers
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38. |
Number of Directors
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39. |
Election and Removal of Directors
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40. |
Qualification of Directors
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41. |
Continuing Directors in the Event of Vacancies
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42. |
Vacation of Office
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43. |
Remuneration of Directors
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44. |
Conflict of Interests
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45. |
Alternate Directors
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46. |
Meetings
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47. |
Quorum
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48. |
Chairman of the Board of Directors
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49. |
Validity of Acts Despite Defects
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50. |
Chief Executive Officer
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51. |
Minutes
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52. |
Declaration and Payment of Dividends
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53. |
[Deleted]
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54. |
Amount Payable by Way of Dividends
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55. |
Interest
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56. |
Payment in Specie
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57. |
Capitalization of Profits, Reserves etc.
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58. |
Implementation of Powers under Articles 56 and 57
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59. |
Deductions from Dividends
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60. |
Retention of Dividends
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61. |
Unclaimed Dividends
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62. |
Mechanics of Payment
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63. |
Receipt from a Joint Holder
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64. |
Books of Account
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65. |
Audit
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66. |
Auditors
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67. |
Branch Registers
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68. |
Rights of Signature, Stamp and Seal
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(b) |
The Company shall have at least one official stamp.
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69. |
Notices
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70. |
Exculpation, Indemnity and Insurance
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(iii) |
expenses, including reasonable litigation expenses and legal fees, incurred by an Office Holder in relation to a proceeding instituted against such Office Holder:
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(i) |
a breach of his duty of care to the Company or to another person;
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(iii) |
a financial obligation imposed on him in favor of another person.
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71. |
Winding Up
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1. |
PURPOSE OF THE PLAN
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2. |
DEFINED TERMS
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3. |
RESERVED SHARES
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3.1 |
The Company has reserved sufficient authorized but unissued Shares for purposes of the Plan, subject to adjustment as provided in Sections 11 and 17 of the Plan. The aggregate number of Shares that may be issued under the Plan
upon the exercise of ISOs (as defined below) shall not exceed the Authorized Share Limit (as amended from time to time and as adjusted pursuant to Sections 11 and 17).
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3.2 |
Notwithstanding the aforesaid, in the event that any outstanding Awards granted hereunder shall for any reason expire or be canceled prior to its exercise or relinquishment in full, such number of expired or terminated Awards
shall automatically increase the number of Shares available for allocation hereunder, and such increase shall not be deemed as amendment to this Plan. In addition, any Shares which are retained by the Company upon exercise of an
Award in order to satisfy the exercise or purchase price for such Award or any withholding taxes due with respect to such exercise or purchase (including for example when effecting a "Net Exercise") shall be treated as not issued
and shall continue to be available under the Plan. The Shares shall bear such rights and restrictions as set forth under the Articles of Association, as currently in effect and as may from time to time be amended or replaced in
accordance with applicable law, without the consent of any Participants (notwithstanding anything else here to the contrary). Any Shares which may remain unissued, and which are not subject to outstanding Awards at the termination
of the Plan shall cease to be reserved for the purpose of the Plan, but until termination of the Plan the Company shall at all times reserve a sufficient number of Shares to meet the requirements of the Plan. Should any Award for
any reason expire or be canceled prior to its exercise or relinquishment in full, the Shares therefore subject to such Award may again be subjected to an Award under the Plan.
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3.3 |
Awards granted hereunder to US Participants may or may not contain such terms as will qualify such Awards as “incentive stock options” (“ISOs”) within the meaning of Section 422(b) of the
United States Internal Revenue Code of 1986, as amended (the “Code”). Awards that do not contain terms that will qualify them as ISOs shall be referred to herein as “non-qualified stock
options” (“NQSOs”). Each Award Agreement shall state whether such Award will or will not be treated as an ISO. Any ISO granted under this Plan shall contain such terms and conditions,
consistent with this Plan, as the Company may determine to be necessary to qualify such Award as an “incentive stock option” under Section 422 of the Code and no ISO shall be granted unless such Award, when granted, qualifies as
an “incentive stock option” under Section 422 of the Code. Any ISO granted under the Plan may be modified by the Company to disqualify such Award from treatment as an “incentive stock option” under Section 422 of the Code.
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3.4 |
Awards granted hereunder to Israeli Participants may or may not contain such terms as will qualify such Awards for the special tax treatment under Section 102(b) of the Israeli Tax Ordinance (New Version), 5721-1961, as amended
(the “Ordinance”), and the Income Tax Rules (Tax Benefits in Share Issuances to Employees) 5763-2003 (the “Rules”) (“102
Awards”) and may be granted in one of the following tax tracks, subject to any applicable restrictions and limitations as provided in applicable law regarding the eligibility of Israeli Participants to each of the
following tax tracks, based on their relationship towards the Company:
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(a) |
“102(b) Award” – an Award granted through a trustee and intended to qualify, under the provisions of Section 102(b) of the Ordinance, as either “Capital
Gain Award” for the special tax treatment under Section 102(b)(2)/(3) of the Ordinance pursuant to which income resulting from the sale of shares derived from Capital Gain Awards is taxed as capital gain, or “Ordinary Income Award” for the special tax treatment under Section 102(b)(1) of the Ordinance pursuant to which income resulting from the sale of shares derived from Ordinary Income Awards is
taxed as ordinary income.
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(b) |
“Other 102 Award” – an Award granted under the terms of Section 102 of the Ordinance, excluding Section 102(b) Awards.
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(c) |
“3(i) Award” – an Award granted under the terms of Section 3(i) of the Ordinance to persons which do not qualify as “employees” under the provisions of Section 102 of the Ordinance.
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3.5 |
This Plan contemplates issuances to Participants in various jurisdictions and under various tax regimes with respect to which the Board or the Committee (as defined below) is empowered, but is not required, to make the
requisite adjustments in this Plan and set forth the relevant conditions in a Sub-Plan to this Plan or in the Company’s agreement with the Participant in order to comply with the requirements of such other tax regimes. Awards
granted to non-Israeli and non US Participants, shall be granted in accordance with the applicable laws of each Participant’s nationality state and/or in accordance with the terms and conditions set forth in its respective Award
Agreement as prescribed by the Board or the Committee.
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3.6 |
With respect to 102 Awards, if and to the extent any action or the exercise or application of any provision hereof or authority granted hereby is conditioned or subject to obtaining a ruling or tax determination from the
Israeli Tax Authority (“ITA”), to the extent required by applicable law, then the taking of any such action or the exercise or application of such section or authority with respect to 102
Awards shall be conditioned upon obtaining such ruling or tax determination, and, if obtained, shall be subject to any condition set forth therein; it being clarified that there is no obligation to apply for any such ruling or tax
determination (which shall be in the sole discretion of the Committee) and no assurance is made that if applied any such ruling or tax determination will be obtained (or the conditions thereof).
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4. |
ADMINISTRATION OF THE PLAN
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4.1 |
To the extent permitted under applicable law, the Company’s Articles of Association and any other governing document of the Company, this Plan shall be administered by a committee established or appointed by the Board (the “Committee”). In the event that the Board does not appoint or establish a committee to administer this Plan, or if otherwise required by applicable law, this Plan shall be administered by the
Board. In the event that an action necessary for the administration of this Plan is required under applicable law to be taken by the Board without the right of delegation, or if such action or power was explicitly reserved by the
Board in appointing, establishing, and empowering the Committee, then such action shall be so taken by the Board. Even if such a Committee was appointed or established, the Board may take any actions that are stated to be vested
in the Committee, and shall not be restricted or limited from exercising all rights, powers and authorities under this Plan or applicable law. All references herein to the Committee shall be construed as references to the Board to
the extent that the Board is administering the Plan or otherwise taking any actions that are stated to be vested in the Committee. Subject to applicable laws, any member of such Committee shall be eligible to receive Awards under
the Plan while serving on the Committee, unless otherwise specified herein.
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4.2 |
Subject to the provisions of applicable law and the Articles of Association, the Board or the Committee shall have full power and authority to (i) designate participants in the Plan; (ii) approve the form(s) of agreement(s)
used under the Plan; (iii) determine the terms and provisions of respective Award Agreements (which need not be identical) including, but not limited to, the number of Shares to be covered by each Award, the vesting schedule, any
restrictions, provisions concerning the time or times when, and the extent to which, the Awards may be exercised, the payment method, the method for satisfaction of any tax withholding obligation arising in connection with the
Awards or such Shares, or other terms and conditions of the Award; (iv) modify or amend any terms of the Awards, taking into account market best practices and ISS policy guidelines including without limitation, the exercise period
(including extending the time for exercising any Option, but not beyond the original ten-year term), vesting schedule (including the acceleration of the right of a Participant to exercise, in whole or in part, any previously
granted Award) and the exercise price (provided that discounts, if any, may be mitigated by performance criteria); (v) determine the Fair Market Value of the Shares in accordance with Section 2 above; (vi) designate the specific
tax classification of the Awards, including as Ordinary Income Awards, as Capital Gain Awards, as Other 102 Awards, as 3(i) Awards, as ISOs or as NQSO; (vii) interpret the provisions and supervise the administration of the Plan;
(viii) amend the Plan from time to time in order to qualify for tax benefits applicable under U.S. and Israel laws; (ix) adopt and administer sub-plans, including without limitation the determination, if the Board sees fit to so
determine, that to the extent any terms of such sub-plan are inconsistent with the terms of this Plan, the terms of such sub-plan shall prevail; (x) make a 102(b) Track Election (subject to the limitations set under Section 102(g)
of the Ordinance); (xi) in order to fulfill the purposes of the Plan and without amending the Plan, to modify grants of Awards to Participants who are foreign nationals or employed outside of the United States of America or the
State of Israel in order to recognize differences in local law, tax policies, or customs; and (xii) determine any other matter which is necessary or desirable for, or incidental to administration of the Plan. In determining the
number of Shares covered by the Awards to be granted to each recipient, the Board or the Committee may consider, among other things, the nature of services provided by the recipient, the recipient’s salary and/or duration of his
service or employment by the Company.
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4.3 |
Subject to the provisions of the Articles of Association, all decisions and selections made by the Board or the Committee pursuant to the provisions of the Plan shall be made by a majority of its members except that no member
of the Board or the Committee shall vote on, or be counted for quorum purposes, with respect to any proposed action of the Board or the Committee relating to any Award to be granted to that member. Any decision reduced to writing
and signed by all of the members who are authorized to make such decision shall be fully effective as if it had been made by a majority at a meeting duly held.
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4.4 |
The interpretation and construction by the Committee of any provision of the Plan or of any Award thereunder shall be final and conclusive unless otherwise determined by the Board.
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4.5 |
Subject to the provisions of applicable law and the Articles of Association, each member of the Board or the Committee may be indemnified and held harmless by the Company against any cost or expense (including counsel fees)
reasonably incurred by him, or any liability (including any sum paid in settlement of a claim with the approval of the Company) arising out of any act or omission to act in connection with the Plan unless arising out of such
member’s own fraud or bad faith, to the extent permitted by applicable law, and in such amounts and subject to such conditions, as may be decided by the Board. Such indemnification, if applicable, shall be in addition to any
rights of indemnification the member may have as a director or otherwise under the Articles of Association, any agreement, any vote of shareholders or disinterested directors, insurance policy or otherwise.
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5. |
DESIGNATION OF PARTICIPANTS
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5.1 |
The persons eligible for participation in the Plan as recipients of Awards shall include any employees, officers, directors and consultants of the Company or of any Affiliate of the Company provided however, that a US employee
or consultant shall not be eligible to receive ISOs or NQSO hereunder unless such employee or consultant is a natural person, renders bona fide services to the Company or any Affiliate, and such services are not in connection with
the offer or sale of securities in a capital raising transaction and do not directly or indirectly promote or maintain a market for the Company’s securities. The grant of an Award hereunder shall neither entitle the recipient
thereof to participate nor disqualify him from participating in, any other grant of Awards pursuant to this Plan or any other equity incentive plan of the Company or any of its affiliates. Notwithstanding any provisions to the
contrary herein, no ISO shall be granted to any individual otherwise eligible to participate in the Plan who is not an Employee of the Company or any Affiliate, on the date of granting of such ISO. No 102 Awards shall be granted
to any individual who is not an Employee of the Company or of an Affiliate of the Company, or who otherwise would not qualify as an “employee” under Section 102(a) of the Ordinance.
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6. |
TRUSTEE FOR 102(B) AWARDS
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6.1 |
The 102(b) Awards which shall be granted to Participants and/or any Shares issued upon exercise of any Options and/or any other Shares received subsequently following any realization of rights resulting from a 102(b) Award or
rights resulting from Shares issued upon exercise of a 102(b) Award, shall be issued to a Trustee nominated by the Board and approved in accordance with the provisions of Section 102 of the Ordinance (the “Trustee”). The Board shall determine and approve the terms of engagement of the Trustee, and shall be authorized to designate from time to time a new Trustee and replace either of them at its
sole discretion, and in the event of replacement of any existing Trustee, to instruct the transfer of all Awards and Shares held by such Trustee at such time to its successor. The 102(b) Awards and/or any Shares issued upon
exercise of any Options will be held by the Trustee for the benefit of the Participants for a period of not less than the minimum period permitted by applicable law without disqualifying such 102(b) Awards from treatment under
Section 102(b) of the Ordinance. The Trustee will hold such Awards or Shares resulting from the exercise thereof in accordance with the provisions of the Ordinance and the Rules promulgated thereunder, the trust agreement and any
other instructions the Board may issue to him/it from time to time (so long as they do not contradict the Ordinance and the Rules promulgated thereunder). Thereafter, the Trustee will transfer the Awards or the Shares, as the case
may be, to the Participant upon his/her demand, subject to any deduction or withholding required under the Ordinance, the Rules, or any other applicable law.
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6.2 |
Anything to the contrary notwithstanding, the Trustee shall not release any 102(b) Awards which were not already exercised into Shares by the Participant or release any Shares issued upon exercise of such Awards prior to the
full payment of the Participant’s tax liabilities arising from such Awards which were granted to him and/or any Shares issued upon exercise of such Awards.
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6.3 |
Upon receipt of a 102(b) Award, the Participant will sign an Award Agreement which shall be deemed as Participant’s undertaking to exempt the Trustee from any liability in respect of any action or decision duly taken and bona
fide executed in relation with the Plan, or any Award or Share granted to him thereunder.
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6.4 |
Subject to applicable law, the Board shall be entitled to revise, amend or replace the terms of the trust agreement with the Trustee, to the extent that same (i) do not adversely affect any rights of Participant under any valid
and outstanding Award, which are expressly provided for in the respective Award Agreement with such Participant, or (ii) is necessary or desirable in the light of any change or replacement of Section 102 of the Ordinance.
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6.5 |
Any and all rights resulting from the 102(b) Awards and/or any Shares issued upon exercise of such Awards and/or any other Shares received subsequently following any realization of rights resulting from a 102(b) Award, shall be
issued or distributed, as the case may be, to the Trustee and held thereby. Such rights will not be sold or transferred until the lapse of the minimum period permitted by applicable law, and such rights shall be subject to the
taxation track which is applicable to such Share Awards or Shares issued pursuant to the exercise of Options hereunder. Notwithstanding the aforesaid, Shares issued pursuant to the exercise of 102(b) Awards hereunder or rights
resulting from such 102(b) Awards may be sold or transferred, and the Trustee may release such Shares issued pursuant to the exercise of Options (or Share Awards) or rights from trust, prior to the lapse of the minimum period
permitted by applicable law, provided however, that tax is paid or withheld in accordance with Section 102 of the Ordinance and/or Section 7 of the Rules, and/or any other provision in any other section of the Ordinance and any
regulation, ruling, procedure and clarification promulgated thereunder, that will be relevant, from time to time.
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6.6 |
Each Award Agreement evidencing 102(b) Awards shall include (i) an approval and acknowledgment by the Participant of the agreement of the Company with the Trustee (as may be amended from time to time), (ii) a declaration that
the Participant is familiar with the provisions of Section 102 and the “Capital Gain Track” (if applicable) and (iii) an undertaking not to sell or transfer the Share Awards and/or the Shares issued pursuant to the exercise of
Options prior to the lapse of the period in which the Options and/or such Shares are held in trust, unless the Participant pays all taxes, which may arise in connection with such sale and/or transfer (as provided in Section 6.5
above). Notwithstanding the above, if any such sale or transfer occurs during the restricted period, the sanctions under Section 102 of the Ordinance and under any rules or regulation or orders or procedures promulgated thereunder
shall apply to and shall be borne by such Participant.
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7. |
GRANT OF OPTIONS
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7.1 |
Each Award Agreement shall state a number of the Shares to which the Option relates and the type of Option granted thereunder (an Ordinary Income Award, Capital Gain Award, Other 102 Award, a 3(i) Award, an ISO, an NQSO, a
generally nonqualified option or other type of Award as applicable), the exercise price per Share, the vesting schedule to which such Option shall become exercisable the Expiration Date (as defined below), the exercise period, and
may include other terms as determined by the Board. US Participants shall be eligible only for grants of ISOs and/or NQSOs. Notwithstanding any other provision of the Plan, the aggregate Fair Market Value (determined as of the
date an ISO is granted) of the Shares with respect to which ISOs are exercisable for the first time by a Participant during any calendar year (under the Plan and any other “incentive stock option” plans of the Company or any
Affiliates shall not exceed $100,000 (or such other amount as may be prescribed by the Code from time to time); provided, however, that if the exercisability or vesting of an ISO is
accelerated as permitted under the provisions of this Plan and such acceleration would result in a violation of the limit imposed by this Section 7.1, such acceleration shall be of full force and effect but the number of Shares
that exceed such limit shall be treated as having been granted pursuant to a NQSO; and provided, further, that the limits imposed by this Section 7.1 shall be applied to all outstanding ISOs (under the Plan and any other
“incentive stock option” plans of the Company or any Affiliates in chronological order according to the dates of grant. In the event a Participant receives an Option intended to be an ISO which is subsequently determined not to
comply with the requirements of the Code for ISOs, the Option shall be amended, if necessary, in accordance with the Code and applicable Treasury Regulations and rulings to preserve, as the first priority, to the maximum possible
extent, the status of the Option as an ISO and to preserve, to the maximum possible extent, the number of Shares subject to the Option. Options may be granted at any time after this Plan has been approved by the Company, subject
to any further shareholder approval required under Section 102 of the Ordinance or the Rules, in case of 102(b) Awards, or of the U.S. Treasury, in case of ISOs and other applicable law.
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7.2 |
The exercise price of each Share subject to a new Option to be granted or any portion thereof shall be determined by the Board or the Committee in its sole and absolute discretion in accordance with applicable law, subject to
any guidelines as may be determined by the Board from time to time. The exercise price per Share covered by each ISO and NQSO shall be not less than 100% of the Fair Market Value of the Company’s shares on the date the Option is
granted; provided, however, that no ISO shall be granted to an individual otherwise eligible to participate in the Plan who owns (within the meaning of Section 424(d) of the Code), at the time the Option is granted, more than ten
percent (10%) of the total combined voting power of all classes of shares of the Company or any Affiliates (a “Ten Percent Shareholder”), unless, at the time such ISO is granted, the
exercise price per Share subject to the Option is at least 110% of the Fair Market Value of a Share on the date such ISO is granted, and the ISO by its terms is not exercisable after the expiration of five (5) years from such date
of grant.
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7.3 |
Options shall be exercised by the Participant (a) by way of an exercise order submitted via the online service operated and maintained by the Company or any of its service providers, or (b) or in any other manner as the
Committee shall prescribe from time to time. The notice shall specify the number of Shares with respect to which the Option is being exercised and shall include such other representations and agreements as required by the Company.
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7.4 |
The exercise price shall be paid in full with respect to each Share, at the time of exercise and as a condition therefor, either (i) in cash, (ii) if the Company’s shares are listed for trading on any securities exchange or
over-the-counter market, and if the Committee so determines, all or part of the exercise price and any withholding taxes may be paid by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities
broker approved by the Company to sell Shares and to deliver all or part of the sales proceeds to the Company or the Trustee, (iii) to the extent applicable, by applying the Net Exercise mechanism set forth in Section 7.5 below,
or (iv) in such other manner as the Committee shall determine, which may include procedures for cashless exercise. The application of Net Exercise mechanism with respect to any 102 Awards shall be subject to obtaining a ruling
from the ITA, to the extent required by applicable law.
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7.5 |
Notwithstanding the provisions of Sections 7.3 and 7.4 above, the Board or the Committee may determine (and, in the case of an ISO or a 102 Option, shall be determined at the time of grant) that in lieu of payment of the
exercise price in cash, the Participant may elect to receive Shares equal to the aggregate value of the Options (or the portion thereof being exercised) by written notice of such election to the Company, in which event the Company
shall issue to the Participant, for no additional consideration, that number of Shares computed using the following formula:
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X =
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Y (A – B)
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A
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7.6 |
Vesting of Options may be time-based or performance-based, in the discretion of the Committee and the Board. Unless otherwise prescribed by the Committee or the Board and specified in the Award Agreement, (a) the Options shall
vest over a period of four (4) years (provided that in case of executives, the vesting commencement date shall not be earlier than 12 months prior to the Date of Grant) as follows: (i) 25% of the Shares underlying the Option shall
vest upon the lapse of twelve (12) months as of the Date of Grant of the Options, and (ii) the remaining 75% of the Shares underlying the Option shall thereafter vest over the following three (3) year-period, such that an equal
amount of such remaining Options, shall vest upon the lapse of each full three (3) months (in such three (3) years) (i.e. 100% of the Options will be vested after four (4) years, all provided that Participant continues to provide
Service to the Company at each vesting date). Without derogating from the foregoing, the Board shall have the exclusive authority to accelerate the periods for exercising an Option, or to initially include an acceleration
provision in an Award Agreement (including a “double trigger” acceleration).
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8. |
RESTRICTED SHARE UNITS
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8.1 |
The Board or the Committee will determine to whom an offer will be made to purchase Restricted Share Units and the terms of such offer including the number of Restricted Share Units, the purchase price to be paid by the
Participant (if any), the type of Award granted thereunder (whether an Ordinary Income Award, Capital Gain Award, Other 102 Award or a 3(i) Award), the restrictions to which Restricted Share Units are subject, and all other terms
and conditions of the Share Award. The Restricted Share Units granted pursuant to the Plan, shall be evidenced by a written Award Agreement between the Company and the Participant, in such form as the Board or the Committee shall
from time to time approve.
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8.2 |
Vesting of Restricted Share Units may be time-based or performance-based, in the discretion of the Committee and the Board. Unless otherwise prescribed by the Committee or the Board and specified in the Award Agreement, (a) the
Restricted Share Units shall vest over a period of four (4) years as follows: (i) 25% of the Shares underlying the Restricted Share Units shall vest upon the lapse of twelve (12) months as of the Date of Grant of the Restricted
Share Units, and (ii) the remaining 75% of the Shares underlying the Restricted Share Units shall thereafter vest over the following three (3) year-period, such that an equal amount of such remaining Restricted Share Units, shall
vest upon the lapse of each full three (3) months (in such three (3) years) (i.e. 100% of the Restricted Share Units will be vested after four (4) years, all provided that Participant continues to provide Service to the Company at
each vesting date). Without derogating from the foregoing, the Board shall have the exclusive authority to accelerate the periods for the settlement of Restricted Share Units, or to initially include an acceleration provision in
an Award Agreement (including a “double trigger” acceleration).
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8.3 |
Restricted Share Units may be granted at any time after this Plan has been approved by the Company, subject to any further approval or consent required under Section 102 of the Ordinance or the Rules, in case of 102(b) Awards.
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8.4 |
The Participant shall not possess or own any ownership rights in the Shares underlying the Restricted Share Units and no rights as a shareholder shall exist prior to the actual issuance of Shares in the name of the Participant.
Following vesting of the Restricted Share Units, the Company shall issue Shares within reasonable time in the name of the Participant, subject to compliance with applicable law and payment of any tax liability associated with such
issuance. The issuance of Shares upon vesting shall be subject to the payment of the par value of the Shares by the Participant (or otherwise compliance with Section 304 of the Companies Law).
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8.5 |
Notwithstanding anything to the contrary set forth herein, any Restricted Share Units granted under this Plan that are not exempt from the requirements of Section 409A of the Code shall contain such restrictions or other
provisions so that such Restricted Share Units will comply with the requirements of Section 409A of the Code, if applicable to the Participant. Such restrictions, if any, shall be determined by the Committee and contained in the
Award Agreement evidencing such Restricted Share Units.
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9. |
RESTRICTED SHARES
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9.1 |
The Board or the Committee will determine to whom an offer will be made to purchase Restricted Shares and the terms of such offer including the number of Restricted Shares, the purchase price to be paid by the Participant (if
any), the type of Award granted thereunder (whether an Ordinary Income Award, Capital Gain Award, Other 102 Award or a 3(i) Award), the restrictions to which Restricted Shares are subject, and all other terms and conditions of the
Share Award, subject to the following terms and conditions. The Restricted Shares granted pursuant to the Plan, shall be evidenced by a written Award Agreement between the Company and the Participant, in such form as the Board or
the Committee shall from time to time approve.
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9.2 |
Share Awards may be granted at any time after this Plan has been approved by the Company, subject to any further approval or consent required under Section 102 of the Ordinance or the Rules, in case of 102(b) Awards.
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9.3 |
Beginning on the Date of Grant and subject to the execution of an Award Agreement and the payment of the purchase price for the Restricted Shares (if any), the Participant shall become a shareholder of the Company with respect
to all Restricted Shares and shall have all of the rights of a shareholder, including the right to receive distributions made with respect to such shares, including regular cash dividends (except as otherwise provided by the
Board); provided, however, that in the absence of a Board action to the contrary, any Shares or any other property (other than regular cash distributions) distributed as a dividend or otherwise with respect to any Restricted
Shares as to which the restrictions have not yet lapsed shall be subject to the same restrictions as the shares covered by such Restricted Shares, as further detailed in the applicable Award Agreement. The issuance of Restricted
Shares shall be subject to the payment of the par value of the Restricted Shares by the Participant (or otherwise compliance with Section 304 of the Companies Law).
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9.4 |
The Participant shall not be permitted to transfer, sell, pledge, or otherwise dispose of Restricted Shares granted under the Plan prior to the lapse of the restrictions as detailed in the Award Agreement (the “Restriction Period”). If the Restriction Period expires without a prior forfeiture of the Restricted Shares, certificates for Shares attributable to such Restricted Shares shall be delivered to
the Participant (or, if certificates were previously issued, replacement certificates shall be delivered upon return of the previously issued certificates). All legends shall be removed from said certificates at the time of
delivery to the Participant, except as otherwise required by applicable law, applicable agreements to which the Participant is bound, or other limitations imposed by the Board. Notwithstanding the foregoing, actual certificates
shall not be issued to the extent that book entry recordkeeping is used.
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9.5 |
Subject to such exceptions as may be determined by the Committee, if the Participant’s continuous Service to the Company or any Affiliate thereof shall terminate (for any reason prior to the expiration of the Restriction Period
of an Award or prior to the timely payment in full of the purchase price of any Restricted Shares), any Restricted Shares remaining subject to vesting or with respect to which the purchase price has not been paid in full, shall
thereupon be forfeited, transferred to, and redeemed, repurchased or cancelled by, as the case may be, in any manner as set forth in Section 12.3(i) through (v), subject to applicable law and the Participant shall have no further
rights with respect to such Restricted Shares.
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9.6 |
Vesting of Restricted Shares may be time-based or performance-based, as described under Section 10 below, in the discretion of the Committee and the Board. Unless otherwise prescribed by the Committee or the Board and specified
in the Award Agreement, (a) the Restricted Shares shall vest over a period of four (4) years (provided that in case of executives, the vesting commencement date shall not be earlier than 12 months prior to the Date of Grant) as
follows: (i) 25% of the Restricted Shares shall vest upon the lapse of twelve (12) months as of the Date of Grant of the Restricted Shares, and (ii) the remaining 75% of the Restricted Shares shall thereafter vest over the
following three (3) year-period, such that an equal amount of such remaining Restricted Shares, shall vest upon the lapse of each full three (3) months (in such three (3) years) (i.e. 100% of the Restricted Shares will be vested
after four (4) years, all provided that Participant continues to provide Service to the Company at each vesting date). Notwithstanding, and unless otherwise prescribed by the Committee or the Board and specified in the Award
Agreement, Performance Based Awards shall vest over a period of four (4) years (provided that in case of executives, the vesting commencement date shall not be earlier than 12 months prior to the Date of Grant), on an annual
basis. Without derogating from the foregoing, the Board shall have the exclusive authority to accelerate the periods for exercising Restricted Shares, including Performance Based Awards, or to initially include an acceleration
provision in an Award Agreement (including a “double trigger” acceleration).
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10. |
PERFORMANCE BASED AWARDS
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10.1 |
Subject to the sole and absolute discretion and determination of the Board, the Board may decide to grant Awards under the Plan, the vesting of which shall be conditional upon the performance of the Company and/or a division or
other business unit of the Company and/or upon the performance of the Participant, over such period and measured against such objective criteria as shall be determined by the Board and detailed in the Award Agreement (“Performance Based Awards”). In granting each Performance Based Award, the Board shall establish in writing the applicable performance period (“Performance Period”),
performance formula (“Performance Formula”) and one or more performance goals which, when measured at the end of the Performance Period, shall determine on the basis of said Performance
Formula the extent to which the Performance Based Awards have vested and become exercisable (collectively, the “Performance Conditions”). It is clarified that Performance Conditions may be
determined for an Award either in addition to, or in substitution for, a vesting schedule.
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10.2 |
After a Performance Based Award has been granted, the Board may, in appropriate circumstances and subject to any other approval required in order to comply with mandatory law (for example, shareholders’ approval), amend any
Performance Condition, at its sole and absolute discretion. Without derogating from the above, if the Board determines that a change in the business, operations, corporate structure or capital structure of the Company or the
manner in which the Company or an Affiliate conducts its business, or other events or circumstances render a Performance Condition to be unsuitable, the Board may modify such Performance Condition in whole or in part, as the Board
deems appropriate. If a Participant is promoted, demoted or transferred to a different business unit or function during a Performance Period, the Board may determine that the Performance Condition or Performance Period are no
longer appropriate and may: (i) adjust, change or eliminate the Performance Condition or the applicable Performance Period as it deems appropriate to make such conditions and period comparable to the initial conditions and period;
or (ii) make a cash payment to the Participant in an amount determined by the Board. Performance Conditions shall not be automatically waived merely due to an event of a Transaction (as defined below) or any other adjustment under
Section 11 below.
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11. |
ADJUSTMENTS; CORPORATE TRANSACTIONS
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11.1 |
Upon the occurrence of any of the following described events, any Awards granted under the Plan to Participants shall be adjusted as hereafter provided (and with respect to Shares held by the Participant’s the applicable
provisions below shall apply):
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11.2 |
If the outstanding shares of the Company shall at any time be changed or exchanged by declaration of a share dividend, share split, consolidation of share capital, reclassification, combination or exchange of shares,
recapitalization, distribution of bonus shares, or any other like event of the Company, then in such event, then the Committee shall make, without the need for a consent of any holder of an Award, such adjustments as determined by
the Committee to be appropriate, in its discretion, in order to equitably adjust (i) the number and class of shares reserved and available for grants of Awards, (ii) the number and class of shares covered by outstanding Awards,
(iii) the exercise price per share covered by any Award, (iv) the terms and conditions concerning vesting and exercisability and the term and duration of the outstanding Awards, (v) the type or class of security, asset or right
underlying the Award (which need not be only that of the Company, and may be that of the surviving corporation or any affiliate thereof or such other entity party to any of the above transactions), and (vi) any other terms of the
Award that in the opinion of the Committee should be adjusted. Any fractional shares resulting from such adjustment shall be treated as determined by the Committee, and in the absence of such determination shall be rounded to the
nearest whole share, and the Company shall have no obligation to make any cash or other payment with respect to such fractional shares. No adjustment shall be made by reason of the distribution of subscription rights or rights
offering to outstanding shares or other issuance of shares by the Company unless the Committee determines otherwise. The adjustments determined pursuant to this Section 11.2 (including a determination that no adjustment is to be
made) shall be final, binding, and conclusive.
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11.3 |
Notwithstanding anything to the contrary included herein, and subject to applicable law and the applicable accounting standards, in the event of a distribution of cash dividend by the Company to all holders of Shares, the
Committee shall have the authority to determine, without the need for a consent of any holder of an Award, that the exercise price of any Award, which is outstanding and unexercised on the record date of such distribution, shall
be reduced by an amount equal to the per Share gross dividend amount distributed by the Company, and the Committee may determine that the exercise price following such reduction shall be not less than the par value of a Share (if
such Shares bear a par value), subject, in each case, to the approval of the Company’s shareholders. The application of this Section with respect to any 102 Awards shall be subject to obtaining a ruling from the ITA, to the extent
required by applicable law and subject to the terms and conditions of any such ruling.
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11.4 |
Anything herein to the contrary notwithstanding, in the event of (i) a sale of all or substantially all of the assets of the Company, or a sale (including an exchange) of all or substantially all of the shares of the Company,
to any person, or a purchase by a shareholder of the Company or by an Affiliate of such shareholder, of all the shares of the Company held by all or substantially all other shareholders or by other shareholders who are not
Affiliated with such acquiring party; (ii) a merger (including, a reverse merger, a reverse triangular merger and a share swap), consolidation, amalgamation, reorganization or like transaction of the Company with or into another
corporation; (iii) a scheme of arrangement for the purpose of effecting such sale, merger, consolidation, amalgamation or other transaction; (iv) approval by the shareholders of the Company of a complete liquidation or dissolution
of the Company; (v) Change in Board Event; or (vi) such other transaction or set of circumstances that is determined by the Board, in its discretion, to be a transaction subject to the provisions of this Section 11.4, excluding
any of the foregoing transactions in clauses (i) through (iv) if the Board determines that such transaction should be excluded from the definition hereof and the applicability of this Section 11.4 (each of the foregoing
transactions, a “Transaction”), then, without derogating from the general authority and power of the Board or the Committee under this Plan, without the Participant’s consent and action and
without any prior notice requirement, the Committee may make, in its sole and absolute discretion, any determination as to the treatment of Awards, as provided herein:
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11.4.1 |
The surviving or the acquiring entity, as the case may be, or its respective parent company or subsidiary (the “Successor Entity”) in a Transaction may either assume the Company’s rights
and obligations under outstanding Awards or substitute the outstanding Awards, without the Participant’s consent and action and without any prior notice requirement. For purposes of this Section 11.4.1, the outstanding Awards
shall be deemed assumed or substituted by the Successor Entity if, following the consummation of the Transaction, the outstanding Awards confer the right to receive, for each share underlying any outstanding Awards immediately
prior to the consummation of the Transaction, the same consideration (whether shares, cash or other securities, rights or property) to which an existing holder of a Share on the effective date of consummation of the Transaction
was entitled; provided, however, that if the consideration to which such existing holder is entitled comprises of consideration other than or in addition to securities of the Successor Entity, then the Board may determine, with
the consent of the Successor Entity, that the consideration to be received by the Participants for their outstanding Awards will comprise solely of securities of the Successor Entity equal in their market value to the per share
consideration received by the holders of Shares in the Transaction.
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11.4.2 |
In the event that the Successor Entity neither assumes nor substitutes all of the outstanding Awards of a Participant, the Board or Committee may in its sole discretion:
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11.4.2.1 |
provide for the Participant to have the right to exercise the Award in respect of Shares covered by the Award which would otherwise be exercisable or vested, under such terms and conditions as the Committee shall determine, and
the cancellation of all unexercised Awards (whether vested or unvested) upon or immediately prior to the closing of the Transaction, unless the Committee provides for the Participant to have the right to exercise the Award, or
otherwise for the acceleration of vesting of such Award, as to all or part of the Shares covered by the Award which would not otherwise be exercisable or vested, under such terms and conditions as the Committee shall determine;
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11.4.2.2 |
provide for the cancellation of each outstanding Award at or immediately prior to the closing of such Transaction, and if and to what extent payment shall be made to the Participant of an amount in, shares or other securities
of the Company, the acquirer or of a corporation or other business entity which is a party to the Transaction, in cash or other property, in rights, or in any combination thereof, as determined by the Committee to be fair in the
circumstances, and subject to such terms and conditions as determined by the Committee. The Committee shall have full authority to select the method for determining the payment (being the intrinsic (“spread”) value of the option,
Black-Scholes model or any other method). Inter alia, and without limitation of the following determination being made in other circumstances, the Committee’s determination may provide that payment shall be set to zero if the
value of the Shares is determined to be less than the exercise price (“out-of-the-money Options”), or in respect of Shares covered by the Award which would not otherwise be exercisable or vested, or that payment may be made only
in excess of the exercise price; and/or
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11.4.2.3 |
provide that the terms of any Award shall be otherwise amended, modified, or terminated, as determined by the Committee to be fair in the circumstances.
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11.4.3 |
All Awards, whether vested or not, which are neither assumed, exchanged or substituted by the Successor Entity, nor exercised by the consummation of the Transaction, or canceled by the Board, shall expire effective as of the
date of the consummation of the Transaction, whereupon they shall become null and void and shall no longer entitle the Participant to any right in or towards the Company or the Successor Entity.
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11.4.4 |
The Board may determine: (i) that any payments made in respect of Awards shall be made or delayed to the same extent that payment of consideration to the holders of the Shares in connection with the Transaction is made or
delayed as a result of escrows, indemnification, earn outs, holdbacks or any other contingencies or conditions; (ii) the terms and conditions applying to the payment made or payable to the Participant, including participation in
escrow, indemnification, releases, earn-outs, holdbacks or any other contingencies; and (iii) that any terms and conditions applying under the applicable definitive transaction agreements shall apply to the Participant (including,
appointment and engagement of a shareholders or sellers representative, payment of fees or other costs and expenses associated with such services, indemnifying such representative, and authorization to such representative within
the scope of such representative’s authority in the applicable definitive transaction agreements).
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11.4.5 |
The Committee may, determine to suspend the Participant’s rights to exercise any vested portion of an Award for a period of time prior to the signing or consummation of a Transaction.
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11.4.6 |
Without limiting the generality of this Section 11, if the consideration in exchange for Awards in a Transaction includes any securities and due receipt thereof by any Participant (or by the Trustee for the benefit of such
Participant) may require under applicable law (i) the registration or qualification of such securities or of any person as a broker or dealer or agent with respect to such securities; or (ii) the provision to any Participant of
any information under the Securities Act or any other securities laws, then the Committee may determine that the Participant shall be paid in lieu thereof, against surrender of the Shares or cancellation of any other Awards, an
amount in cash or other property, or rights, or any combination thereof, as determined by the Committee to be fair in the circumstances, and subject to such terms and conditions as determined by the Committee. Nothing herein shall
entitle any Participant to receive any form of consideration that such Participant would be ineligible to receive as a result of such Participant’s failure to satisfy (in the Committee’s sole determination) any condition,
requirement or limitation that is generally applicable to the Company’s shareholders, or that is otherwise applicable under the terms of the Transaction, and in such case, the Committee shall determine the type of consideration
and the terms applying to such Participants.
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11.4.7 |
Neither the authorities and powers of the Board under this Section 11.3, nor the exercise or implementation thereof, shall (i) be restricted or limited in any way by any adverse consequences (tax or otherwise) that may result
to any holder of an Award, and (ii) as, inter alia, being a feature of the Award upon its grant, be deemed to constitute a change or an amendment of the rights of such holder under this Plan, nor shall any such adverse
consequences (as well as any adverse tax consequences that may result from any tax ruling or other approval or determination of any relevant tax authority) be deemed to constitute a change or an amendment of the rights of such
holder under this Plan, and may be effected without consent of any Participant and without any liability to the Company or any Affiliate, or to their respective officers, directors, employees and representatives, and the
respective successors and assigns of any of the foregoing. The Committee need not take the same action with respect to all Awards or with respect to all Participants. The Committee may take different actions with respect to the
vested and unvested portions of an Award. The Committee may determine an amount or type of consideration to be received or distributed in a Transaction which may differ as among the Participants, and as between the Participants
and any other holders of shares of the Company.
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11.4.8 |
Each Participant, upon executing an Award Agreement, shall be deemed to have authorized the Company and each of its officers and to have granted the Company and each of its officers an irrevocable power of attorney to execute
in his/her behalf such instruments and documents mentioned in this Section 11.4. For the avoidance of doubt, the Board or the Committee may determine that each such Participant shall be required to execute the Transaction
agreements applicable to each holder of shares or awards in the Company, and the Participant hereby agrees to comply with such requirements, and no additional consent of Participant or prior notice to Participant shall be
required.
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11.5 |
Notwithstanding the foregoing adjustments, any changes to ISOs pursuant to this Section 11 shall, unless the Company determines otherwise, only be effective to the extent such adjustments or changes do not cause a
“modification” (within the meaning of Section 424(h)(3) of the Code) of such ISOs or adversely affect the tax status of such ISOs.
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11.6 |
Notwithstanding the foregoing adjustments, any changes pursuant to this Section 11 to NQSOs or to any Awards that are subject to Section 409A of the Code shall, unless the Company determines otherwise, only be effective to the
extent such adjustments or changes do not cause a “modification” (within the meaning of Code Section 409A (as defined below)) of such NQSOs or adversely affect the tax status of such NQSOs or other Awards.
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12. |
TERMINATION OF AWARDS; CONDITIONS OF ISSUANCE
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12.1 |
Upon the termination of a Participant’s Service, for any reason whatsoever, any Awards granted in favor of such Participants which are not vested Awards, shall immediately expire and terminate and become null and void.
Restricted Shares which have not yet completed the Restriction Period will be forfeited to the Company in accordance with Section 9 above.
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12.2 |
Notwithstanding anything to the contrary in Sections 7.6 and 11 above, and unless otherwise prescribed by the Committee or the Board and specified in the Award Agreement, an Option may be exercised after the date of termination
of Participant’s Service only with respect to the number of Options already vested and unexpired at the time of such termination according to the vesting and expiration periods of the Options set forth in this Plan, or under a
different period prescribed by the Committee or by the Board and specified in Participant’s Award Agreement, provided however, that;
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|
12.2.1. |
such termination is without Cause (as defined below) and not the result of death or Disability in which case the Options shall be exercisable within the earlier of: (i) the Expiration Date of such Options; or (ii) not more than
three (3) months from the effective date of such termination, unless the Participant is a director - in such case not more than eighteen (18) months from the effective date of such termination; or
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|
12.2.2. |
such termination is the result of death or Disability of the Participant, in which case the Options shall be exercisable within the earlier of: (i) the Expiration Date of such Options; or (ii) twelve (12) months from the
effective date of such termination.
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12.3 |
Notwithstanding anything to the contrary contained herein or in the Articles of Association, and subject to applicable law, in the event of termination for Cause (whether the facts or circumstances that constitute such Cause
occur prior to or after termination of Service), or if facts or circumstances arise or are discovered with respect to the Participant that would have constituted Cause, then all Awards theretofore granted to such Participant
(whether vested or not) shall terminate and be subject to recoupment by the Company on the date of such termination (or on such subsequent date on which such facts or circumstances arise or are discovered, as the case may be)
unless otherwise determined by the Committee, and any Shares issued upon exercise or (if applicable) vesting of Awards (including other Shares or securities issued or distributed with respect thereto, and including the gross
amount of any proceeds, gains or other economic benefit the Participant actually or constructively receives upon receipt or exercise of any Award or the receipt or resale of any Shares underlying the Award), whether held by the
Participant or by the Trustee for the Participant’s benefit, shall be deemed to be irrevocably offered for sale to the Company, any of its Affiliates or any person designated by the Company to purchase, at the Company’s election
and subject to applicable law, either for no consideration, for the par value of such Shares (if such Shares bear a par value) or against payment of the exercise price previously received by the Company for such Shares upon their
issuance, as the Committee deems fit, upon written notice to the Participant at any time prior to, at or after the Participant’s termination of Service. Such Shares or other securities shall be sold and transferred within 30 days
from the date of the Company’s notice of its election to exercise its right. If the Participant fails to transfer such Shares or other securities to the Company, the Company, at the decision of the Committee, shall be entitled to
forfeit or repurchase such Shares and to authorize any person to execute on behalf of the Participant any document necessary to effect such transfer, whether or not the share certificates are surrendered.
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12.4 |
Notwithstanding anything to the contrary herein, upon the issuance of a court order declaring the bankruptcy of a Participant, or the appointment of a receiver or a provisional receiver for a Participant over all of his/her
assets, or any material part thereof, or upon making a general assignment for the benefit of his/her creditors, any outstanding Awards issued in favor of such Participant (whether vested or not) shall immediately expire and
terminate and become null and void and shall entitle neither the Participant nor the Participant’s receiver, successors, creditors or assignees to any right in or towards the Company or any Affiliate in connection with the same,
and all interests and rights of the Participant or the Participant’s receiver, successors, creditors or assignees in and to the same, shall expire.
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12.5 |
In the event that the Company is liquidated or dissolved while unexercised or unsettled Awards remain outstanding under the Plan, then the Board shall have the right to resolve with respect to certain Participants that all or
part of such Participants’ outstanding Awards may be exercised in full by the Participants as of immediately prior to the effective date of such liquidation or dissolution of the Company, without regard to the vesting terms
thereof.
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12.6 |
The holders of Awards shall not have any of the rights or privileges of shareholders of the Company unless and until, they become shareholders of the Company following exercise/settlement Awards and in case of Awards held by
the Trustee, subject always to the provisions of Section 3 and 6 of the Plan.
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12.7 |
Any form of Award Agreement authorized pursuant to this Plan may contain such other provisions as the Board may, from time to time, deem advisable.
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12.8 |
An Award may not be converted into a fraction of a Share. In lieu of issuing fractional Shares, the Company shall convert any such fraction of an Award, which represents a right to receive 0.5 or more of a Share, to one Share
and shall extinguish any such fraction of an Award, which represents a right to receive less than 0.5 of a Share without issuing any Shares.
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|
12.9 |
Blackout Periods. In the event that the exercise period under Section 12.2.1 above, begins following the commencement of any Company trading blackout period pursuant to the Company’s Insider Trading Policy (referred to
as a “Blackout Period”) such exercise period shall be extended automatically and shall conclude 14 days or three months, as the case may be, following the end of any such Blackout Period in
accordance with this Section.
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13. |
PURCHASE FOR INVESTMENT
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13.1 |
The Company’s obligation to issue Share Awards or Shares upon exercise of an Option granted under the Plan is expressly conditioned if so required under the applicable law, and as supported by the opinion of the Company’s
counsel, upon the following terms: (a) the Company’s completion of any registration or other qualifications of such Shares under any applicable law, rulings or regulations or (b) representations and undertakings by the Participant
(or his legal representative, heir or legatee, in the event of the Participant’s death) to assure that the sale of the Shares complies with any registration exemption requirements which the Company in its sole discretion shall
deem necessary or advisable. Such required representations and undertakings may include representations and agreements that such Participant (or his legal representative, heir, or legatee): (x) is purchasing such Shares for
investment and not with any present intention of selling or otherwise disposing thereof; and (y) agrees to have placed upon the face and reverse of any certificates evidencing such Shares a legend setting forth (i) any
representations and undertakings which such Participant has given to the Company or a reference thereto, (ii) that, prior to effecting any sale or other disposition of any such Shares, the Participant must furnish to the Company
an opinion of counsel, satisfactory to the Company, that such sale or disposition will not violate the applicable requirements of State and federal laws and regulatory agencies, and (iii) any other legend deemed reasonably
necessary or appropriate by the Company.
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14. |
DIVIDENDS
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14.1 |
It is hereby clarified that a Participant which has not exercised its Options into Shares, shall not, by virtue of this Plan, or the applicable Award Agreement or any Option granted to the Participant, have any of the rights or
privileges of a shareholder with respect to the Shares underlying the Options, until the Options have been exercised. In addition, the Participant shall not be deemed to be a class of shareholders or creditors of the Company for
the purpose of all applicable law, until registration of the Participant as holder of such Shares in the Company’s register of shareholders upon exercise of the Options in accordance with the provisions of the Plan.
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14.2 |
With respect to all Shares (in contrast to Options not exercised into Shares) issued to a Participant under this Plan, the Participant shall be entitled to receive dividends in accordance with the quantity of such Shares, and
subject to any applicable taxation on distribution of dividends. Notwithstanding the foregoing, in the absence of a Board action to the contrary, any Shares or any other property (other than regular cash distributions) distributed
as a dividend or otherwise with respect to any Restricted Shares as to which the restrictions have not yet lapsed shall be subject to the same restrictions as the shares covered by such Restricted Shares, as further detailed in
the applicable Award Agreement.
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14.3 |
During the period in which Shares, issued to the Trustee on behalf of a Participant upon exercise of a 102(b) Award, are held by the Trustee, the cash dividends paid with respect thereto may be paid directly to the Participant;
all subject to the provisions of applicable law and Section 6 above.
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15. |
TRANSFERABILITY OF AWARDS
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15.1 |
Other than by will or laws of descent, no Award, whether fully paid or not, shall be assignable, transferable, or given as collateral or any right with respect to them given to any third party whatsoever, and during the
lifetime of the Participant each and all of such Participant’s rights to purchase Shares hereunder shall be exercisable only by the Participant. Notwithstanding the foregoing, however, to the extent permitted by the Board in its
sole discretion, an NQSO may be transferred by the Participant to a revocable trust or to one or more family members or a trust established for the benefit of the Participant and/or one or more family members to the extent
permitted by Rule 701 of the United States Securities Act of 1933, as amended (the “Securities Act”) and Section 260.140.41(c) of Title 10 of the California Code of Regulations (to the
extent applicable).
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15.2 |
Shares issued under Share Awards or following the exercise of the Options into Shares shall be transferable; provided, however, that Shares may be subject to applicable securities regulations, market stand-off provisions, lock
up periods, and such other conditions and restrictions as may be included in the Company’s Articles of , any shareholders’ agreement to which the holders of Shares are bound, the Plan, any applicable sub-plan, the Award Agreement,
and/or any conditions and restrictions included in the Company’s securities law compliance manual/insider trade policy, or similar document, if any, all as determined by the Board at its sole discretion.
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15.3 |
Subject to any other restriction as to transferability of the Shares and/or Options provided hereunder, and for the avoidance of any doubt, any Shares sold or transferred by Participant in accordance with the provisions
hereunder shall be held by transferee and/or his successors, executors, administrators and assigns (each, “Transferee”) subject to the terms and conditions hereof, and any restrictions,
obligations and/or waivers which apply to the Participant shall apply, mutatis mutandis, also to such Transferee.
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16. |
TERM OF THE PLAN
|
17. |
AMENDMENTS OR TERMINATION
|
17.1 |
The Board may, at any time and from time to time, amend, alter or discontinue the Plan, except that no amendment or alteration shall be made which would impair the rights of the holder of any Award granted, if and to the extent
such rights are specifically set forth under the applicable Award Agreement, without such Participant’s consent.
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17.2 |
Additionally, the following changes to the Plan shall be made subject to the approval of the shareholders of the Company, if such approval is required and necessary to satisfy (i) with regard to ISOs, any requirements under the
Code relating to ISOs, (ii) any applicable law, regulation or rule, or (iii) any provision specified under the Articles of Association:
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|
(a) |
except as is provided in Section 11, increase the maximum number of Shares which may be sold or awarded under the Plan;
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|
(b) |
except as is provided in Section 11 decrease the minimum Option exercise price requirements under the Plan;
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|
(c) |
change the class of persons eligible to receive Awards under the Plan; or
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|
(d) |
extend the duration of the Plan under Section 16 or the period during which ISOs may be exercised under Section 7.
|
17.3 |
Notwithstanding any provision of this Plan to the contrary, the Company (and the Participant) intends that this Plan shall satisfy the applicable requirements of Section 409A of the Internal Revenue Code of 1986, as amended (“Code Section 409A”) in a manner that will preclude the imposition of additional taxes described in Code Section 409A. The Company shall have the right to amend the Plan to the extent necessary
to comply with Code Section 409A and the regulations, notices and other guidance of general applicability issued thereunder.
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18. |
GOVERNMENT REGULATIONS; ISRAELI RESIDENTS
|
18.1 |
Subject to Section 28 below, the Plan, the granting and exercise of Awards hereunder, and the obligation of the Company to sell and deliver Shares under such Awards, shall be subject to all applicable laws, rules, and
regulations, whether of the State of Israel or of the United States or any other State having jurisdiction over the Company and the Participant, including the Securities Act, and to such approvals by any governmental agencies or
national securities exchanges as may be required.
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18.2 |
This subsection shall apply only to Participants who are residents of the State of Israel or those who are deemed to be residents of the State of Israel for the payment of tax. Notwithstanding anything herein to the contrary,
the Plan shall be governed by the provisions of the Ordinance, the rules promulgated thereunder, and any other applicable Israeli laws with respect to service providers or employees who are Israeli residents. Following the grant
of Awards under the Plan and in any case in which the Participant shall stop being considered as an “Israeli Resident”, as defined in the Ordinance, the Company may, if and to the extent the Ordinance and/or the rules promulgated
thereunder shall impose such obligation on the Company, to withhold all applicable taxes from the Participant, to remit the amount withheld to the appropriate Israeli tax authorities and to report to such Participant the amount so
withheld and paid to said tax authorities.
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19. |
DATA PRIVACY; DATA TRANSFER
|
19.1 |
Information related to Participants and Awards hereunder, as shall be received from Participant or others, and/or held by, the Company or its Affiliates from time to time, and which information may include sensitive and
personal information related to Participants (“Information”), will be used by the Company or its Affiliates (or third parties appointed by any of them, including a trustee) to comply with
any applicable legal requirement, or for administration of the Plan as they deems necessary or advisable, or for the respective business purposes of the Company or its Affiliates (including in connection with transactions related
to any of them). The Company and its Affiliates shall be entitled to transfer the Information among the Company or its Affiliates, and to third parties for the purposes set forth above, which may include persons located abroad
(including, any person administering the Plan or providing services in respect of the Plan or in order to comply with legal requirements, or a trustee, their respective officers, directors, employees and representatives, and the
respective successors and assigns of any of the foregoing), and any person so receiving Information shall be entitled to transfer it for the purposes set forth above. The Company shall use commercially reasonable efforts to ensure
that the transfer of such Information shall be limited to the reasonable and necessary scope. By receiving an Options hereunder, Participant acknowledges and agrees that the Information is provided at Participant’s free will and
Participant consents to the storage and transfer of the Information as set forth above.
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20. |
CONTINUANCE OF EMPLOYMENT OR HIRED SERVICES
|
21. |
TAX CONSEQUENCES
|
21.1 |
To the extent permitted by applicable law, any tax consequences arising from the grant or exercise of any Award, from the payment for Shares covered thereby, the transfer of Shares from the Trustee to the Participant, the sale
or transfer of the Shares by the Participant, or from any other event or act (of the Company, the Trustee or the Participant) hereunder shall be borne solely by the Participant, including without limitation, in the event that the
Awards do not qualify under the tax classification in which they were intended. The Company, Affiliate and/or the Trustee (where applicable) may withhold taxes according to the requirements under the applicable laws, rules, and
regulations, including the withholding of taxes at source. Furthermore, the Participant shall agree to indemnify the Company and the Trustee (where applicable) and hold them harmless against and from any and all liability for any
such tax or interest, or penalty thereon, including without limitation, liabilities relating to the necessity to withhold, or to have withheld, any such tax from any payment made to the Participant.
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21.2 |
The Company shall not be obligated to allow the exercise of any Award by or on behalf of a Participant until all tax consequences arising from the exercise of such Award are resolved in a manner acceptable to the Company.
|
21.3 |
The Company does not undertake and shall be under no duty to ensure, and no representation or commitment is made, that any of the Awards qualifies or will qualify under any particular tax treatment (such as Capital Gain Award
or ISO), nor shall the Company be required to take any action for the qualification of any of the Awards under such tax treatment. The Company shall have no liability of any kind or nature in the event that, for any reason
whatsoever, the Awards do not qualify for any particular tax treatment. The Participant is advised to consult with a tax advisor with respect to the tax consequences of receiving and exercising/settling Awards or disposing of
Shares hereunder. The Company does not assume any responsibility to advise the Participant on such matters, which shall remain solely the responsibility of the Participant.
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21.4 |
The Board, the Committee and/or the Trustee shall not be required to release any Share certificate issued upon exercise of a 102 Award and/or a 3(i) Award to a Participant until all required payments have been fully made.
Therefore, the Company shall be entitled to require each Participant, as a condition to the exercise of the Awards or the sale of the Shares (including without limitation, sale of Shares as part of a Transaction), to provide the
Company with confirmation or certificate by the applicable tax authorities regarding tax withholding treatment (any such certificate, if applicable, to be satisfactory to the Company and the Trustee). If the Company is required to
withhold taxes in connection with the exercise or sale as provided above, the Company shall be entitled to require as a condition of issuance/transfer that the Participant remit an amount sufficient to satisfy all governmental
withholding tax requirements related thereto. A determination of the Company’s counsel that a withholding tax is required in connection with the exercise of Awards or transfer of Shares shall be conclusive for the purposes of this
requirement condition. With respect to Other 102 Awards, if the Participant ceases to be employed by the Company or any Affiliate, the Participant shall extend to the Company and/or its Affiliate with whom the Participant is
employed a security or guarantee for the payment of taxes due at the time of sale of Shares, all in accordance with the provisions of Section 102 of the Ordinance and the Rules.
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21.5 |
If an Option is intended to qualify as an ISO, then if the Participant makes a disposition, within the meaning of Section 424(c) of the Code and the regulations promulgated thereunder, of any Share issued to the Participant
pursuant to his exercise of the Option within the later of two (2) -year period commencing on the Date of Grant or within the one (1) -year period commencing on the date after the date of transfer of such Share to the Participant
pursuant to such exercise, the Participant shall, within ten (10) days after such disposition, notify the Company thereof, by delivery of a written notice to the Secretary of the Company.
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22. |
NON-EXCLUSIVITY OF THE PLAN
|
23. |
MULTIPLE AGREEMENTS
|
24. |
NO REPRESENTATION
|
25. |
NO INTERFERENCE
|
26. |
PROHIBITION ON EXECUTIVE OFFICER LOANS
|
27. |
CLAWBACK PROVISIONS
|
28. |
GOVERNING LAW & JURISDICTION
|
1. Re-election and election of seven directors for a term of approximately three (3)
years ending on the date of the Annual General Meeting that will be held in 2027:
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FOR
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AGAINST
|
ABSTAIN
|
1.A. Ilan Rosen.
|
☐
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☐
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☐
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1.B. Efrat Makov.
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☐
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☐
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☐
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1.C. Yael Shaham.
|
☐
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☐
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☐
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1.D. Shlomo Liran.
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☐
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☐
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☐
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1.E. Rami Hadar.
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☐
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☐
|
☐
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1.F. David Ripstein.
|
☐
|
☐
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☐
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1.G. Robert Wadsworth.
|
☐
|
☐
|
☐
|
2. Approval of certain compensation terms of the company’s non-executive directors, including the grant of equity consideration, all, as part of their compensation for
service as such:
|
|||
2.A. To approve the payment of the Chairman Annual Fee to Mr. Ilan Rosen, Ceragon’s chairman of the Board.
|
☐
|
☐
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☐
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2.B. to approve the payment of Mr. Wadsworth’s Participation Fee to Mr. Robert Wadsworth, non-executive director.
|
☐
|
☐
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☐
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2.C. To approve the grant of the Directors Equity Grant to the Company’s non-executive directors.
|
☐
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☐
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☐
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3. Approval of certain compensation terms for Mr. Doron Arazi, the Company’s Chief Executive Officer, including the CEO Revised Base Salary, the CEO Cash Bonus Plan and the
Annual CEO Equity Grant.
|
☐
|
☐
|
☐
|
4. Approval of the Amended Articles, in the form attached as Exhibit A to the Proxy Statement for the 2024 Annual General Meeting of Shareholders, including without
limitation, the Share Capital Increase, such that the Company's Current Articles be reinstated and replaced by such Amended Articles.
|
☐
|
☐
|
☐
|
5. To adopt and approve the 2024 Equity Incentive Plan, in the form attached as Exhibit B to the Proxy Statement for the 2024 Annual General Meeting of Shareholders, under
which an initial 500,000 ordinary shares will be reserved for issuance in the form of Incentive Stock Options.
|
☐
|
☐
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☐
|
6. To re-appoint Kost Forer Gabbay & Kasierer, A Member of EY Global, as the Company’s independent auditor for the fiscal year ending December 31, 2024 and for the year
commencing January 1, 2025 and until immediately following the next annual general meeting of shareholders, and to authorize the Board (with power of delegation to its Financial Audit Committee), to set the annual compensation of the
independent auditor in accordance with the volume and nature of its services, as described in Proposal 6 of the Proxy Statement.
|
☐
|
☐
|
☐
|
By executing this proxy card, the undersigned hereby confirms and declares that he, she, or it is not a “controlling shareholder” and does not have a “personal interest” in
any of the above proposals, except if he, she, or it has notified the Company in writing and in advance on the existence of a “personal interest” in the approval of any of the above proposals.
|
If the undersigned or a related party of the undersigned is a controlling shareholder of the Company or has such “personal interest” in any of the above proposals, please
notify the Company immediately in writing.
Under the Companies Law, 5759-1999 (the “Companies Law”), a person will be deemed to be a "Controlling Shareholder" if that person has the power to direct the activities of the company, other
than by reason of serving as a director or other office holder of the company.
Under the Companies Law, a person is deemed to have a personal interest if he/she or any member of his or her immediate family, or the immediate family of his or her spouse, has a personal
interest in the adoption of the proposal; or if a company, other than Ceragon, that is affiliated with such person or affiliated with his or her spouse, has a personal interest in the adoption of the proposal. A company is deemed to be
affiliated with a person if such company is a company in which such person or a member of such person’s immediate family serves as a director or chief executive officer, has the right to appoint a director or the chief executive officer, or
owns 5% or more of the outstanding shares.
PLEASE NOTE THAT IT IS HIGHLY UNLIKELY THAT YOU HAVE A PERSONAL INTEREST IN ANY OF THE ABOVE PROPOSALS.
You are not deemed to have a personal interest in the adoption of a proposal if your interest in such proposal arises solely from your ownership of our shares.
For further information regarding the definition of “Controlling Shareholder” or "Personal Interest", please see the explanation under Proposal 2 of the Proxy Statement.
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